Hobbs v. Frazier

• Decision Date: 30 May 1911
• Citation: 55 So. 848,61 Fla. 611
• Parties: HOBBS et ux. v. FRAZIER.
• Court: Florida Supreme Court

55 So. 848

61 Fla. 611

HOBBS et ux. v. FRAZIER.

Florida Supreme Court, Division B.

May 30, 1911

Appeal from Circuit Court, Hillsborough County; J. B. Wall, Judge.

Bill by J. W. Frazier, trustee in bankruptcy, against J. W. Hobbs and Nancy E. Hobbs. Decree for complainant, and defendants appeal. Affirmed.

Syllabus by the Court

SYLLABUS

Where there is a demurrer to an amended bill on the ground that it presents a cause of action entirely different from and foreign to the cause of action alleged in the original bill and the original bill is not a part of the record in the case before this court, such a ground will not be considered here.

The law applicable to ordinary creditors' bills, in which judgments must first be obtained, does not apply to a bill filed by a trustee in bankruptcy. See case of Beasley v Coggins, 48 Fla. 215, 37 So. 213.

Under the United States bankruptcy law (Act July 1, 1898, c. 541 30 Stat. 544 [U. S. Comp. St. 1901, p. 3418]), a state court has jurisdiction of a bill in equity filed by a trustee in bankruptcy to set aside a fraudulent conveyance of his property by a bankrupt.

When a married woman voluntarily permits her husband to use her money as his own by investing it in property in his own name and thereby obtains credit on the faith of his being the owner of such property, she will not be allowed in equity to claim the property so acquired, to the detriment of his creditors.

COUNSEL G. B. Wells, for appellants.

F. M. Simonton and H. S. Hampton, for appellee.

OPINION

HOCKER J.

The record before us shows that on the 24th day of April, 1909, the appellee filed an amended bill in the circuit court of Hillsborough county against the appellants. This record does not set forth the original bill or its contents.

The amended bill is in substance as follows: That on the 8th of December, 1907, J. W. Frazier, the complainant, was duly elected trustee in bankruptcy of the estate of J. W. Hobbs and duly qualified as such; that during April, 1907, said J. W. Hobbs was engaged in the saloon business at Plant City, Fla., and was seised and possessed of an undivided one-half interest in and to the following land, tenements, and hereditaments situate in Hillsborough county, Fla., to wit: Block 3 of I. M. Allen's subdivision of that part of the N.W. 1/4 of the S.W. 1/4 of section 28, township 28, range 22 E., lying south of the main line and east of the spur line of the Atlantic Coast Line Railroad Company, and also an undivided one-half interest in and to certain furniture situate on the premises last above described and used in connection with the said business as a saloon and hotel, and that said J. W. Hobbs contracted large amounts of debts on the faith of the ownership of said property; and that during the month of July the said Hobbs became utterly insolvent and continued insolvent up to the time of the institution of this suit; that during the month of October, 1907, said Hobbs filed a voluntary petition in bankruptcy in the United States Court for the Southern District of Florida, and, just prior to the filing of said voluntary petition in bankruptcy, the said J. W. Hobbs caused the title to said property to be transferred and placed in the name of his said wife, Nancy E. Hobbs, and that this was done for the purpose of hindering, delaying, and defrauding the creditors of the said J. W. Hobbs, and that Nancy E. Hobbs had notice of such purpose, or was aware of such facts as would place a reasonable person upon inquiry as to such purpose, and that in reality the property is that of J. W. Hobbs, and that his indebtedness is still unsatisfied.

The amended bill also alleges that J. W. Hobbs and Nancy E. Hobbs are utterly insolvent; that said property is rented at about $100 per month; that Nancy E. Hobbs is collecting the rents, issues, and profits thereof, and is concealing and disposing of the same; and that, in order to protect the rights and interests of complainant, it is absolutely necessary to appoint a receiver to collect the rents, issues, and profits of said property, and to hold the same until the final determination of this suit.

The amended bill, among other things, prays for an answer, not under oath, that the title to said property be adjudicated to be in J. W. Hobbs and his estate in bankruptcy; that any alleged transfer of the same be declared fraudulent and void as to the complainant for a receiver, and for general relief.

The defendants demurred to the amended bill on eight grounds, in substance as follows:

(1) The amended bill is not an amendment of the original bill, but presents an entirely different cause of action, foreign to that of the original bill.

(2) Does not show in whose behalf or interest it is filed.

(3) Does not show that J. W. Hobbs or Nancy E. Hobbs is indebted to any one.

(4) Does not show that the alleged creditors were not fully satisfied for all claims against defendants.

(5) Does not show that J. W. Hobbs has not paid or satisfied all his creditors.

(6) Does not show that Frazier, trustee, is authorized and empowered by the creditors of Hobbs to sue in this manner on their behalf severally.

(7) Does not show that J. W. Hobbs has not been discharged in bankruptcy and freed from liability to his creditors.

(8) And for other causes apparent on the bill.

This demurrer was overruled, and defendants permitted to answer. J. W. Hobbs answered the bill, admitting that Frazier was elected and had qualified as trustee in bankruptcy; that the claims set forth in the bill are cognizable in the District Court of the United States, and not in the circuit court of Florida; that on or about the 22d of November, 1907, being unable to pay his debts in full, and being willing that all his property except his exempt property should be administered for the benefit of his creditors, he filed a voluntary petition in bankruptcy in the District Court of the United States for the Southern District of Florida, and thereby placed himself and all his assets in the jurisdiction of said court for the purpose of having himself adjudicated a bankrupt and his assets administered for the benefit of his creditors; that he was duly adjudicated a bankrupt about the 22d of November, 1907, and that the bankruptcy laws have precedence over the laws of Florida in the premises; that on the 18th of March, 1909, he was by the said District Court of the United States duly discharged from the obligation of all his debts represented by the complainant as trustee. Further answering, he alleges that he is not the owner of, nor is he seised of, a half interest in the lands described in the bill, but that the legal title thereof is vested in his wife, Nancy E. Hobbs. He denies that he caused the title to said lands to be transferred to his said wife for the purpose of hindering, delaying, and defrauding his creditors, but alleges that the said interest in said real estate was purchased by him with money belonging to and furnished by his said wife as an investment, and that no part of the purchase price thereof was furnished by him. Further answering, defendant alleges that the bill is bad, in that the trustee does not show on whose behalf he sues, and to whom the defendant is indebted, and that creditors have obtained judgments against defendant, and prays the same advantage as if he had pleaded or demurred to the bill.

Nancy E. Hobbs answered the bill, setting up that she was the owner in fee simple, and is in possession of the real estate described in the bill, and alleges that said real estate is not the property of the defendant J. W. Hobbs, but is her property 'free and absolute.' She also denies that the complainant trustee is entitled to the relief demanded, and prays the same advantage of this answer as if she had pleaded or demurred to the bill. Replications were filed and testimony taken. Upon a final hearing a decree was entered, in substance, finding the equities in favor of complainant; that the purchase money for the property involved was furnished by J. W. Hobbs; the transfer to Nancy E. Hobbs fraudulent and void; that the equitable title was in J. W. Hobbs; and that said property is the property of his estate in bankruptcy. It was ordered that the deed to Nancy E. Hobbs be set aside, vacated, and declared null and void as to the trustee in bankruptcy, and that Nancy E. Hobbs do make, execute, and deliver to the complainant as trustee in bankruptcy of the estate of J. W. Hobbs, within five days, a deed conveying the said property, and, in case of her failure to do so, the decree shall operate as a conveyance of said property.

The first assignment of error is based on the overruling of the demurrer to the amended bill.

The first ground of the demurrer presented is that the amended bill presents 'a cause of action entirely different and foreign to the cause of action alleged in the original bill.' As we have stated, the original bill is not contained in the record before us. It is stated in the brief of appellant that the original bill was for a partition of the real estate, but, inasmuch as said bill is not contained in the record we are now considering, we are not advised that it is our duty to go outside of the record before us to determine the point raised by the demurrer; for such a determination would involve a consideration of both bills, one of them being no part of the record before us. No authority is shown in support of such a course of procedure.

The next contention presented by the demurrer is that the bill does not show in whose behalf or in whose interest the said bill is filed. It is contended that the amended bill, if anything, is a creditor's bill, and fails to give the names of creditors or show that their claims have been...