Rowley v. Shepardson

• Decision Date: 13 January 1916
• Citation: 90 Vt. 25,96 A. 374
• Parties: ROWLEY et al. v. SHEPARDSON et al.
• Court: Vermont Supreme Court

96 A. 374

90 Vt. 25

ROWLEY et al.

v. SHEPARDSON et al.

Supreme Court of Vermont. Windham.

Jan. 13, 1916.

Appeal in Chancery, Windham County; Frank L. Fisk, Chancellor.

Bill by E. E. Rowley and another against George W. Shepardson and another. From a decree dismissing the bill, the orators appeal. Decree reversed, and cause remanded.

Argued before MUNSON, C. J., and WATSON, HASELTON, POWERS, and TAYLOR, JJ.

Charles S. Chase and William R. Daley, both of Brattleboro, for appellants. Barber & Barber, of Brattleboro, and Cudworth & Pierce, of So. Londonderry, for appellees.

TAYLOR, J. This is a bill in equity to enforce satisfaction of a judgment that plaintiffs recovered against the defendant George W. Shepardson in an action on the case for deceit in the sale to them of a certain farm known as the "Hunting farm." The cause was first here on demurrer to the bill. 87 Vt. 57, 87 Atl. 528. The decree was then reversed and the cause remanded, with mandate permitting amendment of the bill, which has since been made. The cause was heard before the chancellor on the amended bill, answers, and evidence taken. During the trial certain exceptions were noted to the chancellor's rulings. On the facts found the chancellor dismissed the bill, and from this decree the orators appeal.

The material facts found by the chancellor are as follows: Defendant George W. Shepardson has no property in his own name upon which the execution in the suit at law can be satisfied. The plaintiffs seasonably took out successive executions which were duly returned unsatisfied; and on January 23, 1914, they took out an alias execution which was seasonably levied on all of the real estate of defendant Eva C. Shepardson and upon her interest in the real estate mortgage executed by the plaintiffs to her, all as the property of the said George W. The property thus levied upon was certain real estate in Londonderry, Vt., known as the "Hermitage," of which the record title is in Eva C. This real estate is unincumbered, and is valued from $6,000 to $9,000. Eva C. also holds the mortgage on the Hunting farm and the notes which it secures. Defendants are husband and wife, and formerly lived in Massachusetts, where they were both employed on a salary for many years, the former receiving $1,200 to $1,500 a year and board, and the latter about $300 a year and board. At the time defendants came to Vermont to reside they had together about $10,000 represented by deposits in savings banks held by each individually in about equal shares; also an equity in real estate in Massachusetts valued at about $2,400 standing in the name of Eva C. On coming to Vermont George W. made several purchases and sales of real estate, using his own and his wife's money in the transactions. He acted as manager and agent for his wife in these matters, exercising his own judgment, and she acquiesced in his dealings.

One of the purchases made by him was the Hunting farm, over which this litigation arose. The consideration paid was $4,000, consisting of $2,400 realized from the equity in the Massachusetts property, standing in the wife's name, $750 from each of their savings deposits, and $100 as to which the source did not appear. George W. held the title to the Hunting farm in his own name until January 12, 1904, when he transferred it without consideration to Eva C. The farm was sold and conveyed to the plaintiffs in November, 1905, and in this transaction the fraud was committed for which the plaintiffs recovered judgment against George W. The purchase price of the farm was $1,600, for which the plaintiffs executed to Eva C. 16 promissory notes of $100 each secured by a mortgage to her of the farm. Six of these notes have been paid with interest on the whole indebtedness to November 20, 1911. Payments were sometimes received by George W., and sometimes by Eva C.

George W. purchased the Hermitage property in December, 1904, and the same was deeded directly to Eva C. The price paid was $3,750, made up as follows: $850 from George W.'s personal funds, $850 from savings deposit in Eva C.'s name, and $2,050 received from the sale of timber purchased in 1901 for $1,050, with funds from savings deposit in Eva C.'s name. The chancellor finds that the conveyances were made to Eva C. to enable her to hold the property against George W.'s heirs in case of his death, he being in feeble health and wishing that it should go at his death to his wife and not to his heirs; that George W. was not indebted to any one at the time of the several purchases and transfers, and has never owed any debts, so far as appears, for which claim has been made against his property, except the "debt" for which this action was brought; that none of the conveyances were made by the defendants with a view of defeating the claim of the plaintiffs, and all, save the deed to the plaintiffs of the Hunting farm, antedated the defendants' acquaintance with the plaintiffs.

Plaintiffs claim that on these facts they are entitled to a decree enabling them to satisfy the execution out of the property as belonging to George W. The argument is that there is no finding that Eva C. had any separate estate; that money earned by her during coverture belonged to the husband in the absence of an agreement to the contrary; that there is no finding of a gift to her of the money deposited in her name or of the property conveyed to her; that the taking of title in her name on the findings did not change the ownership of the property so long as George W. lived; that in the circumstances the inference is that the property still belongs to him. But all inferences to be drawn from the facts found are against the plaintiffs, as the decree is for the defendants. It is unnecessary to consider whether the facts found show a valid gift to Eva C. It is enough to say that on the facts found, supported by such inferences as could reasonably be drawn therefrom, we cannot disturb the decree on the ground that Eva C. holds the title to the "Hermitage" property and the mortgage of the Hunting farm in fraud of plaintiffs' rights as creditors of George W. Their right of recovery, if any, on the case before us, grows out of the fraud affecting the notes and mortgage received by Eva C. in the sale of the Hunting farm.

It is claimed that, as the findings show that Eva C. has the avails of the fraudulent transaction, the plaintiffs are entitled to have the notes remaining in her hands canceled and the amount applied upon their execution against George W. The bill is framed with this object in view. As drawn it has a double aspect. It seeks to have the judgment in the suit at law satisfied out of the "Hermitage" property and the mortgage on the Hunting farm as held by Eva G. in fraud of creditors; and is also framed to compel her to restore sufficient of the avails of the Hunting farm, which it is alleged she received through the fraud of George W., acting as her agent, to satisfy their execution against him. As a foundation for this...