Crane v. Waldron

• Decision Date: 28 April 1903
• Citation: 94 N.W. 593,133 Mich. 73
• Court: Michigan Supreme Court
• Parties: CRANE v. WALDRON et al.

94 N.W. 593

133 Mich. 73

CRANE v. WALDRON et al.

Supreme Court of Michigan

April 28, 1903

Appeal from Circuit Court, Eaton County, in Chancery; Clement Smith Judge.

Bill in aid of an execution by William Crane against John Waldron and another. From a judgment for complainant, defendants appeal. Affirmed.

Grant and Moore, JJ., dissenting.

Thomas Cummins & Nichols, for appellants.

S. B Roe, for appellee.

HOOKER, C.J.

On July 12, 1900, complainant obtained a judgment against John Waldron in a justice court in Shiawassee county for about $170. On July 21, 1900, a transcript was filed, and an execution was issued by the circuit court to the sheriff of Eaton county, and on July 23, 1890, it was levied upon some village lots in that county, the title to which was then in John Waldron. On June 26, 1900, John Waldron, who then lived in Shiawassee county, deeded the same to his daughter, Mary Ann Waldron, who for several years has been working out in the capacity of domestic. On December 10, 1900, this bill was filed in aid of the execution, to which the defendants answered separately, denying that the transfer was fraudulent, and asserting that it was in payment of $250, of which $200 had been earned by Mary, and loaned to or expended for the benefit of John, Waldron, previous to the transfer. Upon the hearing complainant made proof of the judgment, the issue of execution, the levy, and the deed. The execution itself was not produced, but was shown to be lost, and secondary evidence was admitted. The defendants offered no testimony. A decree was rendered in behalf of complainant and the defendants have appealed.

Counsel for defendant attack the constitutionality of Act 99 of 1897, being Comp. Laws, � 10,203, which provides that 'in all suits in aid of execution the complainant shall make a prima facie case by introducing in evidence the judgment against the principal defendant, the execution with the levy or levies endorsed thereon, and proof of the conveyance complained of.' They also question the sufficiency of complainant's evidence. They say that: 'Bills in aid of execution only lie where the conveyance was made with the intent to hinder, delay, or defraud creditors. Section 9533, Comp. Laws 1897. If grantee is a purchaser for a valuable consideration, then it must further appear that he had notice of his grantor's fraudulent intent. Section 9537, Id. To establish a prima facie case, therefore, it must appear: First, that the conveyance was made with the intent to defraud creditors; second, that the purchaser gave no consideration, or else took with notice of his grantor's fraudulent intent. The statute of 1897 attempts to make the judgment, execution, or deed, without the aid of other proof, evidence of fraudulent intent on the part of the grantor, and evidence of notice of such fraudulent intent on the part of the grantee.' Their claim is that 'due process of law' requires that some evidence be given of a fraudulent intent by Waldron, shared by his daughter. The power of the Legislature to prescribe rules of evidence is undoubted. When one is in debt, and deeds all of his property subject to execution to another, who has no visible property, it cannot be said that there is no evidence tending to show fraud. It was within the legislative power to say that these facts shall be prima facie evidence of a fraudulent intent, making it necessary for the persons charged with fraud to give some testimony to the contrary. Cooley's Con. Lim. 457; Gruner v. Brooks (Mich.) 85 N.W. 1085; Molitor v. Robinson, 40 Mich. 200; Buhl Iron Works v. Teuton, 67 Mich. 623, 35 N.W. 804; Hatch v. Fowler, 28 Mich. 205; Webster v. Bailey, 40 Mich. 641; Cooper v. Brock, 41 Mich. 488, 2 N.W. 660; Kipp v. Lamoreaux, 81 Mich. 299, 45 N.W. 1002; U.S. v. Lee Huen d. c.) 118 f/ed. 442. The title to the act is 'An act to provide for the change of the rules of evidence in cases where bills in aid of execution are filed.' This is sufficient, unless we are to say that the title must be an index of the provisions of the act, which is not required.

It is contended that the failure to produce the execution at the trial was an omission, which excludes the application of the statute. We are of the opinion that secondary evidence is admissible, under this statute, in accordance with the general rule.

A number of technical reasons are urged in support of the proposition that the contents of the execution were not proved. The testimony regarding the execution was not challenged, except under the very general objection that the proof was incompetent and immaterial. We discover nothing that should have indicated to the court that objection was made that it was not shown to be properly directed, or properly tested, or issued in the name of the people, etc., or that it was not returnable seasonably, or did not properly recite the judgment or name the parties. Under the circumstances the statement by Cooper that he received an execution in the case stated from Shiawassee county, the admission of the validity of the judgment upon which it was issued, the copy of the transcript of judgment and the notice duly filed, are sufficient to convince the mind in the absence not only of evidence, but of any claim to the contrary.

The decree is affirmed, with costs.

CARPENTER and MONTGOMERY, JJ., concurred with HOOKER, C.J.

GRANT J. (dissenting).

The bill in this case was filed in aid of an execution upon a judgment for $167.83, exclusive of costs, rendered July 12, 1900, by a justice of the peace. A transcript was duly taken to the circuit court, execution issued, and levy made. The bill, after setting forth the facts, alleges a deed, made on June 27 (it was in fact made June 26th), 1900, by the defendant John and his wife to the defendant Mary, his daughter, and that said deed was made without consideration, and was fraudulent and void. The answers deny all the material allegations of the bill as to the transfer of the property allege a bona fide consideration; that Mary worked out as a domestic, and gave the greater portion of the money she earned to her father, upon the promise that her father should convey the lands to her for her own use. Complainant made his case by proving his judgment, execution, levy, the deed from defendant John to his daughter, Mary, and that the land was worth about $400. Defendant introduced no evidence, and a decree was rendered for the complainant.

The sole evidence of fraud upon which the decree in this case is based is the deed made by defendant John to his daughter, Mary, and the fact that he was at the time in debt. The bare execution of a deed and the fact of indebtedness by the grantor are, therefore, made to establish a fraud, for which alone the deed could be set aside. Plaintiff relies upon Act No. 99, p. 108, Pub. Acts 1897, the title and body to which read as follows:

'An act to provide for the change of rules of evidence in cases where bills in aid of execution are filed.'

'Section 1. That in all suits begun or hereafter to be begun by the filing of bills in aid of execution, the complainant shall make a prima facie case by introducing in evidence the judgment against the principal defendant, the execution with the levy or levies thereon endorsed and proof of the conveyance or conveyances complained of. The burden of proof shall then be upon the judgment debtor, or the person or persons claiming through or under him or the person or persons whom it is claimed are holding property in trust for said judgment debtor to show that the transaction or transactions are in all respects bona fide or that such person or persons are not holding as a trustee, or trustees of said judgment debtor.'

This legislation is unique. It stands alone. It has no precedent or posterity. No such law is found upon the statute books of any other state. We cannot, therefore, have the benefit of the reasoning and conclusions of other courts in determining the constitutionality of the act. We must determine it upon reason and principle. For centuries the usual method of transfer of title to land has been by deed. Thousands of them are executed every day. No other method of obtaining title except upon execution, decree, or adverse possession, is known to the law. Presumptively, these transfers are honest. Ever since civilization began, they always have been, and still are, so considered. Like all other business transactions, they are daily executed, delivered, and received in good faith. Without this presumption, business could not well be carried on. The law does not limit its effect to cases between members of the same family, which courts of law as well as of equity scan with great care, where lands are transferred by one who is in debt. The earmarks of fraud in such cases are easily traceable, and courts have found no difficulty in dealing with them under the rules of evidence which have always existed. But the law stamps as presumptively fraudulent every deed made by every person against whom is a judgment unpaid, and that, too, whether the debt was contracted before or after the deed was made. Most business men are borrowers of money. Merchants borrow money at the banks in order to meet their current indebtedness, and buy goods upon credit. Many borrow money with which to make invest ments. If the Legislature, under the specious plea of the mere change in the rules of evidence, can make the execution of a deed presumptive fraud, it can also make the execution of every other contract a presumptive fraud, no matter whether it exists in writing or in parol. Contracts of sale of real and personal property, bills of sale, promissory notes, in fact every act or transfer of property essential to the business life of the country, can be...