Louk v. Patten

• Decision Date: 29 October 1937
• Docket Number: 6393
• Citation: 73 P.2d 949,58 Idaho 334
• Parties: MINNIE LOUK, Respondent, v. GEORGE E. PATTEN and LEORA M. HOWELL, Appellants
• Court: Idaho Supreme Court

73 P.2d 949

58 Idaho 334

MINNIE LOUK, Respondent, v. GEORGE E. PATTEN and LEORA M. HOWELL, Appellants

No. 6393

Supreme Court of Idaho

October 29, 1937

FRAUDULENT CONVEYANCES-RIGHT OF ASSIGNOR TO ASSERT INVALIDITY-CONTINGENT LIABILITY EXISTING AT TIME OF CONVEYANCE-CREDITORS-INTENT OF GRANTOR-EVIDENCE-APPEAL-ASSIGNMENT OF ERROR, SUFFICIENCY OF-FAILURE TO CITE AUTHORITIES.

1. Judgment creditor, who had assigned judgment to her counsel as security for attorneys' fees and money loaned to her by counsel with the understanding that when indebtedness was paid the balance would go to judgment creditor, was not deprived of right to maintain action to set aside a deed allegedly executed by judgment debtor to hinder judgment creditor from collecting on her judgment.

2. An assignor of a chose in action who has assigned the legal title thereto to another as security for a debt has such an interest therein that he may maintain a suit thereon in his own name.

3. A promise to carry out a subsisting contract with promisee does not amount to a new contract, because of lack of consideration.

4. In action to set aside deed allegedly executed to hinder plaintiff from collecting on a judgment procured by her in a breach of promise suit against grantor, where deed was executed subsequent to date upon which grantor was not entitled to allege that plaintiff was not a creditor at time of conveyance because of an alleged subsequent reconciliation, since subsequent promise was mere reaffirmance of original promise without consideration as a new contract, and defense would have been available only in case of mutual abandonment of original contract and entering into of a new and independent agreement.

5. A contingent liability is fully protected against fraudulent voluntary conveyances, and whoever has a claim arising out of a preexisting contract, although it may be contingent, is a "creditor" whose rights are affected by such conveyances, and, as such, can avoid them when the contingency happens upon which the claim depends.

6. A conveyance to grantor's daughter executed subsequent to grantor's repudiation of a promise to marry was subject to be set aside as a "fraudulent conveyance" by virtue of the contingent liability existing in favor of promise at time of conveyance.

7. Where actual fraud is established, a conveyance may be void as to subsequent creditors as well as prior creditors.

8. Statute, declaring that a transfer of property with intent to delay or defraud any creditor or "other person" of his demands is void, embraces by use of words "other person" those who have become creditors after the conveyance and whose debts have been defrauded. (I. C. A sec. 54-906.)

9. Transfers between members of a debtor's household are not prima facie fraudulent, but only slight additional evidence is required for a prima facie case.

10. All facts and circumstances in evidence must be taken into consideration in determining intent of parties, as respects fraud in conveyance.

11. Evidence that alleged gift deed was executed by grantor to daughter shortly after his repudiation of a promise to marry of which his daughter was aware, and that after execution of deed grantor remained in possession of the property exercising control over it, supported finding that deed was executed by grantor for purpose of defrauding promisee in the agreement to marry, and to prevent her from realizing on any judgment she might obtain against grantor.

12. The supreme court will not review an assignment which does not point out particulars in which alleged error consists.

13. An assignment of error that court erred in making a certain finding is not sufficiently definite to point out the ground on which the court erred, and does not call in question the sufficiency of the evidence to support the finding.

14. Supreme court was not required to consider alleged errors, in absence of authorities cited in connection therewith or argument made in the briefs.

APPEAL from the District Court of the Ninth Judicial District, for Bonneville County. Hon. Guy Stevens, Judge.

Action to set aside conveyance. Judgment for plaintiff. Affirmed.

Affirmed. Costs awarded to respondent.

D. E. Rathbun and Hoyt Ray, for Appellants.

The real party in interest must maintain the action. (Andrews v. Kibbee, 12 Mich. 94, 83 Am. Dec. 766; Benson v. Alterburg, 124 Kan. 296, 259 P. 791; Brumback v. Oldham, 1 Idaho 709; Casady v. Scott, 40 Idaho 137, 237 P. 415; Chatham v. Mecklenburg Realty Co., 180 N.C. 500, 105 S.E. 329.)

To maintain an action to set aside a deed, plaintiff must be a creditor prior to the conveyance. (Associated F. Co. v. Idaho Oregon Fruit Growers Assn., 44 Idaho 200, 256 P. 99; Johnson v. Blomdahl, 90 Wash. 625, 156 P. 561; Kerns v. Washington W. P. Co., 24 Idaho 525, 135 P. 70; Simpson v. Twin Falls Feeder Co., 51 Idaho 193, 3 P.2d 1100; 12 R. C. L. 492.)

A new contract between the same parties covering the same subject matter, nullifies former contracts between the same parties. (Hall v. Butler, 224 F. 709, 140 C. C. A. 249; Beechley v. Beechley, 134 Iowa 75, 108 N.W. 762, 120 Am. St. 412, 9 L. R. A., N. S., 955.)

A. A. Merrill and O. A. Johannesen, for Respondent.

Appellants take the position that to maintain an action to set aside a deed, plaintiff must be a creditor prior to the conveyance. This is not the law as we see it. (Associated F. Co. v. Idaho-Oregon Fruit Growers Assn., 44 Idaho 200, 256 P. 99; Luizza v. Brinkerhoff, 3 Cal.App.2d 218, 39 P.2d 283.) A conveyance made with the intent to defraud the plaintiff as a subsequent judgment creditor, would come within the statute. (Hoffman v. Junk and Another, 51 Wis. 613, 8 N.W. 493. See, also McRoberts v. Upsher & Upsher, 175 Okla. 145, 52 P.2d 1071; Cioli v. Kenourgios, 59 Cal.App. 690, 211 P. 838; Gwillim v. Asher, 71 Colo. 143, 204 P. 609.)

BUDGE, J. Givens, J., Morgan, C. J., Ailshie, J., and Downing, D. J., concurring. Holden, J., did not sit at the hearing and took no part in the decision.

OPINION

BUDGE, J.

--March 30, 1934, respondent, Minnie Louk, procured a judgment against appellant George E. Patten for the sum of $ 1,053.30, the suit arising out of a breaching of appellant Patten's contract of marriage with respondent. This action was instituted by respondent to set aside a deed of conveyance, made at about the time of the breaching of the contract above referred to, from appellant Patten to his daughter, appellant Leora M. Howell, conveying title to lot 7 of Block 75, Riverside addition to the city of Idaho Falls, upon the grounds that it was given to hinder, delay and defraud respondent in collecting her judgment. The cause was tried to the court and findings of fact and conclusions of law were made and entered in favor of respondent and judgment was entered canceling, vacating and setting aside the deed. This appeal was taken from the judgment.

From the record it appears that subsequent to the time respondent obtained the judgment in her breach of promise action, appellant Howell, appellant Patten's daughter, brought an action in the justice court against respondent and obtained a judgment for $ 131.70, and thereafter an execution was issued out of the justice court and an attempted levy made on, and sale had of, the judgment previously obtained by respondent against appellant Patten, for the purpose of satisfying the judgment of appellant Howell against respondent. Upon motion of the attorneys for appellant Howell, the Howell v. Louk cause was transferred from the justice court to the probate court and in the probate court a motion was made to have the execution sale quashed and set aside for the reason that respondent had not been served with the writ. The sheriff, through his deputy, in the first return on the writ certified he had served respondent. He filed an amended return in the probate court wherein he certified that the writ had not been served on respondent and that his first return did not correctly set out the true facts. In the probate court the deputy sheriff was sworn and testified that neither the sheriff nor any of his deputies served the writ issued out of the justice court on the respondent; that the original return had not been carefully read by him, and said officer requested that he be permitted to amend the return and correct the error. Appellants by their own record established in the trial court the invalidity of the sale on execution out of the justice court and that the return made by the sheriff through his deputy was incorrect. It would hardly be consistent with justice to hold that in the face of such a state of facts appellants would be permitted to urge the validity of the sale of the judgment, obtained by respondent to satisfy the judgment of appellant Howell against respondent, in this court or to urge error in the action of the trial court in holding that there was no merit in appellant's contention that respondent was not the owner of the judgment and therefore not a proper party to the action.

There is no merit in the contention that respondent was not entitled to maintain the action to set aside the deed involved herein for the reason, urged by appellants, that respondent had assigned the judgment to her counsel. The evidence is undisputed that respondent's counsel took her assignment of this judgment as security for attorneys fees and money loaned respondent by her attorneys with the understanding that when the indebtedness was paid the balance would go to respondent, which being true, the respondent was not divested of the judgment so as to deprive her of the right to maintain the present action. The rule is stated in Uhlig v. Diefendorf, 53 Idaho 676, 26 P.2d 801, as follows:

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