Crampton v. Schaap

Mansfield, J. The conclusion reached in considering this cause, on the evidence adduced, makes it unnecessary to decide the questions presented by the demurrer to the complaint. 1. When voluntary conveyance not fraudulent. To avoid a voluntary conveyance, a subsequent creditor must show that it was made with the actual intent to defraud. Drigg & Co.’s Bank, v. Norwood, 50 Ark. 42. He cannot, like a prior creditor, raise a presumption of such intent by merely showing tha't the grantor was in debt at the date of the conveyance. A presumption of fraud as to subsequent creditors does arise on proof that the grantor was insolvent. But this presumption is not as to such creditors conclusive. Rudy v. Austin, ante p. 69. If it be conceded that Seybert, the grantor in the present case, was insolvent at the time of the conveyance to the defendant, the presumption arising as to the intent with which the grant was made is not supported by circumstances such as were held to make it conclusive in the cases cited. It does not appear, as it did in those cases, that, soon after the execution of the deed, the grantor contracted debts which he could not reasonably have expected to pay. Nor is any connection whatever shown between the debts he then owed and that of the plaintiff, which accrued more than nine years after the date of the conveyance. The evidence also fails to show that any part of the indebtedness then existing was paid by contracting other debts, or that the plaintiff is entitled to be subrogated to the right of a prior creditor to avoid the conveyance. Rudy v. Austin, supra; Bump, Fraudulent Conv. 322. Whether, in the absence of any circumstance similar to either of those mentioned, a presumption resting alone on the insolvency of the grantor will be repelled by the facts urged against it here, is a question we need not decide in this case ; for we think the evidence insufficient to establish Seybert’s insolvency. Three witnesses called by the plaintiff gave testimony on the question of his indebtedness. But neither of them states the amount of his debts or facts from which the amount may be estimated. Nor does either of these witnesses make any statement from which the extent or value of his property may be arrived at. One of them, a merchant, who appears to have had more information as to Seybert’s circumstances than either of the others, states that he was “reckless” in trading and “ owed everybody from whom he could buy on credit from 1878 to 1887.” But the extent to which he obtained credit, or whether this course of trading began before the purchase of the lands conveyed to the defendant, is not shown. The same witness says that Seybert, who was a physician, was the most successful man he knew in his practice and in buying cattle. And his testimony shows that the witness did not cease to credit him until in 1882, which was several years after the purchase of the lands. One of the other witnesses says that, according to statements made to him by Seybert, the latter was largely in debt from 1877 to the time of his death. But what proportion his indebtedness at any time bore to the value of his property, or what part of it was incurred in purchasing the lands .referred to, is not shown. The witness, however, states that in 1878 Seybert spoke of his indebtedness for lands, saying he had bought beyond his means. The conveyance complained of was made in May, 1878. Whether any of the lands were purchased at an earlier date does not appear. But it does appear that, at the time of the principal purchase, only the sum of two hundred dollars was paid upon the price. The third of the three witnesses mentioned states that his impression in 1878 was that Seybert’s circumstances were tolerably good. But the witness had no certain information as to what his situation was. From all the facts bearing on that question it is fairly to be inferred that Seybert was in debt at the time the lands were purchased. But we think the evidence does not warrant a finding that he was then insolvent. And ■ without proof of insolvency there' is no presumption as to the plaintiff’s debt against the validity of the conveyance. 2. when conveyance of ífot uiení. But it is said that the actual intention to defraud is . ' by a witness who states that Seybert requested pis advice as to whether lands conveyed to his wife would be liable for his debts. The witness understood, from the conversation had with him, that he desired to protect the lands from subsequent debts growing out of the “uncertainties of business,” and not that he then contemplated contracting debts. We think the intention indicated by this conversation, when it is considered in the light of other facts found in the record, was not fraudulent, and may be reconciled with the purpose simply to settle this property upon the defendant, so that it would be secured to her as a home — not exposed to the hazard of Seybert’s business enterprises. ' And if credit be given to her testimony, Seybert had used money belonging to her equal in amount to the cost of the lands, and the conveyance to her was by way of restoring an inheritance from her father’s estate. However that may have been, the lands were improved and occupied as a homestead, and the purchase money was for the most part obtained by a mortgage upon the property executed during the year in which it was bought and only satisfied by a sale which. took place a short time before the institution of this suit. The sum which was actually paid on the purchase, from means acquired by Seybert, can not be exactly ascertained from the evidence. But it was probably not larger than a man of his station might reasonably expend in renting a comfortable place of residence, for the period during which he occupied these lands. It is said to be a duty which a man owes to his family to provide for them a home. 2 Jones, Liens, sec. 1263. In the effort made to discharge that duty, it is not apparent that Seybert was guilty of any wrong, even to a prior creditor.' And we cannot .see that his conduct furnishes a just ground of complaint to one whose debt had no existence until many years after the purchase. Edmonson v. Meacham, 50 Miss. 34. We think the evidence does not justify the finding and decree of the chancellor. The judgment will therefore be reversed, and the complaint dismissed.