Steele v. Reid
| Decision Date | 19 July 1920 |
| Citation | 223 S.W. 881,284 Mo. 269 |
| Parties | JOSEPH W. STEELE v. THOMAS L. REID et ux., Appellants |
| Court | Missouri Supreme Court |
Appeal from Jackson Circuit Court. -- Hon. Clarence A. Burney Judge.
Affirmed.
James A. Kemper for appellants.
(1) The Osage City Hotel property was the homestead of T. L. Reid and family, on and prior to the 1st day of March, 1915, and as such was free from the judgment lien and exempt from the levy of execution in favor of any judgment creditor within or without said jurisdiction. It was property in which creditors had no interest whatever, which the law could not touch limit or restrain, and the owner, T. L. Reid, could alienate the same by gift or by sale, at will. Winter v Ritchie, 57 Kan. 212; Roser v. Bank, 56 Kan. 129; Wilson v. Taylor, 49 Kan. 774; Hixon v. George, 18 Kan. 253; National Bank v. Kopplin 42 P. 263; Reed v. Nicholson, 186 Mo. 404; Pocoke v. Peterson, 256 Mo. 501; Balz v. Nelson, 171 Mo. 690; Rose v. Smith, 167 Mo. 86. (2) Being the owner of the fee of said hotel property, Mae N. Reid had absolute and unrestricted authority to alienate the same without regard to the rights of any creditors of T. L. Reid; and if the Osage City Hotel property became the property of Mae N. Reid, the transaction by which it was conveyed to her by T. L. Reid was not fraudulent, and Mae N. Reid, could alienate the same. Winter v. Ritchie, 57 Kan. 212; Roser v. Bank, 56 Kan. 129; Wilson v. Taylor, 49 Kan. 774; Hixon v. George, 18 Kan. 253; National Bank v. Kopplin, 52 P. 263; Reed v. Nicholson, 186 Mo. 404; Pocoke v. Peterson, 256 Mo. 501; Balz v. Nelson, 171 Mo. 690; Rose v. Smith, 167 Mo. 86. (3) Being the owner of the fee to said property, free from fraud, Mae N. Reid was fully authorized to exchange the same for the Haddon Hall property in Kansas City, and it is immaterial that the transaction of exchange was in part conducted by T. L. Reid, as her agent, any more than had she been represented by an outside and wholly theretofore disinterested party. Reed v. Nicholson, 189 Mo. 396. (4) Haddon Hall, being the property of Mae N. Reid, is in no way liable for the debts of T. L. Reid contracted before Mae N. Reid acquired said property, any more than would property acquired by her at said time in which T. L. Reid had never had any interest whatever be liable for said debts. Reed v. Nicholson, 189 Mo. 396; Bebb v. Crowe, 18 P. 225; Hoffman v. Hill, 28 P. 624; Rush v. Gordon, 16 P. 700. (5) Had the title of the Kansas homestead rested in T. L. Reid, upon exchanging the same for property in Missouri taking the title in the wife, would not be in fraud of creditors, and the same could be held by the holder of the title thereof free from levy and sale for prior existing debts of the owner of the Kansas homestead property. Stinde v. Behrens, 81 Mo. 254. (6) Respondent cannot maintain this action and cannot recover for the reason that it is not pleaded and the evidence fails to show that an execution had been issued upon plaintiff's judgment and returned unsatisfied; but it affirmatively appears from the evidence that such was not done. Brown v. McKown, 265 Mo. 320. (7) Judgment ceased to be a lien at the expiration of three years after the same was obtained and respondent has no such interest in Haddon Hall -- having no judgment lien against the same. Kegan v. Haslett, 128 Mo.App. 293; Larimore v. Tyler, 88 Mo. 661; Sublett v. Railroad Co., 96 Mo.App. 113; McLaughlin v. McLaughlin, 16 Mo. 242.
Walter W. Calvin for respondent.
(1) The testimony established the fact that Thos. L. Reid was, for a long time prior to the trial of this cause, as well as at the time of the trial, insolvent; and appellants' contention that an execution should have been issued upon the judgment in question, as a condition precedent to the maintaining of this action, must be ruled against them. Sec. 2133, R. S. 1909; Zoll v. Soper, 75 Mo. 460; Davidson v. Dockery, 179 Mo. 687; St. Francis Mill Co. v. Sugg, 169 Mo. 130; Klauber v. Schloss, 198 Mo. 502; Wilson v. Salisbury, 167 Mo.App. 191; Commercial State Bank v. Ankrum, 191 Mo.App. 251. (2) Neither was respondent required to institute an action in a court of equity to have the conveyance in question set aside as a consummated fraud. He also had the right, and as he did, to institute an action to set aside the conveyance in question as fraudulent as to him, or to the extent of his judgment; which, being done, he could thereupon have execution issued upon his judgment, and the realty sold to satisfy the same. Spindle v. Hyde, 247 Mo. 32. (3) A new homestead, acquired with the proceeds derived from the sale of an old one, refers wholly and exclusively to Missouri homesteads; and, the law does not permit one to sell a homestead in another State and with the proceeds derived therefrom acquire a homestead in this State, with the result that exemption rights would attach to the latter. Sec. 6712, R. S. 1909; Bank v. Dougherty, 167 Mo. 1; Kennedy's Admr. v. Duncan, 157 Mo.App. 212. (4) The record is replete with testimony justifying the conclusion of the court that the conveyance in question was a fraudulent one. Moreover, fraud need not be proved by direct testimony; and, in transactions between husband and wife, slight evidence thereof is sufficient. Sec. 2881, R. S. 1909; St. Francis Mill Co. v. Sugg, 206 Mo. 155; First Natl. Bank v. Fry, 216 Mo. 42. At least a portion of the consideration for the conveyance of the Everest Hotel by Thos. L. Reid, to Mae N. Reid, being fictitious, rendered even that conveyance voidable at the instance of respondent. Klauber v. Schloss, 198 Mo. 502; Bates County Bank v. Gailey, 177 Mo. 181; State ex rel. Robinson v. Hope, 102 Mo. 410. (5) In any event the conveyance of Haddon Hall to Mae N. Reid had the effect of hindering and delaying the creditors of Thos. L. Reid; and for that reason that conveyance must be regarded as fraudulent. Kurtz v. Troll, 86 Mo.App. 649; McCollum v. Grain, 101 Mo.App. 522; Kurtz v. Troll, 175 Mo. 506; Klauber v. Schloss, 198 Mo. 502.
OPINION
This plaintiff, on February 20, 1912, recovered a judgment in the Circuit Court of Jackson County, Missouri, against Thomas L. Reid for the sum of five hundred dollars, and the judgment bore interest from that date at the rate of six per cent per annum. The present action was brought against said Thomas L. Reid and his wife, Mae N. Reid, to set aside a conveyance executed December 30, 1916, by James T. Broughal and his wife, Annie L. Broughal, which conveyed to defendant Mae N. Reid Lots 1 and 2 (except that part taken for streets) in Roseland, an addition to Kansas City, Missouri, and subject said premises to the levy of an execution issued to collect plaintiff's said judgment. On the lots is a large three-story building called Haddon Hall, and used for an apartment house where the tenants are given meals. The relief plaintiff seeks is asked upon allegations that the conveyance of the property to Mae N. Reid was for a consideration paid entirely by Thomas L. Reid, who had the title put in her name, for the purpose of delaying and defrauding his creditors, including the plaintiff, and that Mae N. Reid was cognizant of the facts and participated in that purpose. The answer admits plaintiff obtained a judgment against T. L. Reid as alleged in the petition, and that the judgment bore interest from its date; denying all other allegations. For further defense the answer stated that on December 18, 1916, (the date when the contract for the purchase of the aforesaid premises from Broughal and wife was made), and for years prior thereto, the defendants were husband and wife and resided in Osage City, Kansas, where they owned and occupied as a homestead, Lots 1, 3, 5, 7, 9, 11, 13 and 15, in Block 4, of Dodd & Boyds' Addition to Osage City, and improvements thereon; that those lots comprised less than one acre and as the homestead of defendants the premises "were free from the lien of any judgment and exempt from liability for any indebtedness due from the said T. L. Reid, under Section 3440, Revised Statutes 1909, of the State of Kansas;" that while the said lots were occupied by defendants as a homestead, and on March 1, 1915, defendant T. L. Reid conveyed them for a valuable consideration to Mae N. Reid; that on December 18, 1916, Mae N. Reid negotiated with James T. Broughal and Annie L. Broughal an exchange of the aforesaid homestead for Lots 1 and 2 (except that part taken for streets) in Roseland Addition to Kansas City, Missouri; that the negotiation terminated December 30, 1916, in the aforesaid deed of that date made by James T. Broughal and his wife, conveying to Mae N. Reid said Lots 1 and 2 in Roseland Addition to Kansas City; that in said transaction Mae N. Reid acted in good faith, without intention to defraud. Plaintiff joined issue as to the new matter in the answer by a replication in the form of a general denial.
The court below found the conveyance of the Broughals of said lots in Roseland Addition was made to Mrs. Reid for the purpose of hindering, delaying and defrauding the creditors including plaintiff, of T. L. Reid; that the conveyance rendered T. L. Reid insolvent; that the real estate mentioned in it was the property of defendant T. L. Reid, subject to incumbrances existing thereon prior to the date of the conveyance to Mae N. Reid, and in equity and good conscience his interest should be subjected to the payment of plaintiff's judgment. It was accordingly considered and adjudged that said deed be set aside and for naught held against the plaintiff; that unless T. L. Reid should within ten days from the date of the decree to set the deed aside, satisfy plaintiff's judgment against him, which then amounted to $...
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