Sawyer v. Metters

• Decision Date: 05 November 1907
• Citation: 113 N.W. 682,133 Wis. 350
• Parties: SAWYER v. METTERS.
• Court: Wisconsin Supreme Court

133 Wis. 350

113 N.W. 682

SAWYER

v.METTERS.

Supreme Court of Wisconsin.

Nov. 5, 1907.

Appeal from Circuit Court, Grant County; Geo. Clementson, Judge.

Action by Delos L. Sawyer, administrator of John P. Metters, deceased, against Margaret Metters. From a judgment for defendant, plaintiff appeals. Affirmed.

This action was brought by the plaintiff, as administrator of the estate of John P. Metters, deceased, against the defendant, his widow, to set aside a certain deed dated February 28, 1903, from deceased to defendant conveying an interest in lands in Grant county, Wis. The action was commenced under section 3832, St. 1898. The plaintiff's claim, as set up in the complaint, is that the conveyance was made by John P. Metters with the intent to defraud future creditors, the said Metters, as was alleged in the complaint, being at the time of the conveyance about to engage in business at Bigelow, Minn., and that such fraudulent intent was participated in by the defendant. The defendant in her answer put in issue the material allegations of the complaint. The court found: That at the time of the marriage of John P. Metters to defendant he had no money or property and previous to that time had by an accident lost both hands at the wrists. That defendant had about $600 in money, and afterwards had received several sums from her relatives, which sums were turned over to John P. Metters and used up in living expenses. That in March, 1903, said John P. Metters and defendant moved to Minnesota, where said Metters engaged in business. Thomas Metters, father of John P. Metters, died April 18, 1894, and by his will devised to John P. Metters an undivided one-half of 91 acres of land, subject to a life estate therein, and also gave John P. Metters one-fourth of the personal property. That afterwards the executors paid John P. Metters his legacy, aggregating about $1,414. In June, 1894, John P. Metters bought a homestead, for which he paid $350, and took the deed in the name of the defendant. Prior to January, 1903, there had been no agreement or understanding between defendant and her husband that she should be paid the amount turned over to John P. Metters. On February 28, 1903, John P. Metters deeded the undivided one-half of the 91 acres of land mentioned in the complaint to his wife, the defendant. The deed expressed a consideration of $2,075, but there was no consideration paid by defendant at the time of the execution of the deed. It was, however, understood between defendant and her husband that the money to be received from the sale of the homestead, which they were about to dispose of, and which was in defendant's name, should be taken by John P. Metters to help him in his business at Bigelow, Minn. The main object in view by both parties in the deeding of said land to defendant was to prevent it from being subject to the debts of John P. Metters if the Bigelow business should be a failure. That at the time of the execution of this deed John P. Metters owed nothing. In March, 1903, the homestead was sold for $775, and defendant turned this money over to John P. Metters. On March 4, 1903, defendant's husband bought a bill of goods for the store at Bigelow amounting to $656.59 and paid thereon $156.59, and defendant and her husband secured the payment of the balance, $500, by a mortgage on the land in question. She afterwards paid this mortgage, $300 of which she received from the estate of her mother. Defendant's husband, John P. Metters, had about $1,900 capital at the time he removed to Bigelow. He entered into business there in keeping a general store with one C. T. Millard, under the name of Metters & Millard. The firm continued to do business from the spring of 1903 until about January 30, 1906, at which last-named date said Metters and C. T. Millard executed a trust deed to the plaintiff for the benefit of creditors of the firm of Metters & Millard, which included all the property owned by Metters and Millard, or either of them, except exempt property and real estate in Wisconsin owned by John P. Metters. From the proceeds of the stock and property transferred to the trustee part of the indebtedness was paid, but there was not sufficient to pay all indebtedness. On January 30, 1904, the firm of Metters & Millard gave a property statement for the purpose of obtaining credit, in which it was set forth that Metters owned 46 1/2 acres of land of the value of $4,500, and afterwards the firm gave property statements to the effect that Metters owned 46 1/2 acres of land in Wisconsin of the value of $4,500, and that Metters often talked to salesmen stating that he owned this land, and that it was very valuable. That defendant was not present at the times these statements were made by her husband and did not sanction them, except that soon after their arrival in Bigelow she went with her husband to the home of Millard, and at this time Metters stated in the presence of defendant that he owned this land in Wisconsin. That the interest of John P. Metters in the Wisconsin land was worth $2,500 February 28, 1903, when he deeded it to his wife. That John P. Metters died February 10, 1906. That soon after defendant's marriage to John P. Metters she turned over to him $600 and between $300 and $400 which she received from her relatives, also proceeds of other property received from her relatives, aggregating $365. That the defendant was an industrious, economical, hardworking woman, and her husband for several years after their marriage was sickly and unable to do much work or earn anything towards the support of himself and wife, but after his health improved, and before going to Bigelow, Minn., he earned some money. The court concluded as matter of law that under the rule laid down in Ecklor v. Wolcott, 115 Wis. 19, 90 N. W. 1081, the plaintiff could not recover, and ordered the action dismissed. Judgment was entered for the defendant. The plaintiff appealed upon the record, contending that upon the facts established by the findings and evidence he was entitled to judgment. The defendant excepted to the findings and caused a bill of exceptions to be settled.

Geo. B. Clementson (A. E. Boyesen, of counsel), for appellant.

Brown & Brennan and Bucklin & Bucklin, for respondent.

KERWIN, J. (after stating the facts as above).

The main contentions of appellant are: (1) That the case at bar is not ruled by Ecklor v. Wolcott, 115 Wis. 19, 90 N. W. 1081; and (2) that the findings and evidence warrant judgment for plaintiff.

1. As we have seen, the court below dismissed the action and gave judgment for defendant on the strength of Ecklor v. Wolcott, 115 Wis. 19, 90 N. W. 1081, because of certain language used to the effect that under section 3832, St. 1898, it must appear, in order to entitle the administrator to maintain the action, that there will be a deficiency to pay creditors existing at the time of the transfer. This language was obviously inadvertently used by the court and was not necessary to the decision of the case, since the case turned upon the want of any evidence showing “that there was or would be any deficiency of assets in the estate to meet all proper claims against it of any nature.” The language in the opinion in the Ecklor Case, to the effect that it must appear that the suit under this statute can be maintained by the administrator only on account of creditors existing at the time of the transfer, is not a correct statement of the law, and, so far as out of harmony with the doctrine laid down here, must be regarded as overruled. Borchert v. Borchert (decided Sept. 24, 1907) 113 N. W. 35. It is established in the case before us that there are claims allowed against the estate of John P. Metters, deceased, which there are no assets to pay, although these claims did not exist at the time of the transfer in question. The vital question therefore under this head is whether an action under this statute by an administrator can be maintained for the purpose of satisfying claims allowed against the estate not in existence at the time the conveyance sought to be set aside was made, but which were in contemplation. There can be no doubt, under the authorities, that an action can be maintained by an administrator under section 3832, St. 1898, to set aside a conveyance fraudulent as to future creditors whose claims arose after the conveyance, and who were in the contemplation of the grantor at the time of the conveyance, and who were intended by the grantor to be defrauded by such conveyance. So we think it clear that an administrator may attack his decedent's transfer in fraud of a future creditor whose claim has been allowed, where there is a deficiency of assets. The statute (section 3832) seems clearly to warrant this construction and cover a fraudulent transfer during the lifetime of deceased affecting future creditors as well as creditors existing at the time of the transfer. It provides: “When there shall be a deficiency of assets in the hands of an executor or administrator and when the deceased shall in his lifetime have conveyed any real estate...