Barrett v. Lowrey

Morse, J. The testimony in these two cases is the same, except as to the date of the levies of execution, and therefore I shall treat them both together. In 1885, James Barrett, the present husband of complainant, was living upon and the owner of a farm in Clinton county. This farm was subject to a life-lease executed to an old gentleman, Charles White, who had in 1867 conveyed the premises to Barrett. Barrett was considerably in debt in 1885, and there were mortgages upon the land amounting to about $3,600, — one executed to a brother, William Barrett, for $1,200, January 7, 1885, which was assigned by William to Anna Barrett, January 10, 1885; one to Thomas C. Pitkin, of Detroit, for $600; and one to James M. Soverhill, of Geneva, New York, for $1,800. August 3, 1885, James Barrett conveyed this farm to his brother, William Barrett, the consideration in the deed being $6,000. August 10, 1885, the defendant Charles H. Frain, who' had a judgment against James Barrett, levied upon the premises as the property of said — 670 — Jarnés Barrett, and the same were sold at sheriff’s sale, and bid in by said Frain, and the usual certificate executed and filed in the proper office. On December 19, 1885, the complainant married James Barrett. July 21, 1886, William Barrett conveyed the farm to the complainant, for the consideration, expressed in the deed, of $6,200, with a clause in the deed conveying also the wheat sown on the premises. September 24, 1886, the defendant Lowrey, who had a judgment against James Barrett, levied upon the premises as his property. No steps were afterwards taken to further enforce this levy. In the deed from James to William Barrett the premises were warranted free from all incumbrances. Nothing was said about incumbrances in the deed from William to the complainant. In April or March, 1888, the complainant filed separate bills of complaint in the circuit court for the county of Clinton, in chancery, against Frain and Lowrey, alleging that she was the owner of the premises; that she had been in sole possession of the same since July 21, 1886; and that the value of the same was $5,000. She avers the levies, and the sale under the Frain execution, and the failure to further enforce them; that she had demanded their removal and cancellation of the defendants, notifying each of them that she was the legal and lawful owner, in fee, of the whole premises, but that they had each refused and neglected to comply with her demand, and that they each maintain that they have a legal lien upon the land, and that said James Barrett has an interest in the premises. The defendants admit the levies, and their claim of lien under them, and aver that the deeds from James to William and from William to complainant were without consideration, in fraud of, and void against, James Barrett’s creditors. The court below, upon the pleadings — 671 — and proofs taken in open court, dismissed both bills. The. decree in each case is manifestly right. The testimony shows a barefaced attempt on the' part of James Barrett to defraud his creditors, and that William Barrett and complainant were parties to it, and that the deeds were made in execution of the fraud. At the time the deed from James to William was made, William was living with James, who was then a widower. They went to Lansing to have the deed, executed; and William, according to his testimony, had $3,000 in money, which at the time, and for some time before, he was carrying in his pocket. He did. not pay James for the land at Lansing, when the deed was delivered, but waited until after they returned home, at night, when he paid James $2,400 in cash; that being the amount of the consideration over and above the mortgages. This payment rests on the oath of William alone; James not being sworn on behalf of complainant. No one has ever seen or heard of a dollar of this money since the pretended payment. Where the money that William carried in his pocket came from is also a great mystery. He is not shown to -have had it, except by his own testimony, which clearly shows he did not have it. He is a single man, and is now living where he was when this deed was executed, at the house of James Barrett. According to his testimony, he was in business 30 years in Franklin, Oakland county, where he had a varied experience; being arrested for various crimes and misdemeanors some 20 times, or more. He attributes his misfortunes in this respect to whisky, which he says he tried to destroy by drinking it for 15 years. Failing in this, he turned around, and attempted to prevent the sale of it. Then those who were in favor of liquor selling began to persecute him, procuring his arrest for various offenses, and also his conviction for some of them, larceny being one of the crimes of which — 672 — he was found guilty. He was in the dry-goods and grocery business at Franklin, and five years before the time he was testifying, owned a stock of goods inventoried at $5,000. He owned the store in which the goods were. He had no other property at that time, or when his store and goods were burned, about that time. He has done nothing to earn any money since, but has had plenty to live on. The insurance on the goods and store he has not yet collected. He also testifies that at the time of the deed to him he knew of the mortgages on the land, but did not know that James owed any other debts. In almost the same breath, he swears that he does not know what James did with the money he paid him, but that James told him that he was going to work and pay up his debts with it, —little debts that he had around loose. He testifies that he bought the farm to get his pay upon the $1,200 mortgage he had upon it; but his own testimony shows that he had assigned the same to one Anna Barrett, his sister, over six months before, and received the money for it. After the execution of his deed, he still lived with James, and the farm was so managed and conducted by James that no one in the neighborhood knew or suspected that any transfer had been made to William. October 30, 1885, James insured the house and barn on the premises against fire, and in his application for insurance stated that he owned the farm, and the buildings and personal property upon it. The deed from James to William was not put on record until July 21, 1886, the same day that William deeded to the complainant. The statement of complainant in relation to the money she paid towards this land, and where she obtained it, is also very unsatisfactory. She claims to have paid William $1,000 the day the deed was executed to her, $800 of — 673 — which she borrowed of a relative, one Charles Haveland, who supports this claim by his testimony. Haveland is shown to have been at this time heavily in debt, with a large mortgage upon his farm, on which he was unable to pay the interest. The complainant’s testimony was neither frank nor candid. On cross-examination she refused to answer many proper and reasonable questions. She was unwilling, and refused, to explain many things that needed explanation. In answer to different interrogatives, she said: “That is my own affair, mister,” “I shan’t answer,” “I shan’t tell, if I do know,” and the like. If she could tell a plain, straightforward story as to her purchase of this land, she certainly did not do so on this hearing, or manifest any disposition to do so. The payments she has made, since she received the deed of the farm, of interest on the mortgages and other debts have manifestly been made out of the proceeds of the farm,' which she admits she has received, although to all outward appearances, James has run and managed it the same as he did before these conveyances were made. A very significant feature of these cases, as tried, is the failure of the complainant to call her husband, who is charged by the defense to have disposed of his land with intent to defraud his . creditors. If the transaction was a fair and honest one, his testimony was material, and would have been of great advantage to complainant, and no good reason is shown for his remaining silent, as he was in the court-room during the trial, and testified, being called by the defense, as to some matters in the case. It is suggested that the defendants have lost their right to enforce these levies because they have not moved sooner, and therefore the prayer of complainant’s bill should be granted. It is said that one attacking a trans — 674 — action as fraudulent must complain, by proper proceedings, promptly, or the remedy is waived. In the case of Frain, the levy was upon this land when the complainant pretends she purchased it, and was notice to her that fraud in the sale from James to William was complained of, and the levy of Lowrey was made very soon after she received her deed. The fraud was complained of speedily, and the initial steps taken to contest it. That is all the law requires. There has been no such delay since, in my opinion, as to waive or forfeit the rights of Frain and Lowrey to enforce their levies and prove the fraud complained of. But, be this.as it may, the complainant, coming into a court of equity, must show clean hands. When she comes in as she has here, and by her own testimony convinces the court that James Barrett made the conveyance to William to defraud his creditors, and that the subsequent deed from William to her was in furtherance of this fraud, she can hardly ask a court of chancery to relieve her against her fraud, and to judicially approve it, because Frain and Lowrey have not yet sought to enforce by further proceedings their claim of fraud against her. This will not do. By her own act, and out of her own mouth, she has established the fraud, and she must suffer the consequences of it. The decree in both cases must be affirmed, with costs. Ohamplin and Long, JJ., concurred with Morse, J.