Sears v. Setser

Hart, J., (after stating the facts). If it be conceded that the conveyance of the property in question by John H. Setser and his wife was a fraud against the rights of the plaintiff as an existing creditor, still the plaintiff would not be entitled to recover in this action. In the case of Doster v. Manistee National Bank, 67 Ark. 325, it was held that a judgment was not a lien upon land which the judgment-debtor had previously conveyed to defraud his creditors. The court pointed out that, although such conveyances were often spoken of as void as to creditors, they were in fact only voidable, and would stand unless some legal steps were taken to avoid them. The court held, in effect, that where it is said that a fraudulent conveyance is void as to the creditors of the grantor, what is meant is that it is ineffectual against legal process instituted by the creditors against the property of the debtor and exercised through regular and valid proceedings. In the case of Ward v. Sturdivant, 81 Ark. 73, the court reaffirmed the rule announced in the Doster case, and said that while such a deed is good between the parties, a creditor may elect to treat it as a nullity, and that when he recovers judgment against the fraudulent grantor he may levy his execution on the property and subject it to sale for the satisfaction of his debt. The court held that the purchaser under execution’ sale can recover possession from the fraudulent grantee by an action of ejectment, upon showing the nature of the conveyance. In that case, the judgment-creditor fixed a lien upon property by a levy of an execution on the land which had been fraudulently conveyed by the debtor. In the present case, the plaintiff did not recover judgment against John H. Setser until the 5th day of January, 1909. Prior to that time, namely, on the 27th day of February, 1908, John H. Setser and Eliza Setser, his wife, had conveyed the property in question to Arthur B. Setser. Therefore, no lien was fixed upon the land by the rendition of the judgment, and no lien was afterward fixed on it by the levy of an execution. A lien was attempted to be fixed on the land by the institution of the present suit on the 8th day of October, 1910, but prior to that time, namely, in August, 1909, the family of John H. Setser had moved upon the land and claimed it as their home. It is true that John H. Setser at that time was absent from the State, but his testimony shows that he was only temporarily absent and that he intended to return to the State at the time he left. He. did return in the early part of 1910 and took up his abode on the premises in question, where his wife and the rest of his family already lived. Thus, it will be seen that Setser and his family moved on the land and fixed it with the character of his homestead before any lien was affixed on the land; and this court has held that a debtor may fix his homestead upon any lands he may own, regardless of his debts and the rights of his creditors, if he can do so before any lien attaches to the land. Gibbs v. Adams, 76 Ark. 577; Ferguson v. Little Rock Trust Co., 99 Ark. 45. It follows that the chancellor was right in dismissing the complaint for want of equity, and the decree will be affirmed.