Freeman v. Stewart

119 Ala. 158 | Ala. | 1898

McCLELLAN, J.

We understand by the words of •description contained in the bill, viz.: “The following described real estate in the city of Decatur, Morgan ■county, Alabama, to wit, * * * part lots 126 and 127 known as the Stiles lots,” that reference is made, not to parts of lots 126 and 127, but to the whole of said lots, and that they are fractional lots, i. e., less in their entire area than the size of lots generally as laid out in the plat of the town. ' So interpreted, the description is sufficiently definite and certain.

We do not think it was incumbent on the complainant to make prior mortgagees parties to this bill. The complainant as a judgment creditor of Oldacre had a right on the facts averred in the bill to sell the real estate in controversy under an execution issued on his judgment, and running, of course, against Oldacre alone, without any notice to or taking any account of the mortgagees, and the purchaser at such sale would have taken only Oldacre’s interest in the property. The rights and interests of the prior encumbrancers would mot have been at all affected by such sale, but the purchaser taking the shoes of Oldacre would have held as he did subject to the superior rights of the mortgagees. Oldacre’s fraudulent conveyance of his interest in the property to Mrs. Freeman neither enlarged nor limited complainant’s rights in the premises, nor in anywise clogged or complicated his remedies for their enforcement. He still had a perfect right to subject Oldacre’s interest to the payment of his debt, and this without instituting any contest with the mortgagees, for, seeking to subject no interest that belonged to them, there was and could be no issue, no matter for litigation, between him and them. The only effect of the fraudulent conveyance by Oldacre to Mrs. Freeman was to give the complainant an additional and cumulative remedy. Before his remedy was solely by execution on his judgment. After the conveyance he could either levy Ins execution on the assumption that the transaction between Oldacre and Mrs. Freeman was invalid, or he could proceed, as he is proceeding here, by bill averring the fraud of that conveyance, and seeking to have it set aside and the property sold under decree in chancery to satisfy his judgment. The prosecution of this latter remedy, no more than a resort to execution at law, can not affect any interest the mortgagees have in the land, the chancery sale will be as an execution sale would have been, subject to all the rights of the prior encumbrancers ; and as no interest of theirs can be affected by this proceeding, as indeed no interest of theirs is or' can become interested in this litigation, it is inconceivable that any necessity or occasion can exist or arise for making them parties to the bill. This is the logical view; and the authorities support it. — Bolling & Son v. Pace, 99 Ala. 607; Williams et al. v. Spraggins, Buck & Co. et al., 102 Ala. 424; Waite Fraud. Conveyances, §138; Hawes on Parties, § 27.

Nor was it necessary to aver particularly the nature and amount of the encumbrances on the property in controversy. The purpose of the averment was to show the necessity for the appointment of a receiver to percept the rents for that on account of the prior encumbrances the property, or rather Oldacre’s interest in it, was not of sufficient value to pay complainant’s judgment. The averment is in substance and effect only this, and might well have been made in this way: Old-acre owned an equity of redemption in certain described property which was subject to the payment of complainant’s judgment. This he fraudulently conveyed to Mrs. Freeman to defeat complainant in the collection of his debt. The equity is not of value sufficient to ■ satisfy the debt, and it is necessary to that end that the rents thereof pending the suit should be intercepted and held by the court and eventually 'applied to complainant’s debt. Obviously such a statement of complainant’s case would not have been open to criticism for not showing why Oldacre had only an equity, or in whom the legal title was, or the extent of the encumbrance upon it. It might as well be contended that where it is necessary to aver the value of a mule, or its inadequacy of value to a certain end, the pleader should go on and aver that it was only of the value stated, or of inadequate value because it was a very small or a very old mule, or was blind, or the like; or, as suggested by counsel, inadequacy of the value of property to meet a debt might result “from its location, or swampy character, or difficulty of access thereto; yet it would not be necessary to aver in just Avliat particular the location was undesirable, or whether it was all covered by morass, etc., or just what obstacles were interposed to egress or ingress.”

On the case made by the bill Oldacre Avas the OAvner of the lots down to the time he conveyed to Mrs. Freeman, and the latter then became the OAvner as between herself and the former. Possession and the right to rents issues and profits prima facie attend OAvnership; and hence Oldacre and Mrs. Freeman severally have been in the possession and in the perception of rents doAvn to and Avere at time of bill filed. True, the bill avers that the premises Avere “heavily encumbered,” but it does not folloAV from this that the encumbrancers Avere such as to become entitled to the rents under any circumstances; and, even conceding that the encumbrancers Avere mortgagees — which is not shown by the bill, directly or inferentially — they would have no claim on the rents un- • til they entered nnder, and after the law day of their mortgages: Of this there is no pretense referable to the averments of the bill.

The bill further averring the insolvency of the respondent, presented a case entitling the complainant to subject Oldacre’s interest in the property and the rents thereof coming to him or to his alleged fraudulent grantee pending litigation to the payment of his judgment, and the several demurrers to it were properly overruled.

The pleas filed by respondent were bad. They showed that Oldacre had only an equity of redemption in the land, and proceed on the idea that there can be no receivership of land in which the respondent has only the right to redeem. This is an erroneous theory, certainly when, as in this case, the respondent is in the possession and in the perception of rents. Under our statutes an equity of redemption may be levied upon and sold under execution, as we have seen, and the purchaser at such sale succeeds to the possession and right to rents of the defendant in execution. The plaintiff in judgment being forced by the fraudulent conveyance of the defendant into chancery for a more perfect remedy, is entitled to the same measure of satisfaction out of the property and its rents, incomes and profits as under execution, and this he obtains by the appointment of a receiver to take the rents pending suit which would have passed to the purchaser at execution sale, by a sale of the land under decree, and the eventual application of the rents in the hands of the receiver and the proceeds of the sale to his judgment. Of course all this is done in recognition of the superior rights of prior mortgagees who may at any time in a proper case intervene either in the pending-suit or by original bill to subject the property and the rents accruing after intervention to the payment of their several debts. — Micou v. Moses, 72 Ala. 439; Ashurst v. Lehman, Durr & Co., 86 Ala. 370; Steele v. Walker, 115 Ala. 485. Of course if the pleas had shown that the mortgagees were in possession and in the perception of rents they would have been good defenses, at least so far as the bill seeks to subject the rents, but they do not aver these facts.

The bill therefore, we conclude, was sufficient in all respects to warrant the relief prayed including the appointment of a receiver; and the pleas, we further conclude, presented no defense, and were properly stricken out. It remains to be considered whether the receiver should have been appointed on the showing- made at the hearing in that regard. The bill sufficiently charged fraud in the conveyance by Oldacre to Mrs. Freeman, and that both Oldacre and Mrs. Freeman were insolvent. The respondents filed affidavits in which they in general terms only deny fraud and aver that the recited consideration for the conveyance was paid; and they further affirm that one of them, Mrs. Freeman, is solvent and has over and above her exemptions property and effects liable to execution of the value of two thousand dollars or more. The parties to the .alleged fraudulent conveyance were closely related — Oldacre was the husband of Mrs. Freeman’s daughter. The conveyance was made when complainant’s debt was about to be put into judgment. And it is averred that the recited consideration was fictitious and simulated and that the conveyance was executed to hinder, delay and defraud the complainant. It is no answer to such a case to say simply that the conveyance was not made with the intent to defraud but was made in good faith and that the recited consideration was real and in fact paid. • The facts must be averred showing good faith and the actual payment of a real and adequate consideration. It must be made to appear how, when and in what the consideration was paid. Mere conclusions will not suffice in the answer or affidavit. These are for the court and not the respondent or affiant to draw; and there must be such presentation of the facts, as contradistinguished from conclusions of fact, as will enable the court upon the assumption of their truth to say that no fraud was committed. On the inquiry of fraud vel non, the affidavits were wholly insufficient to meet the averments of the bill. — Robinson v. Moseley, 93 Ala. 70; Cartwright v. Bamberger, 90 Ala. 410.

The affidavits are also insufficient in respect of the insolvency of Mrs. Freeman. Here, too, facts and not conclusions should have been stated. It should not have been stated merely that she had property and effects liable to execution of the value of two thousand dollars or more. It was for the court and not the affiants to draw the legal conclusion that she had property liable to execution sufficient in value to meet complainant’s demand, and to enable the court to do this the affidavits should have set forth the kind, amount and situs of her property and effects. The affiants may be altogether mistaken as to the liability of her property to execution, and if so the complainant would suffer from tbe court’s allowing tbe legal question to be decided by tbe parties instead of insisting upon its right and discharging its duty to decide it itself. Tbe court properly held tbe showing made against tbe case for the appointment of a receiver presented by the averments of tbe bill insufficient, and its order appointing the receiver, as also its decree on the demurrers and pleas, must be affirmed.

Affirmed.