Guggenheimer v. Lockridge

• Decision Date: 11 June 1894
• Citation: 39 W.Va. 457,19 S.E. 874
• Court: West Virginia Supreme Court
• Parties: GUGGENHEIMER et al. v. LOCKRIDGE et al.

19 S.E. 874

39 W.Va. 457

GUGGENHEIMER et al.

v.LOCKRIDGE et al.

Supreme Court of Appeals of West Virginia.

June 11, 1894.

Creditors' Bill—Necessity of Judgment Deed— Delivery and Acceptance—Disclaimer—Registration.

1. Under section 2, c. 133, Code, a creditor, before obtaining judgment, may sue in equity to avoid a fraudulent transfer of his debtor's property, and, if successful, has a lien from the commencement of his suit.

2. After a grantee in a fraudulent conveyance has reconveyed the property to the debtor (grantor), equity has no jurisdiction of a suit by a creditor to subject the property, in advance of lien by judgment or otherwise, merely because of such fraudulent conveyance.

3. A deed must not only he delivered by the grantor, but must be accepted by the grantee. Acceptance may be express, by signing the deed or otherwise, or may be implied from circumstances. The assent of the grantee will be presumed, where the deed is beneficial to him, until dissent appear. Where dissent or dis claimer appears, the deed Is inoperative, and the title to the thing granted reverts to the grantor by remitter from such disclaimer.

4. Where such a fraudulent deed is made, but is disclaimed by the grantee, equity has no jurisdiction of a suit brought after such disclaimer by a creditor of the grantor to subject the property to debt, in advance of judgment, merely because of such deed.

5. A deed is good between the parties without registry, as registry is only to protect subsequent purchasers from the grantor for valuable consideration, without notice, and creditors: and therefore the registry of a deed, without the knowledge or consent of the grantee, will not bar him from disclaiming it

6. A transfer from one joint debtor to another will not give equity jurisdiction to entertain a suit by that creditor of the grantor, in advance of lien by judgment or otherwise, to subject the property to his debt

(Syllabus by the Court)

Appeal from circuit court, Pocahontas county.

Bill in chancery by Guggenheimer & Co. against H. M. Lockridge and others. On demurrer, suit was dismissed, and complainants appeal. Affirmed.

H. S. Rucker, for appellants. L. M. Mc-Clintic, for appellee

Lockridge. W. M. & J. T. McAllister, for appellee First Nat Bank of Buena Vista.

BRANNON, P. This suit in chancery was in the circuit court of Pocahontas county by Guggenheimer & Co. against Lockridge and others. Upon demurrer the suit was dismissed, and Guggenheimer & Co. appeal. The question at the threshold of the case is, has equity jurisdiction of the suit upon the case as made by the bill? The original bill sets up a joint and several debt by notes in favor of Guggenheimer & Co. against H. M. Lockridge and J. B. Lockridge, and seeks to avoid, as fraudulent, conveyances of land, —one made by J. B. Lockridge to Ernest N. Moore, for one tract of land, and one from H. M. Lockridge to J. B. Lockridge, for another tract The plaintiffs are only general creditors of the two Lock-ridges, by note, and had no lien, but claim the right, as such general creditors, before obtaining judgment at law, to sue in chancery to avoid fraudulent conveyances, by authority of section 2, c. 133, of the Code, authorizing a creditor, before obtaining judgment, to institute any suit to avoid a fraudulent transfer of, or charge upon, the estate of his debtor, which he could institute after judgment Before the enactment of that statute, such general creditor, having no lien, could not go Into equity to enforce his debt, by assailing a fraudulent conveyance. Kelso v. Blackburn, 3 Leigh, 299; Bump, Fraud. Conv. 521; Guano Co. v. Heatherly, 38 W. Va. 415, 18 S. E. 611. But under said statute he can do so, and, if successful in overthrowing the fraudulent conveyance, he has a lien from the commencement of his suit. Clark v. Figgins, 31 W. Va. 156, 5 S. E. 643; Sweeney v. Refining Co., 30 W. Va. 443, 4 S. E. 431; Norris v. Lemen, 28 W. Va. 336; Wallace v. Treakle, 27 Grat. 470. But do the statements of the bill bring the case under the statute? Indeed, do they not show that equity jurisdiction cannot be sustained under it? Take the case made by the bill, as it relates to the tract of land conveyed by J. B. Lockridge to Ernest N. Moore. While the bill states that Lockridge executed a deed for it to Moore with fraudulent intent, yet it distinctly states that in executing the deed it was impossible that Lockridge could have communicated with Moore; that Moore did not seek to buy the land at any price, and did not pay $8,000 cash, or any sum, but that Lockridge made the deed to Moore without consulting him, and Moore knew nothing of it until after the deed had been executed and recorded at the instance of the grantor, and that on learning of it he repudiated the deed, and denied any Interest under it; that Lockridge and Moore met, and both agreed and admitted such facts to be true, and agreed that the land should be recon-veyed by Moore to Lockridge; and that Moore had executed a deed conveying the land back to Lockridge, but Lockridge failed to put it on record, with intent to hinder and defraud creditors. An amended bill states the execution of this deed reconveying the tract from Moore to Lockridge, and exhibits it, and it appears to have been made prior to the institution of this suit It appears from the showing of the plaintiffs that while Lockridge, so far as his mere act could do so, had made a fraudulent transfer to Moore, the land had revested in the debtor, Lockridge, by reconveyance. That fact does away with any call for equity which entertains a suit to avoid fraudulent conveyances only because the fraudulent conveyance has removed the estate out of the reach of ordinary remedial process against the debtor, by divesting him of it, so that a judgment at law against the debtor would not operate as a lien, and vesting It In another; and it is to brush away such conveyance, and restore the land to the debtor, so far as the creditor is concerned, that equity assumes jurisdiction. Where the parties have repented, and done, themselves, the act of reconveyance, where Is the call for equity Intervention? It is again within the reach of the usual remedial procedure, as though the fraudulent conveyance had never had existence.

There Is a second reason for denying equity jurisdiction. The bill states that Moore did not assent to or ratify the deed, but repudiated it on learning of it Did an estate In the land vest in Moore? If it did not where is the reason for equity jurisdiction, the estate remaining in the grantor? Is acceptance by a grantee of the deed a part and parcel of the act of delivery? On all hands we find...