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NUDD ET AL. v. BURROWS

October 1, 1875

NUDD ET AL.
v.
BURROWS, ASSIGNEE.



ERROR to the Circuit Court of the United States for the Northern District of Illinois.

This was an action brought by the defendant in error, as the assignee of one Norton Emmons, a bankrupt, against the plaintiffs in error, to recover the net proceeds of about eleven carloads of live-stock and dressed hogs shipped by the bankrupt to the plaintiffs in error, and one thousand dollars in money paid by him to them, which proceeds and money they had applied to the payment of his indebtedness to them, in fraud, as contended by the assignee, of the provisions of the act to establish a uniform system of bankruptcy throughout the United States, approved March 2, 1867. Judgment was rendered in favor of the assignee.

A bill of exceptions was allowed in the court below, which is in substance as follows:––

The plaintiff introduced evidence tending to show that Emmons had for a number of years been engaged in the stock business in Wisconsin, purchasing cattle, sheep, and hogs, and shipping them chiefly, but not always, to the defendants at Chicago, for sale upon commission; that about the first day of July, 1870, Emmons associated with him Richard B. Chandler and James W. Chandler, and that said parties thenceforth, under the firm name of Emmons & Chandler, continued the business, also shipping chiefly to the defendants the stock which they bought; that about the thirteenth day of December, 1870, said firm was indebted to the defendants between $4,000 and $5,000; that Emmons was then insolvent; that it was then arranged between the defendants, said Emmons and said Richard, B. and James W. Chandler, that said firm of Emmons & Chandler should dissolve; that James W. Chandler had previously gone out; that Emmons should continue the business until the first of the following January, and should at the close of the year buy a large amount of stock upon credit, which should be shipped to and sold by the defendants, and the proceeds applied to pay his indebtedness to them; that the firm of Emmons & Chandler did dissolve about the thirteenth day of December; that Emmons did in the first four days of the following January, in his own name and on his own account, ship to the defendants nine car-loads of cattle, sheep, and hogs, which were sold by them, and the proceeds held to pay the said indebtedness; that upon the sixth day of January, 1871, Emmons paid to the defendants $1,000 in money; that the net proceeds of said last shipment, so held by them, was $7,553.27; that a large part of the stock which went into the last shipment was paid for by drafts drawn by Emmons on the defendants, which were not accepted or paid by them; that the amount of drafts so drawn and unpaid was about $4,000; that a petition in bankruptcy was filed against Emmons in the District Court of the United States for the Eastern District of Wisconsin, on the eighteenth day of February, A.D. 1871, on which petition he was duly adjudicated a bankrupt; that the defendants, at the time of making the aforesaid arrangement,–to wit, on or about the thirteenth day of December, 1870,–had reasonable cause to believe said Emmons was insolvent.

As tending to show some of said matters, the plaintiff introduced in evidence a document as follows:––

'CHICAGO, Dec. 13, 1870.

'To whom it may concern:––

'This certifies that whereas Mr. R. B. Chandler has been a joint partner with Norton Emmons from the first day of July, 1870, to date, we release him from all further obligations that may be transacted between us and Norton Emmons, and look to Norton Emmons only for balance of present account and all business that may hereafter be transacted with him.

'The above release of R. B. Chandler is made by the consent of all parties.

'I. P. NUDD & Co.'

Also the ledger of the defendants, showing the account of Emmons and of the firm of Emmons & Chandler with the defendants.

The last item upon the account of Emmons & Chandler is as follows:––

'1870, Dec. 13. By balance due Nudd, $1,617.43.'

Under which is written the following:––

'The above balance we transfer to the individual account of Norton Emmons, by request of both parties.'

Immediately after and upon the same ledger page is the following, showing all the entries made subsequent to said Dec. 13, 1870:––

DR. NORTON EMMONS. CR.

1870. 1870.

Dec. 13 To balance due Nudd,

and transferred from

the ac. of Emmons &

Chandler $1,617 43 Dec. 24 By net proceeds $1,140 07

" 13 To paid draft 1,500 00 " 24 " " " 4,767 51

" 14 " " " 1,500 00 " 3 " " dressed hogs 107 04

" 15 " " " 1,500 00 " 28 " " proceeds 651 88

" 16 " " E. Peterson 750 00 " 28 " " " 766 31

" 21 " " draft 187 00 " 28 " " " 1,929 48

" 22 " " " 1,500 00 " 29 " " " 765 84

" 23 " " " 3,500 00 " 20 E. & C., dressed hogs 1,396 64

" 23 " " " 200 00 " 29 E. & C., dressed hogs 863 58

1871.

" 23 " " " 500 00 Jan. 7 " " " " 1,444 15

" 24 " " S. W. Montague 55 72 " 6 " " cash rec'd 1,000 00

" 24 " " draft 1,000 00 " 10 " net proceeds 4,002 03

" 24 " " " 400 00 " 10 " " dr. h. 1,174 37

" 16 " " Chandler 40 00 " 10 " " dr. ...


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