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Ky.)

HURT V. MORGAN COUNTY

255

elected, but before he had qualified, as counHURT V. MORGAN COUNTY.

ty attorney, the following action was taken: (Court of Appeals of Kentucky. Oct. 22, 1915.) "On motion of W. G. Short and second by

Franklin Walters that the salaries of the coun1. OFFICERS Ow100-CHANGE OF COMPENSA- ty judge, county attorney, and school superinTION-FIXING AFTER ELECTION.

While, under Const. $$ 161, 235, prohibiting tendent for this ensuing term, beginning Januchange of the compensation or salary of coun- ary, 1914, be fixed at $900 each, and rea and ty and public officers after their election or dur- Yea. A. F. Blevins, Yea. Franklin Walters,

E. W. Day,

nay votes: W. G. Short, Yea. ing their term of office, compensation, not hav

J. S. Mcing been fixed before 'election, may thereafter Guire, Nay. J. E. Lewis, Nay.

J. E. Lewis, Nay. There being be fixed, it cannot subsequently be changed.

three yeas and three nays, and a tie vote, I. C. [Ed. Note.-For other cases, see Officers, Cent. Ferguson, county judge, presiding, voted yea, Dig. $$ 152–157; Dec. Dig. Om 100.]

and the motion carried." 2. JUDGES 22-FISCAL COURT - DISQUAL

The fiscal court paid appellant $900 for his IFICATION BY INTEREST.

One is disqualified by interest to vote as services as county attorney for the year a member of a county's fiscal court on a mo 1914; but at the regular term of the court țion to fix salaries, including his own as county held in November, 1914, it entered the two judge.

following orders: [Ed. Note.-For other cases, see Judges, Cent.

"(1) On motion of B. F. Blankenship, and Dig. $$ 75-88, 179; Dec. Dig. 22.]

second by J. M. Carpenter, it is ordered and di3. COUNTIES Ow57—ORDER OF FISCAL COURT rected that the county judge and county at- COLLATERAL ATTACK.

torney receive at the rate of $900 per year The order of a county's fiscal court fixing each for their salaries up to January 1, 1915. salary and compensation of officers cannot be "(2) Motion made by B. F. Blankenship, and collaterally attacked.

second by J. R. Day, that the salaries of the [Ed. Note.-For other cases, see Counties, county attorney and county judge, be, and they Cent. Dig. $$ 74, 75; Dec. Dig. Ow57.]

are hereby, fixed at the sum of $600 per year be

ginning January 1, 1915." Appeal from Circuit Court, Morgan

From this last order reducing his salary County. The fiscal court of Morgan County made

to $600 per year, Hurt prosecuted an appeal

to the circuit court. A jury trial was an order reducing the salary of S. M. R. waived, and the case was tried by the cirHurt, as County Attorney, and he appealed cuit judge; and from his judgment affirming to the circuit court, and from its judgment the order of the fiscal court, Hurt proseof affirmance again appeals. Reversed.

cutes this appeal. Fogg & Kirk, of Paintsville, for appellant. [1] The meaning of section 161 of the ConA. N. Cisco, of West Liberty, for appellee. stitution, above quoted, is in no sense doubt

ful. It provides, in express terms, that the MILLER, C. J. This appeal contests the compensation of a county officer shall not be right of the fiscal court of Morgan county to changed after his election or appointment, reduce the salary of the appellant, S. M. R. or during his term of office. Section 235 of Hurt, as county attorney.

the Constitution repeats the provision, by Section 161 of the Kentucky Constitution, saying that: reads as follows:

"The salaries of public officers shall not be “The compensation of any city, county, town changed during the terms for which they were or municipal officer shall not be changed after elected.” his election or appointment, or during his term

The purpose of these salutary constitutionof office; nor shall the term of any such officer be extended beyond the period for which he al provisions was to put it beyond the power may have been elected or appointed.”

of the fiscal court either to reward its attorSection 235 of that instrument further pro- ney by raising his salary or from punishing vides:

him by reducing his salary during his term of "The salaries of public officers shall not be office. This purpose is carried out by fixing changed during the terms for which they were the salary before those whose duty it is to elected; but it shall be the duty of the Gen-I fix it know who the incumbent will be. This eral Assembly to regulate, by a general law, in what cases and what deductions shall be made is especially important with reference to the for neglect of official duties. This section shall office of county attorney, who should, above apply to members of the General Assembly also.” all other officers, be entirely free from the

The appellant was elected county attor- influence that the power to regulate his pay ney for Morgan county at the regular elec- would give to another. tion held in November, 1913, for a term of In carrying out the provisions of the Confour years beginning January 1, 1914. The stitution above quoted it was the duty of the compensation of his office at the time he was fiscal court, by an order entered before the elected was $900 per year. The orders of the election of the county attorney, to fix his salfiscal court show that an annual salary of ary for the ensuing term; but, having failed $900 had been paid to Haney, his predecessor in this case to fix the salary before his elecin office, from 1910 to 1914, although there tion, it had the right to do so after his elecwas no order of court formally fixing his tion and before his qualification, or even after salary.

he had taken office. Barrett v. City of FalAt the meeting of the fiscal court held No- mouth, 109 Ky. 151, 58 S. W. 520, 21 Ky. Law vember 29, 1913, after appellant had been Rep. 667; Marion County Fiscal Court v. Kelly, 112 Ky. 831, 56 S. W. 815, 22 Ky. Law | cause the clerk, Sebastian, told him he had Rep. 174; Jefferson County v. Waters, 114 no right to vote, and but for this advice he Ky. 48, 70 S. W. 40, 24 Ky. Law Rep. 816; would have voted against fixing the salary Butler v. James, 116 Ky. 575, 76 S. W. 402, of the county attorney at $900. This testi25 Ky. Law Rep. 801; McNew v. Nicholas, mony was admitted over the objection of ap125 Ky. 66, 100 S. W. 324, 30 Ky. Law Rep. pellant. Dennis, however, admits that after 1147; Grayson County v. Rogers, 122 S. W. he qualified as county judge he received his 868; Fox V. Lantrip, 162 Ky. 184, 172 s. salary at the rate of $900 per year, under W. 133.

the order of November 29, 1913. It is clear, therefore, that the order of There are several reasons why the testiNovember 29, 1913, fixing appellant's salary mony of Dennis was incompetent. In the at $900, was properly entered, and the sub- first place, the order in question also fixed sequent order of November 26, 1914, changing Dennis' salary as county judge; and, being his salary to $600 per year, from January 1, interested, he was not competent to vote upon 1915, was unauthorized and invalid.

the motion and thus break the tie. Grayson [2, 3] The circuit judge seems to have County v. Rogers, supra; Thomas v. O'Brien, reached his decision upon the theory that the 138 Ky, 775, 129 S. W. 103. order of November 29, 1913, fixing appellant's A court speaks by the record, and can speak salary at $900, was improperly entered, and in no other way. And, having spoken was therefore ineffectual for any purpose. through the judgment and within its jurisThis conclusion was based upon the testimony diction, the ruling is conclusive in a collaterof S. S. Dennis, who was a member of the al proceeding and cannot be questioned, as fiscal court at that time, and had been elect- is here attempted. Grayson County v. Roged county judge at the November election ers, supra. If a judgment could be attacked three weeks before, although he did not take indirectly, there would be an end to that conhis seat as judge until January, 1914. Den-fidence in the stability of judgments, regunis testified that he was present at the meet-larly entered, which is the very foundation ing of the fiscal court on November 29, 1913, of our system of jurisprudence. but that he was prevented from voting on the Judgment reversed for further proceedings motion fixing appellant's salary at $900 be- consistent with this opinion.

Tex.)

OwossO CARRIAGE & SLEIGH CO. v. MCINTOSH & WARREN

257

garnishment upon them, which was issued OWOSSO CARRIAGE & SLEIGH CO. v. Mc- at the instance of the Owosso Carriage & INTOSH & WARREN. (No. 2417.)

Sleigh Company, plaintiff in error. (Supreme Court of Texas. Oct. 13, 1915.) Trial in the court below was bad on an 1. FRAUDULENT_CONVEYANCES Om3 – BULK agreed statement of facts, which showed, SALES LAW-POLICE POWER.

substantially, as follows: The Bulk Sales Law (Acts 31st Leg. c. 27), requiring particular formalities for a sale

One C. K. Sweet was engaged in the imof a stock of goods other than in the usual way, plement, vehicle and hardware business in and making it invalid as to the creditors of the the town of Brownwood. The evidence seller unless there is compliance, is a valid ex strongly indicates that on the 10th day of ercise of the police power, and does not unrea

On said sonably deprive the owners of merchandise of August, 1909, he was insolvent. their control over it and right to contract in re- date, and for at least 30 days prior thereto, lation to it.

he was indebted to the plaintiff in error, a [Ed. Note.-For other cases, see Fraudulent foreign creditor, in the sum of $1,700 for Conveyances, Cent. Dig. $ 5; Dec. Dig. Om 3.) vehicles, etc., sold him by the plaintiff in 2. FRAUDULENT CONVEYANCES 229_REMEDIES OF CREDITOR-GARNISHMENT.

error for use in said business. He was also Under Bulk Sales Law (Acts 31st Leg. c. indebted to various other wholesale dealers 27) § 1, declaring that any sale of a stock of for goods used in said business, among them goods not in the ordinary course of business the Keating Implement & Machinery Comshall be void as against the creditors of the seller, unless the purchaser shall at least 10 days pany for $3,617.95, and the Emerson Manubefore sale make full inquiry as to the names facturing Company for $1,294. He owed of all creditors, obtain from the seller a writ- various other creditors in the aggregate sum ten answer to such inquiries, which answer shall be sworn to by the seller,' and notify such of $3,000. On said 10th day of August, 1909, creditors of the sale, one who purchases a stock he sold his stock of goods in bulk to Mcof goods without complying with the statute be- Intosh & Warren, defendants in error, for comes a trustee for the creditors of the seller, the consideration of $6,005.97; they assumand, notwithstanding the goods have been sold, by him and proceeds disposed of, the seller's ing the payment of said $3,617.95 to Keating creditors may recover by garnishment.

Implement & Machinery Company, and $1,[Ed. Note.- For other cases, see Fraudulent 294 to the Emerson Manufacturing ComConveyances, Cent. Dig. $8 668-670; Dec. Dig. pany as a part of said consideration, and On 229.]

paying to said Sweet in cash the sum of 3. APPEAL AND ERKOR @ww747-ASSIGNMENT $500, and giving him one negotiable promisOF CROSS-ERROR-NECESSITY.

Where plaintiff did not on defendant's ap- sory note for $594.02, due January 1, 1910, peal assign as error the denial of complete re- which was paid to said Sweet on the day of lief, the question will not be reviewed.

its maturity. The consideration paid was a [Ed. Note.-For other cases, see Appeal and fair price for the property. At the time of Error, Cent. Dig. $$ 3053-3056; Dec. Dig. Om 747.]

said transfer and sale of said merchandise,

the said Sweet had no other property except Error to Court of Civil Appeals of Third some negotiable promissory notes, amounting Supreme Judicial District.

in the aggregate to about $7,000, due him by Action by the Owosso Carriage & Sleigh various customers scattered over his trade Company against C. K. Sweet and McIntosh territory, for merchandise which had been & Warren, garnishee. A judgment in part sold to them. The evidence shows that, if for plaintiff against the defendant garnishee the crops had been good in that section for was reversed and remanded by the Court of the years 1909 and 1910, said notes would Civil Appeals (146 S. W. 239), and plaintiff have been worth something like their face brings error. Judgment of Court of Civil value; but the crops were unusually short, Appeals reversed, and that of trial court af- and said notes were worth only about 50 firmed.

cents on the dollar, and at the time of the I, J. Rice, of Brownwood, for plaintiff in trial it was agreed that Sweet was unable error. T. C. Wilkinson, of Brownwood, for to pay all of his creditors, and was insoldefendant in error.

vent.

On October 19, 1910, plaintiff in error filed YANTIS, J. This case involves, as the suit against the said Sweet on a promissory main questions, the constitutionality of what note in the sum of $1,695.34, and interest is commonly known as the "Bulk Sales Law," thereon, and at the same time caused a writ passed by the Thirty-First Legislature, and of garnishment to be issued, which was the effect of the service of the writ of gar- served upon the defendants in error on the nishment upon the proceeds of the sale of 20th day of October, 1910. On the 20th day merchandise which was purchased by Mc- of December, 1910, plaintiff in error recoverIntosh & Warren, defendants in error, at ed in said suit its judgment against said private sale, and not in the ordinary course Sweet in the sum of $1,883.60, with costs of trade, but in bulk, and in violation of all of suit and interest at the rate of 8 per cent. the provisions of said bulk sales statute, and The evidence indicates that there was no afterwards resold by them and converted in intentional fraud upon the part of the deto cash prior to the service of the writ of fendants in error in purchasing said mer

On For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

chandise, or on the part of said Sweet in tached, and no liability arose against them. making the sale, and while there is no dis- Upon the trial of the case in the court tinct finding of fact by the trial court, or below plaintiff in error awarded judgment in the statement of facts to this effect, we against the defendants in error for the sum will assume such to be true in the considera- of $1,094, with 6 per cent. interest from the tion of the issues. In making the purchase date of said judgment, which is the amount of said merchandise, the defendants in error that was paid by defendants in error to did not at least 10 days prior thereto, or at Sweet as a part of the consideration for the any time prior to the sale, make inquiry of transfer; but the trial court did not enter a the said Sweet, the transferrer of said goods, judgment against the defendants in error for as to the names and places of residence, or the full amount of the plaintiff in error's place of business of each and all creditors judgment against Sweet, which was $1,883.of said Sweet, and the amount owing to each 60, and the plaintiff in error's cross-assignsaid creditor by him, or obtain from him a ment complaining of the failure of the trial written answer in any form to such in- court to render judgment against the defendquiries; nor did they 10 days prior to said ants in error for the full sum was abandonpurchase, or at any other time before said ed on motion for rehearing in the Court of sale, notify each of the creditors of said Civil Appeals. The judgment of the trial Sweet of said proposed sale and transfer. court was reversed and remanded by the The plaintiff in error had no notice of said honorable Court of Civil Appeals for the proposed sale at any time before it occurred, Third District, with instructions that a reaand the bulk sales statute of 1909 was not sonable attorney's fee be allowed by the complied with in any form in making said court below in favor of the attorney for the sale. Defendants in error, who were the defendants in error; said court holding that garnishees, answered said garnishment suit the writ of garnishment was served too late to the effect that they were not indebted to to be effective, on account of the resale of said Sweet in any amount at the time said merchandise before its service. writ was served, or afterwards, nor at the [1] The bulk sales law, so far as material time of answering the same, and that they to a correct determination in this case, is did not have any of his effects in their pos- as follows: session. Plaintiff in error contested this an

“Section 1. That any sale or transfer of any swer, alleging both that they were indebted portion of a stock of merchandise otherwise to said Sweet, and that they had effects of than in the ordinary course of trade in the ususaid Sweet in their possession at the time al and regular prosecution of the seller's or

transferrer's business; or a sale or transfer said writ was served, in that they purchased of an entire stock of merchandise in bulk, shall the stock of goods without complying with be void as against creditors of the seller or the bulk sales statute. The plaintiff in error shall at least ten days before the sale or trans

transferrer unless the purchaser or transferee did not allege that the defendants in error fer, in good faith make full and explicit inquiry had sold said merchandise prior to the serv- of the seller or transferrer as to the name and ice of the writ of garnishment, and the de- place of residence or place of business of each fendants in error did not file any special ex- and all creditors of the seller or transferrer,

and the amount owing to each such creditor by ception to said pleading for said omission, the seller or transferrer, and obtain from the but the defendants in error by their second seller or transferrer a written answer to such special exception excepted to said pleading, inquiries, which answers shall be sworn to by

the seller or transferrer; and unless the puras follows:

chaser or transferee at least ten days before “Because it appears from said controverters' the sale or transfer in good faith, notify or affidavit that plaintiff is endeavoring to hold cause to be notified personally or by registered these garnishees liable for property that has mail each of the seller's or transferrer's credipassed out of their possession, on the ground tors of whom the purchaser or transferee has that they should be held as trustees for property knowledge, of said proposed sale or transfer. wrongfully received by them."

"Sec. 2. Any purchaser or transferee who In section 10 of the agreed statement of shall conform to the provisions of this act shall facts it appears that it was proven at the not in any way be held accountable to any cred

itor of the seller or transferrer for any of the trial that the defendants in error, who were goods, wares or merchandise that have come the garnishees, had sold all of said goods, into the possession of said purchaser or transwares, and merchandise prior to the service feree by virtue of such sale or transfer.

“Sec. 3. Nothing in this act shall apply to on them of the writ of garnishment, and sales by executors, administrators, receivers or that they had realized from same at least as any public officer conducting a sale in his offimuch as they had paid for them. It does cial capacity, nor to a sale or transfer of stocks not appear which party to the suit introduc- debts where all creditors share equally and

for ed the evidence, and neither does it appear without preference in the sale or transfer or the that either party to the suit objected to its proceeds thereof.” Acts 31st Leg. c. 27. introduction. It also appears that in their The defendants in error assail the constisixth assignment of error the defendants in tutionality of the act. If the act is an unerror assert the fact of sale by them prior reasonable restraint of the natural rights of to the service of the writ of garnishment, the owners of merchandise over their control and ask relief because of that fact, claim- and use of their property, and their right of ing that, having already sold the property contract connected therewith, it should be Tex.)

OWOSSO CARRIAGE & SLEIGH Co. v. MCINTOSH & WARREN

CO.

259

proper exercise of the police power of the or more citizens of a state could repeal the state in a wholesome restraint upon the state's laws by contract among themselves. said natural rights for the common good, Neither could they defy the state's laws, then the said act would not be repugnant to and expect the courts to uphold them. And the organic law. An unreasonable restraint if any one should suffer loss in the attempt, of the natural rights of the owners of mer- it should not fall upon a creditor who has chandise over the control and use of their been diligent to act within the law, but property, and their right of contract connect-rather upon the ones who produced the situed therewith, would be intolerable, and viola- ation and caused the loss. tive of rights guaranteed under the Consti

Defendants in error had not the power nor tution; but a wholesome restraint upon the the right to acquire title to this property as natural rights of such owners for the com- against creditors, for the statute in cases of mon good would be within the police power this kind impounds and holds the merchanof the state, and therefore valid.

dise for the benefit of the creditors of the The identical question involved here was seller. And since their act in attempting to before this court in the case of Nash Hard- purchase was void, it follows, as stated ware Company v. Morris, 105 Tex. 217, 146 above, that the title to said property remainS. W. 871. In that case the conclusion was ed in Sweet, the seller, and did not pass to reached by this court, speaking through the the defendants in error; and, when defendlate Chief Justice Brown, that the act was ants in error sold said merchandise, the prowithin the police powers of the state, and ceeds of said sale were subject to garnishwas a reasonable regulation, and not in vio- ment. lation of the Constitution. We approve the

When the defendants in error sold the holding in that case, and overrule the as- merchandise, the title to which remained by signment which assails the constitutionality law in Sweet, they became indebted to Sweet of the act.

for its value. Having sold and converted [2] Passing from this we will now consid- property which, in law, belonged to Sweet, er the important question as to the effect of it obviously follows that they owed him for the service of the writ of garnishment upon its value. It is true, the law would not aid the defendants in error subsequent to the Sweet in recovering its value from the desale of the merchandise by them, which they fendants in error; for, having acted in the had purchased from Sweet. It is contended sale in open violation and defiance of a statthat the garnishment did not fasten upon ute, public policy would deny him a remedy, either the property belonging to Sweet, or and leave the parties to the legal wrong upon its proceeds after sale, for the reason, where it found them. Especially would this as asserted, that the property belonging to be true since the statute in question, under Sweet, which passed into the hands of the the circumstances of this sale, holds the defendants in error, had been sold by them, property for the benefit of Sweet's creditors, and that the proceeds of the sale could not and the courts would not aid Sweet to with be reached by the writ of garnishment, and draw it beyond their reach. But the plainthat the writ of garnishment would not be tiff in error is not in the same attitude as effective unless served before such sale. Up- Sweet. Not having participated in the on the other hand, the contention is made wrongdoing, the law would aid it to recover that the writ of garnishment took effect and the fund set apart by statute for creditors. became a lien upon the proceeds of the sale Now the evidence shows that the defendants of said merchandise.

in error sold the merchandise for at least In considering this question it should be as much as they agreed to pay for it. In remembered that the purchase by defendants other words, the evidence shows that the in error from Sweet, however innocently in-defendants in error sold Sweet's property tended, was in open violation of the bulk for at least as much as $6,005.97, and at the sales law, and, under section 1 thereof, "void time the writ of garnishment was served as against creditors of the seller.” There they still were indebted to Sweet in said was, then, no real sale, in law, but merely sum, and the garnishment fastened upon a change of possession. The parties could said fund. not accomplish that which was prohibited The identical question presented here has by law. The possession was transferred not been adjudicated by this court in confrom Sweet to the defendants in error, which nection with the bulk sales statute. In other left them holding it in trust for the benefit jurisdictions the authorities appear to be of Sweet's creditors, with the title still in somewhat in conflict, but the weight of auSweet. This necessarily follows as the re- thority is to the effect that, when one pursult of the attempted sale being rendered chases merchandise in violation of the bulk void by the statute. A contract between citi- sales law, he holds the property, not for himzens, however honestly made, cannot pre- self, but as trustee for the seller's creditors, vail as against a statute which prohibits the who may reach the trust fund by writ of making of the contract. Either the contract garnishment, even though the purchaser has or the statute must fall in such a clash, and paid full value for the merchandise and has

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