Robinson v. Dryden

• Decision Date: 11 December 1893
• Citation: 24 S.W. 448,118 Mo. 534
• Parties: Robinson et al., Appellants, v. Dryden
• Court: Missouri Supreme Court

24 S.W. 448

118 Mo. 534

Robinson et al., Appellants, v. Dryden

Supreme Court of Missouri, First Division

December 11, 1893

Appeal from Lincoln Circuit Court. -- Hon. E. M. Hughes, Judge.

Affirmed.

Martin & Avery for appellants.

(1) The action of the court in sustaining a demurrer to the evidence on the first issue is contrary to the evidence and every circumstance in the case. The badges of fraud are so numerous as shown by the evidence, that taken together you must come to the conclusion that W. J. Dryden's motive and intention in making the deed to his brother, L. T. Dryden, at the time he did, when he was hopelessly insolvent, as shown by the evidence, was to hinder and delay his creditors, and to put all of his individual property out of the reach of the creditors of W. L. Sturgeon & Co.. of which firm he was a member. Bump on Fraudulent Conveyances, pp. 79, 80; Renney v. Williams, 89 Mo. 145. (2) The consideration expressed in the deed from W. J. Dryden to L T. Dryden, $ 2,500, was much less than the value of the lands as shown by the evidence of all the witnesses in the case, no witness putting the value at less than $ 4,000 and some as high as $ 18 an acre, which would be more than $ 5,000. Bump on Fraudulent Conveyances, p. 86; Wells v. Thomas, 10 Mo. 237; Van Raalte v. Harrington, 101 Mo. 608. (3) It is in evidence and conclusively proven that L. T Dryden lived in California and was there at the time the deed was executed by W. J. Dryden, on the second day of February 1884. He could not have received the deed and had it recorded on the seventh day of February as the filing mark on the deed shows. This, together with the relationship of the parties and the insolvency of W. J. Dryden at the time, certainly constitutes a badge of fraud that should be explained, at least. Van Raalte v. Harrington, 101 Mo. 608. (4) The evidence also shows that W. J. Dryden retained possession of the farm for three years after the execution of deed to his brother, L. T. Dryden; this is a badge of fraud. Bobb v. Woodward, 50 Mo. 100; King v. Moon, 42 Mo. 560; Masters v. McBride, 81 Mo. 357. (5) The supreme court of our own state has unqualifiedly made the distinction in such cases as the one under consideration, as between strangers and near relatives. I refer to the following decisions: Bobb v. Woodward, 50 Mo. 100; Henderson v. Henderson, 55 Mo. 559; Cass County v. Green, 66 Mo. 512; Leavitt v. LaForce, 71 Mo. 354; King v. Moon, 42 Mo. 551; Stone v. Spencer, 77 Mo. 360; Renney v. Williams, 89 Mo. 145; Van Raalte v. Harrington, 101 Mo. 608; Leonard v. Green, 24 N.W. 915; Atkins v. Atkins, 25 N.W. 724; Gordon v. McIlvain, 2 S. Rep. 671; Burt v. Timmons, 2 S.E. 787.

Silver & Brown and R. H. Norton for respondent.

(1) The action of the court in instructing the jury to find for the defendant on the issues submitted to them was proper practice; it was in fact the finding of the chancellor on his own motion which is permissible in an equity case. Cox v. Cox, 91 Mo. 71. (2) The chancellor is not bound in an equity case to submit issues to the jury, nor to accept as his own the findings of the jury when such issues have been submitted. Keithley v. Keithley, 85 Mo. 217; Snell v. Harrison, 83 Mo. 651; Gay v. Shin, 69 Mo. 584; Durkee v. Chambers, 57 Mo. 575; Weeks v. Lenden, 54 Mo. 129; Burt v. Ryner, 48 Mo. 309; Hickey v. Drake, 47 Mo. 369. (3) So the finding of the chancellor will be deferred to in an equity case, unless he has manifestly disregarded the evidence. Sharpe v. McPike, 62 Mo. 300; Boyle v. Jones, 78 Mo. 403; Snell v. Harrison, 83 Mo. 651; Rawlins v. Rawlins, 102 Mo. 563. The credibility of a witness in a suit in equity can best be determined by the chancellor, who has the advantage of having such witness before him. Cox v. Cox, 91 Mo. 71. (4) Actual fraud must be proved, not conjectured. Priest v. Wray, 87 Mo. 16; Hausman v. Hope, 20 Mo.App. 193. It is not the duty of a vendee to inquire into the motive of the vendor in making a sale. He is not chargeable with knowledge of a fraudulent purpose on the part of the vendor because he failed to avail himself of an opportunity of making an investigation which, if made, would have revealed that purpose. State, etc., v. Merritt, 70 Mo. 275; Van Raalte v. Harrington, 101 Mo. 608. Nor can fraud in a sale be inferred from the mere fact that the vendor is insolvent. State, etc., v. Merritt, supra. (5) In the case at bar there was no evidence to show, first, either that the defendant purchased without consideration, or, second, that he had knowledge of any intended fraud on the part of the grantor. (6) Knowledge on the part of the grantee of such intended fraud must be shown. Sloan v. Terry, 78 Mo. 623; Dougherty v. Cooper, 77 Mo. 528; Frederick v. Allgaier, 88 Mo. 598; Durkee v. Chambers, 57 Mo. 575. Knowledge by the grantee of the grantor's indebtedness does not affect the validity of the conveyance. Durkee v. Chambers, 57 Mo. 575. But there is no evidence in the record that defendant even knew of the grantor's financial condition. (7) For aught that appears in the record, W. J. Dryden sold the farm in controversy to raise money to pay other creditors than plaintiffs. He who charges fraud must prove it.

OPINION

Macfarlane, J.

This is a suit in equity by judgment creditors of Wm. J. Dryden to set aside, as fraudulent, a conveyance, made by him to defendant, of a tract of two hundred and ninety acres of land in Lincoln county. The deed expressed a consideration of $ 2,500, was dated the second day of February, 1884, and was filed for record on the seventh day of the same month.

The said Wm. J. Dryden was a member of the firm of W. L. Sturgeon & Co. The firm and all the members failed in a few days after the record of the deed and made a number of mortgages on their partnership and individual property to secure their creditors. The evidence shows, further, that defendant was a brother of Wm. J. Dryden and lived in the state of California; that the grantor continued to reside on the farm and manage it until 1887 and when conveyed it was worth $ 15 per acre, though afterwards sold by defendant for $ 2,700. Defendant owned considerable other property in the neighborhood and Wm. J. Dryden acted as his agent in managing it. These were in substance all the facts proved, which bear on the good faith of the parties to the deed. The evidence was all offered by plaintiff.

A jury was impaneled and issues framed for submission to it. At the conclusion of the evidence offered by plaintiff, at the request of defendant, the court instructed the jury to find all the issues for defendant and judgment was entered accordingly. From this judgment plaintiff appealed.

I. The finding of issues, in chancery cases, is only advisory and the chancellor is not bound by it. There was no error, therefore, in the court instructing the jury to find all the issues in favor of the defendant if, upon all the evidence, the charges made in the petition were not established by the weight of the evidence. Cox v. Cox, 91 Mo. 71, 3 S.W. 585, and cases cited.

II. In order for the creditors of the grantor to defeat the deed for fraud it was incumbent on them to prove that it was made by the grantor with a fraudulent intent and that the grantee had notice of such intent when he purchased. Plaintiff insists that such fraud of the grantor and knowledge thereof and participation therein was sufficiently shown by the following undisputed facts: The insolvency of the grantor; the relationship of the...