Steiner Land & Lumber Co. v. King

COLEMAN, J. Appellees, some of whom were simple contract creditors of Josepli Steiner and Steiner & Sons and Steiner Pros. & Co., and others, judgment creditors .of the partnerships, filed a creditors’, bill to reach and subject to the payment of their claims, lands alleged to have been fraudulently conveyed by their debtors to the [551] Steiner Land & Lumber Company, a corporation, and certain conveyances of individual property. The bill avers, that complainants were creditors prior to the several conveyances which are attacked for fraud. It avers that J. M. Steiner, S. J. Steiner, J. T. Steiner and R. E. Steiner composed the firm of Joseph Steiner & Sons, and as partners were engaged in the banking business, and that the same parties composed the firm of Steiner Bros. & Co., and that as individuals and partners they were insolvent at the time of the execution of the several conveyances. It avers that the defendant corporation became incorporated at the time of the conveyance of theland to it; that the respondents as individuals and the partnership of which they were the sole members owned a large majority of the stock of said corporation, and that said corporation had no assets other than the lands conveyed to it by the insolvent debtors. It further avers that all the remaining stockholders of said corporation were brothers and sisters of respondent debtors, and that they had knowledge of the insolvent condition of respondent debtors, or had notice of facts which were sufficient to put them on inquiry and if followed up would have led to such information. The bill avers that the consideration expressed on the face of the conveyance is $192,000, but that no money was paid, or if any, a very small sum, and that the purpose of the corporation and the conveyance to it was a mere scheme to hinder, delay and defraud creditors. The bill avers that May Steiner and R. E. Steiner, her husband, conveyed certain lot of land to Ida Steiner, wife of J. M. Steiner, for an expressed consideration of $5,000, and that J. M. Steiner furnished the money to pay for said property and had titles taken in the name of his wife, for the purpose of hindering, delaying and defrauding his creditors. The bill avers that S. J. Steiner made a fraudulent conveyance to his Avife for an expressed consideration of $12,000, to hinder, delay and defraud his creditors, and that J. T. Steiner, for like fraudulent purposes, conveyed certain property, to his wife. • The bill avers, that the Steiner Land & Lumber Co., was insolvent, that all the debtor grantors were insolvent, at the time of the several conveyances, that the'grantees were chargeable with notice of their insolvent condition, and [552] that complainants’ debts were contracted and dne prior to all of said several conveyances. The bill was demurred to by several of the respondents separately, but each assigned the same ground of demurrer. No argument or authority is necessary to demonstrate that there is equity in the bill. It has been decided by this court that a simple contract creditor and a judgment creditor may join in a bill to reach property fraudulently conveyed' by their common debtor. — Steiner & Lobman v. Parker, 108 Ala. 357. It is insisted that the bill is multifarious. In the case of Planters & Merchants Bank v. Walker, 7 Ala. 926, the complainant had recovered a judgment against G. Walker, J. H. Walker and Robert Lowe. The two former debtors acting seperately and individually made certain sales of their respective property and the latter by mortgages, each acting independently of the others in the disposition of their respective property. The creditor filed its bill against them all and their respective vendees and mortgages, alleging fraud in the several transactions. Under the averments of the bill the property was liable to the satisfaction of the complainant’s judgment. The purpose of the bill was single, viz., to reach and subject the property to its satisfaction. Each respondent had a common interest, that of satisfaction of the debt. The court held that a demurrer for multifariousness would not be sustained in favor of the debtors, or their grantees. The rule is clearly stated in Fellows v. Fellows, 4 Cowen (N. Y.) 682, reported in 15 Am. Dec. 412, with extensive notes, and which decision has been cited with approval in many cases by this court. Hill Bros. v. Moone, 104 Ala. 353; Hinds v. Hinds, 80 Ala. 225; Collins v. Stix, 96 Ala. 338; Lehman v. Meyer, 67 Ala. 396. The demurrer based upon the ground of multifariousness cannot be sustained. The separate and individual property of each member of a partnership may be subjected by suit against such member to the payment of the partnership debt, and any disposition of his property, liable for such debt, in fraud of such creditor, will be set aside and annulled and the property condemned by- a court of equity. — Baldridge v. [553] Eason, 99 Ala. 516, and authorities cited; Blackman v. Moore-Handley Hardware Co., 106 Ala. 458 Bolling & Son v. Speller, 96 Ala. 269. The statute, Code of 1896, section 700, provides that “A demurrer to a bill must set forth the ground of demerrer specially, and otherwise must not be heard.” We have examined each ground of demurrer contained in the abstract prepared by appellant’s counsel, and applying this rule, and the principles of law applicable to the case, the decree of the chancery court, overruling the demurrer, must be affirmed. The bill nowhere avers, that John J. Flowers is a subsequent incumbrancer, and the ground of demurrer to this effect is not supported by the .bill. We deem it not improper to say, that we do not find in the record a case which justifies the making of Mrs. Estelle Otts, Bernard Steiner and M. C. McGehee parties respondent to the bill. It is not shown that they were debtors of complainants in any manner, nor is it averred that they have purchased or received any property subject to complainant’s debts, nor is any relief, nor any ground of equitable relief, so far as our reading of the bill discovers, shown as against these parties. No objection was raised to the bill of complaint on these grounds and we make no ruling. We merely call attention to the facts, to avoid future complication. No receiver has been appointed and this question 'has not been discussed in brief of counsel. It is true the bill avers the insolvency of the corporation and states that the insolvent corporation should not be allowed to collect the rents from the lands; the bill nowhere avers that the corporation has collected any rents, or is about or intends to collect any, and in fact, it is not averred that any rents have or will accrue on account of said lands. The decree of the chancery court overruling the several demurrers to the bill is affirmed. Affirmed.