129 Neb. 416 | Neb. | 1935
This is a suit in equity, brought as a creditors’ bill, to set aside as fraudulent two deeds of real estate made by the judgment debtor to two of his sons. The trial court found generally in favor of the defendants, and dismissed the plaintiff’s action.
It is disclosed by the evidence that on April 14, 1926, Henry Renken, a retired farmer, now about 77 years of age, signed a note with his youngest son, Louie Renken, to one Lew T. Smith, in the sum of $5,650, and said Smith sold and assigned said note to plaintiff bank; that on July 21, 1932, the said Henry Renken and Louie Renken gave a note to the plaintiff for $300, and the same parties on July 21, 1932, gave another note to the plaintiff for $1,600; that on February 27, 1933, the plaintiff obtained a judg
During the years these two sons lived at home, they were not paid any wages, but received a small amount of spending* money and their clothing, and worked hard for
At the date of the execution and delivery of the three notes which have been reduced to judgment,,these two improved quarter-sections of land stood in the name of the father,! Henry Renken, who signed the notes. The northeast quarter of section 16, being the place occupied by Henry W. Renken, was encumbered by the father with a mortgage of $6,000, and was deeded to him by lys father October 11, 1932, subject to the mortgage, and the northeast quarter of section 15, being Otto’s place, was encumbered í>y a mortgage in the sum of $7,000. On October 8, 1932, the father, Plenry Renken, and his wife conveyed by warranty deed the northeast quarter of section 15, township 7, range 21, to Otto H. Renken, subject to the mortgage against the property in the sum of $7,000. It is not denied that, at the time the father gave a property statement to the plaintiff bank some years before, he had listed these two quarter-sections of land as his own, and failed to list any indebtedness owing to his sons, Henry W. or Otto.
It is insisted by the defendants that the contract and agreement entered into by the father with the sons was long prior to the time that he signed the notes with his son Louie, and that in conveying the two quarter-sections of land to these two sons the deeds were based upon a sufficient consideration and were valid, and that no mutual
The appellant bank insists that when a conveyance of property is made from one member of a family to another, and the effect of it is to place property beyond the reach of the creditors of the grantor, the transaction will be closely scrutinized, and the grantee must establish the bona fides of the conveyance, and cites in support thereof Blanchard v. McMillan, 113 Neb. 275, and Tanner v. Frink, 101 Neb. 660. Our court has gone still further, in Buckner v. McHugh, 123 Neb. 396, and held that a conveyance from a parent who is unable to pay his debts to a child should be most carefully scrutinized, because such transactions are presumptively fraudulent. See Light v. Kennard, 11 Neb. 129.
It is admitted by all the parties to this lawsuit that this is, and has been, the law in Nebraska for many years, but
In our Nebraska law, in the chapter relating to conveyances to defraud creditors, section 86-405, Comp. St. 1929, it provides generally that this question of fraudulent intent shall be deemed a question of fact, and not of law, and section 36-406, Comp. St. 1929, provides that the provisions of this chapter shall not affect or impair the title of a purchaser for a valuable consideration unless it shall appear that such purchaser had previous notice of the fraudulent intent of his immediate grantor, or of the fraud rendering void the title of such grantor. By this chapter of our statutes our legislature confirmed prior rulings of our court which had held it proper and right to set aside fraudulent conveyances when both the grantor and the grantee were parties to the fraud and joined in an attempt to beat the creditors of the grantor, but it is just as evident from the section cited that the legislature made it clear that the law would not affect the title of a bona fide purchaser who did not have previous notice of the fraudulent intent of the grantor, or who did not join with the grantor and assist him in perpetuating a fraud upon his creditors.
This same limitation has recently been set out by Chief Justice Goss in State Bank of Beaver Crossing v. Mackley, 121 Neb. 28, in which is cited from Farmers & Merchants Nat. Bank v. Mosher, 63 Neb. 130, the following statement of the law of Nebraska: “In the absence of a mutual fraudulent intent, the law does not interfere with the right of a person, be he solvent or insolvent, to make such disposition of his property, based upon a valid consideration, as his judgment dictates.”
It has been held that the true facts of a consideration expressed in a deed may be shown by parol testimony
An examination of the evidence discloses that the father did not strip himself of all of his property when he deeded these two quarters of land to his sons, Henry W. and Otto, but he also owns 320 acres of land in Cheyenne county, Nebraska, which is well improved, and of a fair market value of between $13,600 and $15,200, according to the witnesses, subject only to a mortgage of $3,000. In the face of these facts, it cannot be said that the father was insolvent when he conveyed the property to his sons. It is also disclosed by the evidence that the plaintiff’s judgment is practically all of the indebtedness outstanding against Henry Renken.
The father recognized the long-standing obligations to his sons, and the bona fide agreement that he had made with them more than 20 years before, and in a sense preferred them as to his other creditors. This evidence of an adequate consideration for these transfers overcame the presumption of fraud, and does not disclose any fraudulent intent on the part of the two sons, Henry W. Renken or Otto H. Renken.
The trial court found that the deeds in question were each based upon a valid consideration and were without mutual fraudulent intent, and quieted the title in the respective grantees. After a careful consideration of the
Affirmed.