Burnham v. Boyd
| Decision Date | 19 February 1902 |
| Citation | 66 S.W. 1088,167 Mo. 185 |
| Parties | BURNHAM et al., Appellants, v. BOYD et al |
| Court | Missouri Supreme Court |
Appeal from Greene Circuit Court. -- Hon. Jas. T. Neville, Judge.
Affirmed.
Ellis Cook & Ellis, and Karnes, New, Hall & Krauthoff for appellants.
(1) J J. Sitton's agreement with Boyd & Company to keep deeds to him off record, was fraudulent as against plaintiffs, and the bank's deeds of trust on realty were connected therewith, grew out thereof, and were tainted with said fraud. Buck v. Bank, 128 Mo. 141; Hafner v Irwin, 23 N. Car. 490; Meding v. Roe, 30 A. 587; Decourcey v. Little, 19 N.J.Eq. 115; Bank v. Doran, 109 Mo. 40; Blennerhassett v. Sherman, 105 U.S. 100; Cluett v. Brown, 2 Ohio 266; In re Pund (Ohio), Prob. R. 281; Jewett v. Sundback, 5 S. Dak. 111, 58 N.W. 20; Paper Co. v. Press Co., 67 Wis. 101, 30 N.W. 298. (2) The agreement for extensions of the notes secured by the deeds of trust to Massey had the effect of hindering and delaying creditors. The effect of that agreement was to tie up the real estate conveyed by the deeds of trust for two years. During that time the creditors of Boyd & Company could do nothing. They could not redeem the property for the deeds of trust. The legal effect of the deeds of trust was to hinder and delay said creditors. 14 Ency. of Law (2 Ed.), 392, 408; Burgert v. Borchert, 59 Mo. 80; Railroad v. Shirley, 24 S.W. 809; Crow v. Beardsley, 68 Mo. 435; Dougherty v. Cooper, 77 Mo. 528; State v. Nauert, 2 Mo.App. 295; Bigelow v. Stringer, 40 Mo. 195; Bank v. Martin, 96 Tenn. 3, 33 S.W. 565; Woodburn v. Mosher, 9 Barb. (N. Y.) 255.
Benj. U. Massey for respondents.
(1) "No rule of equity pleading is better settled than that which declares that every material fact which it is necessary for a complainant to prove to establish his right to the relief he asks, must be alleged in the premises of his bill with reasonable fullness and particularity." "A party can no more succeed upon a case proved, but not alleged, than upon a case alleged, but not proved." Beach, Modern Equity Practice, secs. 95-99; Phelps v. Elliott, 35 F. 455; Brokaw v. Brokaw, 41 N.J.Eq. 215. (2) An insolvent debtor, or one in failing circumstances, has a right, with an honest view to pay his debts, to convey all his property to one creditor and leave others wholly unpaid. And a creditor may accept all this property, even though other creditors are hindered and delayed in the collection of their debts, or defeated altogether. Schroeder v. Bobbett, 108 Mo. 289; Ames v. Gilmore, 59 Mo. 537; State to use v. Distillery Co., 20 Mo.App. 21; Schroeder v. Mason, 25 Mo.App. 190. (3) J. J. Sitton's agreement with Boyd to keep deeds off record was not fraudulent as between the bank and these plaintiffs. There was no connection between the deeds of trust made by Boyd to the Central bank and the deed of warranty made by Boyd to Sitton to secure Sitton against any liability by reason of his indorsements for Boyd & Company. This last-mentioned deed is not before the court in this case. In fact, it was out of existence before the institution of this suit. The bank was not a party to that deed, had nothing to do with inducing Boyd to make it, had no control over it after it was made, could not have compelled Sitton to file it for record, nor have prevented him from filing it if he had so desired. (4) There was no agreement for the extension of the notes secured by the deeds of trust to Massey that was binding upon the respondents here or upon any other creditors of Boyd & Company, or binding even upon the bank itself. If this instrument had any force and effect, even as an agreement with the bank, not being recorded, it was evidently of no binding force or effect as against other creditors of Boyd. The recorded deeds of trust are the only instruments of writing between Boyd and the bank of which plaintiff or other creditors had any notice, or by which they are bound. And it is not contended that these deeds are void upon their face, void at law, because of any recitals they contain. It did not stand in the way of the plaintiffs in this suit, paying the debt to the bank and taking all the security the bank held and realizing on that security at once. This paper, this agreement to extend time of payment of said notes, is not the obstacle that hindered and delayed plaintiffs in the collection of their debt from Boyd & Company.
This is a suit in equity to set aside three deeds of trust given by defendant Boyd to secure certain indebtedness to defendant, the Central National Bank of Springfield. The deeds convey to a trustee, for this purpose, certain lands in Howell and Oregon counties. The plaintiffs are creditors of the firm, of which Boyd is a member, and had, before filing this suit, brought suits against the firm on the debts due them respectively, and had sued out writs of attachment and attached the lands covered by these deeds of trust. The petition charges that the deeds were executed for the purpose of hindering and delaying the creditors of Boyd and the bank knew it and that since the execution of the deed the bank has allowed them to be used to cover up the property of Boyd and hinder his creditors and has allowed him to use them to coerce his creditors into making unfair and unconscionable settlements. The only averment in the petition as of a fact to sustain the charge of fraud, is that the pretended indebtedness which the deeds purport to have been executed to secure is fictitious and fraudulent. The answer denied all the allegations of fraud and fictitious indebtedness. The trial in the circuit court resulted in a finding and judgment for the defendants and the plaintiffs appeal.
There was really no evidence to sustain the averment that the debt to the bank or any part of it was fictitious and therefore the bill should have been dismissed for that reason. The allegations in the petition to the effect that the deeds were made by Boyd to hinder and delay his creditors, and that the bank allowed him to cover up his property by them and coerce his creditors into unfair settlements are mere charges without specifications and present, in a suit of this kind, no triable issue.
In a suit in equity to set aside a deed on the ground of fraud it is not sufficient to say in the petition that the deed was fraudulent, or that it was for the purpose of hindering and delaying creditors or that it was suffered to be used for that purpose. To say that a deed is fraudulent or that it was executed or used for a fraudulent purpose is merely to characterize it and unless such characterization is accompanied with a statement of the facts that are supposed to constitute the fraud it amounts to nothing in pleading.
The evidence took a wider range than the pleadings in this case authorized, and it is upon points brought out in the evidence only, that the assignment of errors is founded.
It appeared in evidence that one J. J. Sitton, who was the father of one of the members of the firm of Boyd & Company was indorser for the firm on a large part of the firm's paper held by the bank, and that a year or more before the deeds of trust in question were executed, Boyd had conveyed these lands to Sitton to secure him for his indorsements. Sitton withheld his deed from record and the evidence showed that he did so pursuant...
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