Dallam v. Renshaw

• Decision Date: 31 March 1858
• Citation: 26 Mo. 533
• Court: Missouri Supreme Court
• Parties: DALLAM, Appellant, v. RENSHAW, Respondent.^a1

26 Mo. 533

DALLAM, Appellant,

v.RENSHAW, Respondent.^a1

Supreme Court of Missouri.

March Term, 1858.

1. Should the plaintiff in an execution, acting in concert with the defendant therein, purchase in the property of such defendant with a view to cover up the same from the latter's creditors, the transaction would be fraudulent and the other creditors may treat the execution sale and the sheriff's deed as nullities.

2. When all the facts bearing upon the question of the intent of such a transaction will as well consist with honesty as with dishonesty and fraud therein, the court ought not to find the same to be corrupt and fraudulent; the proof of fraud should be perfectly satisfactory.

Appeal from St. Louis Circuit Court.

S. T. Glover and Dick, for appellant.

Todd & Krum, for respondent.

NAPTON, Judge, delivered the opinion of the court.

This case presents mainly questions of fact, although a great many points in relation to the admission and rejection of testimony are also preserved. As all the testimony, whether rejected or admitted, is found in the record, an examination and decision of these points becomes unnecessary in view of the conclusion we have reached upon the whole case.

The record is extremely voluminous, and the various transactions in proof during a series of years are complicated. To undertake a review of the details would fill a volume. It will perhaps answer all the purposes, which adjudications of this character can be expected to subserve, to announce the conclusion reached, and the prominent reasons which have led to it. The plaintiff, a creditor of Charles Collins, obtained a judgment against him in 1848 for about eighteen hundred dollars, and levied his execution upon a lot in the city of St. Louis, known as the “Scott Hotel,” and bought Collins' interest therein. This lot, together with some fifteen or twenty other lots or tracts of land in the neighborhood of St. Louis, had been sold under execution in 1840, and had been purchased by Stacker & Erwin, to whom Collins was at that time largely indebted. The exact amount of this indebtedness is disputed, but combining the individual indebtedness to Stacker with the judgments obtained by Woods, Stacker & Co., and Yeatman, Woods & Co., for which Erwin was agent, and the judgments of W. C. Anderson, which had been bought up, they may be stated at a sum not less than fifty thousand dollars. The plaintiff brought his action in 1852, and he insisted that the purchase of S. & E., under an execution in 1840, was fraudulent and void, and that all the subsequent transfers of this property through McConnell, Reyburn, Morrison, Bowman, and others, were made with a full knowledge of this fraud and a full participation in the original scheme; that they were designed to defraud Collins' creditors; and he insists that these deeds, which on their face are absolute, and purport to convey an absolute title, shall be held fraudulent and void, and so declared, and the title to the said Scott Hotel property be transferred to him by virtue of his purchase in 1848, under his execution. It will be thus perceived, that the sole question in the case is one of fact; and that is, whether the sale to Stacker & Erwin, in 1840, was valid and bona fide, and vested the title, or was fraudulent and consequently void. If this sale is upheld and the title passed at that time, whatever character may be affixed to subsequent transactions, the present action must fail. If the sale in 1840 was valid, then Collins' interest in this property was gone, and his creditors could not be injured. Subsequent transactions with Collins might give him an equitable interest in this property such as would authorize a transfer of the title to Collins' creditors, but such transfer could not be claimed except upon the same terms that Collins himself or his heirs would have the right to demand it. But the theory of this suit is based entirely upon the total invalidity of the original execution sale, and the subsequent transfers of the property which occurred during the succeeding eight or ten years are produced, not as creating new trusts, but as establishing original and continuous fraud. It will be observed that in the whole course of this proceeding, which embraces a number of years, there is no transfer to or from Charles Collins. The title at no time was nominally in him after the sale to S. & E. in 1840. It is not therefore a case in which a deed from a debtor to a creditor is attacked for fraud. The case is one in which a sale under execution is made, and that sale, and the purchase at it, are asserted to be fraudulent and void. There is no other ground upon which the action can be sustained. If the purchase in 1840, under execution, was valid, Stacker & Erwin became the absolute owners of the property; and if, as absolute owners, they thought proper to give Collins an interest, contingent or fixed, of one-half or one-third, or any other amount, such a transaction is not a fraud upon Collins' creditors. Collins' interest might perhaps be reached by execution, but the purchasers would only buy his interest--nothing more. He could not claim that he purchased the interest of S. & E. as well as Collins. The principle may be illustrated by supposing that S. & E. had fifty thousand dollars' worth of property in St. Louis, independent of any acquisition from Collins, not conveyed to them by deed directly from Collins or purchased under execution against his property, and, through motives of friendship or for any other motive, thought proper to give Collins an interest in this property, and to retain the title in their own name. Is this a fraud upon the creditors within the meaning of the common law or the statute of fraudulent conveyances? Can the creditors claim the whole property and destroy the title and interest of S. & E.? It is clear that Collins' creditors have not been injured by the transaction. So far from that, they have been benefited, if they are permitted to reach the interest of their debtor. Yet this case does not at all differ from the case put where the same amount of property is purchased at sheriff's sale, and the purchase is valid and bona fide. The purchaser is dealing with his own property, and there is no principle of common law and no construction of the statute of frauds which prevents him from assisting the defendant in the execution, even to the extent of giving him an interest in the same property, by subjecting his interest as well as the interest of the debtor to the executions of other creditors. Very different would be the case if the property was conveyed to S. & E. by Collins for such purposes, or if the sale under execution was used to effect the same object. The sales and conveyances would then be fraudulent, and the creditor could treat them as nullities, as no obstacles to his execution, and the title of the purchaser under the execution would prevail.

In all these cases, however, the subsequent dealings of a creditor and debtor, after a purchase under execution of the whole property of the debtor, are watched with suspicion, and their character and the circumstances attending them may be resorted to for the purpose of giving tone to the original purchase. In this view the plaintiff has adduced in testimony an entire history of the conduct of the parties in relation to the property in dispute during a series of years, and the various transmutations of ownership which it passed through. In this view we have looked at this mass of testimony to be weighed as a whole in giving character to the original purchase, and not in reference to the independent validity of each separate transaction. Viewing the transactions in this light, we have not been satisfied, from the evidence in the case, that a court would be justified in pronouncing the purchase of Stacker & Erwin fraudulent, and in transferring the title to the Scott House property to the plaintiff. We do not attach much importance to the unsigned agreement or memorandum of 1840, which was found among Collins' papers at his death. To do so, would subvert all the well established principles of evidence. It does not appear that the paper was ever seen, or that its existence was ever known by either S. or E.; and if it was, the fact that it remained unexecuted would show that they repudiated it. The only ground upon which the paper is supposed to have any value as testimony, is a supposed coincidence in its terms with events as they subsequently transpired. But the force of this argument is destroyed if the events can as well be reconciled with the integrity of S. & E. as they can with the imputed corrupt bargain. This paper at most shows that Collins was willing, and may have thought himself able, to effect the arrangement of his property which is there set out; it can not show, nor have any tendency to prove, that such an arrangement was actually contemplated by S. & E., much less that it was consummated.

The purchase of the Virginia Hotel property from Tiffin is supposed to be a strong corroboration of the fraudulent agreement and plan foreshadowed in the unsigned paper. But other instances are adduced of similar conduct on the part of Collins in reference to other persons besides Stacker; and they altogether rather show a peculiarity and a uniformity in the conduct of Collins than fix any complicity in the affair upon Stacker. There is no evidence to show that Stacker knew of this transfer, and he denies it.

The executed agreement of June 19, 1844, is relied on as conclusive evidence of fraud, so far as the transaction itself is concerned, and very strong evidence to fix an original corrupt...