Thomas v. Fletcher

• Decision Date: 08 April 1907
• Docket Number: 33.
• Citation: 153 F. 226
• Parties: THOMAS v. FLETCHER.
• Court: U.S. District Court — District of Maine

153 F. 226

THOMAS v. FLETCHER.

No. 33.

United States District Court, D. Maine.

April 8, 1907

Albert S. Woodman, for complainant.

Nathaniel B. Walker, for respondent.

HALE District Judge.

This suit in equity seeks to set aside certain transfers alleged to have been made by the bankrupt to his wife, Annie M Fletcher. The facts in the case are sufficiently set forth in the report of the special master. The substantial part of the report is as follows:

'Elias Thomas, Jr., and Edwin I. Littlefield, were examined as witnesses for the plaintiff, and the respondent was examined in her own behalf. The schedules filed by john W Fletcher in bankruptcy, and the testimony of his wife in the proceedings before the referee, were admitted as evidence by agreement. It was admitted that John W Fletcher, the bankrupt, was insolvent on the 1st day of September, 1905, that he then owed $2,700, and that on that day he conveyed all his attachable property to his wife, the respondent herein, for a nominal consideration. The property was a small stock of groceries in the store kept by him in Kennebunk, together with the book accounts due him. Of these a bill of sale was given. The other property was the equal right with one Smith to remove the growth from a lot of land in Wells, Me., at any time within three years from May 29, 1904. Howard K. Smith and John W. Fletcher bought this lot from one Towne for $1,000 cash, each paying therefor $500. It has been frequently held in this state that such conveyances are prima facie fraudulent as to creditors, and the burden of proof is placed on the transferee to show the contrary. Wheelden v. Wilson, 44 Me. 18; Robinson v. Clark, 76 Me. 493; Horner Gaylord Co. v. Miller & Bennett, 17 Am.Bankr.Rep. 257, 147 F. 295.

'There are no circumstances connected with the case that rebut this presumption of fraud. The witness Edwin I. Littlefield, a York county sheriff, testified that about September 1, 1905, he went to the Fletcher's store with a writ to make an attachment. Mrs. Fletcher told him that the property had been transferred to her, and said it was done to prevent attachments. Fletcher paid that claim, and a few days later Littlefield went with another writ and attached the stock of goods. Mr. Fletcher gave him the key to the store, which he retained till after the adjudication in bankruptcy of Fletcher. He then gave the key to the trustee. An involuntary petition in bankruptcy was filed by creditors January 11, 1906. After the adjudication, Mr. Fletcher filed his schedules, properly sworn to, and in them he claims the groceries and book accounts as his own. The trustee took possession of these, and sold the goods and has collected the accounts in part.

'The respondent, called in defense, testified clearly that the sole purpose of the transfer of the property to her was to prevent attachments, that her husband was harassed by debts and attachments and could not go on with his business, and they thought the transfer to her would end the trouble. Her statement that she did not intend to defraud his creditors seems quite immaterial.

'As to the transfer of the right to cut timber on the Towne lot, she testified that the consideration was the substitution of her name for that of her husband on a note held by the Ocean National Bank. The $1,000 paid by Fletcher and Smith for that right had been hired from that bank on their joint and several unsecured note in May, 1904. This was a four-months note, and was kept alive by renewals. The last note signed by Mr. Fletcher matured October 1, 1905, a month after the date of the deed to his wife. She testified that her husband was desirous of giving up to Mr. Smith all right in the wood lot, but that she objected to it, and agreed that, if the bank would consent, she would put her name on the note together with Smith's when the next renewal came. She was uncertain whether this arrangement was made after the deed of the lot to her or before. Mr. Smith was consulted and got the consent of the bank to the substitution of Mrs. Fletcher's name for her husband's on a new note which was given and signed by her October 1, 1905.

'It is impossible to come to the conclusion that this was any consideration for...