tember. I don't know but Mr. Corliss came and said he had a bill of sale of the property, and said he thought there was in the neighborhood of $1200 or $1500 worth of goods there; that he could not pay expenses on that amount of goods, and he wanted some one to give him credit-put some goods in there. I declined to do anything with it, and they came again, and said if we would sell some goods to that concern up there they would give us a bill of sale of the goods-turn them over; they should be wholly in our charge; and I agreed to put in some $1500 worth of goods, and take those goods that were in the store and pay up their bills that they could not pay-the insurance, rent and whatever might be so agreed upon. I decided to advance that money and take a bill of sale of that stock. The bill of sale was taken in the name of Dunning & Co. Dunning is the only man concerned in the firm of Dunning & Co. The company was a mere nominal matter. Mr. Reeg has no interest in that store and its business, and none whatever in the goods that are in the Mr. Reeg has been in that store until within a few weeks. He managed the business there, hired the clerks, and I suppose discharged the clerks that were discharged, and paid the clerks, too. He did not have charge of the goods; he merely selected the goods for that stock."

This testimony was given in February, 1883. It further appears from his testimony that he did not know of the indebtedness of Mr. Reeg at the time he took the bill of sale, except some back rent due Corliss, taxes and insurance, which J. K. Burnham & Co. paid, amounting to between $350 and $700, and that is what they paid Reeg for the goods on the sale to Burnham; that no inventory was taken of the stock at the time of the sale; that Reeg, in the management of the business, bought goods of other parties than J. K. Burnham & Co. at his pleasure; was never asked to account for the proceeds of the business; that when Reeg left the business, in January, 1883, J. K. Burnham & Co. did not owe Reeg anything, but on his request gave him $290 to go west with, and took his receipt therefor in full of all claims on settlement.

The testimony of defendant Reeg, under an order of the court on the 20th day of March, 1883, was offered in evidence by complainant's counsel, wherein he testifies in the

most positive terms that the mortgages and bill of sale mentioned were all given without consideration, and for the purpose of preventing creditors from making their claims; that he did not owe Corliss anything for which the obligation was given. He further testifies that a few days after he gave the bill of sale to Corliss he went to J. K. Burnham & Co. and told Burnham "the shape he was in ;" that he owed about $800 for merchandise and could not pay it, was hard up and had alimony to pay, and did not wish to pay that; told Burnham that he owed Corliss $105, and if he would let him have goods he could make money at his store and shield him from the attacks of his creditors, and he would be safe himself, and the next day Burnham told Reeg he would do it; that they went to Corliss' office and consulted about the way to do the business, and then it was agreed upon that Corliss should convey the stock to Dunning for Burnham & Co., who were to pay Reeg's debt to Corliss, and the papers were all made under Corliss' and Burnham's direction; that at his (Reeg's) request Exhibit 15 [the instrument dated September 13, 1881, and before set forth] was made and transferred to him, so that he could go on with his business; that the bill of sale was not intended to be absolute, but only a shield for Reeg against his creditors; that the stock of goods mentioned in the bill of sale was at that time worth from $3000 to $3500; that he (Reeg) carried on the business afterwards as he usually had done, bought goods of J. K. Burnham & Co., and paid for them, and never accounted for any goods sold to any one; that no person but himself had the management and control of the business and the goods, and no one interfered with him or his business; that his place of business and his signs. remained the same after as before the bills of sale were made, and that the only moneys he used from the business were what he paid for running it, for goods and for his own personal expenses; that he did not pay any of his other creditors; that the largest amount went to J. K. Burnham & Co. for goods, for which he had their statement of account both for goods received and moneys paid; that he never paid Dunning or Corwin anything, but lent the latter money, $40 of which

constituted a part of the $290 received by him of J. K. Burnham when he left; that J. K. Burnham & Co. had nothing to do with the business except to sell him goods, and they never paid anything for him except the money to Corliss; that he held the lease of the store in his own name all the time, which did not expire till April, 1884, and never transferred it; that after the transfer from Dunning to Corwin, and about the last of December, 1881, or first of January, 1882, an inventory of the stock was taken; that Burnham's clerks helped to take it, and it amounted to about $7000, but Burnham & Co. never allowed him to look it over; that he does not know that all the goods were put on the inventorythinks they were not; they marked the goods too low, put down dress goods at a shilling which cost eighty cents per yard; that he paid all the taxes on the goods; that on the 5th of January, 1883, after the inventory was taken, Burnham & Co. sent Corwin up to the store and took possession; that the stock of goods at that time was worth $9000 or more, and that his inventory in January, 1881, amounted to $4500.

Reeg further testified that he was surprised and bewildered when he found he was to be turned out, but Burnham & Co. had him in their power and he could do nothing; that he tried to get them to give back goods to the amount of his interest, and they refused; that he then tried to get them to take out goods to the amount of his indebtedness to them, and let him have the rest, and this they refused; that he then tried to get them to let him have $500, and he finally got $290 and about $70 in accounts of them, as above stated; that he never made any settlement. with them; that he never received any more money from any of them, and never gave any receipt on a settlement of his matter with Corwin, Burnham & Co., or Dunning.

The foregoing is the substance of the testimony of Mr. Reeg. Several witnesses (Reeg's clerks) were sworn on the part of complainant, whose testimony was mostly corroborative of Reeg's statement of his doing the business, and the manner of doing it; also of the statement of Reeg that the

55 MICH-4

goods belonged to him, but that he was trying to defraud complainant out of her alimony, and was doing business under other names to get rid of paying the alimony.

Mr. Burnham and several of his clerks were sworn for defendants, and testified to the effect that the consideration paid for the bill of sale to Dunning was about $350, paid by Burnham & Co., and that they advanced about $700; that when the stock was transferred to Corwin there was owing to them about $4000 or $4500; that the inventory taken in January, 1883, showed the value of the goods $6937, but that they were worth not over $4500, and that on the 13th of September, 1881, the stock was not worth over $1500; that when Burnham & Co. entered into the arrangement with Reeg they did not intend to give him a line of credit of more than $1200, but that he did get $4500, and that they then took possession of the stock of goods, after offering to let Reeg have it for less than that amount if he would pay it.

Several other witnesses were sworn on the part of the defendants, tending to show the value of the goods, and that Reeg's credit was bad.

The foregoing is a brief summary of the pleadings and proofs as shown by the record. The testimony is very conflicting, indefinite and unsatisfactory as to the value of the Reeg stock, both at the time the bill of sale was made to Dunning, and also at the time J. K. Burnham & Co. took possession of the stock in January, 1883. It is, however, quite certain that Reeg must have known their amount and value, when the bill of sale was made, better than any of the other witnesses, and he puts the value at $3000 or $3500 at that time. I think their fair value, from the testimony, may be safely placed at $2500. I am not satisfied that the evidence shows Mr. Reeg's interest in this stock was increased in value by his management between that time and the time J. K. Burnham & Co. took possession, and if they can be held at all responsible in this case to account to the receiver. for the goods, the amount should not exceed the sum named. There is no question about the indebtedness of Reeg to

the complainant at the time of the transfer of the goods by him to Dunning, or at the time of filing the complainant's bill, or that at the latter date it exceeded the sum of $2500, and I think the fraudulent intention of Mr. Reeg in making the pretended mortgages and sales of his stock of goods to Corliss, and procuring the same to be made to Dunning and to Corwin for J. K. Burnham & Co., is equally clear; that it was to place them beyond the reach of legal process issued upon the complainant's decrees, and in fraud of her rights to the extent of the value of the goods so transferred. That such fraudulent intent of defendant Reeg was known to J. K. Burnham & Co., and participated in by them, is not so apparent from the evidence, but the testimony of Reeg upon this point, if believed, places it beyond doubt. I think the circumstances accompanying the transaction, and the dealings between the parties, are very strongly corroborative of Reeg's testimony upon this question, and I cannot escape the conviction that the preponderance of the evidence on this point is that J. K. Burnham & Co. and the other defendants had knowledge, or were in possession of facts from which they must be held to have had knowledge, of the fraudulent intent of Reeg in making the transfer, and their action served as a cover of Reeg's property, and prevented the sheriff from taking it on execution to satisfy the complainant's decrees.

J. K. Burnham, as the evidence shows, had known Mr. Reeg ten or twelve years; knew that his commercial honesty and his commercial credit were bad; that he had been purchasing on credit, and could no longer, except for cash; that he had been trying to purchase of J. K. Burnham & Co. on credit for five or six years, and had been all the time refused; that he had been in litigation with complainant. He knew the existence of Corliss' mortgages, which stated Reeg's indebtedness to him at over $3000, and knew that it was not true, as Burnham paid the actual indebtedness thereon, with $119.47; that the bill of sale to Corliss was a sham; that Reeg was unable longer to continue his trade in his own name and escape the complainant's execution, and that Reeg desired him to name the