164 A. 369 | Pa. Super. Ct. | 1932
Argued November 15, 1932. This bill in equity was filed to annul the conveyance of two properties from a husband to his wife, without fair consideration, for the purpose of defrauding creditors, at a time when the property remaining in grantor's hands was insufficient to pay his debts. The chancellor found for the plaintiff, and his findings of fact and conclusions of law were sustained by the court sitting in banc. Our duty is to determine whether there was sufficient competent evidence to support the decree entered.
P.J. Koch, through an intermediary, on July 17, 1923, conveyed to his wife, for the consideration of $2, a piece of land that he acquired from Mary Lee et al., by deed, dated April 5, 1919, located in the city of Sharon, Mercer County, and known as lots 3 and 18 in the Charles S. Flowers "Woodrow Court" Plan of Lots, and property acquired from the Farrell Realty Company on April 6, 1921, located on the southwest corner of Haywood Street and Lee Avenue, in the borough of Farrell, Mercer County.
The defendant's answer alleges that she had originally purchased the real estate so conveyed with her own funds, and that the placing of the legal title in her husband was due to error, accident and mistake. She complains, in her first assignment of error, of the finding that P.J. Koch was insolvent at the time he transferred the property.
The Uniform Fraudulent Conveyance Act of May 21, 1921, P.L. 1045, No. 379, § 1 (
P.J. Koch was engaged in the plumbing business, and was the owner of the legal title to the property in Farrell, which was devoted to business purposes. He guaranteed, by writing, the payment of indebtedness, incurred by Strizzi and Wise, tenants, to certain wholesale creditors. During 1923, these tenants became delinquent in substantial amounts in their accounts and they subsequently went into bankruptcy. The court below found that the conveyance was made without fair consideration, and that the grantor was solvent on July 17, 1923, the date of the conveyance to his wife, and that he was indebted as follows:
"Colonial Trust Company ................... $ 1440.80 B. Kuppenheimer Co. ..................... 1200.00 Michaels, Stern Co. ..................... 1074.11 Hart, Schaffner Marx .................... 701.17 B. Kuppenheimer Co. paid in Oct. 1923 ... 1300.00 Michaels, Stern Co. afterwards paid by Strizzi Wise ........................ 231.83 ---------- Total ................................. $5947.91"
The appellant contends that the indebtedness on the date of the conveyance amounted to but $4,253.39, as $1,300 of the amount of indebtedness found by the court was voluntarily paid by Koch in October, and that $231.83 was collected by Michaels, Stern Company from the bankrupt estate of the tenants. These payments did not reduce his "probable liability" or "contingent indebtedness," as of July 17, 1923, which *532 is the date that governs us in determining the question of his financial status.
Nor does the allegation, that included in the indebtedness are some items, which are comparatively small, representing purchases made after July 17, 1923, when Koch had notified the creditors of Strizzi and Wise that he desired to cancel his contract of guaranty, affect the situation, as judgments were obtained by these creditors for the amounts found due by the court; and they are conclusive.
The appellant takes the position that Koch was solvent at the time he made the conveyance, as the aggregate amount of his property, at a fair value, was sufficient to pay his creditors: Cherry v. Union National Bank,
The appellant further contends that the land, when purchased, was unimproved; that the buildings were constructed by her with her individual funds; that, therefore, the consideration was sufficient, and the conveyance was made to her as a creditor in good faith, regardless of the alleged insolvency: Peoples Savings *533 Dime Bank Trust Co., v. Scott et al.,
The court found on sufficient evidence that the appellant did not have an individual estate during her entire marital life of more than $1,300. The business block in the borough of Farrell cost between $30,000 and $31,000. The written contract for its construction was made by her husband and it was he alone who executed the leases and collected the rents, which were deposited in the bank in his individual account. He paid no rent for the portion of the building he occupied and generally exercised exclusive ownership over the property. The appellant stated that she obtained the money to pay for the erection of the building through the sale of another property, from which she derived $25,000, which was deposited in the joint account of her husband and herself. Her recollection was defective as it was shown that the account was in the name of her husband alone. There was ample testimony to support the court's findings that it was not the wife's money that purchased the land or paid for the improvements.
The appellant complains of the admission of the testimony of J.G. Marshall, an officer of the Colonial Trust Company. The objection is as follows: "We enter our objection to testimony of any conversation with Mr. Koch, who is now deceased." The objection was not specific, but the court concluded, and we will assume, that the appellant was invoking clause (e), section 5, of the Act of May 23, 1887, P.L. 158 (28 P. S. § 322), which provides, inter alia, that where any party to a thing or contract in action is dead and his right thereto or therein has passed to a party on the record, who represents his interest in the subject in the controversy, no surviving or remaining party to such thing or contract, nor any person whose interest shall be adverse to the right of such deceased, shall be a competent witness to any matter occurring before the *534
death of said party. The burden was on the appellant to show the incompetency of the witness, as competency is the rule, and incompetency the exception: Waugaman v. Henry,
In Dillon's Est.,
Furthermore, the appellant is not representing or relying on her husband's rights in the subject-matter in controversy. Under her contention, she was the real owner; the husband never had any interest in this property. She is standing on her own rights or interest: Hamill v. Supreme Council,
Nor is the rule, recognized in Jarvis, Trustee, v. Bell,
We find no reason to disturb the conclusion reached by the learned court below.
Appeal is dismissed at the cost of the appellant.