Jayhawk Equipment Co. v. Mentzer
| Decision Date | 14 July 1964 |
| Docket Number | No. 43780,43780 |
| Citation | 394 P.2d 37,193 Kan. 505 |
| Parties | JAYHAWK EQUIPMENT CO., Inc., a Corporation, Appellee, v. Wilma A. MENTZER, Appellant. |
| Court | Kansas Supreme Court |
Syllabus by the Court
1. A wife in a divorce action, if not an actual creditor of the husband, is at least such a quasi creditor that she can rely on her husband's obligation to support her and the minor children as consideration for a property settlement approved in a divorce decree.
2. The mere fact that an insolvent debtor pays one creditor in full, and in doing so absorbs all of his assets, is not of itself evidence of an intention to hinder, delay or defraud other creditors.
3. Real estate conveyed to a wife by a property settlement which is made a part of a divorce decree cannot be subjected to the lien of subsequent judgment creditors of the husband under the facts and circumstances disclosed by the record in this case.
Hal C. Davis, Topeka, argued the cause and was on the briefs for appellant.
William R. Stewart, Topeka, argued the cause and was on the briefs for appellee.
HATCHER, Commissioner.
This is an appeal from a judgment rendered in an action in the nature of a judgment creditor's bill to impress an equitable lien upon real property which had been conveyed to a wife in a property settlement and made a part of the judgment in a divorce action.
The petition alleged in effect that the plaintiff was a judgment creditor of Delbert Mentzer, the divorced husband of the defendant, that a property settlement had been made in the divorce action which left Delbert Mentzer without assets to satisfy the judgment, and
'That said property settlement agreement was a conveyance which was made without consideration and for the purpose of hindering and defrauding this plaintiff as a creditor of Delbert Mentzer as the said Wilma A. Mentzer then knew. * * *'
The prayer was that the divorce decree approving the property settlement be declared null and void or that the judgment be declared a lien on the real property in controversy.
The answer denied that the property settlement was a scheme to defraud made without consideration.
The facts covering three separate actions may be summarized as they are detailed in Jayhawk Equipment Co. v. Mentzer, 191 Kan. 57, 379 P.2d 342, where this court had this case before it on the question of res judicata.
On December 5, 1958, Delbert and Wilma Mentzer, then husband and wife, purchased as joint tenants a tract of land near 29th and California Streets, described as lot number 20 in Schellcrest Subdivision, an addition to the city of Topeka, Shawnee County, Kansas. A building was constructed on the real estate known as the Lariet Drive-In. Sometime during the spring of 1959, Delbert purchased certain restaurant equipment from the Jayhawk Equipment Company which was installed in the building. Part of the purchase price remained unpaid.
On September 19, 1960, the Jayhawk Equipment Company filed an action against Delbert and Wilma to recover the unpaid purchase price. Wilma was made a defendant in the action on the theory she had ratified and assumed Delbert's purchase agreement.
On November 28, 1960, Wilma filed an action for divorce. The petition alleged in part:
'Plaintiff further alleges that the parties are the owners of a small amount of household furniture, including one 1955 Buick automobile, real estate located near 29th and California Streets, Topeka, Kansas, and a small amount of other personal property.'
The prayer was for an absolute divorce; that she be awarded the property belonging to the parties, and that she be awarded custody of the three minor children, ages seven, eight and twelve.
On November 30, 1960, Delbert and Wilma entered into a property settlement which provided in part:
'1. First Party shall have as her sole and separate property, free and clear of any and all claims of Second Party, the following real and personal property, to-wit:
'(a) One 1955 Buick Automobile.
'(b) All of the equity of the parties in and to the house and real estate known as 2245 Winterwood Lane, Topeka, Kansas, including all household furniture and personal effects therein.
'(c) All of the right, title and interest in and to the real estate and building known as Lariet Drive-In at 29th and California Avenue, Topeka, Kansas.
'(d) All the right, and interest of the parties in and to a certain promissory note for $800.00 dated May 26, 1960 and from Mr. and Mrs. Raymond J. Fraser.
'2. It is further agreed that First Party shall have the sole custody, care and control of the three minor children of the parties hereto with reasonable rights of visitation granted to Second Party and Second Party agrees to pay for the support of said children the sum of $100.00 per month or such amount as may be determined hereafter by the Court.
On December 2, 1960, Delbert entered his voluntary appearance in the divorce action. On the same day an order of emergency was entered and a divorce granted to Wilma. The decree awarded Wilma the custody of the minor children, support and maintenance of the children in the sum of $100 a month and further provided 'IT IS FURTHER BY THE COURT ORDERED that the property settlement made and entered into by and between the parties hereto be, and the same is hereby approved and made a part of this decree as though fully set forth herein and plaintiff is awarded all of the right, title and interest of the parties in and to the personal and real property set forth in said property settlement and defendant is barred from claiming any interest in and to said real and personal property and plaintiff is specifically awarded all of the right, title and interest in and to the building and real estate as described in said property settlement as the Lariet Drive-In at 29th and California Streets, Topeka, Kansas and described as follows:
'Lot 20 of Schell Crest Subdivision, an addition to the City of Topeka, Shawnee County, Kansas.'
On April 27, 1961, the case of Jayhawk Equipment Company against Wilma and Delbert was tried. The trial court found:
'That the defendant Mrs. Delbert Mentzer was not a partner of Delbert Mentzer in the operation of the Lariet Drive In Restaurant and was not a party to the contract of purchase of the equipment involved herein.'
Judgment was entered in favor of Wilma, and against Delbert, in the sum of $3,860.22. Execution issued against Delbert was returned unsatisfied.
On May 3, 1961, the Jayhawk Equipment filed the action now under consideration.
Although not material to the issues now before us, it may be noted that on May 9, 1961, Wilma sold the property in controversy for the sum of $16,000.00, a mortgage lien and costs of sale were paid and the balance in the sum of $4,887.06 was placed in escrow subject to the determination of this controversy.
Following the trial of the issues in the present controversy the trial court found:
'The Court, having heard the evidence presented by the parties, considered the documents presented into evidence, having studied the briefs submitted by the parties finds the allegations contained in plaintiff petition to be true. The court further found that this is an action in equity in the nature of a judgment creditors bill to impress an equitable lien upon the property commonly known as the Lariet Drive-In, located at 2414 East 29th Street in Topeka, Kansas described as:
Lot 20 Schell Subdivision, an addition to the City of Topeka, Shawnee County, Kansas.
'The court further finds that the judgment plaintiff obtained on April 27, 1961 in the amount of Three thousand eight hundred and sixty and 22/100 dollars with interest at the rate of six percent (6%) per annum on Three thousand four hundred sixty-eight and 83/100 dollars until paid, should become an equitable lien on the above described property as of the date this action was filed being May 3, 1961.'
Judgment was so entered and defendant has appealed.
The appellant first contends that the trial court erred in finding the allegations of the petition to be true, particularly that the property settlement was a scheme to defraud and without consideration, and further in granting judgment for appellee and adjudging an equitable lien on the real estate.
After a careful consideration of the record and all arguments advanced by the parties in support of their respective positions we are constrained to agree with appellant's contention.
Appellee argues:
'* * * It is the position of the appellee that the conveyance to Wilma A. Mentzer, in the divorce action, in view of the events involved and her knowledge of the debt, is in fact and in law a fraud to this appellee.'
It must be conceded that...
To continue reading
Request your trial
-
Mohr v. State Bank of Stanley
...for a pre-existing debt, an event that takes place every day in the business world." The trial court cited Jayhawk Equipment Co. v. Mentzer, 193 Kan. 505, 509, 394 P.2d 37 (1964): "A debtor may in good faith prefer one creditor to another and the diligent creditor is entitled to protection ......
-
Printed Media Services v. Solna Web, Inc.
...preexisting indebtedness. Mohr v. State Bank of Stanley, 244 Kan. 555, 770 P.2d 466, 478-79 (1989) (citing Jayhawk Equipment Co. v. Mentzer, 193 Kan. 505, 509, 394 P.2d 37 (1964) and Schmitz v. Stockman, 151 Kan. 891, 893, 101 P.2d 962 (1940)). On December 31, 1991, the Note was a valid exi......
-
In re Sayler
...No reported recent cases adhere to the fraud as a matter of law holdings of the Hardware and Swartz cases. In Jayhawk Equipment Company v. Mentzer, 193 Kan. 505, 394 P.2d 37 (1964), the court quoted from both Swartz and Semke and stated its continued adherence to those rules, but distinguis......
-
Tyrell v. Commissioner
...her and the minor children as consideration for a property settlement approved in a divorce decree. Jayhawk Equipment Co. v. Mentzer, 193 Kan. 505, 509, 394 P.2d 37, 41 (1964). The facts of Jayhawk Equipment are similar to the facts of the instant case. Id. In Jayhawk Equipment, debtor-husb......