Maxwell & Isham v.Hanshaw.

• Decision Date: 05 July 1884
• Citation: 24 W.Va. 405
• Parties: Maxwell & Isham v. Hanshaw.
• Court: West Virginia Supreme Court

24 W.Va. 405

Maxwell & Isham

v.Hanshaw.

Supreme Court of Appeals of West Virginia.

Submitted June 17, 1884

Decided July 5, 1884.

1. A transfer of property either directly or indirectly by an insolvent husband to his wife during coverture is justly regarded with suspicion; and unless it clearly appears that it was entirely free from any wrong intent or purpose to withdraw the property from the husband's creditors it will not be sustained. (p. 410.)

2. In such transfers there is a presumption against the wife in favor of the husband's creditors which she must overcome by affirmative proof. (p. 410.)

3. A case in which it is held, that an alleged loan of money by a wife to her insolvent husband was, under the circumstances, a gift and not a loan as against the creditors of the husband.

The facts of the case are stated in the opinion of the Court. John Bassel and S. P. McCormick for appellant. Martin, $ Woods and J. W. Mason for appellee. Snyder, Judge:

Charles F. and Robert M. Hanshaw, partners as Hanshaw & Bro., on February 12, 1881, made their two due bills of that date, the one to Mattic J. Hanshaw, the wife of said Charles F. for two thousand and fifty-eight dollars and the other to Marion W. Hanshaw, the wife of said Robert M. for two thousand four hundred and forty-one dollars and fifty six cents. On the same day the due bills were assigned by said Mattie and Marion, respectively, to David T. Percy, and at once the said Charles and Robert confessed in the clerk's office of the circuit court of Taylor county a judgment to said Percy for four thousand tour hundred and ninety-nine dollars and fifty-six cents, the amount of said two due bills. By deed dated February 14, 1881, said Charles and Robert and their wives conveyed to M. H. Dent, trustee, all the property, real and personal, owned by them individually and as partners to secure first the payment of said judgment to Percy and one or two other debts and then to pay ratably all other debts due from said Charles and Robert. On April 2, 1881, the trustee sold the real estate thus conveyed to him under the provisions of said trust-deed and Percy became the purchaser thereof at the price of two thousand nine hundred and ninety-six dollars, which sum was credited by him on the judgment confessed in his favor as aforesaid and he directed the trustee to convey said real estate to said Mattie J. and Marion W. Hanshaw, and this seems to have been done by the trustee.

At the time these transactions occurred the said Hanshaw & Bro. were carrying on business as retail merchants in the town of Grafton, Taylor county, where they had been so doing since 1870, and they were then utterly insolvent and in failing circumstances their indebtedness in addition to the sums alleged to he due their wives exceeding ten thousand dollars, and their property and effects worth less than halt that sum.

In August, 1881, Maxwell & Isham and W. & T. Allen, creditors of Hanshaw & Bro. filed their bill in the circuit court of Taylor against said Hanshaws, their wives and many of their creditors, stating the above and other facts and alleging that said due bills were without any real or valuable consideration and made with intent to hinder, delay and defraud the creditors of Hanshaw & Bro. and therefore void as to the debts of the plaintiffs, and other creditors; that said Percy gave nothing for said due bills, but that his name was used merely for the purpose of effecting the scheme of said Hanshaws to defraud their creditors by withdrawing their property from the reach of creditors and transferring it to their wives. The bill prays that said due bills and judgments to Percy and so much of said trust-deed as pretends to secure said judgment may be declared void and the proceeds of said real estate applied to the payment of the plaintiffs and other creditors secured in said trust-deed, &c.

The defendants Chas. F. and Robt. M. Hanshaw and their respective wives answered the bill denying that said due bills were without a valuable consideration or made for the purpose of defrauding any one; but averring that they were given for money loaned to Hanshaw & Bro. by the said Mattie and Marion W. Hanshaw which they owned as their separate estates and no part of it was derived by either from her husband. Depositions were taken and the cause having been matured for hearing, the court on November 15, 1882, entered a decree dismissing the plaintiffs' bill with costs, and from this decree the plaintiffs have appealed.

The appellants insist that the alleged debts for which the due bills were given are fictitious and fraudulent as against them and that, therefore, the circuit court erred in refusing so to decide. Whether the court erred or not is more a question of fact than of law. But three depositions were taken, two of them were those of the defendants, Mattie J. and Marion W. Hanshaw, and the third was that of William McClaskey, the father of said Mattie, and all were taken on behalf of the defendants. The substance of the testimony of these witnesses is as follows:

William McClaskey deposes, that he is the father of the defendant, Mattie, and father-in-law of Charles F. Hanshaw; that prior to 1870, he and said Charles had been partners in merchandizing and on a settlement of their transactions said Charles was found indebted to him nine hundred and fortyfive dollars and seventy-five cents, and that in the summer or fall of that year he advanced said indebtedness and five hundred dollars in cash to his daughter, the said Mattie.

Mattie J. Hanshaw deposes, that she was married to Charles F. Hanshaw in December, 1865; that her father, in October, 1870, advanced to her one thousand four hundred and forty-five dollars and some...