Cruise v. Sorrell

MAYFIELD, J. This is a typical creditors’ bill. Its objects is to set aside a conveyance by a debtor husband to his wife of substantially all of his property. The reports are full of just such cases. The text-books and reports of adjudged cases teach us that when, a male married debtor becomes embarrassed by demands which he cannot pay without a sacrifice of all his property he usually attempts to save his property and postpone the evil day by conveying his property to his wife in payment of alleged debt which he owes her. Sometimes he is a real debtor of his wife in an amount in excess of the value of his property, and in such cases the conveyance is not a fraud upon the husband’s other creditors, though, in such cases, if it conveys substantially all the husband’s property, it amounts, in law and in equity, to a general assignment for the benefit of all his creditors, under the provisions of section 4295 of the Code. The question as to general assignments, however, is not in this case. The bill in this case rests solely upon the question of fraud, or an attempt to hinder, delay, or defraud creditors. The conveyance is attempted to be set aside because void under the provisions of section 4293 of the Code. [240] The complainant in this case, being a judgment creditor, and an execution haying been returned “No property found,” is not driven to the necessity of filing his bill under any of the sections of chapter 72, nor under sections 3735-3744, of the Code, pertaining to creditors’ bills. The bill alleges the relation of judgment debtor and creditor, the issuance of execution and its return with the indorsement “No property found,” the relation of husband and wife between the grantor and the grantee; that the recited consideration of $1,500 was fictitious and simulated; that the property conveyed was of value greatly in excess of the recited consideration; that the property conveyed constituted substantially all the debtor’s property; and that the conveyance was made with the actual intent to hinder, delay, and defraud the creditors of the grantor, one of whom was the complainant. The allegations of the bill were therefore sufficient, under the authority of all the' text-books and the adjudged cases upon the subject. The respondents answered this bill and, in effect, denied the equities of the bill. There is some difference between counsel as to whether the amended answer was filed, and as to what evidence was in fact introduced on the final hearing; but it certainly appears from this record that the case was heard by the chancellor on the full merits of the cause as made by the pleadings and the evidence. The record has been examined carefully, as is required on an appeal from such decrees, by this court, without any presumption in favor of the finding of the chancellor upon the facts; and we have reached the conclusion that the chancellor was correct in his rulings on the demurrer to the bill and in his finding as to facts; that the decree rendered by him is in all [241] things correct; and that it ought to he, and it hereby is, in ail things affirmed. Affirmed. All the Justices concur, except Dowdell, C. J., not sitting.