Brooks v. Dike

TimliN, J. All tbe findings of fact of tbe learned circuit court seem to be supported by evidence. This includes tbe finding tbat alleged alterations appearing upon tbe deed of July 29, 1903, to tbe. infant plaintiffs were sufficiently accounted for and explained so as to admit that' deed in evidence. But tbe conclusions of law based on such findings are incorrect. Tbe learned circuit court seems to have given tbe rule of tbe case of Corry v. Shea, 144 Wis. 135, 128 N. W. 892, an unwarranted extension. In tbat case tbe owner and bolder of tax certificates, one at least of which was ripe for foreclosure, brought an action to set aside as invalid under sec. 2320, Stats., a voluntary conveyance, made at or about tbe time tbe right of foreclosure accrued, by tbe landowner to bis infant son, for tbe purpose of extending tbe time for redemption, and thus hindering, delaying, or defeating tbe plaintiff’s action of foreclosure. Under former decisions of this court construing statutes then and now in force, a conveyance to an infant of real estate upon which there were outstanding tax certificates of sale bad tbe effect, if permitted to stand, to extend tbe time of redemption until tbat infant arrived at tbe age of twenty-one years and within one year thereafter. This, we considered, bad become a rule of property and we did not feel at liberty to change it. Therefore, if tbe deed to tbe infant were held valid it conferred upon tbe infant greater rights than those possessed by bis adult grantor and operated to binder and delay a foreclosure suit upon tbe tax certificate, because tbe foreclosure decree therein would be subject to a right of redemption different from and greater than tbat possessed by tbe adult grantor of tbe infant. But tbe learned circuit court in the instant case held tbe defendants entitled to greater rights than creditors or “others” can assert under sec. 2320, supra, and limited tbe plaintiffs in tbe assertion of rights which may be asserted by grantees whose grant is within tbe purview of said section. As in Corry v. Shea, supra, so under tbe findings in this case would [158] the deed under which the infants claim have been invalid to confer upon such infants any right or title which would stand in-the way of the tax-title holder asserting any right which he could have asserted against the grantor of such infants. But where the voluntary conveyance to the infants did not and could not hinder, delay, or defraud, viz. as to all those rights and interests unaffected by the voluntary conveyance and which could have been as effectively and as easily asserted without the conveyance to the infants, or had that conveyance never been made, a different rule applies. For example, a mortgagee cannot complain of a subsequent conveyance of the equity of redemption as fraudulent, because his rights are in no manner injuriously affected. The conveyance is not void as to such rights. Hodson v. Treat, 7 Wis. 263. “A creditor cannot impeach a conveyance without showing that he has been injured thereby, and, to entitle him to equitable relief, it is necessary for him to show that he has been thereby deprived of his remedy at law, and is therefore compelled to resort to equity.” 20 Cyc. 419, cites cases from twenty-six states of this Union in support of the foregoing. In A. D. Baker Co. v. Booher, 153 Wis. 319, 141 N. W. 248, it was held that assuming the husband and wife joined in the conveyance to their sons, fraudulent as to creditors, taking back an agreement for support, and the wife in a subsequent divorce suit' obtained a decree transferring to her as a final division of his property all the husband’s- interest in and to the land so conveyed to the sons, creditors of the husband suing afterward could not have the transfer set aside. ' Furthermore, a conveyance by husband to wife of the homestead cannot be considered fraudulent as to his creditors, because, being exempt from execution, it is no more beyond their reach after the conveyance than it was before. Pike v. Miles, 23 Wis. 164; Shawano Co. Bank v. Koeppen, 18 Wis. 533, 47 [159] N. W. 723; Bank of Commerce v. Fowler, 93 Wis. 241, 67 N. W. 423; Bartle v. Bartle, 132 Wis. 392, 112 N. W. 471. “According to natural and authoritative exposition, the statute was not intended to enlarge the rights of creditors further than might be necessary to enable them effectually to defeat the alienation made by the debtor; aside from this, creditors have no greater rights (under the statute of Elizabeth) against the alienee than they would have had against the debtor had there been no alienation.” Bigelow, Eraud. ■Conv. (Revised ed. 1911) 52, 53. Because a deed is invalid under sec. 2320 as against certain rights of the creditor or “other person,” it is not necessarily invalid against every right which that' creditor or other pjerson may assert and which were not injuriously affected by the fraudulent conveyance. Upon the findings these defendants never had title or right ■of action to assert title, which they,could enforce against the grantor of the infant plaintiffs. Prior to his election to take .a tax deed on the land, Mr. Dike had a lien by virtue of the ■certificates of tax sale. As against this lien the conveyance to the infants was invalid and ineffectual to hinder or delay foreclosure and sale. He still has that lien. But the voluntary and fraudulent conveyance to the infants did not' give to Mr. Dike other or greater rights than he had against the grantor of the infants. He thereby acquired no right to take a tax deed without notice nor to refuse redemption within the time fixed for redemption by adult persons. On the other hand, the conveyance to the infants was good as between the parties to it' and transferred to the infants all those rights in and to the land which the grantors themselves could assert against the tax-title holder had the conveyance not been made. Home Inv. Co. v. Emerson, 153 Wis. 1, 140 N. W. 283. Eor these reasons the tax-title holder cannot urge the fraudulent character of the deed to the infant plaintiffs to prevent them [160] from attacking his tax title upon grounds available to their grantor had the fraudulent conveyance never been made; nor deny them the right of redemption within the time redemption could have been made had the deed to the infants never been executed. Sec. 1165, Stats. If we assume as most favorable to the respondents that these infants, at the time aged respectively twelve and fourteen years, by mere receipt of the title from their grantor, or by such receipt with knowledge of the purpose of the conveyance to them, were in equal delict with their grantor, they would not be thereby barred from maintaining this action. Their conduct, if it merited this condemnation, nevertheless did not affect the equitable relations between them and the defendants asserted in this action, or place the defendants in any worse position with reference to the rights here asserted than the latter would have been had no such conveyance been accepted. Their misconduct, if misconduct it was, is unconnected with the matter in litigation and did not concern or affect the title of the opposite party asserted in this action. 1 Pom. Eq. Jur. (3d ed.) § 397 ét seq. We consider the action one under sec. 3186, Stats., hence governed by sec. 1210A. The plaintiffs will be entitled to judgment upon the findings upon condition of their making the payments mentioned in the latter section. They are also entitled to have commissioners appointed in the special proceeding. By the Court. — Judgment reversed, and cause remanded with directions to enter judgment for plaintiffs in the action as above directed; and the order refusing to appoint' commissioners and dismissing the special proceeding is reversed and remanded for further action in conformity with law. The appellants to recover one bill of costs in this court'.