Stramann v. Scheeren

• Citation: 42 P. 191,7 Colo.App. 1
• Parties: STRAMANN et ux. v. SCHEEREN et al.
• Decision Date: 14 October 1895
• Court: Court of Appeals of Colorado

42 P. 191

7 Colo.App. 1

STRAMANN et ux. v. SCHEEREN et al.

Court of Appeals of Colorado

October 14, 1895

Appeal from district court, Arapahoe county.

Action by Julia Scheeren and others against W.J. Stramann and wife to set aside a conveyance to the wife by the husband as in fraud of creditors, and subject it to the payment of plaintiffs' claim. From a judgment for plaintiffs defendants appeal. Reversed.

This was a suit in equity, brought by appellees to cancel a deed of conveyance of certain property in the city of Denver, made by appellant W.J. Stramann to his wife Elizabeth H. Stramann, the other appellant, on the 15th day of March, 1893. It is alleged in the complaint that the plaintiffs recovered a judgment on the 2d day of August 1893, against the defendant W.J. Stramann for $833 and costs that on August 3d an execution was issued, which was returned unsatisfied; that on the 15th day of March, 1893, after the debt was contracted for which a judgment was obtained, W.J Stramann was the owner of certain real estate (describing it) in the city of Denver, which he on that date conveyed by deed to his wife, Elizabeth H., for the expressed consideration of $7,500, but that no consideration in fact passed, and that at the time of making the deed Elizabeth was insolvent, and without means to pay for the property; that W.J. Stramann made the conveyance with intent to delay, hinder, and defraud his creditors, especially the plaintiffs, and has no other property. Prayer: That the deed be declared fraudulent and void, and the plaintiffs' judgment satisfied out of the property, and for an injunction restraining the lease or incumbering the property. The answer, after general and special denials of each important allegation, alleges that defendants were married in April, 1887; that in November, 1887, the defendant W.J. Stramann purchased the land in controversy, and paid for the same, including taxes, the amount of $2,700; that the lots were unimproved; that previous to the marriage of defendants, Elizabeth H. had been a partner with her father in the grocery business in Cincinnati, from which she realized over $5,000; that her father died in 1885, from whose estate she had $1,200; that she also engaged in other business, from which she realized $500,--all of which sums, amounting to over $6,700, she had in money. In the year 1888 the husband and wife agreed to build houses upon the lots with the money of the wife. The houses were built at the cost of $6,600, with the money of the wife. The agreement also provided that the husband was to have one-third of the income of the rents of the property and the wife two-thirds. The agreement between the parties was verbal. The title stood in the name of W.J. Stramann until the conveyance to the wife, in March, 1893. There was no promise on the part of the husband to repay the money, or to convey the property, or any interest in it, to the wife. It is further alleged that after the building of the houses the wife received as her portion of the rents over $2,000; that on October 31, 1888, W.J. Stramann borrowed $1,000, which was secured by deed of trust upon the property; that in December, 1891, Elizabeth H., at the request of her husband, paid the debt, and the property was released; that in the year 1890 W.J. Stramann borrowed $2,500, which was secured by deed of trust on the property, which still remains unpaid; that in February, 1891, W.J. Stramann leased an hotel from the plaintiffs; that the wife objected to the leasing and moving into the hotel; that an agreement was made between husband and wife that the wife was to superintend the hotel, and the husband was to pay her for such service $25 per month; that for the services so performed there was due and owing her from the husband $775; that the wife also delivered to her husband a piano, worth $300, which he sold; that the said several sums, $6,600, $1,000, $775, and $300, amounting to $8,675, were the separate property of the wife, and that no part of it had been paid except by the conveyance of the property; that the value of the property conveyed does not exceed $9,000, and only $6,500 over the $2,500 incumbrance; and that the property was conveyed to the wife March 15, 1893, to secure her equitable interest in the same, and to pay and discharge, as far as it would, the various sums of money due the wife.

Plaintiffs, in reply, deny and traverse every important allegation of defendants' answer; particularly and specifically those wherein it was alleged that the wife had money to the amount of $5,000, or any other amount, as proceeds of the partnership with the father, and that she received $1,200 from her father's estate; and allege that she had no money in her own right, and put none in the property in controversy; again, allege the conveyance to the wife to have been made solely for the purpose of defrauding plaintiffs, and preventing the collection of their demand; set up the contract, and a copy of the lease of the hotel, only one clause of which, as follows, need be cited: "To pay the said party of the first part, as rent for the said demised premises, the sum of eleven thousand eight hundred and fifty (11,850) dollars, payable as follows: One hundred and seventy-five dollars at the ensealing and delivery of these presents, the receipt hereof being hereby confessed and acknowledged; one hundred and seventy-five dollars on each the first days February, 1891, March, 1891, April, 1891, May, 1891, June, 1891; and thereafter, on the first day of each succeeding month, and until the determination of this lease, the sum of two hundred (200) dollars, and all water license for the use of water by the said parties of the second part during their occupation of said premises."

The following facts were stipulated by the parties: "Lease set out in replication admitted to be correct; that the debt for which judgment in the county court was recovered was for installments of rent under such lease accruing subsequent to the execution of the deed sought to be set aside; that the lease was made and entered into before the transfer of the property herein sought to be set aside."

After a lengthy and elaborate trial, the court found the following facts from the evidence: "(1) That the defendants intermarried in the month of April, 1887. (2) That the defendant Elizabeth H. Stramann, at the time of the marriage was in possession, in her own right, in money, of upward of $6,000. (3) That in 1888 the defendant W.J. Stramann was, and for some time prior thereto had been, the owner of lots 8, 9, and 10, block 5, in Hunt's addition to Denver, then unimproved, and his wife was still in possession of the said money and other moneys, altogether amounting to $6,000. (4) That in the year 1888 the defendants agreed together that six houses should be built upon the said lots, for the purpose of renting, and that the defendant Elizabeth H. Stramann's money should be used for that purpose, and that the rents should be divided between the defendants, two-thirds to the wife and one-third to the husband. (5) That the houses were built, all the business relating thereto being transacted by the husband in his own name, and the wife turning over to him her money to the amount of $6,600, from time to time, and he expended it in the construction as it became necessary. (6) In the course of the construction of the houses the husband made a deed of trust upon the property to secure the sum of $1,000, which he borrowed to put into the improvements; and the wife afterwards, upon his request, furnished him with the money with which to pay off this incumbrance; but no promise was exacted by the wife nor made by the husband that the money should be repaid to her. (7) That subsequently to January 1, 1891, the defendant W.J. Stramann executed a trust deed upon the premises for the sum of $2,500 for money borrowed for his own individual use. This incumbrance has not been paid off, but still remains a charge upon the property. (8) That on March 15, 1893, the husband conveyed the property to his wife to secure her for the $6,600, and also for the $1,000 additional which she furnished with which to pay off the $1,000 incumbrance; she paying no other consideration therefor. (9) That the husband collected the rents, and, as collected, turned over to the wife two-thirds thereof, retaining the remaining one-third for himself. (10) That the conveyance to the wife, nor any conveyance or security upon the property, was ever mentioned between the defendants until the latter days of December, 1892." Then follows the finding of the court in regard to the leasing and occupancy of the hotel, and copy of a portion of the lease above cited, all of which is unimportant in the decision of the case, as the facts were admitted, and no controversy nor evidence in regard to them. Then occur the following findings of fact: "(13) The plaintiffs' judgment against W.J. Stramann was rendered on account of installments of rent, which, by the terms of the lease, became due after the conveyance of the lots to his wife. (14) At the time the lease was made the plaintiffs knew that the title to the lots described in the complaint was in W.J. Stramann, and that the business connected with the construction of houses had been transacted by him in his own name, and were ignorant of the agreement between the defendants in relation to the erection of the houses, and that the rents were to be or were divided between them, and relied in part in making said lease upon the apparent financial ability of said W.J. Stramann. (15) The defendant Elizabeth H. Stramann knew the lease was entered into by the husband, that he was negotiating therefor, and also knew of its making at the time it was made. (16) At the time of the...