Waters v. Merit Pants Co.

McCulloch, J. This is an action brought by appellee, Merit Pants Company, against appellants, H. M. Waters and wife, in which- appellee seeks to subject certain lands to the paynjent of a debt in the sum of $380.75 due appellee by said H. M. Waters. It is alleged that H. M. Waters, being insolvent and indebted to appellee, purchased the land in controversy from one McClure, and, with intent to defraud his creditors, caused the title to be conveyed to his wife. The proof in the case consisted only of the testimony of McClure and Mrs. Waters, and it appears therefrom that McClure sold the land to H. M. Waters at a fixed price of $300, which was paid by delivery to McClure of a lot of cattle and a small stock of merchandise, a remnant of the stock carried by Waters as a merchant, and that, at the request of PI. M. Waters, McClure made the deed to his wife. McClure •testified that the cattle were taken at a valuation of either $64 or $67. Mrs. Waters testified the value of the cattle were fixed at $80, and that they were her separate property. She also testified that her husband owed her about $1,000 for a lot of cattle and horses which she had sold him when they were married twenty years previously, and for proceeds of sale of her farm thirteen years previously; that no note or other evidence of the indebtedness was executed by the husband, and that she had given him credit on the debt for $220, the estimated value of the stock of merchandise used in payment of this tract of land. The chancellor found that the conveyance to Mrs. Waters was fraudulent, but that her property, the cattle, of the value of $80, had been used in the purchase, and decreed a lien in favor of appellee for $220, the value of the stock of merchandise. The defendants appealed. It is settled by the decisions of this court that an insolvent husband, when justly indebted to his wife, may, without fraud, prefer her claim to that of other creditors, and make valid appropriation of his property to pay it, even though the result be to deprive other creditors of the means to satisfy their claims. But such transactions between husband and wife are viewed by the courts with suspicion, and the perfect good faith of the transaction must be established by proof. Where the wife asserts, as a consideration for conveyance of his property to her, a claim of debt against her insolvent husband for money loaned to him many years previous, no note or other written evidence of an agreement to repay being shown to have been executed, and the alleged debt having become stale by long lapse of time, as in this case, her bare statement should be corroborated by some other evidence of the existnce of a valid debt, before the courts can accept it in support of the conveyance. Bor a discussion of the law on this subject reference is made to the recent case of Davis v. Yonge, 74 Ark. 161; and nothing need be added here on the subject. See also, Godfrey v. Herring, 74 Ark. 186; Driggs v. Norwood, 50 Ark. 42. We think the evidence in this case is far from satisfactory as to the existence of a valid debt, and that the chancellor was right in his conclusion. Appellants complain that the court erred in allowing witness McClure to testify that, of the merchandise received from Waters, about one hundred and twenty-five dollars’ worth bore ■.the marks and name of appellee, thus tending to show that these goods were bought by Waters from appellee. The witness was ■allowed to examine the itemized account sued on, and after •examination state that he recognized the number of suits of ■clothes and the prices thereof on the account as the same he purchased from Waters. The decree was not dependent on this .testimony for sufficient evidence to support it; and, if it be held to be incompetent, the presumption must be indulged that the •chancellor was not controlled by it in reaching his conclusion. A ■chancery case will not be reversed for the failure to exclude improper testimony where, without it, the decree is supported by a preponderance of the legal testimony. Niagara Fire Ins. Co. v. Boon, ante p. 153; Allen v. Ozark Land, Co., 55 Ark. 549. Counsel for appellant also contends that the proof of insolvency is not sufficient; but we think that fact is satisfactorily ■established by the proof on the subject, in connection with the undenied allegation of insolvency at the time of the commencement of this suit. Decree affirmed.