Hardcastle v. Hardcastle

• Citation: 131 Kan. 319,291 P. 757
• Decision Date: 11 October 1930
• Docket Number: 29,469
• Parties: ELIZABETH PARKMAN HARDCASTLE, Appellee, v. EDWARD D. HARDCASTLE and O. B. HARDCASTLE, Appellants
• Court: Kansas Supreme Court

291 P. 757

131 Kan. 319

ELIZABETH PARKMAN HARDCASTLE, Appellee, v. EDWARD D. HARDCASTLE and O. B. HARDCASTLE, Appellants

No. 29,469

Supreme Court of Kansas

October 11, 1930

Decided July, 1930.

Appeal from Lyon district court; ALONZO C. MCCARTY, judge.

Judgment affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

1. FRAUDULENT CONVEYANCES -- Transfers Between Relatives -- Presumption of Fraud. While in transactions between relatives fraud is not presumed from the mere relationship of the parties, yet such relationship may be taken into consideration as a circumstance bearing upon the question of the good faith of the transaction.

2. APPEAL AND ERROR--Finding of Fraud Conclusive on Appeal. The record is examined and in view of the well-recognized province of the trial court it is held that the findings made by the trial court cannot be set aside.

3. SAME--Preservation of Grounds--Defense Abandoned in Trial Court. The rule followed, that unless the record on appeal clearly discloses that the defense was specifically and unequivocally brought to the attention of the trial court while it had possession of the case, this court will consider the defense as abandoned.

W. S Kretsinger and S. S. Spencer, both of Emporia, for the appellants

Owen S. Samuel, of Emporia, for the appellee.

Jochems, J. Harvey, J. concurring in part only.

OPINION

JOCHEMS, J.:

The action was brought to set aside a deed on the ground that it was made to hinder, delay and defraud creditors. Plaintiff prevailed, and the defendants appeal.

Plaintiff pleaded that she was granted a divorce from the defendant, Edward D. Hardcastle, on August 7, 1920; that in a decree entered at that time she was allowed $ 50 per month for alimony and $ 100 per month for the support of the two minor children of the parties; that defendant was in arrears on this judgment to the extent of $ 7,300; that executions had been issued and returned unsatisfied; that under the will of one J. S. Kenyon the defendant, Edward D. Hardcastle, had been devised an interest in certain real estate; that after the death of Kenyon the defendant Edward D. Hardcastle on September 14, 1928, conveyed the real estate so devised to him to his father, the defendant O. B. Hardcastle; that such conveyance was made without consideration and for the purpose of hindering, delaying and defrauding the creditors of Edward D. Hardcastle, and particularly to cheat and defraud the plaintiff and her minor children; that at the time he accepted the deed the defendant O. B. Hardcastle knew of the judgment in plaintiff's favor in the divorce action; knew that it was unpaid and that executions had been issued thereon and returned unsatisfied and that the defendant Edward D. Hardcastle was in default on that judgment and that he was insolvent.

The defendant Edward D. Hardcastle answered alleging that the judgment in favor of the plaintiff was void; that plaintiff had full knowledge of the making of the deed to his father and did not object to the making thereof, and that it was made for a good and sufficient consideration. The defendant O. B. Hardcastle filed a general denial.

Upon these issues the case was tried to the court, and thereafter the court made findings of fact and conclusions of law as follows:

"From the evidence introduced the court finds generally in favor of the plaintiff and against the defendants and both of them, and that the allegations contained in said petition are true:

"1. That the plaintiff was legally divorced from the defendant on August 7, 1920, in case No. 14,308, which judgment the defendant has since recognized by his subsequent marriage.

"2. That plaintiff was awarded alimony for her support and that of her minor children, as stated in said petition, and that at the time of the filing of the present action defendant, Edward D. Hardcastle, was indebted to her under said award of alimony and support for the minor children of the defendant in the sum of $ 7,300, and that plaintiff was a creditor of said Edward D. Hardcastle.

"3. That plaintiff never did remarry. That both of said children are minors.

"4. That defendant for a short time made payments as ordered by the court, but thereafter made only partial payments and for a long period of time contributed nothing to the support of his said wife or children. That finally and on the 1st day of May, 1928, upon application of defendant the amounts payable for the support, care, maintenance and education of said children were by the court at such time reduced to $ 10 per month. That defendant has failed and continues to fail to pay the amount of $ 50 per month due under said order of the court in said divorce action.

"5. That the defendant, O. B. Hardcastle, is the father of Edward D. Hardcastle, and the grandfather of the two minors, and well knew of the granting of the divorce. Knew the provisions of the divorce decree and that his said son was not making the payments as provided in the decree.

"6. That the said Edward D. Hardcastle, in 1928, and at the time of the making of the deed referred to in petition, was insolvent and had been for some considerable time prior thereto. That the said O. B. Hardcastle well knew of such insolvency.

"7. That the late J. S. Kenyon made provision for the payment to Edward D. Hardcastle of the sum of $ 1,000 in cash and gave to him the real estate described in the petition; that such property so received from said estate was all the property owned by the said Edward D. Hardcastle at the time he attempted to convey said property to his father, the grandfather of the minor children.

"8. That the said O. B. Hardcastle was not a creditor of said Edward D. Hardcastle, and said Edward D. Hardcastle did not owe his father any monies.

"9. That there was no consideration for the deed made by the son to his father, O. B. Hardcastle.

"10. That the said Edward D. Hardcastle made and delivered said deed to his father, O. B. Hardcastle, with the intent to commit a fraud upon this plaintiff and his minor children, and the effect of the deed was to hinder, cheat, wrong and defraud his said minor children and said plaintiff.

"11. That said deed is invalid and should be set aside, canceled and held for naught.

"12. That said property mentioned in said deed should be applied to the satisfaction of the judgment in favor of plaintiff in the divorce action.

"13. That, prior to the filing of this action, two executions were issued against the defendant, Edward D. Hardcastle, and both were returned unsatisfied. That this fact was known to the defendant, O. B. Hardcastle, prior to the making of the deed in question.

"It is therefore, by the court, considered, ordered and adjudged that the deed mentioned and described in plaintiff's petition from the said Edward D. Hardcastle to the said O. B. Hardcastle dated September 14, 1928, and duly recorded in the office of the register of deeds of Lyon county, Kansas, on the 17th day of September, 1928, and duly recorded in book 162 at page 444, be and the same is hereby set aside and declared and adjudged to be null and void.

"That the said O. B. Hardcastle be and he hereby is adjudged to have no right, title, interest or estate in or to said property therein described. That the sum of $ 7,300, together with interest at 6 per cent from July 1, 1919, be adjudged to be a first and prior lien against the interest of the said Edward D. Hardcastle in and to said real estate described in said deed, and if the same be not paid within ten days from the rendition of this judgment that an order of sale issue and said property be sold to satisfy said judgment herein rendered and said sums due the said plaintiff from the said Edward D. Hardcastle. That the plaintiff recover her costs herein."

The appellants concede the rule that findings made by the trial court, if based upon any evidence, are conclusive on the appellate court, but contend that findings Nos. 8, 9, 10 and 11 are wholly unsupported by any evidence and are contrary to all the evidence. Appellants review the evidence showing that within a short time after the decree of divorce was granted, Edward D. Hardcastle lost his job, at which he was employed at a salary of $ 300 per month, and that thereafter he was out of regular employment; that his earning capacity was limited and in order to keep up his payments to his wife he began to borrow from his father as early as 1921; that by January 3, 1928, he had borrowed from his father a total of $ 5,500. They contend that the evidence showed that during 1924 and 1925 the defendant Edward D. Hardcastle was out of work practically all the time; that he gave his father notes from time to time for the amounts borrowed, and these were all merged into one note dated January 3, 1928, for $ 5,500; that since the divorce decree was granted defendant had paid plaintiff from some source approximately $ 7,200; that he didn't earn that much and it must have been borrowed from his father. Both the father and son testified to these facts; that their testimony is uncontradicted by any evidence offered on the part of plaintiff, and that therefore the findings complained of cannot stand.

As to finding No. 8 the appellee calls attention to certain contradictions in the testimony given by the father and son pointing out, among other things, that the father testified that at one time he loaned the son $ 2,500, while the son stated that the largest amount he ever received from his father at any one time was $ 1,200; that the testimony showed numerous checks were given by the father to the son and that a number of notes were given by the son from time to time, which were merged in the note of $ 5,500. An explanation of the failure to produce the canceled checks was made by showing that...