Rose v. Dunklee

• Decision Date: 09 January 1899
• Citation: 56 P. 342,12 Colo.App. 403
• Parties: ROSE et al. v. DUNKLEE.
• Court: Colorado Court of Appeals

56 P. 342

12 Colo.App. 403

ROSE et al. v. DUNKLEE.

Court of Appeals of Colorado

January 9, 1899

Appeal from district court, Arapahoe county.

Bill by George F. Dunklee against Elizabeth Rose and others to set aside a fraudulent conveyance. Decree for plaintiff, and defendants appeal. Affirmed.

B.F. Harrington, for appellants.

Geo. F Dunklee and O.E. Jackson, for appellee.

BISSELL J.

The controversy between these parties has been before the court in various forms, and in some of its phases has been re-presented to us in the argument of two other causes (56 P 348, 349) submitted since the original decision of this particular case. It has occasioned us a great deal of difficulty, and, while it may appear to be free from doubt when our position is fully stated, the various arguments which have been had before us have led to a re-examination of the specific question on which the appeals have been generally rested and the defense based, and we have deemed it best to reformulate the opinion in this case, and, fully as we can, and clearly as we may, state our conclusions. The result is, in some of its aspects, precisely like that antecedently reached, although in one particular it extends the rights of the appellee and concludes the appellants on one matter respecting which, as we originally looked at the case, they were entitled to a further hearing. From 1883 to 1888 one Otis, who was an employé of Elizabeth Rose, earned wages which were unpaid when he brought his suit and obtained judgment, in 1888, for $1,221. From that judgment Elizabeth Rose, the defendant prosecuted an appeal to the supreme court, wherein the judgment was reversed (31 P. 493) for errors exhibited in the opinion, and the cause sent back for a new trial. In April 1893, the cause was retried, and Otis had a verdict. A motion for new trial was interposed, various proceedings had under our practice, the objections to the verdict and procedure were overruled, and final judgment entered. Between the commencement of the suit and the disposition of the motion for a new trial, and in January, 1893, the defendant Rose deeded to her daughter, Mrs. Riddle, who is a co-defendant in this suit, a large amount of property. The deed was executed in January, acknowledged in February, but was not recorded by Mrs. Riddle until the day the jury rendered the verdict against her mother, Mrs. Rose. The history of this particular case, with other facts which are illustrative of the controversy, is set out and commented on in the case of Otis v. Rose, 48 P. 967, 9 Colo.App. 449. This case is referred to because that litigation and the facts which it developed are more or less explanatory of the situation in this cause. Since they are neither vital nor pivotal in the determination of this particular appeal, it is enough to refer to that case, and parties who may be interested in tracing the history of the litigation, taking the various opinions together, will be abundantly advised of the transaction out of which the litigation has grown. After that judgment was recovered, the cause was appealed to this court, and the judgment affirmed. Thereafter Otis brought suit to set aside the conveyance made in January, 1893. The basis of the suit was the alleged fraudulent character of the transfer by Mrs. Rose to her daughter. The consideration which was set up in that suit as establishing the bona fides of the conveyance was the settlement of a very ancient claim which grew out of an inheritance which passed to the daughter, when an infant, on the death of her father. The conveyance made in the settlement of this claim was attacked as fraudulent in fact, and the object of the suit was to subject the property conveyed to the payment of the judgment. Otis failed, and we affirmed the judgment in an opinion which is reported in 48 P. and 9 Colo.App., heretofore cited. Thereafter Otis transferred his judgment to Dunklee, who brought this suit.

From the allegations and the proof it appears that after Otis had earned his wages, and Mrs. Rose had incurred the debt, and he had recovered the judgment which was reversed, Mrs. Rose conveyed to Mrs. Riddle two lots which are the subject-matter of this action, and described as "Lots 1 and 2, Rose's subdivision of block 3, Lakeview." At the time of the conveyance the property had not been platted as a subdivision, or, if platted, the description was inaccurate, and omitted a portion of the lots intended to be conveyed, and a subsequent deed of quitclaim was executed to cure this defect; otherwise, this latter deed is of no importance. The original conveyance of these two lots was made in 1890. The consideration expressed was one dollar, and the purpose of the transfer is very clearly exhibited in the testimony. The condition of the property at the time of the transfer and the delivery of the deed is quite plainly shown by Mrs. Riddle's evidence. According to her version of the transaction, the conveyance was intended as a wedding gift. She moved into the house which had been built on the lots prior to her marriage, although it was not entirely finished, though sufficiently so for the purposes of occupancy. According to her story, the lots and the house were intended as a wedding present; and, although the matter was not made, otherwise than as a legal result, the subject-matter of an issue, or of testimony offered pro and con with reference to the pivotal question of fact, it clearly transpired from what Mrs. Riddle said that the house was built, and, with the lots as thus improved, transferred to her, and intended as a gift on her marriage. The only evidence which she gives respecting it is found partly in her direct and partly in her cross examination, and in this form: "Q. Did you build a house on these lots? A. Yes, sir. Q. When? A. I do not know just when it was commenced. We went into it after we were married. Q. And then you commenced building before you were married? A. In April or May. In was not quite built, but we went right in. It was being built before we were married, and before I got the deed. The house cost $1,465, and the furnace we put in the following fall cost $65, and the barn and fence we built separate from the house cost $72. We have since built two porches that cost $75, and the putting in of the lawn, and getting it graded, etc., cost us nearly $100. I have forgotten just the number of dollars. I have been living there all the time since, with the exception of about six weeks. My home has been there all the time. My mother was owing me at that time $4,468.80. I possibly may not have figured it correctly. I figured it at simple interest. She owed, besides, $1,000 to a Mr. Mann for the use of W.G. Cowan. The debt was incurred before I was married. Q. And the house and improvements were put on there before the deed was given to you? A. It was given as a wedding present, and we did not get it until the day we were married. Q. And at that time your mother was owing you this sum? A. Yes, sir; but that was never taken into consideration. It was a gift, the same as to the other girls. I have these 33 lots now, yes, sir. They are clear, except the taxes." It is thus apparent that the property, as improved, was deeded to the daughter as a wedding gift, having been arranged to this end; and there is nothing in the testimony which denotes, or compels us to conclude, or even justifies us to infer, that the daughter built the house or improved the property, save as to what may have been put into it after she had moved in under the deed. We are thus particular in stating the exact situation respecting the improvements because it is seriously contended that whatever rights Dunklee had to set aside the conveyance and enforce the lien of his judgment on the property could extend only to the lots themselves, and could not include the improvements. We are very frank to say that on the original hearing we inclined to that opinion, and we were moved to return the case for evidence respecting the value, and limit Dunklee's rights in this particular. A careful re-examination of the question in the light of this testimony, and in the light of the issues which the defendants tendered, has led us to a different conclusion. It will be remembered we before adverted to the limitation on the issues, which was followed by a statement of the testimony. We will now advert to the issue as framed, and comment on and determine the force and effect of a stipulation made at the time of the trial.

Suit was brought to set aside the conveyance of this property. The complaint was full in its averments respecting the commencement of the suit by Otis, the trial of the cause before the jury, the motion for a new trial, the entry of judgment, the filing of the transcript in the office of the county clerk, the affirmance of the judgment, the issuance of an execution, an alias, and a levy on these particular lots and then set out the conveyance, which was charged to be voluntary. The complaint then proceeded with a full averment respecting the insolvency of the defendant Rose, her inability to pay her debts, and the intent, both actual and legal, to defraud her creditors, and especially the claim and judgment owned by Otis, and that the conveyance in fact operated as a fraud on his rights, and prevented his recovery. This complaint the plaintiff amended by interlineation, and then a demurrer was filed to the amended complaint, and it was again amended by the insertion of an allegation numbered in the record 14 1/2, wherein he set up a failure to discover the fraud and the facts constituting it within three years next preceding the commencement of the action. The allegation was as full as it well could be on a subject of this sort, where the fraud was constructive, rather...