Harcrow v. Gardiner

• Decision Date: 24 March 1900
• Citation: 58 S.W. 553,69 Ark. 6
• Parties: HARCROW v. GARDINER
• Court: Arkansas Supreme Court

58 S.W. 553

69 Ark. 6

HARCROW v. GARDINER

Supreme Court of Arkansas

March 24, 1900

Appeal from Pulaski Chancery Court THOMAS B. MARTIN, Chancellor.

STATEMENT BY THE COURT.

Action in equity upon the following note, and to enforce a vendor's lien upon the lands therein described.

"$ 9,000.00.

LANARK ARK., July 19, 1893.

"One day after date I promise to pay to the order of J. C. Harcrow the sum of nine thousand dollars for property, to-wit, two lots on 13th and Battery, in the city of Little Rock, one lot on 6th and Wolf streets, ten acres adjoining Valentine's addition, 80 acres known as the 'Gough place,' 60 acres known as 'W. H. Wheeler place,' 40 acres known as the 'Martindale place,' 40 acres known as the 'Turner place.'

(Signed)

"E HARCROW."

The defense set up was want of consideration, and further that the note was part of a scheme to defraud the creditors of J C. Harcrow. The facts appear in the opinion. The chancellor found against the defendant, and gave judgment accordingly. From this judgment the defendant appealed.

Judgment affirmed.

F. T. Vaughan and James H. Stevenson, for appellant.

The evidence does not show that J. C. Harcrow ever advanced any money to appellnat. The "release" offered in evidence was genuine, and the chancellor erred in his finding to the contrary. On the right of witnesses to testify as to genuineness of signature, upon comparsion and by memory, see 7 La. 95, 30 N. J. Law, 387; 8 Ark. 155; 5 McLean, 186; Laws. Exp. Ev. 317; 11 Ala. 855; 5 Neb. 248; 3 Jones' Law, 310; 41 N.Y.S. 6; 82 N.Y. 52. The findings of the chancellor as to the facts being against the evidence, the case should be reversed. As to difference between chancery cases and jury trials in this respect, see: 34 Ark. 212; 31 Ark. 85; 41 Ark. 292; 42 Ark. 521; 15 Ark. 209; 23 Ark. 341; 43 Ark. 307. There could be no lien ill favor of J. C. Harcrow, because:

An express lien by parol would contravene the statute of frauds. 25 Miss. 88.

No lien by subrogation could exist, because: (a) The elements of subrogation are wanting. 2 Beach, Eq. § 868; Bisph. Ey. 335; 13 Oh. 148; 14 Ill. 468; 25 Miss. 88; Perry, Trusts, 238; 163 Pa.St. 609; 1 Am. & Eng. Dec. in Eq. 472, 505 n.; 2 Beach. Eq. § 801; Jones, Liens, §§ 73, 1067; 1 N.Y. 586; 18 Ark. 142; 10 Ark. 411; 4 Lea, 216; 10 Heisk. 522; 16 La.Ann. 292; 5 Rob. 204; 86 Pa.St. 409; 56 Pa.St. 76; 38 N.J.Eq. 105; 14 N.J.Eq. 235; 61 Ala. 108; 3 Ala. 302; 25 Ark. 133; 44 Ark. 504; 47 Ark. 118; 50 Ark. 109. The fraud in the original transaction precludes any subrogation. 2 Beach, Eq. § 819; 38 Ala. 625; 81 N.Y. 394; 4 Dill. 207; 33 Kan. 90; 117 Ill. 145; 53 Ark. 271; Sheld. Sub. §§ 42, 44; Harr. Sub. § 813; 94 N.Y. 82; 105 N.Y. 539.

There never having been a sale of the property, J. C. Harcrow had no vendor's lien in his own right. 2 Jones, Liens. 1066; 121 Ill. 191. If we assume that there was an advancement, the evidence shows strong badges of fraud on J. C. Harcrow's part. Bump, Fr. Con. §§ 46, 49, 51, 53, 63. There could be no resulting trust in favor of J. C. Harcrow because of the fraud on the creditors, 17 So. 185; 4 Barb. 425; 6 Oh. St. 52; 2 Dev. Eq. 497; 19 N.J.Eq. 546; 26 Ind. 319; 1 Beach, Tr. 125, p. 155; 1 Beach, Eq. § 217, p. 244; 1 Perry, Tr. § 151, p. 181; 10 Am. & Eng. Enc. Law, 57, 58; 50 Mo. 572; 4 Halst. 891; 10 Am. & Eng. Enc. Law, 14. To raise such a trust there must have been an advancement of a definitely ascertained amount at the time of the purchase of the property and with the intention of raising such a trust. Tied. Eq. § 311; I Beach, Eq. 217, 219; 30 Ark. 230; 29 Ark. 612; 32 Miss. 190; 27 Ark. 89; 2 Paige, Ch. 217; 10 Am. & Eng. Enc. Law, 5, 8, 12, 13 and 14; 9 Ark. 529; 21 Md. 32. The evidence of these facts must be clear and convincing. Tied. Eq. Jur. § 311; 27 Ark 89; 2 Paige, Ch. 217; 5 Johns. Ch. 18, 19; I Beach, Eq. § 224; 81 Va. 152; 15 Oh. 148; 19 Ia. 362; Perry, Tr. § 137; 19 N. J. Eq 549; 44 Ark. 365; 114 Ill. 554; id. 636; 21 Md. 328; 10 Am. & Enc. Law, 23, §§ 11, 12, 13, 14, 16 and 17. The fraud bars recovery on the note. Equity refuses to grant relief to either party to an executory contract to defraud creditors. 26 Ark. 317; 52 Ark. 171; 10 Ark. 54; 11 Ark. 411; ib. 475; 19 Ark. 650, 659; 26 Ark. 316; 47 Ark. 301; Bump, Fr. Con. 432; 11 Ill. 300; 50 Am. Dec. 460, 469 n; 29 Ill. 524; 45 id. 23; 3 Mass. 378; 23 N.J.Eq. 60; 15 Am. Dec. 596, 600; 38 id. 578. No recovery can be had upon a note given as the consideration of a fraudulent transfer. 33 N. J. Law, 318; 20 Wend. 37; S.C. 4 Hill, 424; 9 Dana, 318; 21 Ill. 152; 10 Me. 71; 3 Paige, Ch. 154; 49 Mass. 269; 3 Dana, 540; 1 Oh. St. 262; 126 Ill. 525; 8 Cush. 525; 58 Barb. 390; Wait, Fr. Con. 395; 25 Mo. 165; 1 M. & W. 159-166; 2 Lans. 103; 10 Barb. 369; 34 S.W. 755; 65 Tex. 499; 65 Tex. 217. This principle extends to the personal representative of the fraudulent grantor. 19 Ark. 659; 4 Ark. 173; 13 Ark. 593; Bump, Fr. Con. § 433; 11 Ill 300; S.C. 50 Am. Dec. 460, 469, note; 42 Am. Dec. 168. The statute of 1895 (Laws 1895, pp. 165-6) does not apply, so as to authorize the administrator to bring this suit, because that statute includes only transfers of realty. The statute, being in derogation of common law, will not be extended by implication. Suth. Star. Const. § 400; 78 Ala. 111; 50 Miss. 517; 56 Barb. 51; 77 N.Y. 36; 3 Den. 220; 85 Ill. 197; 3 Barb. 341; 38 Miss. 118; Suth. Stat. Const. § 208; 44 Miss. 322; 21 N.Y. 148; 46 Me. 377; 4 W.Va. 383; 87 Pa.St. 253; 5 Mich. 98; 6 ib. 242; ib. 17; 20 Wend. 181; ib. 555; 20 Johns. 361; ib. 342; 3 Cow. 59; 5 Hill, 461; I Barb. 185; 6 Hill, 149; 7 ib. 431; 3 Den. 601; 3 N.Y. 396; 31 Mich. 431; 18 Ga. 333. Nor can the act be construed retrospectively. 11 Wis. 371; 39 Miss. 364; Suth. St. Const. §§ 463, 464; 6 Ark. 484, 493; 56 Ark. 485,495; 1 N.Y. 129; S. C. 1 Den. 128; 6 Hill, 149; 33 Gratt. 677; 58 Barb. 176; Wade, Ret. Laws, 34-5-6; 7 Johns. 504; 17 Hun. 457; 46 Mich. 278; 20 id. 398; Sedg. St. Con. 160; Cooley, Con. Lim. 455; 26 Ark. 127; 15 Wis. 548; 1 Black, 459.

Z. T. Wood and W. S. & F. L. McCain, for appellee.

If J. C. Harcrow furnished the money to buy the land, he would be entitled to a lien without any express agreement. 40 Ark. 62. If the parties intended by the note that J. C. should have a lien, equity will effectuate that intention. 51 Ark. 433; 60 Ark. 598; 52 Ark. 441. The act of 1895 applies to authorize the administrator to sue. 58 Ark. 117; 43 Ark. 156; Sch. Ex. and Adm. § 320. A release must have a consideration. 31 Ark. 728; 33 Ark. 572; 40 Ark. 182. Re-delivery of the note was essential to make the release good as a gift. 2 Kent's Comm. 438; 60 Ark. 169.

RIDDICK, J. The CHIEF JUSTICE and WOOD, J., concur. BATTLE, J., dissenting.

OPINION

RIDDICK, J., (after stating the facts).

This is an action by the administrator of the estate of J. C. Harcrow against Elbert Harcrow to recover judgment upon a promissory note for the stun of nine thousand dollars, and to declare the same a lien upon the land described in the note.

The first contention of the defendant is that there was no consideration for the note. He states that his brother, J. C Harcrow, during his last sickness was living with one Sallie Smith, a woman with whom he had sustained immoral relations, and by whom he had illegitimate children. His brother, so defendant testified, said to him that the woman was annoying him by insisting that he should make some provision for her and her children, and that, at the urgent request of his brother, and to appease the woman, this note was executed, under a promise that his brother would in a few days return the note. In a day or two afterwards he called upon his brother, and asked for the note. His brother requested the woman to get it, and give it to defendant, but it had been mislaid, and could not then be found; so, instead of returning the note, his brother executed to him a receipt in writing, stating that he had received payment of the note in full. This is his story, and there is much other evidence bearing on this point, but we need not discuss it. The question as to whether this note was without consideration, and whether the receipt purporting to be signed by J. C. Harcrow was genuine or forged, were submitted to the chancellor, who found against the defendant, and we can by no means say that this finding is clearly against the weight of evidence. If defendant be injured by such finding there is little ground for sympathy, for by his own confession this note was executed as a part of a scheme to deceive a wronged and ignorant woman. If this be true, and he is compelled to pay the note, it is a case of one caught in his own trap. But we do not believe that any mistake was made. At the time this note was executed, J. C. Harcrow, besides these illegitimate children, had, living in the same county, a lawful wife and child. As this fact was well known, it is not apparent why the execution of this note to him should have been regarded by Sallie Smith as a provision for her or her children. It does not appear that the attempted return of the note, of which defendant testified, was kept secret from her, nor why the possession of it for only a brief time would have tended in any way to shield the brother of defendant from her importunities. In fact, the whole story of the defendant in reference to the execution of the note and the written release seems to us unreasonable and improbable. It is in conflict with the facts stated in the amendment to his answer, in which he alleged that the land for which the note purports to have been executed was purchased by defendant and J. C. Harcrow jointly, and the title taken in the name of the defendant for the purpose of covering up the interest of J. C. Harcrow in such property and...