Wilson v. Spear

• Decision Date: 20 September 1895
• Citation: 68 Vt. 145,34 A. 429
• Court: Vermont Supreme Court
• Parties: WILSON v. SPEAR et ux.

34 A. 429

68 Vt. 145

WILSON

v. SPEAR et ux.

Supreme Court of Vermont. Windsor.

Sept. 20, 1895.

Appeal in chancery, Windsor county; Thompson, Chancellor.

Bill by James J. Wilson against George J. Spear and wife to have a voluntary conveyance by him to the wife set aside as in fraud of creditors. Prom a decree for plaintiff, defendants appeal. Reversed.

French & Southgate, for appellants.

J. J. Wilson, pro se.

MUNSON, J. On the 28th of November, 1885, the defendant George J. Spear received from one Parkhurst a deed of one undivided half of his farm. In the fall of 1887 said Spear purchased the other undivided half of the farm, and had Parkhurst convey it to his wife, the defendant Eva B. Spear. The consideration for both conveyances was paid by George J. Spear from his own means. On the 31st day of December, 1887, George J. Spear executed to one Beach a deed of the undivided half conveyed him by Parkhurst, and on the 16th day of January, 1888, Beach conveyed the same to Eva B. Spear. The master finds that the defendant George had this property conveyed to his wife, the defendant Eva, "for the reason that he thought the same would be safer in her hands than in his own, from attachment by his creditors," of whom the orator was one. This is a sufficient finding that the transfer was made with intent to defraud the orator. There is no finding that connects the defendant Eva with the fraudulent purpose of her husband. Upon the question of consideration, the master says he is "unable to find" that the defendant Eva paid anything for the farm,—which cannot, of itself, be treated as an affirmative finding that nothing was paid. But, as the master says in this connection that the defendant husband had the same conveyed to his wife to keep it from his creditors, it is thought by a majority of the court that the payment of a consideration is fairly negatived. The master also reports certain facts in regard to the grantor's indebtedness and unconveyed property which it will not be necessary to consider. It appears that a part of the orator's account accrued after the conveyances were made, but the case will first be considered as if the entire demand were pre-existing. We have, then, the case of a voluntary conveyance, executed with an actual intent to defraud an existing creditor, to be passed upon without reference to the amount and availability of the property retained.

In disposing of the question stated, it seems desirable to make some reference to the cases, in view of the frequent failure to distinguish carefully between fraudulent conveyances upon consideration, and conveyances without consideration, and, in the case of voluntary conveyances, between those which rest upon a legal inference of fraud, and those where an actual fraudulent intent is shown. When the conveyance is without valuable consideration, the creditor may avoid it for the fraud of the grantor alone. Foster v. Foster, 56 Vt 540, 548. It is only when there is a valuable consideration that fraud on the part of the grantee is essential. Such were the cases of Root v. Reynolds, 32 Vt 139; Leach v. Francis, 41 Vt 670; Nichols v. Nichols, 61 Vt. 426, 18 Atl. 153. The fraud of a voluntary grantor may be an actual fraudulent purpose, or the fraud which the law imputes to him from the condition of his estate and the necessary consequence of his act. When the grantor is found to have conveyed for the express purpose of defrauding his creditors, the condition of his estate is immaterial. Wadsworth v. Williams, 100 Mass. 126; Hager v. Shindler, 29 Cal. 47; Westerman v. Westerman, 25 Ohio St 500; Gormley v. Potter, 29 Ohio St. 597; Vasser v. Henderson, 40 Miss. 519; Edmunds v. Mister, 58 Miss. 765. It is only in cases where no actual fraud appears that the conveyance can be sustained on the ground that the grantor retained sufficient property to satisfy his debts. Of this character were the cases of Brackett v. Wait, 4 Vt 389; Dewey v. Long, 25 Vt 564; Church v. Chapin, 35 Vt 223; Wilbur v. Nichols, 61 Vt. 432, 18 Atl 154. It appears, then, that the orator, as an antecedent creditor, can avoid these conveyances without other findings than that they were designed by the grantor to defraud his creditors, and were without consideration.

Upon the facts reported, the disposition of the case is not affected by the finding that a part of the account was for services rendered after the conveyances were made. The charges were for the orator's services and disbursements as attorney in a single suit if the conveyance was designed to defraud the orator, it was an attempt to defeat the collection of his compensation for a continuing service, rendered and to be rendered under an employment already given. It is possible that in a case of this character the entire account should be treated as pre-existing. If this would not be permissible, there is authority for saying that the orator could have relief, to the extent of the pre-existing charges notwithstanding the judgment was for more. Henderson v. Henderson, 133 Pa. St 399, 19 Atl 424. It has been held, however, that one who takes a judgment covering both antecedent and subsequent claims must be treated as a subsequent creditor as to all. Usher v. Hazeltine, 5 Greenl. 471. But if enough appears to avoid the conveyance as to subsequent creditors, it will not be necessary to consider the questions suggested. It is said in McLane v. Johnson, 43 Vt. 48, that a conveyance without consideration, and with fraudulent intent, is invalid as to both existing and subsequent creditors. But that was a case in which the fraudulent intent existed in both grantor and grantee. It is by no means universally conceded that a voluntary conveyance to an innocent grantee, void as to existing creditors, is necessarily void as to all subsequent creditors. Hagerman v. Buchanan (N. J. Err. & App.) 14 Am. St. Rep. 750...