Weckerly v. Taylor

• Decision Date: 08 June 1905
• Citation: 103 N.W. 1065,74 Neb. 84
• Parties: WECKERLY v. TAYLOR ET AL.
• Court: Nebraska Supreme Court

74 Neb. 84

103 N.W. 1065

WECKERLY

v.TAYLOR ET AL.

Supreme Court of Nebraska.

June 8, 1905.

Syllabus by the Court.

1. A judgment creditor, with the aid of equity, may reach any property or interest of his debtor, not exempt from execution, which, with such aid, the said debtor might himself reach.

2. An assignment of a chose in action, even without consideration, is not presumptively fraudulent as to a creditor who becomes such nearly four years afterwards, and such a presumption is not supplied by vague and general allegations, but the circumstances must be pleaded from which fraud may be reasonably inferred.

3. Actions for relief on the ground of fraud must be brought within four years from the discovery of the fraud, or such facts and circumstances as are indicative thereof, and, if followed up, would lead to its discovery.

Commissioners' Opinion. Department No. 1. Appeal from District Court, Douglas County; Dickinson, Judge.

Action by James M. Weckerly against Cadet Taylor and others. Judgment for defendants, and plaintiff appeals. Modified.Arthur C. Wakeley, for appellant.

A. S. Churchill, for appellees.

AMES, C.

This is an appeal from a judgment sustaining separate general demurrers to a petition and dismissing an action as to certain defendants. The alleged causes of action arise out of distinct facts and circumstances, so that we think a demurrer for misjoinder, which was filed by some of the defendants, would have been properly sustained, and we are consequently compelled to divide the case into two branches, and treat of each separately.

It is alleged that in 1890 Cadet Taylor, H. O. Devries, the Globe Loan & Trust Company, a corporation, and the Globe Savings Bank, a corporation, purchased a tract of real estate situate in Omaha, in this state, paying therefor the sum of $18,000, and procuring the title to be conveyed to one McIntyre, the latter paying no consideration therefor; that immediately afterwards McIntyre, also without consideration, and at the request of the purchasers, conveyed the property to the Globe Building Company, another corporation, of which the purchasers were and have remained the principal stockholders. The idea that this transaction was fraudulent as to creditors, existing or subsequent, is not alleged in the petition, and is emphatically repudiated by the plaintiff in his brief; but it is alleged that such conveyance was, and was intended to be, of the bare legal title only, the purchasers or their representatives remaining continuously in possession in person or by their tenants, and managing or controlling the property and receiving its rents, issues, and profits from that time until the present; whence, it is contended, a trust resulted to the purchasers, and they are, and at all times have been, the sole equitable and beneficial owners of the property in the proportions in which they contributed to the payment of the purchase money. In 1896--More than five years after the conclusion of this transaction--the purchasers became obligated to the plaintiff upon a bond in which the savings bank was principal and the others sureties, and upon which a liability accrued sometime later, and upon which suit was brought, and afterwards judgment obtained, in March, 1901. Execution having been issued upon the judgment and returned unsatisfied, it was alleged that all the defendants were insolvent except for the property in question and other property somewhat similarly situated, and prayed that title to the tract described be adjudged to be in the purchasers, and be subjected to judicial sale for the satisfaction of the judgment. This version of the transaction excludes the idea that the property was conveyed to the corporation as a gift, or in exchange for its stocks or obligations, and it also excludes the idea of possession or ownership, or claim thereof, by the corporation, so as to put the statute of limitations in motion, or create a title by prescription; and, as we are constrained to think, the petition states in this regard a cause of action. The plaintiff, with the aid of equity, may reach any property right or interest not exempt from execution that the judgment debtors might with like aid reach themselves; and it is undeniable that, if the story told by the pleading is true, the latter are entitled to have the property conveyed to themselves upon demand at any time, and that equity would, if necessary, enforce the demand. Millard v. Parsell, 57 Neb. 180, 77 N. W. 390; Harris v. King, 16 Ark. 122; Haven v. Bliss, 26 N. J. Eq. 363;Stratton v. Dialogue, 16 N. J. Eq. 70;Bear v. Koenigstein, 16 Neb. 67, 20 N. W. 104;Hews v. Kenney, 48 Neb. 816, 62 N. W. 204; Perry on Trusts (3d Ed.) vol. 1, § 126; Robinson v. Springfield Co., 21 Fla. 205; White v. Seldon, 4 Nev. 280.

But this theory of the transaction excludes, as we have already said, the idea of fraud, or that the estate was conveyed to the building company in fraud of creditors; and the rights and remedies of the plaintiff as to it must therefore be measured by those of his judgment debtors, which they cannot exceed. If the transaction by which the title was conveyed to the building company was fraudulent, it would fall within the principles and authorities of the second branch of this discussion, and the judgment of the district court would have to be affirmed. The Sherman & McConnell Drug Company, another defendant, whose demurrer was sustained, and as to which the action was dismissed, is a lessee of the building company, whose fate it may share, and was, of course, properly joined with it as a defendant as well for its own protection as to enable the plaintiff to obtain complete relief. As to both these defendants we think the demurrer was erroneously sustained.

The other branch of the inquiry pertains to the demurrer of the Putnam Company, which was also sustained, with a judgment of dismissal. With respect to this matter it is alleged that the defendant the Globe Loan & Trust Company, a corporation, acquired from one Ijams and wife on the 7th day of June, 1892, a mortgage on a tract of real estate, and assigned it, without consideration, on the 15th day of June, 1892, to the Linwood Park Land Company, another corporation. Thereafter the last-named company procured title by foreclosure proceedings of the property described in the mortgage, and in the year 1900 conveyed a part thereof to the Putnam Company and a part to the Henryton Land Company, another corporation. Concerning these transactions and the several corporations named as having had to do with them, the petition alleges: “That the said Linwood Park Land Company, said Putnam Company, said Henryton Land Company, and the said Globe...