207 Ky. 772 | Ky. Ct. App. | 1925
Opinion of the Court by
Affirming.
Appellee, May-berry, became surety for one Jones on two notes, totalling $10,100.00, to appellant Bank & Trust Company, on May 30, 1922, and upon Jones’ fail
There were a number of liens against the Mayberry lands at the time it was- sold to Pickard, one for something more than $8,000.00, and another for more than $5,000.00, both of which were assumed by Pickard as a part of the purchase price. The $8,000.00 lien was immediately paid off by Pickard, as was another of $5,000.00. Pickard was entirely solvent. Mayberry had a great deal of property but no money and was much involved in debt. "While the lands were sold by May-berry for much less than he agreed to pay for them, the evidence shows he bought at the peak of land prices in 1919, and sold them in 1922 when prices were much lower. The evidence also proves that the price paid by Pickard to Mayberry was full and adequate. Every suspicious circumstance introduced by appellant, Bank & Trust Company, to sustain its charge of fraud was fairly explained by the evidence of appellees. The lower court was satisfied that no fraud was practiced in the transaction between Mayberry and Pickard and dismissed appellant Bank & Trust Company’s petition. It is from that judgment that this appeal is prosecuted.
We have carefully read the record and are convinced that the trial court reached a proper conclusion. There are no new principles of law applicable to the facts of this case that could be announced. It is similiar to many other cases of like import which have been tried in the circuit courts throughout the state, some of them coming to this court.
(2) The mere fact that Mayberry was badly in debt, while a circumstance to be considered, should not prevent his selling and disposing of this property in the absence of fraud. In the case of Linn v. Brown, 182 Ky. 116, we held that one heavily indebted may transfer his property without violating sections 1906, 1907 or 1910, Kentucky Statutes, if he does so in good faith, without design to hinder or delay his creditors, for a valuable consideration, and without intention of becoming insolvent and of preferring one creditor over another.
(3-4) Of course a debtor cannot prefer one creditor over another; but if his conveyances are made in good
“If a transfer is for a valuable consideration, creditors cannot attack it because of the fraudulent intent of the grantor, where the grantee neither, had (1) actual notice of such intent, nor (2) notice of any fact or facts calculated to- put him on inquiry and which would lead to a discovery of such intent, nor (3) participated in fraud.” Interstate Petroleum Company v. Farris, et al., 159 Ky. 820.
(5-7) Fraud is never presumed. It must be established by the weight of the evidence. Of course the evidence may be circumstantial, but nevertheless it must be convincing. *
Fraud cannot be sustained by mere suspicion, strained inference or conjecture. The rule is that in every case there must -be such legal evidence as is sufficient to overcome in the mind the legal presumption of innocence and beget a belief of the truth of the allegation of fraud. Rose Company v. Hasenzahl, 141 Ky. 676.
(8-9) Fraud will not be presumed but must be proved by such evidence as would justify a jury in finding it as a matter of fact; and the burden of establishing fraud rests upon him who charges it, even where confidential relationship is shown to exist between the alleged colluding parties; but in such cases the court will scrutinize most' closely their transactions. Winfrey’s Trustee v. Winfrey, 150 Ky. 138. There was no confidential relationship between Mayberry and Picard.
We do not think the appellant, Bank & Trust Company, sustained the burden of proof. The chancellor properly ruled in dismissing the petition.
Judgment affirmed.