Estey v. Fuller Implement Co.

¶1I. The appellant maintains that this proceeding was tried and .treated by the trial court as *681an equitable action, and should be so considered eed- and treated in this court. We do not think the record sustains this position. -i. execution: a?v procfo?soosw.ul'ity

¶2The proceeding is not under section 3150, and those following, relating to equitable proceedings, but is unquestionably a proceeding auxiliary to execution, as provided for in preceding sections. That Fuller and wife filed answers not required by law, and that the testimony was taken by consent in term time and' in open court before the judge, instead of in vacation, does not change the character of ■ the proceedings; neither does the fact, that the clerk entered and treated the proceedings as a case against Fuller and wife. It appears that at the same time of instituting this proceeding, the appellees, Estey & Camp, instituted their action in equity against Fuller and wife, and others, to subject the property of the implement company in their hands to the payment of the plaintiffs’ judgments. This fact and the entire record show that the plaintiffs did not consent that this proceeding should be treated as an equitable action. We are clearly of the opinion that the proceeding is none other than for the discovery of property in aid of execution. The appellant’s first contention is that the court erred in overruling the motion for security for costs. This contention is based upon the claim that the proceeding is an equitable action. It not being such, but simply a proceeding in the case of Estey & Camp v. the Fuller Implement Company, section 2927, providing for security for costs, does not apply, and there was no error in overruling the motion.

¶3II. The appellant’s next contention is that the court erred in permitting her husband, A. It. Fuller, to a. witnesses: ívSfe“tesu-d eaoh3other118t testify against her, over her objection. The record- shows that Mr, Fuller was called for examination in obedience to an order of the court, and that, without any objection being made, he proceeded to state at length with respect to the incorporation and business of the Fuller Implement Company, and of the transfer of its property to a partnership, and subsequent transfer by the partnership *682to a new corporation, called tlie “ Co-operative Implement & Hardware Company.” Following this statement, he was asked: “When was the delivery made of that property to the Co-operative Implement & Hardware Company, and how was the delivery made?” The defendants objected as immaterial and incompetent; and M. E. Fuller objected to the witness giving any testimony against her, for the reason that he is her husband, and not competent to testify against her. The objection being overruled, the witness proceeded to state the details of the transaction between these several companies. The only statement referring to Mrs. Fuller was that he was her agent; that she had some of the notes of the companies which were taken by her in the course of business ; that they were sold to her for money which she lent the company on which to do business ; that the partnership owed Mrs. Fuller fifty-seven hundred and ninety-seven dollars, and seven cents, for which she held the notes of the partnership. In these statements there was nothing adverse to the claim made in behalf of Mrs. Fuller. Upon the cross-examination, the attorneys for Mrs. Fuller inquired very minutely as to the transactions by Mr. • Fuller as agent for his wife with the several companies, and the amounts of money advanced by her through him, and the state of the indebtedness to her. In this connection the books of the Fuller Implement Company and several promissory notes by the company to Mrs. Fuller, amounting to six thousand dollars, were called out and introduced, and it was upon cross-examination to this new matter that the statement was elicited upon which the plaintiff claims that there was no consideration for these notes. After this, Mr. Fuller was recalled, and further examined by the plaintiff as to the transactions had by him as agent for his wife, which was followed by further cross-examination. Upon the examination of Mrs. Fuller, she repeatedly disclaimed any personal knowledge as to the transactions between Mr. Fuller, as her agent, and the companies, her *683answer uniformly being: “Ask my agent.” Under this state of tlie record, it cannot be said that Mr. Puller was permitted to testify against Ms wife, over her objection.

¶4III. The appellant contends that there is no legal evidence to support the fifth and sixth findings of fact. „ cautions be-denee-ie: evi' The findings are as follows: “Fifth. That on the seventeenth day of January, 1887, ™ie en^ire property of said judgment debtor was turned over to a copartnership composed of the judgment debtor and three others, said copartnership being known as the ‘Puller Implement Company,’ and that, in consideration of said property so turned over and delivered, said Puller Implement Company made to M. E. Puller its three promissory notes, — one for nine hundred and ninety-seven dollars and eighty cents, one for twenty-three hundred and eleven dollars and seventy-seven cents, and one for twenty-seven hundred and twenty-three dollars and sixty-eight cents, — all due on or before one year from date, to-wit, January 17, 1887, and all drawing interest at the rate of eight per cent, per annum. (Exhibits 4, 5 and 6.) That no consideration passed from M. E. Puller for said notes, but they were made to her for the purpose of keeping the business of the judgment debtor separate from the Puller Implement Company corporation.

¶5“Sixth. That there is due from M. E. Puller to judgment debtor, by reason of the fifth finding of fact herein, the sum of sixty-two hundred and sixty-five dollars and sixty-nine cents, being the sum of the several payments with .six-per-cent, interest per annum from the date thereof.”

¶6These findings have other support than the statement'of Mr. Puller that the one object of giving these notes was to keep the accounts separate. The testimony of Mrs. Fuller shows that she was not possessed of any means at the time of her marriage, and that she had no source of income or accumulation since, but the *684wages allowed her by her husband for attending to the ordinary household duties of a wife and the increase that arose from the investment of her wages ; that her accumulations were managed by her husband, according to his own judgment, and without any direction from her. While she has been thus accumulating money to a considerable extent, he has been prosecuting his business in connection with these corporations and the partnership, the last of which came to insolvency. Without discussing in detail the testimony upon this subject, we may say that it is not such as to inspire the belief that the wife has been in fact as successful in accumulating money as claimed, while the husband, who- transacted the business, and the companies he managed are without means to pay their debts. The findings of the court find ample support in the testimony.

¶7IV. The appellant, in her answer, pleaded the existence of the plaintiff’s action in equity in abatement 4. practice: Irypraoeed* inequity““ abatement. °f this proceeding, and now complains of the findings of the court against that plea, That plea was interposed upon the theory, before mentioned, that this is an equitable action. It being a proceeding auxiliary to execution, it is not abated by the other action, even though it had been first commenced. This proceeding being to discover property may very properly be prosecuted, either before, or contemporaneously with, an equitable action to subject the property to the payment of debts. We find no error in the action and rulings of the court.

¶8Our conclusion is that the order of the superior court should be affirmed.

¶9SUPPLEMENTAL OPINION.

¶10The appellant, M. E. Fuller, petitions for rehearing, upon the ground that the former opinion ' start proceed-effeotasS8' thirdpeibons. is erroneous, in that it affirms the order made upon her to pay over, to be applied upon the plaintiff’s judgments, money fourLq to be due from her to the judgment *685debtor. It is contended that this is in conflict with the ruling of this court in Eikenberry & Co. v. Edwards, 67 Iowa, 619, or with Osborne v. Reardon, 79 Iowa, 175.

¶11It will be seen by the former opinion that this is a proceeding auxiliary to execution; that Mrs. Fuller was not a, party to the judgment; that she was called and examined as a witness in the proceeding, and that it was found that she was indebted to the judgment debtor, and ordered to pay four hundred and fifty-nine dollars and forty-three cents thereof to the clerk, to be applied on the plaintiff’s judgments. In the cases cited the order to turn over property was upon the judgment debtors, while, in this case, it is upon a third person not a party to the judgment. Such orders are expressly authorized by section 3140 of the Code, whether the property be found in the hands of the judgment debtor, or of another person. The cases cited agree in holding that such orders may be made. In Osborne v. Reardon, it is held that the third person, Mrs. Reardon, was not bound by the order upon the judgment debtor to turn over property.

¶12It is evident from the discussion that there is a misapprehension as to the purpose of this kind of proceeding, and the effect of such orders, especially as to third persons. We think it advisable to make this further announcement in the case, to prevent such misapprehension. The purpose of such a proceeding is to discover j roperty of the judgment debtor. The statute authorizing it does not provide any means additional to the usual provisions of the law for applying the property when discovered, other than the order to turn it over. When it is discovered, the judgment creditor’s remedy is ample by the ordinary processes. Mrs. Fuller, not being a party, is not concluded by the order on her to pay the money. Such an order is for the protection of the third person in turning over property or paying over money, and not to compel such turning over or payment. If Mrs. Fuller elected to pay the money as ordered, she would be fully protected in *686doing so by the order, but if she paid it without such an order or at the consent of her creditor, she would not. The provisions of section 3145 of the Code, authorizing the punishment of persons disobeying an order as for contempt, does not apply to the refusal of a third person to deliver property or pay money under such an order. The third person, not being a party to the proceeding, and not bound by the order to deliver or pay, does not disobey it by failing to do so ; but nob so in the case of the judgment debtor, who is bound by an order upon him. In Reardon v. Henry, ante, p. 134, the point determined is that Reardon's acts were not such as to constitute a disobedience of the order, and, hence, that he was not guilty of contempt. The finding of facts and the law fully authorizes the order that was made upon Mrs. Fuller in this case, and, if she elects to pay the money, the order will be ample protection to her in doing so ; but, if she does not pay it, the plaintiff is left to the remedies provided, such as execution, garnishment or equitable proceedings. The opinion is in harmony with the former rulings of this court, and with the statute upon the subject.

¶13The petition for rehearing is overruled.