Farmers' State Bank v. Foshee

• Citation: 280 S.W. 380,170 Ark. 445
• Decision Date: 15 February 1926
• Docket Number: 170
• Parties: FARMERS' STATE BANK v. FOSHEE
• Court: Supreme Court of Arkansas

280 S.W. 380

FARMERS' STATE BANK v. FOSHEE

170 Ark. 445

No. 170

Supreme Court of Arkansas

February 15, 1926

Appeal from Johnson Chancery Court; W. E. Atkinson, Chancellor reversed.

Decree reversed, and cause remanded.

Jesse Reynolds, for appellant.

G. O Patterson, for appellee.

OPINION

WOOD J.

This action was instituted by the appellant against the appellees. The appellant alleged that W. F. Foshee was indebted to it in the sum of $ 548 with interest from April 7, 1922; that it had procured a judgment aggregating said amount at the May term, 1923, of the Johnson Circuit Court; that, at the time the debt of W. F. Foshee was contracted with the appellant he was the owner of eighty acres of land in section 29, township 9 north, range 22 west, of Johnson County, Arkansas, and also a certain town lot containing eight acres in the town of Lamar, in Johnson County, Arkansas. These tracts and parcels of land are described in appellant's complaint. The appellant alleged that the land in the town of Lamar was purchased from one M. E. Burgess and wife for a consideration of $ 4,250, which W. F. Foshee sold on the 13th of September, 1921, to Nannie Foshee, his wife, naming as the consideration in the deed the sum of $ 1. It is further alleged in the complaint that in August, 1921, W. F. Foshee conveyed to one Henry Stubblefield one of the forties above mentioned, and on the 16th of November W. F. Foshee conveyed to his son, W. R. Foshee, the other forty in section 29-9-22, for the consideration of $ 500; that the latter in November, 1921, conveyed to his mother, Nannie Foshee, the other forty, which his father had conveyed to him, naming as a consideration in the deed the sum of $ 500. The appellant alleged that the conveyances from W. F. Foshee to W. R. Foshee and from W. R. Foshee to Nannie Foshee were without consideration, and therefore voluntary, and made for the purpose of defrauding creditors.

The appellees filed a joint answer, in which they denied the allegations of the complaint, and set up that they had deeded a part of the lands described to one Henry Stubblefield, and stated that the land through mistake had been misdescribed, and they prayed that the deed be reformed and be made to contain the correct description.

The facts are substantially as follows: The appellee, W. F. Foshee, contracted the debt to the appellant upon which this action was founded in November and December, 1919, and July, 1920. The debts were contracted with the Blue Stone Bank, and the appellant acquired the notes from that bank. It was shown that W. F. Foshee owned the property in the country at the time the debts were contracted, and also had a home in the town of Lamar, which property at the time was unincumbered; that the loans were made to him on the strength of his financial condition at that time. The appellant established the indebtedness upon which the action was founded, about which there is no dispute. The appellant also introduced the notes and judgment and copies of the deeds set up in its complaint, which deeds it asked to have canceled. It was shown that demand had been made on W. F. Foshee for the payment of the indebtedness, and that he had failed to pay.

W. F. Foshee testified on behalf of the appellees to the effect that he sold the southeast forty of the land in the country to one Stubblefield in August, 1921, for the consideration of $ 2,150. Some time afterwards, on the 16th of October, 1922, he and his wife sold to their son, W. R. Foshee, the other forty, for which he paid $ 500, $ 150 cash, and worked out the balance of the consideration. Before the conveyance was made to their son, witness was indebted to the Farmers' State Bank of Lamar. At that time witness owned four forties, and the same was his homestead. The two forties he sold were a part of his homestead. Witness didn't believe he was living on the place when he sold to Stubblefield, but he was living there at the time he sold to his son. At the time witness sold the south forties, two forties had been sold before. He only owned at that time two forties, and at the time he sold these he lived in the town of Lamar. Witness' wife owned the town property. At the time witness sold the forty to Stubblefield he paid the Bank of Lamar a thousand dollars, but did not pay anything on the notes in suit.

Mrs. Nannie Foshee testified, and her testimony is substantially the same as that of W. F. Foshee. She stated they sold the south forty to Stubblefield and the other forty to their son. It was their homestead. The forty sold to their son had a well and a house on it, and the other forty had a fine orchard. At the time they sold to their son he was living with them. He was 22 or 23 years old. He has paid $ 150 in cash, and then worked out some, and witness paid the rest when she bought it back on the 21st day of October, 1922. The consideration she paid her son was on notes at the Blue Stone Bank, one for $ 193.35 and one for $ 165. She took up these notes, and told her son that she would pay W. F. Foshee the balance due him on the forty of $ 100. She paid this out of her rents on the house in town. They first moved on the 160 acres in the country in 1913, which was their home. She bought the eight acres in the town of Lamar. She moved to town in 1916 and back to the farm in 1921. After she bought the forty back from W. R. Foshee she owned it until December, 1923, and sold it to the First National Bank of Lamar. She did not buy the land back from her son to defeat her husband's creditors. She paid what it was worth. At the time they sold the property to their son, and at the time she bought it back from him, they lived on the property as their homestead. That was the only forty acres they had. The house and lot in Lamar was conveyed to her on September 13, 1921. The deed recites "for $ 1 and other considerations." She had signed a mortgage given by her husband to pay security debts and had a verbal contract with him at the time that, when he made her the deed to the Lamar town property, she would sign the mortgage. It was understood between her and her husband, when she conveyed her dower in the forty to Stubblefield and in the other forty and to the other property, that she should have the town property as her own. This was their homestead at the time it was conveyed to her. At the time her husband made her a deed to the home place in Lamar she didn't know anything about his owing these other notes. He had promised her that he would not go security. The deed was not made to her with the view of defeating the appellant in the collection of its debt. The forty acres she had bought back from her son she contracted to sell to the First National Bank of Lamar for $ 800 on security debts which her husband had contracted for supplies. She stated that, at the time her husband made her the deed to the town property, she knew that he was involved at the First National Bank, and that something had to be done. She had signed a mortgage to the town property in Lamar to the First National Bank for something like $ 1,900, and at that time she had an understanding with her husband that he was to convey this town property in consideration of her dower rights in the other property. She was to sell the forty acres for this town property. Witness had previously assigned her dower and homestead right in the old home place for the sum of $ 3,000, which was paid to her husband.

W. R Foshee testified substantially to the same effect as his father and mother. He had bought the forty acres from his father. The consideration paid by him was a reasonable value of the land at that time. He didn't know at that time that his father was owing considerable amounts, and didn't make the purchase to defeat his father's creditors. They were living on the land at the time he bought it. Witness had kept an...