Newman v. Kirk
| Decision Date | 10 September 1889 |
| Parties | NEWMAN v. KIRK et al. |
| Court | New Jersey Court of Chancery |
(Syllabus by the Court.)
On bill, answers, and proofs.
A. Stephany, for complainant. Joseph Thompson, for defendants.
The bill is by a judgment creditor against the judgment debtor, and his grantee of certain lands, asking that the conveyance may be declared fraudulent and void as against complainant's judgment. The judgment was recovered January 23, 1883. and appears by the declaration to have been founded upon an indebtedness on the common counts, as of January, 1882. The bill alleges that it was based upon a debt or debts existing in October, 1881. This is admitted by the answer of the judgment debtor, Walter Kirk, but not in the answer of his grantee, Annastena Kirk, his wife. It was, however, proven at the hearing. The judgment debtor acquired title to the premises in dispute December 22, 1880, and, by deed dated November 17, 1881, conveyed them to his mother-in-law, a Mrs. Harriet Hammond, who, in January, 1884, conveyed them to Mrs. Annastena Kirk, the wife of Walter. This last conveyance was declared to be for the consideration of one dollar and of love and affection. These conveyances are the object of complainant's attack.
The property in question is an hotel, known as the "Stockton House," at Atlantic City, situate on the corner of Atlantic and Maryland avenues, with a frontage on Atlantic avenue of 107 feet, and a depth on Maryland avenue of 150 feet. The deed from Kirk to Mrs. Hammond covered the hotel property, and also a block of land bounded by Arctic, Baltic, Rhode Island, and Vermont avenues. The consideration mentioned in the deed is "$11,871, as hereafter mentioned," and, after the description of the premises, is stated thus: "This conveyance is in full payment and discharge of a certain indebtedness of eleven thousand eight hundred and seventy-one dollars, due and owing by the said Walter Kirk, as administrator of the estate of John A. Hammond, deceased, late of the county of Philadelphia, to said Harriet Hammond in her own right, and as assignee of Joseph T. Hammond, and said Annastena Kirk, awarded by the orphans' court of said county to be paid to them upon an audit and adjudication of the accounts of said Walter Kirk, as by reference to said proceedings the same will more fully and at large appear." An examination of the proceedings in the Philadelphia orphans' court shows that, by a decree dated April 24, 1875, Walter Kirk, one of the administrators of the estate of John A. Hammond, deceased, was found to be indebted:
To Mrs. Hammond, the widow of the decedent, in the sum of
To Joseph T. Hammond, the son of decedent, in the sum of
Less cash in Joseph T. Hammond's hands...................
795 73
To Annastena Kirk, daughter of decedent and wife of Walter..................
Just how this sum was developed into the sum of $11,871, mentioned as consideration in the deed, does not appear in either of the answers, and no attempt was made at the hearing to show it, either by evidence of witnesses or explanation of counsel. Mrs. Kirk, in her answer, contents herself with saying "that she was always informed by the parties, and verily believes, that such conveyance was good and valid in law, and made for bona fide consideration expressed therein." No proof was made that any assignment had ever been made to Mrs. Hammond by either Joseph T. Hammond or Mrs. Kirk of his or her share in their father's estate, and in 1878, as will appear further on, Walter Kirk treated the decree in favor of his brother-in-law as being paid. Walter Kirk, in his answer, drawn by the same solicitor as was his wife's, gives his account of the consideration thus: "The said eleven thousand eight hundred and seventy-one dollars, above referred to as part of the consideration, consists of the following amounts, and of money due and owing from this defendant to Harriet Hammond, and the said Harriet Hammond assuming the payment of certain bills then and there a lien upon the said premises, viz." I tabulate what immediately follows thus:
Due Mrs. Hammond from Walter Kirk on decree in orphans' court of Philadelphia.............................
Due Edwin A. Smith & William R. Smith for materials furnished in enlarging the Stockton House......................
Due Mary Disston & others for materials furnished in enlarging the Stockton House..............................
Due George F. Currie for materials furnished in enlarging the Stockton House..................................
Due George F. Currie and Samuel Faith for materials furnished in enlarging the Stockton House.....................
Due William A. French for materials furnished in enlarging the Stockton House.......................
Due Josiah Bryan for materials furnished in enlarging the Stockton House..........................
—" And [continues the answer] the balance of said sum of eleven thousand eight hundred and seventy-one dollars, being the sum of money mentioned as the consideration in the deed made by this defendant and wife to said Harriet Hammond, was interest due and owing upon said mortgages and taxes due and unpaid on said premises." Just how the interest upon these various sums and the taxes made up the difference between their aggregate and $11,871, the consideration expressed in the deed, no attempt was made to show. No statement or calculation showing it was presented. This extract from the answer, contrasted with the above extract from the deed, shows that the statement of the consideration in the deed was knowingly untrue, and it is fair to infer that it was put in odd dollars in order to give it an air of reality. And yet, in the face of this statement found in his answer, Kirk swears on the witness stand that the $11,871 was for moneys he owed the estate "of John A. Hammond as administrator." The proofs show that the claim for materials furnished by Josiah Bryan, mentioned in the answer, and put at $3,500, was secured by and included in the mortgage to him, which was on the premises at the date of the conveyance, and was, by its terms, assumed by the grantee, and is still a lien upon the premises. With regard to the other claims last above recited, all but one (William A. French's) were paid by the sale of the one-half of the Baltic-Avenue block, included in the same conveyance. French's claim was put in suit and went to judgment February 12, 1883, and the premises were subsequently sold under it, and purchased by Mrs. Hammond. The object of Kirk in permitting this claim to go to judgment and sale appears further on. No change occurred in the occupancy and management of the house after the conveyance of November 17, 1881. Mrs. Hammond was 80 years old, and very decrepit. She had been an inmate of Kirk's family for several years, and continued to live with him until she died. At the date of the deed she executed to Kirk a power of attorney to manage the hotel in her name. The document itself is not produced, and its contents were not proven with any degree of certainty. It does not appear that any contract was made between Kirk and his mother-in-law as to what compensation he should have for his services in managing the business. He did not pretend that any such contract was made. He took from the income of the house what he needed for his purposes. It does not appear that he ever rendered Mrs. Hammond any account of his dealings with the property. On the contrary, he kept the ordinary books of an hotel precisely the same, so far as appears, as if it had been kept in his own name; but he says Mrs. Hammond could and did look them over. This is all the accounting he ever made to her. He deposited the money taken in from the hotel in her name in bank, and, under the power of attorney, drew against it to pay expenses, and so forth, but it does not appear that he ever paid her any of it. Shortly before Mrs. Hammond died, she executed and delivered a deed of conveyance to her daughter, and after that the business continued as before to be carried on by the husband. It is apparent that he did at all times have complete control of it.
At the time of the conveyance to Mrs. Hammond the property in dispute was incumbered by three mortgages,—two held by the late James B. Dayton for $5,000 and $1,500, respectively, and one by Josiah Bryan for $15,000. This latter mortgage was given to secure Mr. Bryan for money to be advanced by him to pay off the Dayton mortgage, and for materials to be furnished and used in building the addition to the house. At the date of the conveyance Bryan had not paid Mr. Dayton, and had advanced in materials from $2,500 to $3,500 only, which I find from the evidence is the very $3,500 mentioned in the foregoing statement taken from Walter Kirk's answer. Thus it appears that the actual mortgage incumbrance on the hotel was $10,000. In the deed is this clause: The evidence shows that what Kirk expected and intended to do in execution of that covenant was not to pay any money, but to compel Bryan to fulfill his agreement to pay off Dayton. This...
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