Beattys v. Straiton

Dowling, J. (dissenting) :

Upon the record it would seem that the transfer in question was a purely voluntary one. There is no proof of any absolute acceptance by either Martin V. Cook and Arthur E. Helmricli, or by Cook after the latter’s death, of the bequest of the interest of Valentine Cook, Sr., in the firm, charged with the payment of the legacies to Christine Straiten and William Cook. The mere fact that the business was continued by the surviving partners did not constitute such an acceptance, for that was their right and duty as survivors, nor is there any proof that they ever realized any profit from the interest so bequeathed, or in any way treated it as their own. All that the legatees could claim, as it seems to me, was the payment of their legacies from the interest so bequeathed, if, upon an accounting, it was found that there was a surplus after the satisfaction of the firm debts, and. then to the extent only that the interest of the testator in the firm was found able to respond to their claims. •

• Furthermore, I do not believe that the Statute of Limitations had - barred the plaintiff’s right to recover. It is quite true that on December 17, 1900, the plaintiff, through his attorney, knew that the transfer in question was a voluntary one, for on that day it was *376offered in evidence on behalf of plaintiff by his' attorney in the bankruptcy proceedings. But it seems quite clear that plaintiff did not then know the other essential fact that at the time of making such transfer Cook was insolvent. Upon the proof the first time that plaintiff had reason to believe that fact was when he inter posed his counterclaim in the suit of Cook against Straiton on March 24, 1903, wherein he alleged, upon information and belief, practically the same facts as he sets up in his complaint in this action. Upon the trial of that action on May 7, 1903, Martin V. Cook for the first time was examined as to his 'financial condition, and he then admitted for the first time that although his.petition in bankruptcy had been filed October 15, 1900, he had been insolvent for a month prior thereto, and had been engaged in preparing the schedules for a week or ten days before the petition was filed. The transfer in question bore date September 21, 1900. Plaintiff testified that he had no knowledge of the matters in controversy save as. he acquired it through his attorney, and the. latter testified that he first knew on May 7, 1903, of Cook’s insolvency at the time of making the transfer. It does not appear that tire trustee in bankruptcy had any means at his command by which he could have acquired this knowledge at an earlier date, either from the books of the bankrupt or otherwise, nor does it appear save by the statement of the bankrupt how long his condition of insolvency had existed. Surely he cannot be charged with the knowledge of the bankrupt never communicated to him. Concededly the six years’ Statute of Limitations applies here. (Code Civ. Proc. § 382, subd. 5.) Plaintiff having by May 7, 1903, acquired knowledge both that the transfer in question was a voluntary one and that Cook was insolvent at the time of. its making, the statute then began to run. But the action of CooK v. Straiton was then pending, in which by way of counterclaim the plaintiff herein had pleaded substantially the present cause of action and prayed for judgment in his favor. Under section 412 of the Code of Civil Procedure, the running of the statute was, therefore, suspended until the termination of that action, which occurred on June 26, 1903, when the complaint therein was dismissed, and the counterclaim was not passed upon. The statute, therefore, began to run June 26, 1903, and this action having been commenced May 1, 1909, was within the period limited.

*377I believe, therefore, that the judgment appealed from should be affirmed, with costs.

Laughlin, J., concurred.

Judgment reversed and new trial ordered, with costs to appellants •to abide event.