Locke v. Martin

• Decision Date: 17 February 1906
• Parties: LOCKE ET AL. v. MARTIN.
• Court: Alabama Supreme Court

40 So. 387

145 Ala. 274

LOCKE ET AL. v. MARTIN.

Supreme Court of Alabama

February 17, 1906

Rehearing Denied April 3, 1906.

Appeal from Chancery Court, Calhoun County; W. W. Whiteside Chancellor.

"To be officially reported."

Bill by Charles D. Martin against E. Locke and another. From a decree overruling a demurrer to the bill, defendants appeal. Affirmed.

Blackwell & Agee, for appellants.

Lapsley & Arnold, for appellee.

SIMPSON J.

This was a bill filed by a creditor, under section 2158 of the Code of Alabama of 1896, to have declared a general assignment a conveyance made by the debtor to one creditor of substantially all of his property to pay a debt due to said creditor. The appeal is from the decree overruling the demurrer of appellant to the bill of appellee, and the insistence of appellant is that, as the deed is not invalidated by the statute, but under it the grantee merely becomes a trustee for all the creditors, therefore the bill is without equity, unless there is in it an allegation that a demand has been made upon said trustee to execute said trust and a refusal to do so.

The cases upon the subject of express trusts are not applicable. The defendant does not hold under an express trust declaring the interests of the creditor, but, on the contrary, holds under a deed which purports to convey to him the entire estate in payment of his debt, to the exclusion of other creditors. He is holding in opposition to their equities, and it is only by the operation of the statute that the creditors have an equity to have that deed declared to be (what it does not purport to be) an assignment for their benefit. In order to have declared the true nature and effect of the instrument, and to secure their rights whenever the attempt has been thus made to deprive them of their rights, the creditors have the right to invoke the jurisdiction of a court of equity, and the law does not require of them to leave the property in the hands of the party who has attempted to acquire the entire property, and to leave it to him to administer the estate for their interest, but the court will take charge of the property and administer the trust under its own orders. His holding, under a deed which attempted to convey the property absolutely to him, was antagonistic to the trust, and it was not necessary to make any demand on him before invoking the aid of a court of equity, in accordance with the...