Bradshaw v. Halpin

BRACE, P. J. On the 3d day of January, 1900, there was pending in the St. Louis City Circuit Court a suit wherein Mary Devlin was plaintiff and the defendant James Halpin was a defendant, about to come on for trial. And on the same day the said James Hal-pin by his quitclaim deed, in which his wife and co defendant herein, Margaret E. Halpin, joined, by them duly executed, acknowledged and filed for record, for the recited consideration of one dollar, conveyed lot number 24, Chamberlain Park, in city block numbered 3812, in the city of St. Louis to the defendant, The Hal-pin Real Estate Company. Afterwards in due course said suit came on for trial, and the said Mary Devlin, on the 10th of January, 1900, obtained judgment therein against said James Halpin for the sum of two thousand dollars, upon which execution was issued on the 10th day of April, 1900, and levied on said real estate, and in pursuance of a sale made under said execution, the plaintiff herein, Mary E. Bradshaw, became the purchaser thereof, and received a sheriff’s deed therefor, and afterwards at the October term, 1900, of said court, instituted this suit against the said James Halpin, Margaret E. Halpin and the Halpin Real Estate Company, charging in her petition that said conveyance was voluntary, without consideration, and made for the purpose of hindering, delaying and defrauding the creditors of the said James Halpin, and praying that the same be set aside, and for naught held .and for general relief. The answer of the defendants was a general denial. The court found the issues for the plaintiff, entered a decree in which said deed “is •cancelled, set aside and for naught held, ’ ’ and then proceeds : “And the court doth further find that the plaintiff, [670] Mary Bradshaw, is now the owner in fee simple of the said real estate above described, and it is therefore ordered, adjudged and decreed by the court that the title of the property hereinbefore described is divested out of the defendants and vested in the plaintiff. And the court doth further find that the said Mary Bradshaw is entitled to the immediate possession of the said real estate above described, and it is therefore ordered, adjudged and decreed by the court that she be placed in possession thereof, and it is further ordered that the sheriff of the ctiy of St. Louis shall put the plaintiff in full possession of said real estate. And it is further ordered and adjudged by the court that the defendants pay the costs of this proceeding and that execution issue to carry into effect the terms of this decree. ’ ’ From the decree the defendants appeal. 1. • That the defendant James Halpin, besides the real estate in question, had no other property, real or personal, subject to execution, out of which the debt of Mrs. Devlin could have been made was conceded, and the right of plaintiff to have the deed in question set aside is manifest, unless the defense set up by James Halpin and his wife in their evidence on the trial was sustained. That defense in substance was that although the consideration recited in the deed was merely nominal there was in fact a real and valuable consideration therefor, in this, that the said James Halpin. at the time the deed was made was largely indebted to the Halpin Real Estate Company for moneys before that time received by him from the Halpin Manufacturing Company for rent of store No. 1513, on Chestnut street belonging to said real estate company, and occupied by said manufacturing company, and that said deed was made as a payment of the sum of $1,250 on said indebtedness. It appears from their evidence that although the said James Halpin was execution proof, yet through the instrumentality of these two corporations, organized [671] by bim for tbe purpose — he bad a large business and income — tbe usufruct of a large amount of valuable property held and operated by bim in tbeir names. Tbe stock of tbe Halpin Real Estate Company consisted of 750 shares, of tbe pax value of $100 eacb, 744 of which was in tbe name of bis wife, one share in bis own name, and tbe remaining four in tbe names of bis children— and tbe shares of tbe Halpin Manufacturing Company were held by bis wife, himself and bis children in tbe same proportions. He was president, treasurer and general manager of both corporations, and conducted tbe business of eacb according to bis own will and pleasure. They were simply James Halpin incorporated, for bis business purposes, and by bim used at any time, in any manner and for any purpose be saw fit, and to make out tbe defense in this case be in substance testified that as treasurer of tbe real estate company be bad collected from himself as treasurer of tbe manufacturing company a large amount of rents for tbe Chestnut street store, which be bad failed to pay over to himself as treasurer of tbe real estate company, and on tbe 3d of January, 1900, being thus indebted, be made tbe deed in question in part payment of tbe indebtedness — and thus you have a quick and easy method by which an indebtedness may be created and paid off when a debtor has occasion therefor, and tbe use of two corporate names besides bis own, for the purpose. That tbe chancellor should have turned a cold and callous ear to this story of self-to-self indebtedness, and of self-to-self payment was a matter of course. Tbe evidence of Mrs. Halpin added nothing to the probative force of that of her husband, for though nominally vice president of both corporations, she took no part in tbe management of either, and knew nothing about bis or tbeir business affairs except what her husband told her. Of this remarkable business transaction tbe books of tbe concern showed but a single entry pertaining to it, and that was in a book purporting to be the cash book [672] of the real estate company — as follows: “April —, 1900, received deed to Chamberlain property from James Halpin, account rent collected, $1,250.00.” This entry made long after the deed was made, and the judgment against James Halpin was rendered, and when in due course an execution thereon was impending, looks more like' the product of the necessities of the situation, than the record of a genuine business transaction, and instead of tending to sustain, but adds to the suspicious and sinister appearance of the defense. Without stopping to further note the defects, contradictions and in-consistences of the evidence in support of this defense, it is sufficient to say that after a careful consideration of all the evidence in the case, we fully agree with the chancellor in his finding on the issues. 2. It is contended, however, that notwithstanding such finding the bill ought to have been dismissed, because the plaintiff at the sheriff’s sale purchased the property for fifty dollars, when in fact it was worth twelve hundred and fifty dollars. There is nothing in this contention. It is well-settled law in this State, that where a debtor conveys his land for the purpose of defrauding his creditors, the land is subject to the creditors’ execution, and that a purchaser at the execution sale thereof occupies as advantageous a position as would the judgment creditor, when proceeding to set aside the debtor’s conveyance on the ground of fraud. [Ryland v. Callison, 54 Mo. 513; Lionberger v. Baker, 88 Mo. 447; Rinehart v. Long, 95 Mo. 396.] 3. It is finally contended that the decree of the court is erroneous in that it divests Margaret E. Hal-pin of all title in the lot fraudulently conveyed to the Halpin Real Estate Company and inasmuch as upon the setting aside of the fraudulent conveyance her dower interest in the premises revives, the error is prejudicial to her. That the decree is erroneous in this particular must be conceded, but the error can be easily corrected here by a modification of the decree, which is accord [673] ingly ordered, as follows: That the words “that the title of the property hereinbefore described is divested ont of the defendants and vested in the plaintiff” be stricken ont of the decree and the following words be inserted in place and lieu thereof: “That the Halpin Real Estate Company be divested of all title by it acquired in and to the property hereinbefore described under and by virtue of said deed of January 3rd, 1900, and that the same be vested in the plaintiff.” The decree as thus modified will be affirmed. All concur.