Blumenthal v. Blumenthal

• Citation: 303 Mass. 275,21 N.E.2d 244
• Parties: BLUMENTHAL v. BLUMENTHAL et al.
• Decision Date: 29 May 1939
• Court: United States State Supreme Judicial Court of Massachusetts

303 Mass. 275

21 N.E.2d 244

BLUMENTHAL

v.BLUMENTHAL et al.

Supreme Judicial Court of Massachusetts, Norfolk.

May 29, 1939.

Bill in equity by Margaret Fears Blumenthal against Alfred C. Blumenthal and one Rogers to set aside a conveyance of certain property and to reach and apply the property to the satisfaction of a judgment. From an interlocutory decree sustaining a demurrer filed by defendant Rogers, who was the only defendant on whom service was made, and from a final decree dismissing the bill, plaintiff appeals.

Decrees affirmed.Appeal from Superior Court, Norfolk County; Williams, Judge.

Lee M. Friedman and Friedman, Atherton, King & Turner, all of Boston, for appellant.

H. B. Ehrmann, of Boston, for appellee.

RONAN, Justice.

The plaintiff alleges in this bill in equity, brought against her husband, a nonresident, and one Rogers, that she has recovered a judgment in the State of New York against her husband, as damages for his breach of a separation agreement entered into between herself and her husband; that the said judgment has not been satisfied; that her husband for the purpose of hindering, delaying and defrauding the plaintiff has transferred, without fair consideration, a large amount of property including certain corporate stocks and negotiable notes and accounts receivable to his sister, the defendant Rogers, a resident of this Commonwealth, which she holds as trustee or agent for the plaintiff's husband. The bill seeks to set aside this conveyance to Rogers and to reach and apply the property to the satisfaction of the judgment. Rogers, who was the only defendant upon whom service was made, filed a demurrer. The plaintiff appealed from an interlocutory decree sustaining the demurrer and from a final decree dismissing the bill.

We held in Weidman v. Weidman, 274 Mass. 118, 174 N.E. 206, 76 A.L.R. 1359, that a wife, a resident of another State, who had recovered a judgment for alimony and counsel fees against her husband in that State, in proceedings for the annulment of their marriage, could not maintain a bill in equity in this Commonwealth to compel him to pay such a judgment, because, under our laws, she was incapacitated to sue him for the collection of a money obligation that could be recovered only in an action at law if the parties had not been husband and wife. Jurisdiction in equity of suits between husband and wife, in appropriate cases, was explained and affirmed, but it was pointed out that our courts are without jurisdiction to hear or determine a claim that is based entirely on a money indebtedness, by one spouse against the other. It was also decided that the full faith and credit clause of the Constitution of the United States, U.S.C.A. (art. 4, § 1) did not require the recognition of such a judgment in any State that did not have a court empowered to enforce it. That decision has been affirmed in a subsequent case. Giles v. Giles, 279 Mass. 284, 181 N.E. 176; Id., Mass., 200 N.E. 378.

If a remedy is to be provided for those in the situation of the plaintiff, then relief must be sought from the Legislature. St.1933, c. 237, amending G.L.(Ter.Ed.) c. 215, § 6, was enacted after the decision in the Weidman case, but it does not apply to the present case because the bill alleges that Blumenthal is a resident of the State of New York.

The plaintiff contends that she is a creditor as defined by the first section of the uniform fraudulent conveyance law, G.L. (Ter.Ed.) c. 109A, and that, the bill being framed to set aside a fraudulent conveyance and to reach and apply property that cannot be attached at law, she is entitled under the provisions of G.L.(Ter.Ed.) c. 109A, § 7; c. 214, sections 3, 7, 8 and 9, to this statutory remedy. It is true that the plaintiff comes within the literal description of a creditor as set forth in c. 109A, § 1, as she ‘is a person having any claim, whether matured or unmatured. liquidated or unliquidated, absolute, fixed or contingent,’ but the section is a portion of a chapter which must be construed in conjunction with all other pertinent statutes so as to form a consistent and harmonious statutory system. Decatur v. Auditor of Peabody, 251 Mass. 82, 146 N.E. 360;Tillson v. Springfield, 258 Mass. 72, 154 N.E. 561;Hite v. Hite, Mass., 17 N.E.2d 176, 119 A.L.R. 517. The legislative intent in defining the term creditor was to extend the benefits of the fraudulent conveyance statutes to those having unliquidated, unmatured or contingent claims; but the extension was based entirely on the nature of the claim, and the statute evidences no intent to remove an incapacity inherent in the status of a wife which both by the common law and by statute (G.L.(Ter.Ed.) c. 209, § 6) prevents her from suing her husband for the collection of a debt. Golder v. Golder, 235 Mass. 261, 126 N.E. 382;Gahm v. Gahm, 243 Mass. 374, 137 N.E. 876. Compare Edgerly v. Equitable Life Assurance Society, 287 Mass. 238, 191 N.E. 415;Lubowitz v. Taines, 293 Mass. 39, 198 N.E. 320. The rights given to a creditor by the statute in question do not extend a wife having only a bare pecuniary claim against her husband. The phraseology of the uniform fraudulent conveyance law must be read in conjunction with the legislative aim, and words of broad significance cannot be construed to apply to those who, by established law and by the provisions of existing statutes, are prevented from being included within the sweep of the act, even though it is couched in general terms. It was said in Zoulalian v. New England Sanatorium & Benevolent Association, 230 Mass. 102, at page 105, 119 N.E. 686, at page 687, L.R.A.1918F, 185, that ‘It has often been held that certain persons or classes of persons are excepted by implication out of a statute expressed in general words, the rule being that where the words of a law in their common and ordinary significance are sufficient to include such persons or classes of persons “the virtual exception must be drawn from the intention of the Legislature, manifested by other parts of the law; from the general purpose and design of the law; and from the subject matter of it.” Bradford v. French, 110 Mass. 365, 367; McCall v. Parker, 13 Metc. 372, 381,46 Am.Dec. 735.’ See Conklin v. John Howard Industrial Home, 224 Mass. 222, 112 N.E. 606;Commonwealth v. Welosky, 276 Mass. 398, 177 N.E. 656. Indeed, the statutes providing for the special equitable remedies upon which the bill purports to be based have been limited in their application, so as not to conflict with other statutes specially dealing with particular property, and have been construed as not indicating an intent that such property could be reached for the benefit of creditors. Travelers' Ins. Co. v. Maguire, 218 Mass. 360, 105 N.E. 1023;Rosenberg v. Robbins, 289 Mass. 402, 194 N.E. 291. These remedial statutes have been held not to apply to a plaintiff who, on account of other statutory provisions, is incapable of bringing suit against certain defendants. William J. McCarthy Co. v. Rendle, 222 Mass. 405, 111 N.E. 39;Wilson v. Central Vermont Railway, 239 Mass. 80, 131 N.E. 169.

Suits in equity to set aside a fraudulent conveyance and to reach and apply certain kinds of property to the satisfaction of the plaintiff's claim are not cognizable as subjects of general equitable jurisdiction but are the creations of statutes conferring special equitable jurisdiction upon the courts. Powers v. Raymond, 137 Mass. 483.Pettibone v. Toledo, Cincinnati & St. Louis Railroad, 148 Mass. 411, 19 N.E. 337,1 L.R.A. 787;Stockbridge v. Mixer, 215 Mass. 415, 102 N.E. 646;Geen v. Old Colony Trust Co. Mass., 3 N.E.2d 9.

These statutory remedies furnish a method by which a claim at common law, when proved to be valid, may be satisfied out of the debtor's property. The essential basis of the proceeding is an indebtedness that could ordinarily be enforced in an action of contract, and the nature of the claim is in no way changed by the form of procedure. The claim is asserted in the form of a bill of complaint in order that, if proved, it may have the benefit of an equitable remedy to secure its satisfaction. The remedy is incidental to the claim. If the claim is not established, then...