Evans v. Laughton

Cassoday, J. We have just determined, in the suit against the firm, that the attachment mentioned was properly sustained upon the traverse, as against the separate property of N. H. Virgin. As there stated, it was levied upon the eighty-five and one-half acres of land in question [144] as the separate property of N. H. Virgin, February 12,1884. The title to this land at the time was, apparently, in the defendant, Emma V. Laughton, daughter of N. H. Virgin, under a deed to her from her father and mother, dated October 9,1882, and recorded February 11,1884. The next day, after having commenced the attachment suit, and acquired such levy, Hodges commenced this suit in equity in his own name, to have said deed set aside and adjudged fraudulent and void as against Hodges* and to subject the land to such levy and hen in aid of such attachment. The question presented is whether this bill in equity can be maintained for such a purpose upon the facts found as stated, and which seem to be supported by the evidence. It is urged by the learned counsel for the defendant that this is in the nature of a creditor’s bill, and hence, as a condition of its maintenance, Hodges should first have obtained judgment, issued execution thereon, and then waited until the same had been returned unsatisfied, as required by sec. 3029, R. S. In other words, that such a bill cannot be maintained by a creditor at large, but only one who has first exhausted his remedy at law. Had Emma acquired an absolute, indefeasible title in fee-simple to the land October 9, 1882, so as to have prevented the subsequent attachment against the property of N. H. Virgin from becoming a specific lien at law thereon, then there would have been, force in the argument of counsel, and the application of Hyde v. Chapman, 33 Wis. 391, cited by him. But even had the deed from N. H. Virgin and wife to Emma been intended as an absolute conveyance, and hence binding upon the grantors, yet if it was in fact made by them, and received by Emma with the intent to hinder, delay, and defraud the creditors of N. H. Virgin, including Hodges, then there are certainly plenty of authorities holding that, as such deed would in that event have been void as against such creditors, including Hodges, the latter would have been at liberty, notwithstanding such [145] prior conveyance, to seize the land on execution or attachment as the property of N. H. Virgin, and would thereby have acquired a specific lien at law thereon. Sec. 2320, R. S.; Eastman v. Schettler, 13 Wis. 324; and cases cited in. the note to Yocum v. Bullit, 17 Am. Dec. 184-187; Wadsworth v. Schisselbauer, 32 Minn. 84. But this precise question was not discussed, and the view we have taken of 'the case makes it unnecessary to decide it. Under the findings of the court, we are constrained to hold that, notwithstanding the deed was absolute in form, yet that it was not intended by N. II. Virgin nor Emma to be anything more than security for future advances, not exceeding in amount $6,000, and to become absolute only in the event of his death. The arrangement was, in substance and effect, that, as between the parties to it, the deed should be regarded as a mortgage for future advances not exceeding the amount named, during the life of N. IT. Virgin; but, in case he failed to repay such advances as might be so made during his life, then on his death the deed should be regarded as an absolute conveyance. Such an arrangement, with the understanding not to record the deed, as stated, was well calu-lated to decoy, and then hinder, delay, and defraud creditors, and yet reserve to the grantor the privilege of reclaiming the land on redemption, or asserting the absoluteness of the deed, as might best suit the future interests of the parties to it. As the deed was given and received with intent to secure such future advances, it must, under the frequent adjudications of this court, and as between the parties to it, be regarded in equity as a mortgage. Schreiber v. Le Clair, 66 Wis. 579, and cases there cited. Being a mere mortgage, as between the parties, Emma took the deed as a mere mortgagee, having no other rights or remedies than the law accords to mortgagees. Ibid. Since, as between the parties, the grantee was a mero mortgagee, it necessarily follows that the grantor, N. H. [146] Virgin, upon the execution and delivery of the deed, became and continued to be a mere mortgagor, with all the rights and subject to all the liabilities of a mortgagor. In other words, as between the parties, he must be regarded as continuing to be the owner of the land at the time Hodges’ attachment was levied upon it. There is no question but what all the necessary steps for perfecting the attachment were duly taken, and the copy of the writ and the requisite certificate duly filed in the register’s office as required. These things being so, the real estate in question, and the interest of N. II. Virgin therein so attached, exclusive of the homestead, thereby became bound, and the attachment a specific lien thereon.«i law, from the time of so perfecting the same. Sec. 2731, R. S. This being so, the case comes squarely within the rule sanctioned in Cornell v. Radway, 22 Wis. 260; Galloway v. Hamilton, 68 Wis. 651; Wadsworth v. Schisselbauer, 32 Minn. 84; Hahn v. Salmon, 20 Fed. Rep. 801; Dawson v. Sims, 14 Ore. 561. In each of the last two cases cited is a well-considered opinion, sustaining the right of a creditor at large to maintain a bill in equity in aid of an attachment, the one by Deady, J., of the federal court, and the other by Loed, C. J., of the supreme court of Oregon. As there indicated, the authorities to that effect are not all harmonious. See the cases classified in the note to 3 Pom. Eq. Jur. § 1415. There can be no question, however, in this state, for the late Revision gives to every“ owner and holder of any lien or incumbrance on land . . . the same right of action as the owner in fee in possession, to test the legality and validity of any other claim, lien, or incumbrance on such land, or any part thereof.” Sec. 3186, R. S. It follows that Hodges, having by his attachment acquired a specific lien upon the land in question, had the right to maintain this bill in equity to test the validity of the deed to Emma., which turns out to, be a mere mortgage, in aid of his See notes to this case in 33 N. W. Rep. 573, 574. — Rep. attachment. For the reasons given in the case against the firm, the rights thus acquired by Hodges were, by virtue of his assignment, and the substitution made by order of the court, duly entered, transferred to the plaintiff. But notwithstanding such deed was made with intent to hinder, delay, and defraud the creditors of N. H. Virgin, including Hodges, yet, as it was, in effect, a mere mortgage for future advances, and as a large share of such advances were subsequently made in good faith, to increase the value of the property now sought to be reached, and was in good faith so used, the court has concluded to hold that such conveyance is a valid mortgage to the extent that such property was so benefited by such advances, to wit, to the amount of §2,811, with interest thereon from the time of the rendition of the judgment herein, June 22, 1886, but for no further or greater amount; but that said deed, except as to such homestead, is in all other respects held to be fraudulent and void as to Hodges, and the plaintiff as his assignee. By the Court.— The judgment of the circuit court is reversed, and the cause is remanded, with directions to enter judgment in favor of the plaintiff, and- against the defendant, in accordance with this opinion, but without costs to either party, except the clerk’s fees are to be paid by the plaintiff. Orton, J., dissents. See dissenting opinion, post, p. 163.