Andrews v. Mather

• Decision Date: 28 June 1902
• Parties: ANDREWS ET AL. v. MATHER.
• Court: Alabama Supreme Court

32 So. 738

134 Ala. 358

ANDREWS ET AL. v. MATHER.

Supreme Court of Alabama

June 28, 1902

Appeal from chancery court, Lauderdale county; Wm. H. Simpson Chancellor.

Suit by Joseph S. Mather, trustee in bankruptcy, against James A Andrews and others. From decree overruling demurrer to bill defendants appeal. Affirmed.

On the 18th day of April, 1898, James A. Andrews conveyed to his wife, Tabitha M. Andrews, "in consideration of the love and affection which the party of the first part has and bears for the party of the second part, and the further consideration of one dollar in hand paid, receipt whereof is hereby acknowledged" a tract of land lying in Lauderdale county, Ala., described in said deed by metes and bounds, and containing about 137 acres more or less. On the 9th day of August, 1899, James A. Andrews filed his petition in bankruptcy in the United States court for the Eastern district of Louisiana, in bankruptcy, and was duly adjudicated a bankrupt, and thereafter the complainant was appointed trustee in bankruptcy of the said Andrews. On the 18th day of April, 1898 (the date of the alleged fraudulent conveyance) the said Andrews was indebted to the Smith Bros Co., Limited, in the sum of $1,803.48, which is still due and unpaid, and on said date he was likewise indebted to Sherbourne & Schlater in the sum of $762.71, which is still due and unpaid; both of said sums were due on the date of said conveyance by Andrews to his wife.

On June 12, 1900, the appellee, Joseph S. Mather, as trustee in bankruptcy of James A. Andrews, filed in the chancery court of Lauderdale county, the present bill, seeking to set aside the conveyance made by Andrews to his wife as being fraudulent and void. The bill averred the facts as above stated, and in reference to the conveyance contained the following averments: "That on the 18th day of April, 1898, the said James A. Andrews, then being indebted to the complainants in the manner and form as hereinbefore set out, and then being insolvent and with intent to hinder, delay and defraud his creditors made and executed a deed of conveyance to his wife, attempting to convey to her a large and valuable tract of land in" Lauderdale county. Then follows a description of the lands described in said conveyance. It was averred in the bill that "said conveyance was purely voluntary and was made to the said Tabitha M. Andrews without consideration, and complainant alleges that the same is fraudulent and void, and that said deed should be canceled, set aside and held for naught, and that your honor should decree that said lands should be sold for the payment of the debts of the said James A. Andrews." The bill further averred "that said Joseph S. Mather is over the age of twenty-one years and resides in New Orleans, Louisiana; that at a meeting of the creditors of the bankrupt defendants held at the office of Hon. F. D. Chretian, referee in bankruptcy, on the 5th day of March, 1900, the creditors unanimously recommended that the said Joseph S. Mather be authorized to institute suits as may be necessary to recover property supposed to belong to the said bankrupts, and more particularly certain real estate situated at or near Florence, Alabama, and to that end to employ counsel as may be necessary and to incur the necessary costs therein. * * * That upon such recommendation the court gave judgment accordingly authorizing the said Joseph S. Mather as trustee to institute all necessary suits for the recovery of property fraudulently conveyed by said bankrupts."

The prayer of the bill was that a decree be rendered declaring the said conveyance made by James A. Andrews to his wife, as being fraudulent and void; that the same be set aside and canceled; that the lands described therein be sold under a decree of the court, and the proceeds of such sale, after paying the costs of the court, be paid over to the complainant as trustee in bankruptcy of the said James A. Andrews to be by him applied to the payment of the debts of said Andrews under an order of the court wherein said bankrupt estate was being administered. There was also a prayer for general relief.

To this bill the defendants demurred upon the following grounds: "(1) That the complainant has a plain, adequate and complete remedy at law for the recovery of the property described in the bill. (2) That if the complainant has any remedy at all it is at law, and the same is plain, adequate and complete. (3) That the act of congress relating to bankruptcy if it gives the complainant any remedy at all gives him the right to recover the property in the bill described, or its value, and does not give him the right to file a bill in the chancery court to set aside the conveyance from James A. Andrews to the defendant Tabitha M. Andrews and subject the property in the bill described to the payment of the debts described in the bill and other debts of James A. Andrews. (4) That whatever right complainant has to file his bill in the chancery court to set aside the conveyance of the lands described in the bill from James A. Andrews to Tabitha M. Andrews is only such right as the creditors of said James A. Andrews have and had under the acts of congress relating to bankruptcy, and the bill does not allege or show that the creditors in the bill mentioned or any other creditor of said James A. Andrews had or have any right to file a bill to set aside said conveyance. (5) That the bill does not allege or show that the creditors in the bill described or any other creditor of the said James A. Andrews are judgment creditors. (6) That the bill and exhibits thereto show that the conveyance from James A. Andrews to Tabitha M. Andrews was made prior to the acts of congress relating to bankruptcy. (7) That the bill shows that the conveyance from James A. Andrews to Tabitha M. Andrews which the bill seeks to set aside and annul was made prior to the passage of the acts of congress relating to bankruptcy. (8) That the bill shows that the conveyance from James A. Andrews to the defendant Tabitha M. Andrews on the 18th day of April, 1898, and the bill in this case was filed on the 12th day of June, 1900. (9) That the bill does not allege or show that the creditors of James A. Andrews mentioned in the bill or any other creditor of said James A. Andrews have proven their claims in bankruptcy in the said proceeding in which said James A. Andrews was adjudicated a bankrupt. (10) That the bill does not allege or show any fact or facts which show the conveyance from said James A. Andrews to Tabitha M. Andrews to be fraudulent in fact. (11) That the bill alleges that the conveyance from said James A. Andrews to Tabitha M. Andrews was made with intent to hinder, delay, and defraud the creditors of said James A. Andrews, and does not allege or show the facts which stamp said conveyance as fraudulent."

On the submission of the cause upon the demurrers, the chancellor rendered a decree overruling them. From this decree the defendants appeal, and assign the rendition thereof as error.

Simpson & Jones, for appellant.

John B. Weakley, for appellee.

HARALSON J.

1. Section 818 of the Code provides, that a creditor without a lien may file a bill in chancery to subject to the payment of his debt, any property which has been fraudulently transferred or conveyed, or attempted to be fraudulently transferred or conveyed by his debtor.

The averments of the bill in this case are full and sufficient to show that the conveyance sought to be set aside was fraudulent against the creditors of the grantor. They fully advise the defendant that the bona fides of the conveyance is assailed for fraud, and in what the fraud consists. Burford v. State, 80 Ala. 147.

2. The bankrupt law approved July 1, 1898, vests in the trustee of the estate of the bankrupt, upon his appointment and qualification, and his successor or successors, if he shall have one or more, upon his or their appointment and qualification,...