Harris v. Shaw
| Decision Date | 01 November 1954 |
| Docket Number | No. 5-493,5-493 |
| Parties | George E. HARRIS and Faye Littleton, Appellants, v. Nabors SHAW, Appellee. |
| Court | Arkansas Supreme Court |
Gordon B. Carlton, DeQueen, Bobby Steel, Nashville, for appellants.
W. G. Spencer, Mena, for appellee.
This is a suit by appellee under Ark.Stats. § 68-1302 1 to set aside certain chattel mortgages and bills of sale as having been made with the intent to hinder, delay and defraud appellee and other creditors of Mrs. Madeline M. Longan. The sole issue on this appeal is the sufficiency of the evidence to sustain the decree granting the relief prayed.
Mrs. Longan owned and operated the Rose Hill Motel in Mena, Arkansas in 1951 and 1952. During this period she became involved in domestic difficulties culminating in the divorcing of her husband in July, 1951, and the accumulation of numerous debts which exceeded the value of the motel properties. Appellee, a Mena attorney, represented Mrs. Longan throughout the divorce proceedings and in numerous lawsuits and threatened actions by various creditors and lienholders. In May 1952 Mrs. Longan gave appellee a note and mortgage in the amount of $1,000 for his fee, and on December 15, 1952, appellee obtained a judgment against Mrs. Longan in the Circuit Court on said note. When appellee had a writ of attachment issued against the motel furnishings in the circuit court action, appellant George E. Harris intervened, claiming title to said property under a chattel mortgage and bill of sale given him by Mrs. Longan. Appellee then dismissed the attachment without prejudice and instituted the instant suit on January 19, 1953, and another attachment was issued and served upon Mrs. Longan and Harris.
There was introduced at the trial one chattel mortgage covering the motel furnishings from Mrs. Longan to Harris for $2,000 dated March 1, 1952, but acknowledged and filed for record September 22, 1952. A similar mortgage on the same property but for $4,500 and bearing date of March 12, 1952, was also introduced. Harris has been employed for several years as an auto mechanic for Barham Motor Company at Mena at a salary of $35 to $45 per week. He testified that he let Mrs. Longan have $2,000 in cash March 1, 1952, and that she executed the first unacknowledged mortgage on that date, and that three or four days later she returned and said she had to have $2,500 more because some man in Kansas City or St. Louis had a mortgage on the furnishings. Although he only had $1,000 left, he said he borrowed $1,500 in three $500 bills from appellant, Faye Littleton, and her husband, and gave the $2,500 in cash to Mrs. Longan when she executed the $4,500 note and mortgage on March 12, 1952. According to Harris this note and mortgage included the amount of the first loan but there is nothing in the instrument so indicating. Harris was unmarried and kept company with Mrs. Longan after her divorce and they were close friends and associates of Mr. and Mrs. Littleton.
Mrs. Littleton corroborated the testimony of Harris and introduced an unsecured note for $1,500 dated March 8, 1952, which Harris gave the Littletons on that date. There was also introduced a bill of sale of the chattels in controversy from Mrs. Longan to Harris dated October 3, 1952, witnessed by Mr. and Mrs. Littleton, filed for record December 30, 1952, and reciting that it was in satisfaction of the $2,000 chattel mortgage dated March 1, 1952. A similar bill of sale was introduced dated November 13, 1952 reciting that it was in satisfaction of the mortgage dated March 12, 1952. A bill of sale covering the same property from Harris to the Littletons dated January 17, 1953, was also introduced.
In the fall of 1952 Mrs. Longan closed the motel and moved part of the furnishings to her home in Mena where it remained for 2 or 3 months when it was moved to the Littleton home. Most of the furnishings were later moved to a business building in Mena where they were stored until January 19, 1953, when they were sold at a public auction arranged by Harris. The chattels stored at the Littleton home were sold at auction on February 2, 1953. Mrs. Longan left Polk County the next day and has not been heard from since. Although she was served with summons she did not appear in the instant suit. After the sales she took up several bad checks given by her on a local bank which were held for collection by the sheriff of Polk County. Mrs. Littleton testified that she paid Harris an additional $500 when he executed the bill of sale to the Littletons on January 17, 1953. Harris stated that he had turned the sale proceeds over to the Littletons before he was served with a writ of attachment on the day of the sale at Mena but there was other evidence to the contrary. The chattels brought an 'average price' and the total proceeds of both sales amounted to approximately $2,000 or less than half the alleged indebtedness secured by the chattel mortgages.
M. E. Drake is office manager of the motor company where Harris is employed. He is also a notary public and took...
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