Seals v. Robinson & Co.

BRICKELL, C. J. The rules of pleading in a court of equity, as to matters of form, are not so strict as the rules originally prevailing in courts of common law. The statutory requirement in reference to bills in equity is, that they “ must contain a clear and orderly statement of the facts on which the suit is founded, without prolixity or repetition, and conclude with a prayer for the appropriate relief.” A bill conforming to this requirement, under the practice and the decisions of this court, would have been deemed unobjectionable before the enactment of the statute. The statute has not, however, been construed as in derogation of the cardinal rule, as it has been frequently termed, that the bill must show with accuracy and clearness all matters essential to the complainant’s right to relief. These matters must not be made to depend upon inference, nor will ambiguous averments of them be accepted as sufficient. The averments must be direct and positive, not uncertain and inconclusive.—Spence v. Duren, 3 Ala. 251; Cockrell v. Curley, 26 Ala. 405 ; Duckworth v. Duckworth, 35 Ala. 70. A bill may be framed in a double aspect; alternative averments may be introduced ; but each alternative must present a case entitling the complainant to the same relief. The bill is demurrable, if in either alternative the complainant is not entitled to any relief, or is entitled to relief essentially differing in character.—Andrews v. McCoy, 8 Ala. 920 ; Lucas v. Oliver, 34 Ala. 626 ; Rives v. Walthall, 38 Ala. 329 ; David v. Shepard, 40 Ala. 587 ; Micou v. Ashurst, 55 Ala. 607. If the original bill contains alternative averments, and either averment is insufficient to support the right of the complainant to the relief prayed, the objection was not presented in the chancery court by demurrer. Advantage of it was claimed only by motion to dismiss for want of equity. A motion to dismiss for want of equity is not the equivalent of a demurrer; nor is it appropriate to reach mere defects or insufficiences of pleading curable by amendment, which is matter of right at any time before final decree. It should be entertained only when, admitting the facts apparent on the face — 369 — of the bill, whether well or illy pleaded, the complainant is without right to equitable relief. When it is apparent, if the facts were well pleaded, a case for relief would exist, the defendant should be put to a demurrer, specifying the grounds of objection, affording the complainant the opportunity of removing them by amendment.—Hooper v. S. & M. R. R. Co., 69 Ala. 529. The demurrer interposed was general; it fails, in the words of the statute, “ to set forth the grounds,” and the the statute prohibits the hearing of it.—Hart v. Clark, 54 Ala. 490. Objections to the admissibility of evidence, in chancery, ought to be reduced to writing, and a reference to them should be incorporated in the note of submission, or they should be otherwise called directly to the attention of the chancellor. If the fact that they have been made is not noted in the submission, or it is not otherwise shown that they were called to the attention of the chancellor, and he does not notice them, on appeal, the presumption is that they were waived. It is settled by a long line of decisions in this court, that a voluntary conveyance, a conveyance not resting upon a valuable consideration, is void per se, without any regard to the intention of the parties, however free from covin or guile they may have been, as to the existing creditors of the donor, without regard to his circumstances, or the amount of his indebtedness, or of the kind, value or extent of the property conveyed, if it be not exempt from liability for the payment of debts. As to subsequent creditors, if it be not shown that there was mala fides, or fraud in fact in the transaction, the conveyance is valid and operative. But if actual fraud is shown, it is not of importance whether it was directed against existing or subsequent creditors; either can successfully impeach and defeat the conveyance, so far as it breaks in upon the right to satisfaction of their debts. The distinction between existing and subsequent creditors is, that, as to the former, the conveyance is void per se, for the want of a valuable consideration ; as to the latter, because it is infected with actual fraud.— Miller v. Thompson, 3 Port. 196 ; Cato v. Easley, 2 Stew. 214 ; Moore v. Spence, 6 Ala. 506; Costillo v. Thompson, 9 Ala. 937; Thomas v. DeGraffenreid, 17 Ala. 602; Foote v. Cobb, 18 Ala. 585 ; Stokes v. Jones, Ib. 734; s. c. 21 Ala. 731; Gannard v. Eslava, 20 Ala. 732; Randall v. Lang, 23 Ala. 751; Stiles v. Lightfoot, 26 Ala. 443 ; Huggins v. Petrine, 30 Ala. 396 ; Cole v. Varner, 31 Ala. 244; Pinkston v. McLemore, Ib. 308; Williams v. Avery, 38 Ala. 115. The right of the subsequent creditor depends upon the existence of actual fraud in the transaction ; the burden of proving it rests upon him. — Bump on Fraud. Con. 308. The general rule applies, that fraud must be — 370 — proved ; it will not be presumed, if the facts and circumstances shown in evidence may consist with honesty and purity of intention. But it must not be supposed that fraud must be proved by direct and positive evidence, or that it is incapable of proof by circumstances leading to a rational, well grounded conviction of its existence. There is no fact which may be the subject of controversy in a judicial proceeding, civil or criminal, that is not the subject of proof by circumstantial, as distinguished from positive or direct evidence. As the fraud vitiating a transaction at the instance of creditors lies in the intention of the parties to it, vicious intent is not generally susceptible of proof otherwise than by evidence of circumstances indicative of it. The intention is a mental emotion, of which the external signs are tire acts and declarations of the parties, taken in connection with the concomitant circumstances.—Hubbard v. Allen, 59 Ala. 283 ; Harrell v. Mitchell, 61 Ala. 270 ; Thames v. Rembert, 63 Ala. 561; Pickett v. Pipkin, 64 Ala. 520. The conveyance now assailed by subsequent creditors of the grantor is of real estate, is purely voluntary, founded upon no other consideration than love and affection, and the controlling purpose of its execution was a provision for the wife of the donor. It is made directly to the wife, without the interposition of a trustee, and at law is a mere nullity. All contracts and conveyances made between husband and wife directly, at common law, are invalid, for the reason that husband and wife are regarded as but one person, and the legal existence of the wife is merged in that of the husband.—Gamble v. Gamble, 11 Ala. 966; Puryear v. Puryear, 12 Ala. 13; Bradford v. Goldsborough, 15 Ala. 311; Frierson v. Frierson, 21 Ala. 549. The statutes creating and defining the separate estates of married women are not in abrogation of this doctrine of the common law ; they are not intended to sever the unity of the husband and wife, so far as to confer on them capacity to contract with, or to convey directly to each other.—Short v. Battle, 52 Ala. 456; McMillan v. Peacock, 67 Ala. 127. Although this is the recognized doctrine of the common law, a court of equity, when the contract or conveyance is fair and just, will give to it full effect and validity.—Williams v. Maull, 20 Ala. 721; Williams v. Avery, 38 Ala. 115; Mc Williams v. Ramsey, 23 Ala. 813 ; Andrews v. Andrews, 28 Ala. 432; Spencer v. Godwin, 30 Ala. 355. As a gift or conveyance by the husband to the wife directly is invalid at law, and is valid only in a court of equity, it is /regarded as creating in the wife an equitable separate estate, though it may not contain words denoting that it is for her sole and separate use, or words in exclusion of the marital rights of the husband ; and that the estate is not consequently within the influence or operation of the statutes — 371 — enabling the wife to take and bold the property owned by her at the time of the marriage, or to which she' may become entitled subsequently.—McMillan v. Peacock, supra ; Ratcliffe v. Dougherty, 24 Miss. 181; Warren v. Brown, 25 Miss. 66; Short v. Battle, supra. The conveyance is of all the visible, tangible property of the donor, subject to execution at law. All that he retained, consisted of dioses in action, of uncertain, doubtful value. It is said by Judge Story that, “if a husband should by deed grant all his estate or property to his wife, the deed would be held inoperative in equity, as it would be in law ; for it could, in no just sense, be deemed a reasonable provision for her (which is all that courts of equity hold the wife entitled to); and, in giving her the whole, he would surrender all his own interests. ” 2 Story’s Eq. § 1374. In Coates v. Gerlach, 44 Penn. St. 46, the court said : “A conveyance that denudes a husband of all, or the greater part of his property, is much more than a reasonable provision for a wife; for in considering what is, and what is not a reasonable provision, the circumstances of the husband are to be regarded, his probable necessities as well as his debts. Equity will not assist a wife to impoverish her husband.” Whether a court of equity would refuse to enforce this conveyance upon the ground that the provision for the wife is unreasonable, and that giving to it effect would work injustice to the husband, it is not necessary to consider. The circumstances of each case must be considered as determining the reasonableness of a provision for wife or children, and a conveyance may be valid inter partes, which the court would not hesitate to pronounce fraudulent as to creditors.—Jones v. Obenchain, 10 Gratt. 259 ; 1 Bish. on Mar. Women, § 755. When the rights of creditors are involved, the extent and value of the property conveyed, its kind and character, are all facts to be considered in determining whether the transaction is infected with a covinous intent. The fact that a donor strips himself of all visible, tangible property which is subject to execution at law, retaining only choses in action of uncertain, doubtful value, may not be conclusive proof of fraud; taken alone it may be weak and inconclusive; but it will awaken suspicion and add strength to other circumstances which may in themselves be also insufficient to prove that his intent was fraudulent. And it is his intent, not the intent of the donee, which is material; the fraud of the donor is visited upon the donee, though he may be doli incapax, or though his intentions may be fair and honest, Tor he comes in as a volunteer, and has no equity which will protect him against the rights of creditors.—Pickett v. Pipkin, 64 Ala. 520. The conveyance is not only of all visible property of the — 372 — donor subject to execution at law, the value of which far exceeds the highest estimate of the value of the choses in action he retained,"but it contains the unusual, if not remarkable provision, that the donee shall' hold the property conveyed “ as her separate property under the statutes of the State governing the estates of married women.” The effect which would be given this clause of the conveyance, or whether it is capable of being construed as limiting and qualifying the estate, narrowing its incidents, lessening the dominion of the donee, as the estate is created by the general words which precede it, is not now of importance. Whether it is, or is not valid and qualifying as a limitation, subjecting the estate and the wife’s dominion to the properties of a statutory estate, which is, in but a limited sense, a separate estate, it is indicative of the intention of the dojnór; and that intention is, in one aspect, now of the highest importance. Subjecting the estate to the statute wonlcl vest it in the donor as husband and trustee for the donee, entitling him to its rents and profits, so long as he continues in that relation, freed from liability to account to the donee, and exempt from liability for his debts. In other words, he does not part with the property absolutely, but reserves to himself a specific benefit which it is to yield, though the ownership is vested in the donee. Another circumstance it is of importance to consider. More than six months passed after the execution of the conveyance before its registration. Whatever may have been the general circumstances of the donor at the time of the execution of the conveyance, and upon this point the evidence is not so clear and satisfactory as it could probably have been made, the fact is, that when the conveyance was delivered to the judge of probate for registration, he was insolvent, and, in but little more than a month thereafter, made a general assignment for the benefit of creditors. During the interval between the execution and registration of the conveyance, he continued in possession, claiming ownership of the property, vouching the ownership as entitling him to credit, and upon the faith of it obtained credit. The omission to register the conveyance is but a fact or circumstance indicative of fraud, and is open to explanation, which, if just and reasonable, would neutralize all unfavorable inferences that may be drawn from it. The only explanation now offered is, that the donee was ignorant of the necessity for registration ; ignorant that the law required registration to protect her from the claims of subsequent purchasers from the husband, or from the claims of judgment creditors. This is ignorance of law, which can not be accepted as explanatory of the omission. But she was not ignorant that the husband, after the execution of the conveyance, and before — 373 — its registration, embarked in a new mercantile enterprise, contracting debts to a large amount. Nor is ignorance of the necessity of registration, or of the duty of giving publicity to the fact that he was not the owner of the property, imputed to him. The evidence is conclusive that he concealed the fact of the conveyance, and represented himself as having title. The omission to register the conveyance, the want of notoriety of its existence, the magnitude of the property conveyed, when compared with the value of that which was retained, the attempted reservation of a specific benefit to the donor, which he could hold free from liability for debts, his engagement in business very soon after the execution of the conveyance, obtaining a false credit because of his possession and representations that he was the owner of the property, to which, to say the least, the donee by her supineness contributed, are all badges of fraud, or circumstances indicative that the intent of the donor was the hinderance, delay, and fraud of creditors. Bump on Fraud. Con. 308. It is not of importance, whether the intent was directed against present or subsequent creditors; in either event, the conveyance may be successfully impeached by a subsequent creditor. We concur in the conclusion of the chancellor, that the conveyance must be deemed fraudulent as to creditors, prior or subsequent, and the decree is of consequence affirmed.