Hyde v. Chapman

Cole, J. It is claimed on the part of the defendant James A. Chapman, that there was no sufficient evidence in the case which warranted the court in finding that the conveyance from B. A. Chapman to him was without adequate consideration and fraudulent as to creditors. It seems to us that this is so. There does not appear to have been any serious effort made on the trial by the plaintiff to support the charge that the deed was executed by B. A. Chapman with a fraudulent intent. This was a question of fact, and could only be established by competent evidence. It did indeed appear that the firm of N. 0/ Perkins & Co. were indebted to the plaintiff for ■ rent when that conveyance was made, in the sum of $435.35. Further it appeared that the lands had been conveyed to B. A. Chapman by three several conveyances for an aggregate consideration of $2,675, and that B. A. Chapmmi, on the day above named, conveyed - them to James A. Chapman for a consideration expressed in the deed of $3,000. It was also shown by the deputy sheriff, who received the execution on the 24th of November, 1869, that he had been acquainted with the judgment debtors for some years; that they had previously 398 been in business in Beloit, manufacturing soap, and had failed ; that their personal property was “mostly ” mortgaged to some party in Chicago; and that he knew of no personal property belonging to either of them out of which he could satisfy the execution. This is the substance of the testimony given on the part of the plaintiff; the defendant submitting the case without evidence. And it seems to us that it would be going much further than the facts" would warrant, to hold upon this evidence that the deed given by* B. A. to James A. Chapman was made with intent to hinder and defraud creditors. The deed itself expresses a sufficient and valuable consideration, and there is not a particle of proof to show it does not state the true consideration. True, the defendant James A. Chapman states in his answer how the consideration was paid. He alleges that he was the purchaser originally, paying for the lands with his own money, but having the title conveyed to B. A. Chapman for his own use and benefit. Now it is said that if this is a true history of the transaction, B. A. Chapman became under our statute, sec. 7, ch. 84, R. S., the absolute owner in law and equity, and that no trust resulted in favor of James A. Chapman, in consequence of his paying such consideration. This may be conceded; still, if B. A. Chapman recognized James A. Chapmans equities, and actually conveyed the property according to the original understanding and arrangement, we apprehend there would be nothing in the transaction which a court of equity would condemn. For it would be entirely competent for B. A. Chapman to regard the equitable rights of James A. Chapman, and to secure them, either by a lawful declaration of trust, or by a conveyance; and he was under the highest moral obligation to do so, if such was the arrangement between them. Se'e Foote v. Bryand, 47 N. Y., 544-549. At all events there is nothing in the admissions in the answer which authorizes the conclusion that the deed was not executed upon an adequate consideration. But suppose it was not, how then stands the case? Our statute 399 provides that the question of fraudulent intent, in all cases arising under cb. 108, R. S., shall be deemed a question of fact and not of law, nor shall any conveyance be adjudged fraudulent as against creditors or purchasers, solely on the ground that it was not founded on a valuable consideration. Sec. 4. •The fraudulent intent cannot, therefore, be presumed from the fact that the conveyance was voluntary, although that circumstance may properly be considered with the other evidence in determining the question of fraudulent intent. In the present case it seems to us the evidence is entirely insufficient to show that the deed was executed by B. A. Chapman with the intent to commit a fraud upon his creditors. The counsel for the plaintiff seems to have assumed that- if the conveyance was voluntary it was presumptively void. But this is a mistake. The conveyance in question is sought to be set aside for fraud, and it was incumbent on the plaintiff to adduce sufficient evidence to show that he was entitled to relief upon that ground. Another objection was taken by the counsel for the defendant, which seems to us fatal to the plaintiff’s right to maintain the action. It appears.that no execution was ever issued and returned unsatisfied when the suit was commenced. The deed from B. A. to James A. Chapman was executed and delivered nearly nine months before the rendition of the judgment, and it does not appear that the plaintiff did or could obtain any specific lien upon the property by either a judgment or a levy under the execution. Whether the judgment debtor was in possession of the land in his own right when the judgment was obtained, so as to haye an interest therein liable to be sold on execution, within the doctrine of Bunker v. Rand, 19 Wis., 253, is a fact not proven in the case, while certain it is that the legal estate was in James A. Chapman. Under these circumstances it is difficult to say that the plaintiff ever acquired any lien upon the property. And if he did not, the law seems to be well settled that this right to relief depends upon the fact of his having exhausted his legal remedies without being able to 400 obtain satisfaction of his judgment. The issuing of an execution and its return unsatisfied was essential to his right to maintain this action. Beck v. Burdett, 1 Paige, 305 ; Gates v. Boomer, 17 Wis., 455; Cornell v. Badway, 22 id., 260. By the Court. — The judgment of the circuit court is reversed, and the cause remanded with directions to dismiss the complaint. •