Southern Bank v. Nichols

Decision Date19 March 1907
Citation202 Mo. 309,100 S.W. 613
PartiesSOUTHERN BANK OF FULTON v. NICHOLS et al.
CourtMissouri Supreme Court

A co-maker of a note owned at the time of its execution a tract of land. The loan was made on the faith of his ownership thereof. Several years afterwards, and after the payee demanded payment, the co-maker conveyed the land by quitclaim deed to his children for a recited consideration less than the value of the premises. The conveyance rendered him insolvent. Held, that the co-maker as a matter of law conveyed the land with intent to defraud his creditor.

5. SAME—INTENT OF GRANTEE.

The grantee in a quitclaim deed from his father takes with notice of the father's intent to defraud his creditors.

6. SAME—CONSIDERATION—ADEQUACY.

In a suit to set aside a conveyance as fraudulent towards creditors, evidence examined, and held to show a consideration so inadequate as to warrant the setting aside of the conveyance.

7. EVIDENCE—DECLARATIONS AGAINST INTEREST —ADMISSIBILITY.

The declarations against interest of a party to a suit are admissible in evidence in favor of the adverse party, though made in a deposition given by the party, and he is in court at the time the parts of the deposition containing the declarations are offered in evidence.

8. SAME—PROOF AND EFFECT—EXPLANATION.

Where the declarations of a party to a suit against interest made in his deposition are admitted in evidence in favor of the adverse party, he is entitled to have at least so much of the deposition read as bears on his declarations.

9. SAME—PRELIMINARY PROOF.

The statements of a party to a suit are admissible against him as original evidence, and his admissions against interest made in his deposition taken before trial are admissible without first laying a foundation necessary for the impeachment of a witness by proof of contradictory statements.

Appeal from Circuit Court, Callaway County; Robert McPheeters, Special Judge.

Action by the Southern Bank of Fulton against R. H. Nichols and others. From a judgment for defendants, plaintiff appeals. Reversed.

T. A. Boulware, D. P. Bailey, and I. W. Boulware, for appellant. A. Finley, for respondents.

BURGESS, J.

This is a suit to set aside a quitclaim deed made by defendant R. H. Nichols to his children and codefendants, Berdina A. Truitt, Hershel I. Nichols, Richard S. Nichols, and William F. Nichols, on the ground that the deed sought to be set aside was without consideration, and made with the intent to defraud plaintiff and hinder and delay it in collecting its debt, and that the said grantees accepted said deed with the intent and purpose of aiding the said R. H. Nichols in defrauding plaintiff and hindering and delaying it in collecting its said debt. The cause was tried at the May term, 1902, of the Callaway county circuit court, when the following issues of fact were submitted by the court to the jury: "(1) Was the deed from the defendant R. H. Nichols to the defendants B. A. Truitt, H. I. Nichols, R. S. Nichols, and W. F. Nichols, dated November 29, 1899, and conveying the lands described in plaintiff's petition, without any valuable consideration? (2) Was said deed executed and delivered by the defendant R. H. Nichols fraudulently and with the intent to hinder, delay, and defraud plaintiff? (3) Was said deed received and accepted by the defendants B. A. Truitt, H. I. Nichols, R. S. Nichols, and W. F. Nichols, and by each of them, fraudulently and with the purpose and intent of defrauding plaintiff, and for the purpose and intent of aiding the said R. H. Nichols in defrauding plaintiff and preventing plaintiff in collecting its said debts?" At the conclusion of plaintiff's evidence, the court, at the request of defendants, gave the following peremptory instruction to the jury: "The jury are instructed, at the close of plaintiff's testimony, that, under the pleadings and evidence, the verdict and findings must be for defendants, on all three of the issues submitted"—and the jury found accordingly. The court thereupon rendered judgment in favor of defendants and against plaintiff for costs, dismissing plaintiff's bill, from which judgment plaintiff appeals.

The following is a summary of the facts: On the 6th day of October, 1894, the defendant R. H. Nichols and James I. Nichols, his brother, executed and delivered to plaintiff their promissory note for $2,350, due one day after date, with interest from date at the rate of 8 per cent. per annum. At the time of the execution and delivery of said note, defendant R. H. Nichols was the owner of 140 acres of land in Callaway county, which said land, by quitclaim deed dated November 29, 1899, he conveyed to his said children and codefendants for a stated consideration of $1,500; his wife refusing to sign said deed. Upon suit brought for the payment of said note and interest due thereon, plaintiff recovered judgment against said James I. Nichols and R. H. Nichols on the 22d day of December, 1900, for the sum of $2,861.65 and costs, and by virtue of an execution issued thereunder the sheriff seized and levied on the said 140 acres of land. After the levy of said execution, and before the sale, the sheriff appointed three qualified commissioners, who assigned and set off to said R. H. Nichols, as a homestead, 60 acres of said land, and, in lieu of his exemptions as to personal property, 10 acres of the said tract. The remaining 70 acres was sold by the sheriff at public sale; the plaintiff becoming the purchaser for $300, and receiving the sheriff's deed therefor. At the time of the institution of this suit, no part of the said judgment was paid save the said sum of $300.

Each of the three commissioners, James H. Ely, David Newsom, and J. B. Gilpin, who set off the homestead of defendant R. H. Nichols out of the 140-acre tract, testified as to the value of the land. Ely testified that he was not well acquainted with the value of lands in the neighborhood of this 140 acres; that the 60 acres which they had set off as a homestead had the dwelling house and other improvements thereon, and they set the value at $25 an acre; that the other 10 acres set aside by way of exemptions was valued at $20 an acre. He stated that he did not look over the remaining 70 acres, and could not estimate its worth. Newsom's testimony was to the same effect as regards the value of the land set out as a homestead, but he thought the 70 acres remaining over was poorer land, and worth about $2 or $3 per acre. Gilpin testified that he did not value the land as high as Ely and Newsom did the day he was there, and he thought the tract of 140 acres was worth about $2,200. He also said that, four or five years before this trial, he bought 320 acres of land near this 140 acres, and paid $3,150 therefor, or about $10 per acre. He thought that part of his land was about as good as Nichol's land. Dr. J. H. Howard testified that he knew the land in controversy a long time, and that it was reasonably worth $25, $30, or $35 per acre. C. W. Jameson, who was plaintiff's cashier at the time of the note transaction, testified that his information was that the land in question was worth between $3,500 and $4,000, and that the loan was made on the strength of that fact.

The statements of defendant R. H. Nichols, made some time before in answer to inquiries on an examination held before Judge John A. Hockaday, touching his ability and means to satisfy the judgment against himself and J. I. Nichols, were read in evidence; the part relative to the making of the quitclaim deed and the consideration therefor being as follows: "Q. When did you first conclude or determine to deed this land to your children? A. Well, I was in debt to my children, and they wanted a settlement, and I had no money to make any settlement with them with, and had to deed them the land to satisfy them. Q. What did you owe them for? A. I owed them for work they did, and for money I borrowed from them, and such things. Q. Call the children by name, and state how much you owed to each. A. There was Shelton, for one. He lived there and worked on the farm for about seven or eight years, and I was to give him a part of the crops and so much a year for outside work, for attending to the farm, keeping up the fences, and doing work that is necessary on a farm. Q. Who is the next one? A. Then there is Hershel. We went into the grocery business together, and lost money on it, and he paid all the debts. And then I borrowed money from him to pay the taxes, and was in debt to him in that way. Q. How much money did you borrow from him, and when was it borrowed? A. I don't know the amount exactly. I have not got it itemized. Q. About how much was it? A. It was somewhere between $300, $400, and $500, along there somewhere. Q. You borrowed that much money from him? A. No, sir; he paid the debts of the grocery firm for a part of it. Q. You say you borrowed money from your children. How much money did you borrow from him? A. I borrowed some money from him to pay the taxes. Q. How much money did you borrow from him? A. About $26 or $27. Q. Is that all the money you ever borrowed from him? A. He paid the note— we borrowed some money together, and he paid the note off that we gave for it. Q. How much was...

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    ...Co., 150 Mo. 385, 400, 51 S.W. 682, cited by appellant, and declarations against interest by a party to the action. See Bank v. Nichols, 202 Mo. 309, 324, 100 S.W. 613. In Wigmore on Evidence (2 Ed.) sec. 1053, it is said as to this class of "A primary use and effect of an admission is to d......
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