Maynard v. Hoskins

• Decision Date: 15 January 1862
• Citation: 9 Mich. 485
• Court: Michigan Supreme Court
• Parties: William S. Maynard v. Thomas J. Hoskins and others

9 Mich. 485

William S. Maynard v. Thomas J. Hoskins and others

Supreme Court of Michigan

January 15, 1862

Heard April 20, 1861; April 23, 1861; April 24, 1861 [Syllabus Material]

Appeal from Washtenaw circuit in chancery.

The bill was filed to subject certain lands to the payment of a judgment, rendered in November, 1857, in favor of complainant, against the defendant, Thomas J. Hoskins. The bill alleges that the lands were bought by said Thomas J Hoskins, with his own money, who caused them to be conveyed by the seller to his wife, Martha L. Hoskins, for the fraudulent purpose of keeping them beyond the reach of his creditors. It states that Hoskins, on making the purchase took possession of the premises and made valuable improvements thereon, but that Mrs. Hoskins, learning that complainant was taking steps to collect his judgment, conveyed them, without consideration, to one Henning, to keep them beyond complainant's reach. Henning, when he took the conveyance, had notice of the fraud intended. No change of possession was had or intended on this conveyance being made. Complainant took execution on his judgment, December 7, 1857, and caused it to be levied upon the premises; he claims that he has thereby acquired an equitable lien on the premises, and asks that they be subjected to the payment of his judgment.

Henning and Mrs. Hoskins filed answers in the case, and a hearing was had in the court below on pleadings and proofs, and decree entered for complainant as prayed. Defendants appealed.

Decree of the circuit court reversed, and the complainant's bill dismissed, with costs.

H. J. Beakes and T. M. Cooley, for complainant:

1. But for the fraudulent conveyance to the wife, Hoskins had such an interest in the lands as might have been sold on execution. He had bought and paid for the land, and took possession of it, and was entitled to have it conveyed to himself or to such person as he might direct. In other words he was entitled to the title. Under such circumstances his rightful possession was such a legal interest as might be sold on execution: 3 Johns. 222; 9 Cow. 73, 75; 18 Johns. 94.

2. But, independent of this principle, the right to sell on execution lands thus fraudulently conveyed has been generally recognized in this country. In some states, indeed, the courts have based the right upon the statutory authority to sell trust estates: 19 Wend. 414. In one, the case is recognized as coming within statute 29, chapter 2, and therefore salable on execution (1 Humph. 491); while in others the case is held not within that statute (8 Rich. Law, 393; 3 Monr. 158; 1 Ired. Law, 553; 23 Vt. 378); and in still others any sort of interest in lands, legal or equitable, that ought to be subjected to debts, seems to be liable to execution independent of statutory provisions: 3 Ind. 129; 4 N. H., 402. On the other hand, in other states, the right to sell lands thus situated on execution has been recognized on the express ground, as would seem, that the conveyance was a mere dodge to defraud creditors, which the law equally with chancery would circumvent, and the aid of chancery has frequently been invoked and afforded, as well to declare the land subject to sale before one has been made, as to perfect a sale afterwards by compelling a fraudulent grantee to convey to the purchaser: 10 Conn. 137; 11 Conn. 370; 17 Conn. 278; 17 Ill. 585; 23 Mo. 172; 41 Me. 455; 2 Penn. St. R., 38; 15 Mass. 210.

Whatever, therefore, may on principle be the correct course, the practice is far from uniform, and no state would be likely to overthrow the practice adopted by its courts, without very strong reasons for so doing. In our own state, the right to sell on execution in such case is distinctly recognized: Cutter v. Griswold, Wal. Ch., 437. The position of defendants involves the necessity of overruling this decision, which for sixteen years has been regarded as the settled law of the state.

3. But the principle of this decision is now the law of this state by statute. Lands fraudulently conveyed are made liable to execution: Comp. L., § 3119. The terms of this section do not confine the description of lands which may be sold to those fraudulently conveyed by the debtor himself, and there is nothing in the nature of the case which should induce the court to give it this restricted construction. The purpose of the statute was to defeat the fraudulent device and shift of the debtor by making the land subject to execution notwithstanding the title was not in the debtor; and on the ground that, but for his fraud, the legal title would have been in him, and thus attachable: 3 Ind. 131.

4. But even if this land were not subject to execution, the present suit may be sustained. We are not seeking to reach equitable assets, or choses in action not liable to execution, but tangible property, the equitable title to which is, as between defendants and complainant, in the debtor himself. The levy of an execution in such case creates in favor of the creditor an equitable lien, which equity may enforce by decreeing a sale, and by compelling the holder of the legal title to deed over if necessary: 11 N. H., 330; 3 Humph. 661; 8 Rich. Eq., 162; Wright, 439; 10 Yerg. 310; 2 Leigh 268; 24 Vt. 390; 10 Conn. 137; 12 Vt. 700; 2 Stock. Ch., 291; 4 Johns. Ch., 786; 2 Johns. Ch., 283; 18 Wend. 236; 11 Conn. 370; Story Eq. Juris., 1216, b.

O. Hawkins and G. V. N. Lothrop, for defendants:

The lands "fraudulently conveyed" which the statute subjects to execution, are such as have been so conveyed by the debtor himself. These conveyances are expressly declared void by the statute, thus bringing the legal title within reach of execution. Where the debtor has paid the consideration money, and caused the title to be conveyed to another, the statute is equally explicit. It does not avoid the conveyance, for that would put no title in the debtor. It does not raise a trust for the debtor, and then execute the trust, and so vest the debtor with title, or declare that such trust should be subject to levy and execution against the debtor. On the contrary, it declares that no trust shall result to the debtor. But it raises a presumptive trust directly in favor of the creditors. That is, it leaves the title in the grantee, and charges it in his hands with a...