Sanders v. Steele

• Decision Date: 23 November 1899
• Citation: Sanders v. Steele, 124 Ala. 415, 26 So. 882 (Ala. 1899)
• Parties: SANDERS v. STEELE ET AL.
• Court: Alabama Supreme Court

26 So. 882

124 Ala. 415

SANDERS v. STEELE ET AL.

Supreme Court of Alabama

November 23, 1899

Appeal from chancery court, Jefferson county; Thomas Cobbs Chancellor.

Bill by William H. Sanders against Fannie A. Steele and others to establish a trust in certain real estate and other property. From a decree in favor of defendants, complainant appeals. Reversed.

The bill in this case was filed by the appellant, William H Sanders, against the appellees, Fannie A. Steele and others.

The bill was filed to etablish a trust in certain real estate in the city of Birmingham, and also in a certain decree rendered by the chancery court of Jefferson county, Ala., in favor of Fannie A. Steele against the mayor and aldermen of Birmingham, on account of damages to said real estate. As originally filed, the bill alleged in 1883, in accordance with a previous agreement and understanding had between complainant and defendant Fannie A. Steele, the latter purchased several pieces of real estate in the city of Birmingham, Ala., one of which purchases was for the joint account of complainant and herself and the other for complainant alone, taking the title thereto in every instance in her own name, in order that the property might be more easily and conveniently disposed of if it should be sold again; but that it was well understood between complainant and defendant that every such purchase made on joint account was for the equal benefit of complainant and defendant nad that the purchases made solely for complainant were for his benefit alone. The property purchased on joint account consisted of two lots situated on the southeast corner of First avenue and Twenty-First street. The location of the other pieces of property need not be here mentioned, for reasons to be presently stated. The bill alleged that the purchase price of the lots situated on the corner of First avenue and Twenty-First street, above mentioned, was $5,000 of which, by the terms of purchase, one-fourth was to be paid in cash and the balance in semiannual installments of $625 with interest from the 14th day of May, 1883; that the said Fannie A. Steele drew on complainant for the sum of $1,254.15 on account of the first installment of the purchase money on said lots, with interest to that date, which draft complainant paid, and that afterwards on the 14th day of November, 1883, he also paid to Fannie A. Steele $320, as and for one-half of the first installment note given for said lots, with interest thereon, which was paid by her on the purchase price of said lots; that afterwards, on, to wit, the 22d day of January, 1890, said Fannie A. Steele sold a portion of said lots to Steiner Bros. for about $23,000 in cash, and that after paying the balance of purchase money with interest thereon amounting to about $5,000, the said Fannie A. Steele had or should have had left in her hands the sum of about $18,000, one-half of which belonged to complainant. But that said Fannie A. Steele had only paid to complainant of the proceeds of said sale the sum of $5,000, leaving a large balance due to him on account of such sale, none of which had ever been paid.

The bill further alleged that on the 24th day of September, 1890, the said Fannie A. Steele, for the pretended consideration of $25,000, sold and conveyed to one James H. Brown all the remainder of said lots not sold to Steiner Bros.; that no part of said consideration was paid by said Brown or intended to be paid, and that it was well understood between the said Fannie A. Steele and the said James H. Brown at the time of the making of said deed that the legal title was vested in said Brown in secret trust for the benefit of said Fannie A. Steele, and that said Brown continued to hold said property up to the time of his death for the benefit and use of the said Fannie A. Steele; that if complainant was mistaken in saying that no part of the consideration for said property was paid by said Brown, if anything was paid by him to her the same had long since been repaid by the said Fannie A. Steele; that said conveyance was made by her to said Brown without complainant's knowledge or consent, for the purpose of defeating his rights in the premises and for the purpose of hindering, delaying and defrauding creditors of the said Fannie A. Steele; that after the making of said deed to said Brown the latter had pretended to mortgage the property, so conveyed, to R. & J. S. McCord, to secure a pretended indebtedness of said Brown to the said R. & J. S. McCord, but that whatever interest the said R. & J. S. McCord might have acquired in said property the same was subordinate to the rights of complainant.

It was further alleged that the said Fannie A. Steele had brought suit in the chancery court of Jefferson county, Ala., against the mayor and aldermen of Birmingham to recover damages alleged to have been sustained by her because of the erection of a bridge over and along Twenty-First street adjacent to said lots; that on the 4th day of November, 1892, a decree had been rendered in her favor in said suit against the said mayor and aldermen of Birmingham for the sum of $2,750, with interest from the 4th day of November, 1891, together with costs of suit; that while said decree was rendered in the name and in favor of Fannie A. Steele alone on account of damage and injury to said property, the same was in truth and in fact a recovery by her for the joint use of herself and complainant; the said Fannie A. Steele being trustee for him to the extent of an undivided one-half interest in said property and in said decree. It was then averred that the American National Bank, a creditor of said Fannie A. Steele, had garnished the said mayor and aldermen of Birmingham on a judgment recovered by it against the said Fannie A. Steele, and that said mayor and aldermen of Birmingham filed an answer admitting its indebtedness to said Fannie A. Steele in the amount above stated, and suggesting that W. M. Spencer, W. C. Ward and S.W. John claimed to have an interest in said fund.

The said James H. Brown was made a party defendant to the suit, but died pending the suit, and the same was revived against his heirs and personal representatives. J. S. McCord was also made party defendant, it being alleged that the said R. McCord had died leaving no debts and leaving the said J. S. McCord as his sole heir at law. The mayor and aldermen of Birmingham, the American National Bank, W. M. Spencer, W. C. Ward and S.W. John were also made parties defendant, and the four last-named parties were required to propound their interest in and to said decree. The prayer of the bill was that said conveyance made by Fannie A. Steele to James H. Brown should be decreed to be of no validity as against complainant; that said mortgages to R. & J. S. McCord should be declared subordinate to the rights of complainant, and that the complainant should be decreed to be the owner in fee of an undivided one-half interest in all of said lots which remained after the sale and conveyance to said Steiner Bros.; that complainant should be decreed to be entitled to one-half of the decree obtained against the mayor and aldermen of Birmingham, and that the other one-half of said decree should be condemned to the payment of the amount due to complainant by the said Fannie A. Steele on account of said property.

There was a demurrer to the bill on account of multifariousness, which was sustained, and the bill was amended by eliminating all allegations with reference to the real estate mentioned other than the lots situated on the corner of First avenue and Twenty-First street. The bill was again demurred to for multifariousness and on other grounds; but the demurrer was overruled and the defendants all answered. Fannie A. Steele denied all the material averments of the bill, so far as it was alleged that the property in question was bought for the joint use and benefit of complainant and herself, so far as it was alleged that the sale that was made by her to James H. Brown was fraudulent and void as against complainant. The personal representatives and heirs at law of the said James H. Brown also answered to the same effect. The said J. S. McCord set up the fact that he was a bona fide purchaser for value without notice of complainant's claim, and without notice of the alleged fraud of Fannie A. Steele in making the said deed to said Brown to hinder, delay or defraud her creditors. W. M. Spencer by his answer claimed that the decree rendered against the mayor and aldermen of Birmingham had been transferred to him absolutely by the said Fannie A. Steele prior to the institution of this suit, for a valuable consideration, and that the same was his property. W. C. Ward disclaimed any interest in the decree, and S.W. John set up that he had an attorney's or solicitor's lien on the decree for services rendered by him in procuring said decree. There was a decree pro confesso against the mayor and aldermen of Birmingham for want of answer. The American National Bank claimed to have acquired by its garnishment a lien on said decree prior to the equity of complainant.

On the hearing the bill was amended so as to allege that, if complainant was mistaken in the averment that said R. & J. S McCord were not bona fide purchasers of said property, in that event the said James H. Brown became liable to complainant as a creditor of the said Fannie A. Steele by her said conveyance to him as trustee in invitum for the value of said property, and for all sums received by him from the said R. & J. S. McCord for said property. It is averred that said Brown received from the McCords in November, 1890, the sum of $4,900, and in September, 1891, $6,000, the payment of which he secured by executing mortgages on said property to them. ...