McGuire v. Davis

• Decision Date: 08 May 1915
• Docket Number: 19,486
• Citation: 95 Kan. 486,148 P. 755
• Parties: MAGGIE MCGUIRE, v. RACHEL A. DAVIS and JOSEPH DAVIS, Appellants; MARY J. CULBERTSON, Interpleader (HARLAN TAYLOR, as Administrator, etc., Interpleader, Appellee)
• Court: Kansas Supreme Court

148 P. 755

95 Kan. 486

MAGGIE MCGUIRE, v. RACHEL A. DAVIS and JOSEPH DAVIS, Appellants;

MARY J. CULBERTSON, Interpleader (HARLAN TAYLOR, as Administrator, etc., Interpleader, Appellee)

No. 19,486

Supreme Court of Kansas

May 8, 1915

Decided. January, 1915.

Appeal from Allen district court; OSCAR FOUST, judge.

Judgment affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

1. REFORMATION OF DEED -- To Show Life Estate -- Death of Grantor Pending Action--Administrator May Prosecute Claim. Where a grantor sues to have a deed reformed so as to show the reservation of a life interest and a stipulation charging the land with the payment of indebtedness owed by her at the time of her death, and dies before judgment is rendered, the administrator of her estate may be made a party and prosecute the claim for the benefit of its creditors, where no other property is available for their payment.

2. SAME. Such a proceeding may be prosecuted by the administrator, although it was instituted by the intervention of the grantor in a partition action between the grantees and the land had been sold prior to her death, the proceeds being held in court to await the determination of the controversy.

3. SAME--Pleading of Administrator--Not Demurrable. Where in such case the pleading of the administrator sets out that claims are asserted against the estate, and that its assets are insufficient to meet them, it is not rendered demurrable by the fact that it shows the demands have not been allowed or formally exhibited.

4. SAME--Decree of Reformation--Justified by the Evidence. A decree of reformation held to be justified, upon the ground that there was evidence that the grantor believed the deed to be so worded as to make her maintenance for life a charge upon the land, and that the grantees accepted it upon that understanding.

C. S. Ritter, of Iola, for the appellants.

Travis Morse, and G. E. Pees, both of Iola, for the appellee.

OPINION

MASON, J.:

Mary J. Culbertson, an elderly unmarried woman, was the owner of 180 acres of land in Allen county. On November 20, 1909, she executed a warranty deed, in the usual form, without exception or reservation, purporting to convey 160 acres of it to her two nieces, Maggie McGuire and Rachel Davis, sisters. The intention had been to include the entire property, and to remedy the oversight a second deed was made, of like purport, for the other twenty acres. A few days later the grantor caused the deeds to be recorded, and during the next month the grantees paid her the recited consideration of one dollar each, and received the deeds. On September 12, 1911, Maggie McGuire began an action against Rachel Davis for the partition of the property. Mary J. Culbertson interpleaded, and on April 14, 1912, filed a cross-petition alleging a mistake in the drafting of the deeds executed by her, and asking that they be reformed so as to express the real intention of the parties, which was that the income of the property during her life should be reserved to her, that any further expense necessarily incurred for her support should be a lien upon it and that it should be charged with the payment of all her just debts at the time of her death. On July 15, a decree for partition was entered, providing that in case of sale the proceeds should be paid into court, to stand as the land itself, and to be subject to disposition in accordance with the decision of the court upon the issues remaining to be tried.

It was found that the land could not be divided, and on October 15, 1912, it was sold to Rachel Davis and her husband for $ 5405. Fifteen hundred dollars of the price was retained in court to cover (among other matters) such part of it as Mary J. Culbertson might be found entitled to. Mary J. Culbertson died January 7, 1913. An administrator was appointed, who by leave of the court filed an interplea, setting out that various persons were making or were about to make claims against the estate for support of the decedent, estimated at $ 1000; that no property was available to meet them excepting her interest in the land; he asked the reformation of the deeds on the grounds already stated, and that the proceeds of the sale still in the control of the court should be subjected to the payment of such claims. Rachel Davis joined issues with the administrator. The court found in his favor and rendered judgment accordingly. She appeals.

The appellant contends that the administrator can not in any event maintain a proceeding of this character. Probably the larger number of courts that have passed on the question have held that an administrator can not recover for the benefit of the creditors of the estate personal property fraudulently conveyed by the decedent to avoid the payment of his debts. (Note, 135 Am. St. Rep. 330.) But the many decisions to the contrary are supported by cogent reasoning. (Note, 135 Am. St. Rep. 332.) This court has adopted the majority rule (Crawford's Adm'r v. Lehr, 20 Kan. 509), but upon grounds depending in part at least upon the statute reading:

"The real estate liable to be sold as aforesaid [by the administrator to pay debts] shall include all that the deceased may have conveyed with intent to defraud his creditors, and all other rights and interests in lands and tenements not exempt by law." (Gen. Stat. 1909, § 3551.)

In the case cited the court said:

"It might be inferred from this statute, that the administrator might in some cases recover real estate or real property which had previously been conveyed by the deceased to defraud his creditors. But as there is no similar statute applicable to personal property, no such inference can be drawn from the statutes with reference to personal property. Indeed, the inference from the statutes might be against the authority of the administrator to recover personal property conveyed by the deceased to defraud his creditors; for, expressio unius, est exclusio alterius." (p. 511.)

Of the same statute it was said in a later case:

"It is provided that real estate which the deceased may have conveyed with intent to defraud his creditors is liable to be sold as part of the estate. The statute does not expresssly provide who may institute proceedings to set aside fraudulent conveyances so made. Doubtless it is within the power of the executor or administrator to bring a proceeding in equity for that purpose." (Barker v. Battey, 62 Kan. 584, 585, 64 P. 75.)

In view of these expressions, the right of an administrator seems clear to maintain an action to set aside, for the benefit of creditors, lands fraudulently conveyed by the decedent. (See also, 11 A. & E. Encycl. of L. 979; 18 Cyc. 692; McLane, administrator, v. Johnson et al., 43 Vt. 48, 61, 62...