Tucker v. Foster

• Decision Date: 20 March 1930
• Citation: 154 Va. 182
• Court: Virginia Supreme Court
• Parties: M. A. TUCKER, ET ALS. v. J. H. FOSTER.

Page 182

154 Va. 182

M. A. TUCKER, ET ALS. v. J. H. FOSTER.

Supreme Court of Virginia, Richmond.

March 20, 1930.

Absent, Hudgins, Gregory and Browning, JJ.

1. FRAUDULENT AND VOLUNTARY CONVEYANCES — Bankruptcy of Grantor — Appointment of Trustee — Appeal from a Decree Adverse to Complainant — Trustee in Bankruptcy not the Only one Entitled to Appeal — Case at Bar. — The instant case was a suit to set aside a deed as in fraud of creditors. Within four months of the institution of the suit grantor was adjudicated a bankrupt and a trustee was appointed, who was made a party complainant. Defendant grantee claimed that the trustee was vested with all grantor's title and interest in the property which the grantor might enforce, or might be enforced or subjected by his creditors, and that, therefore, complainant had no right to maintain her bill to recover for the benefit of herself and other lien creditors of the grantor, and upon the admission of the trustee in bankruptcy as a party complainant in the suit the control thereof was in the trustee alone and that he alone might appeal from a decree adverse to complainant. Complainant's judgment against the grantor was obtained a year previous to the institution of the instant suit on a debt contracted before the deed to defendant grantee.

Held: That there was no merit in this claim of defendant grantee, and that the plea of the bankruptcy of the grantor presented no valid defense to complainant's bill.

2. FRAUDULENT AND VOLUNTARY CONVEYANCES — Lien of Judgment — Judgment a Lien from Time of Rendition and not Merely from Time of Institution of Suit to Set Aside Deed as Fraudulent. — If a deed be fraudulent and void, a judgment against the grantor is a lien on the land therein conveyed in the hands of the grantee from the time at which the judgment was rendered and not merely from the time of the institution of a suit to set aside the deed as fraudulent and the filing of complainant's petition therein.

3. JUDGMENTS AND DECREES — Judgment Liens — Fraudulent and Voluntary Conveyances — Time when Judgment Lien Attaches. — When a judgment has been rendered and duly docketed the effect thereof is to impose a lien both upon the real estate then held by the judgment debtor and also upon any that he may have theretofore conveyed away in fraud of such judgment creditor after his debt was contracted and before judgment rendered, subject of course in the latter case to the superior equities of bona fide purchasers for value and without notice.

4. FRAUDULENT AND VOLUNTARY CONVEYANCES — Judgment Liens — Effect of Suit of set Aside Fraudulent Conveyance Upon Lien of Judgment. — Bringing a suit by a judgment creditor to set aside as fraudulent a deed executed and recorded prior to the time the judgment was rendered does not postpone the lien of the judgment to the time of the bringing of the suit, or operate as an abandonment or waiver of the existing lien of the judgment against the property in the hands of the fraudulent grantee.

5. JUDGMENTS AND DECREES — Judgment Liens — Fraudulent and Voluntary Conveyances — Section 5186 of the Code of 1919, does not Apply to Judgment Creditors. — Section 5186 of the Code of 1919, which gives a general creditor the same right to sue to set aside a fraudulent conveyance that a judgment creditor would have after obtaining judgment, and gives the complainant a lien on the property in the hands of the fraudulent grantee in the bill mentioned from the time of bringing his suit and a petitioning creditor a lien from the time of filing his petition, has no application to a suit brought by a judgment creditor or a petition filed by a judgment creditor. It adds nothing to and subtracts nothing from the rights of a judgment creditor either as to the existence of his lien, the time from which it attaches, its order of priority, or the right to bring a suit to set aside the fraudulent conveyance.

6. FRAUDULENT AND VOLUNTARY CONVEYANCES — Suit to set Aside — On Demurrer Deed must be Considered Fraudulent. — In considering a demurrer to the bill in a suit to set aside a deed as in fraud of creditors, the deed must be taken to be fraudulent, as in the bill alleged.

7. FRAUDULENT AND VOLUNTARY CONVEYANCES — Bankruptcy — Effect of Bankruptcy Proceedings on Suit to set Aside Deed as in Fraud of Creditors — Jurisdiction of State Court — Case at Bar. — The instant case was a suit to set aside a deed as in fraud of creditors. Complainants had judgment liens on the lands alleged to have been fraudulently conveyed, which attached more than four months prior to the adjudication of the grantor as a bankrupt, and therefore were not within the bankrupt act, and the complainants had the right to maintain a suit to subject the property in the hands of the fraudulent grantee to the satisfaction of their judgment liens, this right not having passed to or become vested in the trustee in bankruptcy.

8. BANKRUPTCY — Fraudulent and Voluntary Conveyances — Jurisdiction of State Court where Bankruptcy Proceedings are Instituted. — A bankruptcy proceeding in and of itself does not oust the State court of its jurisdiction and power to proceed with a suit to set aside a deed as in fraud of creditors, where the State court has acquired jurisdiction both of the subject matter and the parties.

9. FRAUDULENT AND VOLUNTARY CONVEYANCES — Multifariousness — Bill Against Several Fraudulent Grantees. — A judgment creditor's bill brought against a fraudulent grantor and his several fraudulent grantees who had acquired different parcels of his property under separate and distinct deeds, seeking to subject all the property of the judgment debtor so fraudulently conveyed, or so much thereof as might be necessary, to the payment of the judgment debt, is not multifarious; and this is true even though the several deeds may have been executed and delivered at widely different times and have no actual connection with each other in any way, and though there has been no combination or conspiracy among the several grantees or joint participation of the grantees in the fraud of their grantor, and though the fraudulent grantee in any one deed has no knowledge or notice of any other of the fraudulent deeds.

10. JUDGMENTS AND DECREES — Judgment Liens — Fraudulent and Voluntary Conveyances — Lien Upon Land Fraudulently Conveyed — Judgment Creditor's Bill. — In Virginia a judgment is a lien from the time it is rendered upon all real estate owned by the debtor and also upon all real estate which the debtor may have fraudulently conveyed to others; and a judgment creditor's bill to subject the several parcels of land fraudulently conveyed to the payment of the judgment debt is not a bill to acquire liens on such parcels of land, but a bill to enforce an existing lien, which is a lien not merely upon one or more of the parcels, but upon all of them.

11. JUDGMENTS AND DEGREES — Fraudulent and Voluntary Conveyances — Judgment Creditor's Bill to Subject Several Parcels of Land Fraudulently Conveyed. — A judgment creditor's bill to subject several parcels of land fraudulently conveyed is closely analogous in all respects to a judgment creditor's suit brought to subject to the payment of a judgment several parcels of land which, since the entry of the judgment, have been conveyed by the judgment debtor to several different grantees by separate and distinct deeds.

12. DEMURRERS — Equity — Office of Demurrer — Answer. — The office of a demurrer going to the whole matter of the bill is to demand the judgment of the court whether the defendant shall be compelled to answer the complainant's bill.

13. EQUITY — Plea which is a Good Defense to Whole Bill a Special Answer — Answer. — A plea which, if sustained, is a good defense to the whole bill, is a special answer, showing or relying upon one or more things as a cause why the suit should be either dismissed, delayed or debarred. It differs from an answer in the common form in that it demands judgment of the court, in the first instance, whether the special matter urged for it, does not debar the plaintiff from his title to that answer which the bill requires.

14. EQUITY — Answer — Demurrer — Answer not Required until Demurrer or Plea Passed Upon. — In the absence of a controlling statute or rule of court to the contrary, if the defendant has in good faith filed a demurrer or plea which, if sustained, is a good defense to the whole bill, he is entitled to have the court pass upon such demurrer or plea before he is required to answer; and upon an order overruling such a demurrer or plea the defendant is entitled to an opportunity to answer the bill; and it is error to take the bill for confessed or to decree the matter thereof until opportunity has been given the defendant to answer, if he ask leave to answer.

15. EQUITY — Answer — Demurrer — Answer not Required until Demurrer or Plea Passed Upon. — The right of a defendant upon demurrer overruled or a plea stricken out to answer the bill has been recognized by statute in Virginia from the earliest days of the Commonwealth.

16. ANSWERS — Time of Filing — Purpose of Section 6122 of the Code of 1919. — The purpose of section 6122 of the Code of 1919, prescribing the time within which a defendant may and shall file his answer or other defense is not to cut off the orderly presentation of defenses, or to set a trap for the unwary defendant by which a plaintiff may by delaying the prosecution of his cause cut off the defendant from a full defense or escape the necessity for proving his case. Its purpose is to prevent unconscionable delay in the orderly procedure in a chancery cause being caused by dilatory tactics on the part of the defendant, or by the neglect of the defendant where the plaintiff has shown due diligence on his part in the prosecution of the cause.

17. ANSWERS — Time of Filing — Where Defendant Files a Plea which He Considers of Complete Defense to the Whole Bill — Plea of Bankruptcy of...