Blasier v. Doyle

• Decision Date: 01 April 1924
• Docket Number: No. 35796.,35796.
• Citation: 197 Iowa 652,198 N.W. 12
• Parties: BLASIER v. DOYLE ET AL.
• Court: Iowa Supreme Court

197 Iowa 652

198 N.W. 12

BLASIER

v.DOYLE ET AL.

No. 35796.

Supreme Court of Iowa.

April 1, 1924.

Appeal from District Court, Black Hawk County; George W. Wood, Judge.

Action in equity by the trustee to set aside a deed and the assignment of a promissory note and mortgage. Plaintiff alleged that Thomas Doyle was the owner of a $5,000 promissory note secured by mortgage, and the owner of a house and lot in Waterloo, and the transfer of the note and mortgage and the transfer of the house and lot to defendant Kate Doyle were fraudulent as against creditors of Thomas Doyle, and that the conveyances and transfers were made to hinder and delay the creditors of Thomas. Defendants denied that the conveyances were fraudulent. Defendants allege that about February 19, 1920, Thomas Doyle assigned the note and mortgage to the bank as collateral security; that the bank holds sold note and mortgage as collateral for four promissory notes signed by Thomas Doyle and Kate Doyle in the total sum of $1,800, with interest; that the $1,800 notes have not been paid; that about September 21, 1920, Thomas Doyle assigned his interest in the note and mortgage to Kate Doyle. The only interest claimed by the bank in the $5,000 note and mortgage is as collateral for the $1,800. It was stipulated that the note and mortgage was in the possession of the defendant bank when this suit was brought, and that the maker of the note and mortgage had paid it in full to the defendant bank, and the money is now in its possession. It was further stipulated that the value of the Waterloo property was $1,300 when the deed was made to Thomas and when he deeded it to his wife. The defendant Kate Doyle pleaded that she was at all times the equitable owner of the $5,000 note and mortgage and the house and lot, and that the house and lot were homestead property. The trial court found that plaintiff had not made a case, and dismissed the petition. Plaintiff appeals. Affirmed.C. J. Rudolph, of Waterloo, and R. J. O'Brien, of Independence, for appellant.

McCoy & Beecher and John J. Foarde, all of Waterloo, for appellees.

PRESTON, J.

We do not understand appellant to seriously contend that the assignment of part of the note and mortgage to the bank was fraudulent. At any rate, we do not consider the evidence sufficient to justify any extended discussion of that branch of the case. The evidence and argument is leveled against the conveyances to the wife. Thomas Doyle filed his petition in bankruptcy in September, 1921. The assignment of the note and mortgage to the wife was September 21, 1920, and the conveyance of the real estate to her was the same date. It is conceded by appellant that a part of the creditors' claims arose after the date just mentioned. Appellees contend that the claims for which Thomas Doyle was primarily liable on September 21, 1920, were but $250, consisting of two items, and which arose in April, 1920; that debts upon which he was secondarily liable amounted to something over $5,000, about half of which was for notes signed by Thomas as security for his son, the balance made up for the most part of notes to different banks consisting of six or seven items. From the foregoing it will be seen that practically the entire indebtedness of Thomas Doyle arose after September 21, 1920.

Evidence on behalf of defendant shows that the son commenced farming in 1920, and that in that year he paid $1.35 a bushel for corn; in 1921 he sold corn for 14 cents a bushel, and that hogs and cattle were low; that this is the reason the son was not able to pay the notes. Thomas testifies that when he signed these notes he did not think he would be called upon to pay them. Appellant argues that the sole question in the case is whether the property of the Doyles shall be used to pay their honest debts. Of course that involves some other questions.

[1][2] We start with the following established legal principles: Fraud is not presumed. The burden of proof is upon the plaintiff. The evidentiary facts of the alleged fraud must be clearly established. If the wife is a bona fide creditor of the husband, he may transfer property to her in satisfaction of the debt. As to subsequent creditors there must be shown an intent to hinder, delay, or defraud creditors, participated in by both grantor and grantee; a valuable consideration being shown. Harvey v. Phillips, 193 Iowa, 231, 186 N. W. 910, and numerous cases there cited.

[3] Following our custom in fact cases we shall not attempt to recite all the evidence. Some of appellant's claims for the evidence and circumstances relied upon to establish his contentions will be referred to. The assignments of the $5,000 note and mortgage were not recorded prior to the bankruptcy of Thomas. Mrs. Doyle placed her assignment of record some 3 or 4 months after the bankruptcy. It is contended by app...