Protzman v. Billings , 120 Wash. 123 ( 1922 )

Hovey, J.

—Respondent sued the appellants, who are husband and wife, upon a promissory note for $13,000, maturing January, 1921, signed by the husband alone. In the complaint, filed in October, 1920, respondent also asked for the foreclosure of a chattel mortgage securing the note, but at the time of bringing the action respondent also sued out a writ of attachment, and in his affidavit alleged “that defendants have disposed of their property with intent to delay and defraud their creditors and have converted their property or a part thereof into money, for the purpose of placing it beyond the reach of their creditors; that nothing but time is wanting to fix an absolute indebtedness between the plaintiff and the defendants.”

The complaint also contained the following allegation:

“That the defendant, Gr. H. Billings, has attempted to dispose of his property by making fictitious transfers thereof with the intention of defrauding this plaintiff, who is one of his creditors.”

Appellants thereafter joined issue, and when the cause came on for hearing in Lincoln county, where the suit was instituted, the parties to the action, through their attorneys, entered into the following stipulation:

“It is stipulated and agreed between counsel for the respective parties to this action that the chattel mortgage mentioned in the complaint be waived by the plaintiff and the case shall be tried out as a straight law action, demand being confined to the promissory note mentioned in the complaint and that said cause may, upon the application of either counsel and the presentation of this stipulation, be set for trial at the coming Friday setting day for the June term and tried in the superior court of Spokane county upon the issues as heretofore suggested and as they now stand in the pleadings, with the exception of the chattel mortgage which is waived, and the resort only had upon the promissory note as far as the plaintiff is concerned.”

Upon the trial before the court and a jury in the latter county, the trial court directed a verdict in favor of the respondent for the amount due upon the note, together with attorney’s fees and costs.

It is first contended by the appellant that the action was prematurely brought, suit having been filed some three months before the note fell due, and that, when the cause of action was changed from the foreclosure of a mortgage to a straight action upon the note, respondent lost the right to bring the action prior to maturity, which existed in his favor as mortgagee. It is not necessary to pass upon the effect of this stipulation as applied to this question. The allegations of fraud in the complaint and the allegations made in the affidavit for the writ of attachment bring respondent Avithin the provisions of § 649, Rem. Comp. Statutes, and, in our opinion, entitle him to maintain this action if his proof supports the allegations. In our opinion, there was ample proof to sustain the aliegations, and, in fact, there is practically no conflict in the testimony.

It is also urged by appellant that the judgment is erroneous in that it runs against the community consisting of the appellants G. H. Billings and Inez Billings, his wife, as well as against the appellant G. H. Billings. This argument seems to be rested upon certain testimony to the effect that respondent was notified that appellant Inez Billings would not sign the mortgage. The note in question was given to take up several other notes held by the respondent. The original notes were all given in the first instance for stock purchased by appellant G. H. Billings in a corporation, Avith which respondent was not in any manner connected, and these notes were purchased by respondent, who took the precaution of asking appellant G. H. Billings about the validity of the first notes purchased and received a written assurance, and the remaining notes were purchased by respondent at the special instance of the same appellant.

In addition to the presumption of community indebtedness from transactions of the husband, the evidence in this case shows that the business was in fact conducted on behalf of the community. Appellant G. H. Billings was president of the corporation at a salary of $5,000 per annum, and a principal stockholder. The investment proved unfortunate for the appellants. Only a few weeks’ salary was received and the corporation ceased to function. The law does not attempt to prescribe the kinds of business that the husband shall be limited to. There was no evidence introduced on behalf of appellants which tended to prove any defense, and we think the court was clearly required to take the action that it followed in this case.

The judgment is affirmed.

r Parker, O. J., Holcomb, Mackintosh, and Main, JJ., concur.