148 Ga. 429 | Ga. | 1918
(After stating the foregoing facts.)
1. The principle announced in the first headnote is so universally recognized that it is unnecessary either to cite authority for it or to state the reasons upon which the rule is based.
2. Relatively to the real estate involved in this suit the uncontradicted evidence, including the admissions of the defendant’s answer, shows that the money of the wife was used by the husband in making the initial payments upon the purchase-price; that the title was taken in the name of the husband, and the deeds conveying the same were placed on record in the year 1906 and continuously remained in his name, he paying the taxes thereon for a number of years and, so far as the record discloses, up to the date of the execution of the deed to his wife in' 1912. In the meantime the debts which are the foundation of the present suit were contracted by the husband. The property was jointly occupied continuously by the husband and wife as a home, and was so occupied at the time the suit was filed. There is no evidence that the wife at any time asserted or exercised any independent dominion over the property, not even, according to the record, having ever returned it for taxes in her own name or paid taxes thereon. Before the money was loaned by Mrs. Patillo an investigation was made for her to ascertain the condition of the title to this property, and it was found upon examination that the title was vested in the husband, Charles Krueger, and that the shares of stock stood in his name. When his indorsement was made upon the note to the Atlanta National Bank he was the president of the Krueger Manufacturing Company, with which company the bank had done business previously, and, upon the indorsement of Charles Krueger,
Pretermitting the question as to whether the negligent omission of the wife to inform herself as to. the real state of the title would entitle her to assert her equity as against bona fide creditors, we think that from the statements of her answer it is clearly deducible that she knew that the title had been taken in her husband at the time the property was purchased. Her husband, according to her answer, had always transacted most of her business for her, doing so most of the time in his own name. From her answer we quote as follows: “The said Chas. Krueger (this defendant being without business knowledge) had always transacted most of her business for her, doing so most of the time in his own name.” This is an admission that according to the constant and prevailing method of transacting her business she knew that her husband was accustomed to transact 'it in his name. • She further admits in her answer as follows: “When this defendant purchased the McDonough Eoad property, about $1.800 was to be paid in cash,
3,4. The reasoning just above stated applies with equal cogency to the claim of both of the creditors represented by the trustee in bankruptcy. There is, however, another legal principle which is controlling, and which is equally applicable to both creditors, in so far as the same relates to the corporate stocks in question. It will be noted that in her answer Mrs. Krueger alleges that she borrowed $10,000 from her father, which she “loaned” to her husband with the understanding that he was to use it in bringing about a com-r position of a bankrupt estate in which he was interested, and turn over to her the property which he received. The money was so used by the husband, but instead of turning over the corporate stocks to her he kept them in his own name. Some years later, after the debts had been created against him, he conveyed to her the stocks im-question upon the theory that they belonged to her. Under the view we take of this ease there was never any trust in favor of the wife imposed upon these stocks. When she loaned the money to her husband the relation of debtor and creditor was established between them. His promise to turn the property over to her was a mere executory, agreement, a breach of which would give her a right of action; but it could no more give her an equitable interest in the res than could the breach of any other promise in respect to the sale of goods. When the husband transferred to the wife the corporate stocks they were of the value (according to the husband’s testimony as a witness for the wife) of $38,500. The debt due by the husband to the wife was $10,000. The transfer left him wholly insolvent. This being true according to the undisputed evidence, it requires no argument to show that the transfer was void as against the husband’s creditors, when attacked, as was done in. this case, upon the ground that it was. fraudulent within the meaning .of our statute which prohibits a debtor, insolvent at the time, from conveying or transferring his property with intent to delay and defraud his creditors. No.claim of good faith could give validity to the transaction. It would be legally impossible for the husband to pay or for the wife to receive in good faith three times the amount of her debt. Such a transaction the law denounces as fraudulent upon its face. The husband may prefer his wife, hut in doing so he must have due regard for the interests of other creditors. We have considered the cases cited
5. None of the assignments of error show cause for reversal.
Judgment affirmed.