Salemonson v. Thompson
| Decision Date | 26 February 1904 |
| Court | North Dakota Supreme Court |
Appeal from District Court, Grand Forks county; Fisk, J.
Action by Thone Salemonson against Julia Thompson. Judgment for plaintiff, and defendant appeals.
Reversed.
Judgment reversed, and judgment entered in favor of the defendant.
B. G Skulason and F. B. Feetham, for appellant.
A conveyance fraudulent as to existing creditors, is fraudulent and may be avoided by subsequent creditors as well. Rev Codes, 1899 section 5052. Romans v. Maddux, 41 N.W 763; Day v. Cooley, 118 Mass. 527; McLane v. Johnston, 43 Vt. 48; Nichols v. Ward, 73 Am. Dec. 177; Whitmore v. Woodard, 28 Me. 392; Smyth v. Carlyle, 16 N.H. 464; 14 Enc. of Law. 269.
Defendant seduced by Myrom and pregnant by him, was a creditor at time of fraudulent transfer, if not on account of breach of promise of marriage, at least for the support of her illegitimate child. Ingwaldson v. Skrivseth, 7 N.D. 388, 75 N.W. 772; Soly v. Aasen, 10 N.D. 108; 86 N.W. 108.
The judgment in Thompson v. Myrom, an action for breach of promise and seduction, is conclusive, and makes the defendant herein a creditor, and such judgment cannot be impeached collaterally. 1 Black on Judgments, sections 245, 246, 252 and 294; 16 Am. & Eng. Enc. Law, 394; 17 Am. Eng. Enc. Law, 849.
Defendant became a subsequent judgment creditor in the breach of promise action and can attack the fraudulent transfer made therefor. Soly v. Aasen, supra; Greer v. Wright, 52 Am. Dec. 111 and note.
Myrom, having failed to marry defendant at the time agreed upon, made a second promise which must stand untainted by any suspicion of illegality. If the original promise was illegal, the subsequent ones were good. 4 Am. & Eng. Enc. of Law, 889; Burke v. Shaver, 23 S.E. 749; Spellings v. Parks, 58 S.W. 126; Hotchkiss v. Hodge, 38 Barb. 117; 5 Cyc. Law & Proc. 100; Pyle v. Piercy, 55 P. 141.
A fraudulent debtor's interest is attachable. On grounds of public policy he will not be allowed to assail his transfer; as to his creditors his conveyance is a mere nullity. Faber v. Wagner, 10 N.D. 287; 86 N.W. 963; Lockren v. Rustan, 9 N.D. 43, 81 N.W. 60; Westervelt v. Baker, 95 N.W. 793; Westervelt v. Hagge, 85 N.W. 852; 4 Cyc. Law & Proc. 562; Welch v. Ayres, 61 N.W. 635; Blass v. Anderson, 23 S.W. 94; Brasie v. Mpls. Brewing Co., 92 N.W. 340.
When the grantee participates in the fraud, it makes no difference whether he pays full consideration, or how, or to whom, he pays it, the transaction is void. Daisy Roller Mills v. Ward, 6 N.D. 317; 70 N.W. 271; Paulson v. Ward, 4 N.D. 100; 58 N.W. 792; Fluegel v. Henschel, 7 N.D. 276; 74 N.W. 996; Lockren v. Rustan, supra; Morey Bros. v. Stringer, 95 N.W. 978; Foley v. Doyle, 95 N.W. 1067; Rice et al. v. Wood et al., 31 L. R. A. 609, Sweet v. Wright, 10 N.W. 871.
R. M. Carothers and Guy C. H. Corliss, for respondent.
The payment to the grantor's creditor of the full value of the property alleged to have been fraudulently transferred, protects the grantee. Crowninshield v. Kittridge, 7 Metcf. 520; Steere v. Hoagland, 50 Ill. 377; Clements v. Nicholson, 6 Wall. 299, 18 Law Ed. 786; Sprague v. Ryan, 75 N.W. 390; Vorhees, Miller & Co. v. Blanton, 83 F. 234; Bump on Fraudulent Conveyances, section 500; Gottingham v. Greeley-Barnham Grocery Co. 30 So. 560; Crocker v. Huntzicker, 88 N.W. 232; 14 Am. & Eng. Enc. of Law, (2d Ed.) 347; Morrison v. Houck, 93 N.W. 593; Wakeman v. Grove, 4 Paige 23; Goodwin v. McMinn, 53 A. 762; Ames v. Blunt, 5 Paige 13; Murphy v. Briggs, 69 N.Y. 446, Hutchins v. Sprague, 4 N.H. 469; Kaupe v. Briggs, 2 Robt. (N. Y.) 459, 79 N.Y.S. 161; Roane v. Bank, 1 Head. (Tenn.) 526; Stoddard v. Butler, 7 Paige 163; Stover v. Herington, 7 A. 142, 41 Am. Dec. 86; Packer v. Barker, 2 Metcf. 423; Chatterton v. Mason, 86 Md. 236; Pickner v. Wevil, 9 Ala. 305; Wiley v. Knight, 27 Ala. 336; McLear v. Letchford, 60 Miss. 169; Mobile Bank v. Harris, 6 La.Ann. 811.
A creditor who takes a conveyance from his debtor as security, or in payment, is protected, although such debtor intended by the transaction to defraud his other creditors, and the favored creditor is cognizant of his purpose. Paulson v. Ward, 4 N.D. 100, 58 N.W. 792; 14 Am. & Eng. Enc. Law (2d Ed.) 295.
An existing creditor may take security or property on account of his debt. He does not aid the debtor in converting his property in a kind that he can run away with or conceal, as in the case of a purchase; he merely exercises his right to collect or secure his own debt. The debtor having a legal right to prefer, and the creditor a legal right to take the preference, the motive prompting such preference is immaterial. Bump on Fraudulent Conveyance, 187 (3d Ed.); 14 Am. & Eng. Enc. Law, (2d Ed.) 229.
The attachment, judgment, execution and sale are absolutely void. There was no personal service or appearance, and the only pretense of jurisdiction is the pretended attachment of the land; and this had been conveyed by a valid conveyance. Myrom had no interest to be attached, legal or equitable. As between two judgment creditors, he who first files his bill and serves process obtains an equitable lien upon the property superior to a judgment creditor having a prior judgment. Chittenden v. Brewster, 2 Wall. 191, 17 Law Ed. 839; Burt v. Keyes, 1 Flipp. 61; MaCalmont v. Lawrence, 1 Blatchf. 232; Crawford v. Kirksey, 55 Ala. 282; Dargar v. Waring, 11 Ala. 998; Newell v. Morgan, 2 Harr. 225; Cole v. Mottle, 98 Ill. 58; Lyon v. Robbins, 46 Ill. 276; Kisterson v. Tate, 94 Ia. 665, 63 N.W. 350; Fuqua v. Bank, 35 S.W. 545; Richardson v. Ralfsnyder, 40 W.Va. 15; Hartshorn v. Eames, 31 Me. 93; George v. Williams, 26 Mo. 190; Young v. Gillespie, 12 Heisk. 239; Brooks v. Gibson, 7 Lea. 271; Smith v. Summerfield, 108 N.C. 284.
After a fraudulent conveyance the grantor has no attachable interest in the property. Davidson v. Burke, 32 N.E. 514; Lyon v. Robins, 46 Ill. 272; Rappleye v. Bank, 93 Ill. 396; Miller v. Sherry, 2 Wall. 237, 17 Law Ed. 827; In re Estes, 3 F. 134; Bump on Fraudulent Conveyances, 461, 466, 490, 491 and 492; Preston-Parton Milling Co. v. Dexter Horton & Co. 60 P. 412; Doster v. Bank, 77 Am. St. 116.
The sole right of the creditors is to resort to equity to remove the fraudulent obstruction in the way of his enforcing his claim against the property. Rev. Codes, section 5054.
A contract is not lawful which is contrary to good morals. Rev. Codes, sections 3920, 3874.
Cross-examination showed the promise to marry was void, as it was based on the consideration of unlawful sexual intercourse. Boigneres v. Boulon, 54 Cal. 146; Hanks v. Naglee, 54 Cal. 51; Saxon v. Wood, 30 N.E. 797; Burke v. Shaver, 23 S.E. 749; Beaumont v. Reeve, 8 Q. B. 483; Button v. Hibbard, 82 Hun. 289; Baldy v. Stratton, 11 Pa. 316; Goodall v. Thurman, 1 Head. 209; Eve v. Rodgers, 12 Ind.App. 623.
Despite the judgment, the grantee may show that the alleged creditor was never a creditor, when such alleged creditor assumes to attack a transfer from his alleged debtor to a third person. Yeand v. Weeks, 53 Am. St. 50; Moore v. Ashton Plantation Co. 30 So. 152; Miller v. Miller, 23 Me. 22; Miller v. Johnson, 27 Md. 6; Botwell v. McClure, 30 Vt. 674; Jenness v. Barry, 17 N.H. 549; Prescott v. Hayes, 43 N.H. 593; Sargent v. Salmond, 27 Me. 539; Church v. Chapin, 35 Vt. 223; King v. Thorp, 26 Ia. 283; Downs v. Fuller, 35 Am. Dec. 393: Vose v. Morton, 50 Am. Dec. 750; Teed v. Valentine, 65 N.Y. 471; Bruggerman v. Hoerr, 7 Minn. 377; Davis v. Davis, 25 P. 140; McClenney v. McClenney, 59 Am. Dec. 738; Millar v. Babcock, 29 Mich. 626; Tyler v. Pratt, 30 Mich. 63; Black v. Nease, 37 Pa. 433; Farris v. Dunham, 17 Am. Dec. 77.
The grantee is protected if on his own motion he pays the debts of the grantor. Longfellow v. Barnard, 79 N.W. 255; Webb v. Brown, 3 Oh. St. 246.
YOUNG, C. J. COCHRANE, J., did not participate in the decision, Judge W. J. KNEESHAW, of the Seventh Judicial District, sitting in his place by request.
This is an action to determine adverse claims to 160 acres of land situated in Grand Forks county. The complaint is substantially in the form prescribed by chapter 5, p. 9 Laws 1901. The plaintiff alleges that she has an estate in fee simple in the premises, and is in possession; that the defendant claims an interest therein; and prays that said defendant be required to set forth such adverse claim, to the end that its validity and priority may be determined. The defendant in her answer alleges, among other things, that on and prior to the 10th day of October, 1901, the land in question was jointly owned and occupied by the plaintiff and her brother, one Charles O. Myrom, each having an undivided one-half interest; that on the above named date the said Myrom pretended to convey to plaintiff his interest therein by a warranty deed; that on the 20th day of May, 1901, prior thereto, mutual promises of marriage were made and entered between this defendant and the said Charles O. Myrom; that in the month of June, 1901, the said Myrom, under said promise of marriage, seduced the defendant and got her with child which child was born on the 11th day of March, 1902, and is still living; that said Myrom broke his said contract of marriage, and refused to perform the same; that during the most of the time in question the said Myrom was a member of the family of the plaintiff, which consisted of plaintiff and her husband, Gunder Salemonson; that the contract of marriage and its breach, and the seduction of the defendant by Myrom, and the relations of the defendant to the said Myrom, were known at all times to the plaintiff and her said husband; that after the breach of said promise of marriage, and...
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