Be the said bill does not show that complainant | sale of the remaining warrants authorized has pursued such remedy in this behalf as he by the resolution of July 20, 1886, then clearhad before the board of county commission- ly such contemplated action would be illegal, ers of the county of Santa Fe, or by appeal and a fraud upon complainant as a resident from said commissioners. Whereof, and for tax-payer of the county, and he could, by divers other errors and imperfections in said injunction, prevent its accomplishment. bill contained, these defendants demand the Crampton v. Zabriskie, 101 U. S. 601. judgment of this court whether they shall be fore such action was held and the warrants compelled to make any further or other an-issued, there would be no adequate legal remswer to the said bill, or any of the matters edy open to him. The judgment must be reand things therein contained, and pray to be versed, and the cause remanded. hence dismissed, with their reasonable costs in this behalf sustained." On the 12th day of the same month a hearing was had upon the demurrer, and it was sustained. The complainant refusing to amend, and failing to proceed further in the cause, the bill was dismissed. Thereupon complainant sued out a writ of error, and the cause was removed into this court. LONG, C. J., and HENDERSON, J., concur. (5 N. M. 148) TORLINA V. TRORLICHT et al. (Supreme Court of New Mexico. Feb., 1889.) ATTACHMENT-GROUNDS. 1. Under Comp. Laws N. M. §.1923, providing that an attachment may be issued where a debtor is about fraudulently to convey or assign, conceal or dispose of, his property so as to hinder, delay, ground for an attachment that a debtor is about or defraud his creditors, it is not a sufficient to make an assignment of property, the effect of which will be to delay creditors, where the delay caused is not unreasonable, and the debtor is acting in good faith. 3. On a review of the findings of a court, the same rules should be applied with regard to the sufficiency of the evidence to support such findings as prevail on the review of the verdict of a jury. Error to district court, Bernalillo county; Childers, for defendants in error. There are many interesting and important questions presented in this record, and they have been ably and exhaustively discussed by the solicitors upon each side in their oral arguments and in their briefs; but we do not deem it necessary, at this time, to consider them in detail or at length. The demurrer 2. The defendant, being pressed for money, wrote is general, and goes to the whole bill, and the to plaintiff, who was his heaviest creditor, offering various grounds assigned amount to no more to make an assignment to him. The plaintiff had than the general statement that the bill con-attachment papers filed against defendant, but, upon an examination of the business of the latter, tains no equity. The effect of the ruling be- he told him not to make an assignment, and, it ap low in sustaining the demurrer is that there peared, determined not to levy his attachment. is no equity in the bill. We are satisfied, The defendant swore that the proceeds of his however, from an examination of the opin-ment of his debts. Held, when the plaintiff afterbusiness above expenses were applied to the payion of the learned district judge, which is be- wards sought to levy his attachment on the ground fore us, that this aspect of the case was not of fraud, that a finding that no fraud existed pressed upon him, nor considered by him in would not be disturbed. arriving at his conclusion. If the bill contains any equity, a demurrer to the whole bill upon that ground is too broad, and should be overruled. Story, Eq. Pl. § 443. The bill charges that the board of county commissioners, by and through their chairman, issued and sold 50 warrants, with interest coupons attached, after the act of congress of July 30, 1886, had been passed, and antedated them, so that they should appear to have been issued upon the 1st day of July, 1886, and that at the time of the actual issue the county of Santa Fe was indebted in an amount exceeding 4 per cent. of the value of the taxable property of the county. This, if true, (and it is admitted by the demurrer,) was a clear evasion of the act of congress, and a fraud upon the law. Fraud is recognized as one of the grounds upon which a court of equity will interfere to prevent a wrong, although there may be some legal remedy provided. Hannewinkle v. Georgetown, 15 Wall. 548. The bill further charges that the board of county commissioners threaten and give out that they will issue and negotiate the remaining $25,000 of warrants. If at the time of the first issue of warrants, and at the time the bill was filed, the county was indebted in an amount equal to or exceeding the limit fixed in the act of congress, and if the board of commissioners was about to create a further indebtedness by the issue and LONG, C. J. The plaintiff in error was the plaintiff in the court below. There, in the district court of the county of Bernalillo, the plaintiff filed, in the office of the clerk of said court, his declaration in assumpsit and an affidavit for attachment. No question arises as to the sufficiency of the ahdavit. Among other averments, it contains the following: "The said affiant has good reason to believe, and does believe, that the said August Trorlicht and J. Henry Hohnstrater, partners in trade under the firm name of Trorlicht & Hohnstrater, are about fraudulently to convey, assign, conceal, and dispose of their prop erty and effects so as to hinder, delay, and defraud their creditors." Upon the affidavit issue was taken, the parties stipulated to waive a jury, and the cause was on such stipulation submitted to and tried by the court. the close of the evidence the plaintiff asked the court to declare the law to be as follows: "First. If it appears from the evidence that, at the time of the suing out of the writ of attachment in this cause, the defendants were After about to sell, assign, convey, or dispose of their property or effects, so as to hinder, delay, or defraud their creditors, the truth of the allegations of the affidavit for attachment is sustained. Second. The law presumes that every person intends that the reasonable and probable consequences of an act shall follow its commission, and, if it appears from the evidence that at the time of suing out the writ of attachment in this cause the defendants were about to make an assignment of all their property, and that the result of such assignment would be to hinder, delay, or defraud their creditors, then the law conclusively presumes that such assignment was about to be made with intent to hinder, delay, or defraud the creditors of the defendants, and the finding should be for the plaintiff. Fifth. Any assignment contemplated by the defendants, the reasonable and probable result of which was to hinder their creditors in the collection of their debts, is sufficient to sustain the attachment in this cause. Sixth. Any assignment contemplated by the defendants, the reasonable and probable result of which was to delay the creditors in the collection of their debts, is sufficient to sustain the attachment in this cause." The court declined to declare the law to be as stated in said requests, and found for the defendants on the attachment proceeding, and rendered judgment on such finding, and also rendered a personal judgment for the sum of $1,650.30 in favor of the plaintiff, and against the defendants, on the averments of the declaration. It is the finding for the defendants on the issue under the affidavit in attachment and the refusal to declare the law as asked that is assigned for error. The defendant in error contends, the court cannot review these questions. That contention is not sustained. The proposition of law which plaintiff asked the court to declare we conceive to be, in effect, that any assignment, contemplated or about to be made by a debtor, the effect or result of which is to hinder or delay his creditors, is, under the statute of this territory relating to attachments, fraudulent as matter of law. We are aware that there is much respectable authority which gives strong support to the plaintiff's contention on this question, but believe the better reason is with the authorities which limit the proposition. The court below was not asked to declare that every assignment having the effect to create an unreasonable delay to the creditor should be held fraudulent, but to so declare if the assignment resulted in delay merely, however short the time might be, or however beneficially it might result to the creditor. In the nature of things, every assignment must to some extent delay the creditor; but is the mere delay which is a necessary incident to the conversion of property into cash to pay debts to be held per se fraudulent? Suppose such a transaction to be made, as matter of fact, with the honest intention by the debtor, to enable him thereby, with all reasonable speed, to make early sale of the property and pay all his debts. Shall it be held fraudulent because some delay or hindrance shall occur to the creditor as a necessary incident to the honest application of the property to the payment of debts? We think not. Mr. Burrill, in his work on Assignments, (section 335,) says: "The term 'delay' has an obvious reference to time, and hinderance' to the interposition of obstacles in the way of a creditor; but, to a certain extent, the one involves and includes the other. In point of fact and as actually applied by the courts, they are always taken together. The following are prominent instances in which assignments have been declared void on the ground of hindrance and delay; where the time of sale, or of collection by the assignee, or of finally closing the trust, has been, by the terms of the assignment, unreasonably or indefinitely postponed." Here is to be found, at least under the fourth subdivision of section 1923 of our Compiled Laws, the true distinction and the real test to which every assignment, conveyance, or disposition of property should be brought. The test should be not does the conveyance or assignment result in delay merely to the creditor, but does it involve unreasonable delay? and what would or would not be unreasonable delay must be determined by the particular facts of each transaction. If the delay was manifestly beneficial to the creditor, or one which in its probable result would be so to the creditor, it would not be unreasonable. While the failing debtor should be required to act in the utmost good faith towards his creditors, he should not be tied up with arbitrary inferences, unreasonable in kind, which would prevent him from realizing for his creditor, either by sale or assignment, the highest possible value for his property, while intending to apply the same to the payment of his debts, so long as he acts therein in good faith, and so as not to create an unreasonable delay in the conversion of the property. The phraseology and spirit of the statute are both in harmony with this view of the question. It is provided in section 1923, Comp. Laws, that creditors may sue their debtors in the district court by attachment in certain cases, among which are the following: "Fourth, when the debtor is about fraudulently to convey or assign, conceal or dispose of, his property or effects, so as to hinder, delay, or defraud his creditors." The language of this statute must be regarded in giving it construction, as well as its spirit. It does not make the ground of attachment to be that the debtor is about to convey or assign his property so as to hinder or delay his creditors," but the words "convey" and "assign" are qualified and limited by the adverb "fraudulently;" so that the phrase should be read, in effect, "is about to fraudulently convey" or "fraudulently assign.' "" This language clearly implies that there may be a that he was about to dispose of the property with the intent to defraud other creditors, and that the delay in paying the plaintiff, which might result from the defendant's paying the other creditors, was not such a delay as the statute contemplated." conveyance or an assignment which will facts afforded no just grounds for inferring merely delay creditors, as an incident to the transaction, and yet not be fraudulent. An intent to use language with that import by the legislative department would be well founded in reason, and such construction of the law of attachments would be more advantageous both to the debtor and creditor, as it The statute of the state of Missouri is identienables the debtor to sell his property, so cal with our own, and ours is adopted from long as he acts therein in good faith, with- that state. In Drake, Attachm. (5th Ed.) out involving unreasonable delay, and to ap- 672, the Missouri statute is set out in full, ply the proceeds to the payment of his debts, and, so far as it relates to the point under and yet gives to the creditor his right to at- consideration, is as follows: "The plaintiff tach, if the debtor acts in bad faith, or by in any civil action may have an attachment means of a transaction creating an unreason- against the property of the defendant in any able postponement of payment. Such a rule of the following cases: * * (9) When brings the transaction attached to this test, the defendant is about fraudulently to conis the delay so unreasonable in time and vey or assign his property or effects, so as to character as unduly to embarrass or hinder hinder or delay his creditors." In the same the creditor? If so, fraud may be imputed, work (section 74) the case of Spencer v. DeaBut if there is delay merely, not unreason- gle, 34 Mo. 455, is cited, as giving construcable under all the circumstances, fraud will tion in Missouri to the statute relating to atnot, as matter of law, be imputed to the tachments. The author says: "In a subsetransaction, especially if it appear that the quent case it was decided that, in making debtor is acting with an honest intent in fact such a conveyance, the fraudulent intent to apply his property to the just payment of must be shown to have existed in order to his debts. In the case of Meyer v. Black, sustain the attachment, and that it was not 16 Pac. Rep. 620, this court considered sub- sufficient merely to show that the effect of stantially the same question, the same aris- the conveyance was to hinder and delay creding upon a written assignment, and applied itors.' An examination of that case disto the facts of that case the rule here stated. closes that it fully supports the interpretaThe conclusions then reached are not only tion given to it by the learned author above strengthened by the reasons before stated in cited. In that case the proceeding was by this case, but also by some additional au- attachment. The averment in the affidavit thority. In Minnesota (see Drake, Attachm. was "that the defendant had fraudulently 670) the statute is: "The writ of attachment conveyed or assigned his property so as to is issued whenever it appears by affidavit of hinder or delay his creditors. To support the plaintiff * * * that the defendant is the averment, evidence was given in the trial about to assign, secrete, or dispose of his court that the defendant made a deed of trust property with intent to delay or defraud his of personal property, to secure a note of creditors." This seems broader than the $2,500, and the defendant gave testimony New Mexico statute, at least in terms, for it tending to prove he did not owe the whole gives authority to the creditor to attach $2,500, but only a part of it, but that the note when the debtor is "about to assign his was given in part to cover goods which he property with intent to delay his creditors;" expected to receive from the payee. In the and on such a statute. when the word very nature of the transaction, this trust "fraudulently" before the word "assign" is deed somewhat delayed the plaintiff in that not used, it might be urged with much force case. That one differs from the one here that the intent to delay would be inferred only in that the Missouri case alleged a comfrom the fact that such would be the proba- pleted act, while this one alleges the same ble result of the act of selling, and therefore a act was about to be done, and both are predsale creating any delay would be within the icated on statutes identical with each other. statute. But the court in Minnesota hold The principle involved is exactly the same. otherwise. The author just quoted, at section In the Missouri case, in the court below, the 77, cites the case of Eaton v. Wells, 18 Minn. defendant asked the following instruction, 410, (Gil. 369,) as a judicial construction in which was refused: "The jury are instructthat state of the Minnesota statute, and says: ed that, to render the deed of trust fraudu"In Minnesota, an affidavit alleging that the lent as to Deagle's creditors, it must appear defendant is about to dispose of his property from the evidence, and you must be satisfied, with intent to hinder, delay, and defraud that the deed was executed for that purpose. his creditors was considered not to be sus- It is not enough that the effect of the deed tained by showing that the defendant, who is such as to delay creditors of the defendant. was insolvent, was about to sell for a fair He must have executed it with that purpose price his property, consisting of an exempt and intent." For the refusal of the court, homestead and other real estate, with the judgment having gone against defendant, he purpose and intent to apply all the proceeds, appealed. The supreme court say the inless a part of the price received for the home-struction as asked should have been given, stead, to pay his just debts owing to a portion and, because it was not given, reverse the of his creditors. The court held that those action of the court below. The Missouri case seems exactly in point, and decisive of the question raised in the record of this case, as to the refusal of the court below to declare the law as asked. The following is also held in Missouri: "The fact that the sale may or does have the effect to hinder or delay the creditors is not sufficient to avoid it." Murray v. Cason, 15 Mo. 379; Gates v. Labeaume, 19 Mo. 17. "The right to dispose of one's property for honest purposes is not terminated by indebtedness or insolvency, although such a disposition may or does have the effect of hindering or delaying creditors." Dougherty v. Cooper, 77 Mo. 529. Identical as our statute seems to be with that of Missouri on this point, and adopted from that state, and the interpretation there given being founded in good reason, it should be followed here. Another consideration shows the insufficiency of the legal propositions asked to be declared below. Suppose the affidavit in attachment in this case had been so drawn as to embrace only the proposition declared. Would it have been sufficient to require a writ to issue thereon? An affidavit that the defendants were about to convey or assign their property so as to hinder and delay their creditors, although it had contained all other necessary averments, would clearly not have been sufficient without the addition of the word "fraudulentiy," or some other equivalent word. to plaintiff, it could not be expected that within three months they would be fullhanded. If, under such circumstances, at the expiration of three months, they were not somewhat pressed for ready money, it would be unusual. The defendant Trorlicht swears that every dollar received out of the sale of goods, after board-bills and necessary running expenses were paid, was applied, to the payment of debts, and there is nothing in the evidence to dispute his statement. Even if they had not exhibited good business judgment, so long as they did the best they could, and acted honestly, an intention to defraud would not be thereby proven. The evidence proves that they became pressed for present money; that in such emergency they consulted a lawyer, and wrote to the plaintiff offering to assign to him. This letter bears date May 2d. The affidavit in attachment bears date two days later, to-wit, May 4th. The plaintiff, as he swears, after receiving this written offer to assign to him, caused the affidavit and necessary papers to be filed in the attachment proceeding, and then went to see the defendants. He says: "I looked over the business of the house, and saw the way the thing was running, and I left the house with the impression I would not make an attachment; went home with that intention." It would seem from this that the examination was satisfactory to him. He went there, carrying with him the defendants' written offer to assign to him. It is but reasonable to conclude that at this conference the whole subject of their indebtedness and ability to pay was talked over. As a result of plaintiff's examination into their affairs, he left their place of business satis The other assignments of error, in different forms, present for consideration here the action of the court below in its finding on the evidence. Those assignments are as follows: "The plaintiff in error assigns for error in the above-entitled cause-Second, the finding of the district court in favor of the defendants on the issue raised by the trav-fied, and to that time evidently had made no erse of the allegations of the affidavit for attachment; third, the judgment of the district court in favor of the defendants on said finding; fourth, the overruling of the motion of plaintiff in error for a new trial on said issue." direction to attach. Mr. Trorlicht testifies that the plaintiff came to the store, examined the books, and seemed perfectly satisfied. Says Trorlicht: "He told us to come to Albuquerque, and buy more goods if we wanted to. Torlina said: Boys, there is no use of The evidence in the court below is all in your making an assignment.'" Plaintiff the record, and has been carefully examined does not deny that all this occurred. Even and considered. If this court were required if defendants were thinking on the 2d day of to weigh the evidence, and determine whether May of making an assignment, they comthe finding below was in accordance with the municated that fact to plaintiff,—if not their weight of the evidence, then it would be only creditor, by far the largest one. Sevwell to consider the testimony of each wit-eral days must have intervened, and it would ness separately on all material points, and to set out the evidence at considerable length in this opinion, but, as the rule is to the contrary, no good purpose will be accomplished by such recital. It is apparent from this evidence that the defendants were men of limited means, and known to be so by the plaintiff. They had his confidence to such an extent that, according to his own evidence, the plaintiff permitted them to select at their own will out of his stock such goods as they desired, and themselves to fix the price. Such confidence is not usually reposed in men unless they have a good record for honesty and fair dealing. Starting in business entirely on credit, which was known seem that the idea of an assignment was abandoned after the conference, and while the plaintiff yet held control of the writ, and before its levy. In the talk at the store, before the plaintiff ordered a levy made, he said to them there was no need that they should make an assignment. To this defendant assented, and says he had no further intention at all to assign. The plaintiff was paid in cash $90, and some goods, and left for his home, having abandoned the intention of making the attachment. What induced him to change his mind and perfect the attachment by a levy on the goods? Plaintiff answers that question in his own evidence. He says: "I left the house with the impression I would not make the attach- | clearly proven, as it is alleged, relief cannot ment, went home with that intention; but be had, although the party against whom reI found another party that was going to make another attachment,-jump in ahead, --and the condition of their stock was of such a nature that they could not pay a hundred cents on the dollar at the best, if they would, and I concluded I had better serve the attachment, which I did the next day following. ** * * I concluded, if any other creditor might step in, I would not be left, and would secure myself if I could.” lief is sought may not have been perfectly clear in his dealings. * * * The law in no case presumes fraud. The presumption is always in favor of innocence, and not of guilt. In no doubtful matter does the court lean to the conclusion of fraud. Fraud is not to be assumed on doubtful evidence. The facts constituting it must be clearly and conclusively established. Circumstances of mere suspicion will not warrant the conclusion of fraud." In weighing the evidence, the trial court, no doubt, had in mind the foregoing principles, and the effect of the finding there is that the conclusion of fraud It is not the duty of this court to disturb the finding. No error is found in the record, and the judgment below is affirmed. HENDERSON and REEVES, JJ., concur. (5 N. M. 251) RUBY v. TALBOTT et al. (Supreme Court of New Mexico. Feb., 1889.) ALTERATION OF INSTRUMENTS-LIABILITY OF IN DORSER. A note was executed to the plaintiff, who, being dissatisfied with its form, returned it to the maker for the purpose of having him execute a different note; and the plaintiff alleged that, without his with the intention of carrying out plaintiff's wishknowledge or consent, the maker, in good faith, one, by substituting a different amount, date, and rate of interest. Held, that an indorser who had not consented to such alteration was discharged by it, and that a petition in equity to have the note restored to its original form was properly dismissed, as to such indorser. LONG, C. J., dissenting. In this state of the evidence, it would not be a strained or unreasonable conclusion that it was the fear that some other creditor would, by a prior attachment, secure a first lien on the goods, which induced the plaintiff does not clearly follow from the evidence. to make his attachment. In the conference between the parties before the levy, there is not the slightest evidence that defendants concealed any fact, made any misrepresentation, or were in any way unwilling to turn over voluntarily to plaintiff the whole stock of goods in payment of their debt, or that they were asked to do anything and refused. They had promptly informed plaintiff of their embarrassment, and tendered to him an assignment. There is strong ground to believe they were acting in the best of faith, and much evidence in the record tending to support the finding of the court. This court is not required to examine into the finding to determine whether it should not have been for the other party on the weight of the evi-es, instead of executing a new note, altered the old dence. The rule here is otherwise. The supreme court of this territory in Zanz v. Stover, 2 N. M. 29, said: "The court having acted in this case as a jury, so far as its decision on questions of fact is concerned, its verdict should not be set aside, nor the judgment thereon reversed, in a case where there is any evidence whatever on which it could be based." In this case, the finding of the court should be held to occupy the same place as would the verdict of a jury, and the same rule which in the supreme court would be applied in reviewing there the verdict of a jury should be applied to the finding of the court where a jury is waived by stipulation, and the court determines the case below on the weight of the evidence while sitting in the place of a jury. The rule is well settled that the supreme court will not disturb the verdict of a jury, where there is any substantial evidence to support it. To that effect are the following cases: Crolot v. Maloy, 2 N. M. 198; Vasquez v. Spiegelberg, 1 N. M. 464; City of Richmond v. Smith, 15 Wall. 429; Bond v. Brown, 12 How. 254; Waldo v. Beckwith, 1 N. M. 97; Archibeque v. Miera, Id. 160; Ruhe v. Abren, Id. 247. Appeal from district court, Bernalillo county. H. L. Warren and Stone & Stone, for appellant. N. B. Field, for appellee. REEVES, J. On the 26th day of September, 1885, Frank Ruby brought his bill of complaint against William E. Talbott and John William Randall and Teresa M. Randall, defendants. The bill alleges that the complainant loaned to John William Randall the sum of $1,500, and in consideration of the loan, and as evidence of the indebtedness, the defendant executed and delivered to one Mariano Armijo, in trust for the complainant, his promissory note hereinafter described. Prior to the execution and delivery of the note the defendant William E. Talbott indorsed his signature and name upon the back of the note, and delivered the same in blank to the defendant John William Randall, and afterwards the same was signed by said RanWhen the foregoing rule is applied, and it dall, and by Teresa Randall, also one of the is further considered that when the charge is defendants, and delivered to one Mariano fraud it must be clearly and fully proven in Armijo in trust for the complainant. When the trial court, the duty here would seem to the note was delivered to Mariano Armijo the be a plain one. Kerr, Fraud & M. 382-384, same was in words and figures as follows, says: "A man who alleges fraud must clear-to-wit: "$1,500. ALBUQUERQUE, N. M., ly and distinctly prove the fraud he alleges. April 17, 1883. One year after date we * * * If the fraud is not strictly and promise to pay to the order of Mariano Arm. |