Ainsworth v. Roubal

• Court: Nebraska Supreme Court
• Writing for the Court: PER CURIAM.
• Citation: Ainsworth v. Roubal, 74 Neb. 723, 105 N.W. 248 (Neb. 1905)
• Decision Date: 19 October 1905
• Parties: AINSWORTH v. ROUBAL ET AL.

74 Neb. 723

105 N.W. 248

AINSWORTH

v.ROUBAL ET AL.

Supreme Court of Nebraska.

Oct. 19, 1905.

Syllabus by the Court.

Evidence examined, and held to show the conveyance attacked fraudulent, except as to one mortgage.

A party cannot maintain an action in the nature of a creditors' suit to reach property of his debtor fraudulently conveyed until the claim has been reduced to judgment, and until judgment is obtained by the creditor the statute of limitations will not under ordinary circumstancescommence to run against such a suit. Gillespie v. Cooper (Neb.) 55 N. W. 302, so far as it holds a contrary doctrine, disapproved.

The creditor, if he chooses, may, before reducing his claim to judgment, commence an action aided by attachment and seize the estate fraudulently conveyed by his debtor, and after judgment in the attachment suit he may enforce his lien by an action in the nature of a creditors' bill. This course may be pursued, whether the debtor is a resident of the state or a nonresident. Keene v. Sallenbach, 18 N. W. 75, 15 Neb. 200;Kennard, Daniels & Co. v. Hollenbeck, 22 N. W. 771, 17 Neb. 362;Kimbro v. Clark, 22 N. W. 788, 17 Neb. 403.

Commissioners' Opinion. Department No. 2. Appeal from District Court, Dodge County; Hollenbeck, Judge.

Action by John V. Ainsworth, receiver, against Joseph Roubal and others. Judgment for defendants, and plaintiff appeals. Reversed.

F. I. Foss, R. D. Brown, Courtright & Lidner, Chas. H. Sloan, and J. D. Pope, for appellant.

Frank Dolezal, for appellees.

DUFFIE, C.

The plaintiff and appellant, who is receiver of the State Bank of Milligan, Fillmore county, Neb. brought this action against the defendants and appellees to subject certain lands in Dodge county, Neb., to the payment of a judgment obtained by him against Joseph Roubal, the record title of which stands in the name of Josephine Roubal, wife of said Joseph. For a clear understanding of the case, it is necessary to set out somewhat in detail a history of the litigation between the parties.

In November, 1897, the plaintiff recovered judgment against Joseph Roubal in the sum of $4,700 in the district court of Fillmore county upon the bond of one Fiala, on which Roubal was surety. November 24, 1897, Joseph Roubal and wife executed a deed to James Vech, a brother-in-law, conveying to him the land in controversy in this action. November 27, 1897, the plaintiff filed a transcript of his judgment obtained in Fillmore county in the office of the clerk of the district court of Dodge county. December 9, 1897, James Vech and wife deeded the property to Louis J. Kudrna. December 10, 1897, the plaintiff caused execution to be issued on his judgment and delivered to the sheriff of Dodge county, and on the following day the sheriff levied on the real estate in controversy, and caused the same to be advertised for sale as the property of Joseph Roubal, who had during all the time remained in possession of the premises. January 21, 1898, and previous to a sale being made under the execution, Kudrna obtained an injunction from the district court of Dodge county restraining the sheriff from proceeding to a sale under his execution. The plaintiff applied to the court to be made a party to this action, and filed an answer and cross-bill in that case, bringing in other defendants. His cross-petition was in the nature of a creditors' bill, seeking to subject the land to the payment of his judgment. April 21, 1900, a decree was entered in said action setting aside the different transfers, and declaring the real estate to be the property of Joseph Roubal, and ordering it sold, subject to his homestead interest. The defendants in that action filed a supersedeas and took an appeal to this court. In the meantime the law action in which plaintiff's judgment had been obtained in Fillmore county was appealed to this court by the defendant Roubal, and on November 20, 1901, an opinion was filed, reversing said judgment and remanding the case for another trial. See Fiala v. Ainsworth, 63 Neb. 1, 88 N. W. 135, 93 Am. St. Rep. 420. March 21, 1902, a second trial of the law action was had in Fillmore county, in which the plaintiff herein obtained judgment against the defendant Joseph Roubal for the sum of $7,364.45. On the same day Joseph Roubal and his wife executed three mortgages upon the land in controversy; one to George Bauman for the sum of $661, one to Mary Vech for the sum of $1,060, and one to Frank Dolezal for the sum of $2,000. March 28, 1902, the plaintiff filed a transcript of his new judgment obtained in Fillmore county with the clerk of the district court of Dodge county. April 5, 1902, Louis J. Kudrna conveyed the land in controversy to Josephine Roubal, wife of Joseph Roubal. September 18, 1902, the decree in the injunction and creditors' bill case tried in Dodge county was reversed by this court, and the case dismissed, for the reason that the judgment upon which it was based had been reversed on November 20, 1901. Kudrna v. Ainsworth, 65 Neb. 711, 91 N. W. 711. The present action was commenced in the month of March, 1903; the amended petition upon which the case was tried being filed on May 7, 1904. On the trial a decree was entered dismissing the plaintiff's petition upon the ground, as we understand, that his action was barred by the statute of limitations.

We have carefully examined the evidence contained in the record, and have arrived at the conclusion that there can be no doubt that the conveyance made by Joseph Roubal to James Vech, and the several deeds thereafter made, were for the purpose of avoiding the indebtedness due from Joseph Roubal the plaintiff, and finally vesting title to the property in Josephine Roubal, his wife. It is unnecessary to discuss this evidence as even a casual reading will satisfy the mind of any disinterested party that the conveyances, aside from the mortgages mentioned, which will be considered later, were colorable only, and without any good faith consideration paid. This brings us to the consideration of the statute of limitations relied on by the defendants and sustained by the district court. That court evidently relied on and felt bound by the holding in Gillespie v. Cooper, 36 Neb. 775, 55 N. W. 302; and, if that case is to be followed and recognized as the correct rule to be applied in actions of this character, then there is no question that the decree appealed from will have to be affirmed. The deed from Roubal to Vech was made in 1897, while this action was not commenced until 1903, six years after the making and recording of this fraudulent deed. The defendants insist that the plaintiff might have attached the land in controversy, notwithstanding the fact that he had reduced his claim to judgment prior to the fraudulent conveyance, and cites Strickler v. Hargis, 34 Neb. 471, 51 N. W. 1039, in support of this contention. If we concede this to be the rule, then the holding in Gillespie v. Cooper, supra, if adhered to, is fatal to the plaintiff's claim. In that case it was held that an action in the nature of a creditors' bill must be commenced within four years from the discovery of the fraud. We quote from the opinion at page 790 of 36 Neb., page 307 of 55 N. W.: “Were the appellees limited to a creditors' bill in order to obtain relief from this fraudulent conveyance? We think not. Appellees could have attached the property on the ground that it was fraudulently conveyed to Richards for the purpose of delaying Mrs. Cooper's creditors. Civ. Code, § 198, subd. 8; Keene v. Sallenbach, 15 Neb. 200, 18 N. W. 75;Brown v. Brown (Ky.) 11 S. W. 4;Rodgers v. Brown, 61 Mo. 187. For this court to hold that appellees' cause of action did not accrue--the fraud discovered--until appellees were in a position to file a creditors' bill, would be to judicially amend this statute and leave it to the discretion of creditors to fix the time of the accrual of their cause of action by hastening or delaying the recovery of judgment. A case might arise where, by reason of the debtor being a nonresident, a personal judgment could not be obtained. In such case would appellee have no cause of action for relief on the ground of fraud until the debtor became a resident and a personal judgment was entered against him? It is an old maxim that for every wrong the law affords a remedy, but, if one effectual remedy is afforded by the law, the maxim is complied with.”

Upon mature consideration we are unable to agree with the conclusion reached by the learned Commissioner from whose opinion we have taken the above quotation, or the reasoning by which the conclusion is arrived at, and yet we have hesitated to interfere with the law established by that case, upon the principle that it is better that a rule once announced should be permanent and certain, rather than that it should in all cases establish the technically correct rule. The principle involved is, however, of so much importance to the profession and to the people of the state, and the construction given the statute in Gillespie v. Cooper so radically different from our views of its true meaning, that we think it better to get back to what we believe to be the correct doctrine at the earliest date possible. It has always been the rule in this state that a suit of this nature could not be maintained until the plaintiff had reduced his claim to judgment. When he has obtained his judgment at law, he can then appeal to the equity court to assist him in removing an obstruction to the collection of that judgment by clearing up what bidders might regard as a doubtful title. From this it will be seen that the right does not accrue to the creditor to maintain a creditors' bill until after judgment, and our statute of limitation does not by its terms commence to run against any suitor in our courts until his cause of action has accrued. Section 5 of our Code of Civil Procedure is as follows: “Civil actions can only be commenced within the time...