Punta Gorda State Bank v. Wilder
| Decision Date | 19 February 1927 |
| Citation | 93 Fla. 301,112 So. 569 |
| Parties | PUNTA GORDA STATE BANK et al. v. WILDER et al. |
| Court | Florida Supreme Court |
Rehearing Denied April 19, 1927.
Suit by the Punta Gorda State Bank and another against W. E. Wilder and others to set aside a transfer of notes, for an injunction, and other relief. From a judgment of dismissal complainants appeal.
Reversed with directions.
On Rehearing.
Syllabus by the Court
Chancellor's decree will not be reversed on facts except on clear showing of error. Decree of chancellor will not be reversed on facts unless it is made clearly to appear that the decree is erroneous.
Judgment creditor may treat attempted transfer of judgment debtor's property as nullity and sell it under execution judgment creditor's right to treat attempted transfer of judgment debtor's property as nullity and sell it under execution does not prevent suing to vacate conveyance and to remove cloud on title; fraud is one of recognized subjects and most ancient foundations for equity jurisdiction. It must be conceded that a judgment creditor has the right to treat an attempted transfer of property to which the judgment debtor had the legal title as a nullity and to sell the property so conveyed under execution, as though no transfer by connivance had been made, but the existence of such remedy at law does not interfere with the right to resort to a court of equity for the vacation of the fraudulent conveyance as an obstacle in the way of the full enforcement of the judgment, and to remove a cloud on the title to the property; fraud being one of the recognized subjects and most ancient foundations for equity jurisdiction.
Judgment creditor must have return of nulla bona on execution before suing in equity to set aside conveyance of property to which judgment debtor had equitable title; judgment creditor need not have return of nulla bona on execution before suing in equity to set aside conveyance of property to which judgment debtor had legal title. Where a judgment creditor seeks by a bill in equity to set aside an alleged fraudulent conveyance and subject the property therein attempted to be conveyed to his judgment, if the judgment debtor had only an equitable title to such property it is necessary to exhaust the legal remedies and have a return of nulla bona upon execution, before filing such bill in equity; but it is otherwise where the judgment debtor had legal title and fraudulently conveyed the same.
Judgment creditor need not have return of nulla bona on execution before suing to set aside conveyance of notes, judgment debtor's legal assets. The notes in the instant case were legal assets of the judgment debtor and, it is alleged, were fraudulently transferred to defeat and defraud creditors, and we find that the evidence supports the findings of the chancellor that the notes were fraudulently transferred to defeat and defraud judgment creditors. Therefore, we hold that it was not necessary for the complainant to exhaust the legal remedies and have a return of 'nulla bona' upon execution before it could maintain its bill in equity.
Equity, acquiring jurisdiction to enjoin transfer or sale, has jurisdiction to do complete justice under bill's general prayer. Where the court acquires equity jurisdiction to determine the bona fides of the dealings between parties and to determine whether or not the property involved was the property of one or the other of such parties and to enjoin the transfer or sale of the property, the court of chancery has complete jurisdiction and authority under a general prayer of the bill to do complete justice.
Appeal from Circuit Court, Hardee County; W. J. Barker, judge.
Leitner & Leitner, of Arcadia, for appellants.
W. D. Bell, of Arcadia, for appellees.
The appellant filed its bill of complaint alleging that it had recovered a large judgment against the defendant Wilder, and that E. O. Painter Fertilizer Company had likewise recovered a large judgment against Wilder. The bill further alleged that Wilder in a certain trade with one Glass had received as his part two notes of $5,000 each, made by one Turner to Glass; that Wilder was the owner of the notes and through his agent, Gore, sold and delivered the notes to Shelfer, and that Shelfer delivered to Gore, as agent for Wilder, $1,000 in cash, $2,000 in bank certificates of deposit of De Soto National Bank, and two notes in the sum of $2,000 each, payable to the defendant Gore; that Gore was the agent of Wilder, and that the notes were taken in Gore's name for the purpose of defrauding creditors; that the notes had been delivered to Wilder, and that he at the time had them in his possession. The prayer of the bill was for the court to decree:
'(3) What have you done with the two notes and the time certificate that you got from A. T. Shelfer and the De Soto National Bank as a consideration for the said notes?
'(4) What did you do with the $1,000 as part of the consideration for the said notes?
'(5) Is it not a fact that W. E. Wilder owns the notes and the certificate of deposit and the $1,000, and you were acting as his agent in selling those two Glass notes to Shelfer?
'(6) What have you done with the said notes, made and delivered to you from Shelfer, and also the time certificate?
'(7) What did you do with the said notes and time certificate upon returning to Limestone on October 27th?
'And that your orators may have such other and further relief in the premises as equity may require and to your honor shall seem meet.'
Demurrers were filed which were overruled. Afterwards answers were filed and testimony taken before a master appointed for that purpose. Upon the report of the master, the court made the following finding, to wit:
'After giving this case considerable thought and attention, it is the finding of the court that the two old notes known as the Glass notes were and have always been the property of the defendant W. E. Wilder; that W. E. Wilder placed these notes in the hands of the defendant A. T. Gore, and that the title to the said notes was never conveyed by the said Wilder to the said Gore; the said Wilder permitted the said defendant A. T. Gore to sell the said two Glass notes and to take in his own name the two notes of A. T. Shelfer et al., and the said bank certificate set out in the bill; that the defendant W. E. Wilder never has had a legal title to the said two notes and the bank certificate mentioned in the bill, as made by A. T. Shelfer; that, since the said note of A. T. Shelfer and the bank certificate were never in the name of W. E. Wilder, the title that W. E. Wilder has in and to those notes and that certificate was an equitable interest and could only be reached by a proper procedure in chancery.
'The court further finds that a note in this state is not subject to levy, and under the executions of the complainants they had no lien upon the said notes, and the said notes could be transferred, sold, or assigned by W. E. Wilder, free from any claims of the complainants, and that when he did permit the defendant Gore to take the said two notes of Shelfer and the said bank certificate there was no lien following the said new notes and certificate.
'The court further finds that the interest which the complainants are attempting to reach in this bill is an equitable interest, and not a legal interest, and before they can come into a court of chancery they must have shown to this court that they had gone to the utmost in law before they...
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