Smith v. Hall

103 Ala. 235 | Ala. | 1893

COLEMAN, J.

The appellant, as a judgment creditor of Fred Hall, filed the present bill, to subject certain real estate, the legal title to which is held by Louisa Hall, to the payment and satisfaction of the judgment. The court sustained a demurrer to the bill and from this decree the appeal is prosecuted.

According to the averments of the bill, Fred Hall became indebted to complainant in the year 1881 for borrowed money, for which he executed his obligation, and this claim was reduced to judgment in July, 1889, for $2,807.11. This judgment is the foundation of the bill of complaint. The following facts averred in the bill are relied upon, to support the prayer for relief: In October, 1867, Fred Hall purchased and paid for a lot or parcel of land and had the title conveyed to one Amanda Taylor. In June, 1874, he conveyed to Amanda Taylor, without consideration, another parcel of land. These conveyances are absolute in form, and recite a valuable consideration as paid by the grantor. The bill avers that at the date of these several conveyances there were existing creditors of Fred Hall, and that the conveyances were made to Amanda Taylor to hinder, delay and defraud such existing creditors, and for the purpose and with the intent to defraud such other persons as he might thereafter become indebted to. The bill avers that when these conveyances were made to Amanda Taylor, there was a secret agreement'between Fred Hall and Amanda Taylor, that she was to hold the legal title for the sole use and benefit of Fred Hall and subject to his direction, “and that said conveyances were received by said Amanda Taylor, under an agreement, expressed or implied, that she should hold said property for the benefit, use and enjoyment of said Hall, and subject to any disposition that he might thereafter request her to make, and she did so hold said property, and said Hall did so use and enjoy said property and received the benefit thereof until the 14th day of August, 1891, when said Amanda Taylor, at the request of said Hall, conveyed said property to one Louisa Hall as hereinafter stated.” The bill then avers the conveyance of said lands on the 14th of August, 1891, by said Amanda Taylor to Louisa Hall, the widow of an illegitimate son of said Hall and 'Amanda Taylor, without consideration and with like agreement and understanding as that averred as existing between Fred Hall and Amanda Taylor, and that the conveyance to Louisa Hall was at the request of Hall, and in accordance with, and execution of, the secret agreement between Fred Hall • and Amanda Taylor, and that both Amanda Taylor and Louisa Hall, at all times, virtually held the property for Hall as his own. We have in substance stated the vital averments of the bill. We are of opinion the bill has equity. Assume, for the argument, Amanda Taylor answers the bill and admits as true its averments, to-wit, that she was the mere repositor of the legal title, that she never paid anything for the property, and claimed no interest in it under the conveyance, but by agreement held the title solely for the use, benefit and subject to the control, of Fred Hall. Was not the property thus held by her liable to the debts of Fred Hall, and that' without regard to the time of their contraction? Assume further that by her answer she admits that the legal title to the property thus held by her, at the request of Fred Hall and in pursuance of the agreement under which she held it, was conveyed to Louisa Hall without consideration, in June, 1890, after the rendition of the judgment against Hall, and assume that Louisa Hall admits these facts to be true, would not the conveyance to Louisa Hall be at least constructively fraudulent, as against the judgment of complainant? This is complainant’s case, made by his bill, when considered upon demurrer. The averments of the. bill are even stronger as to Louisa Hall than we have assumed. However fraudulent the purpose of a conveyance, it is binding upon the grantor, where its benefits are claimed by the grantee, and upon the same principle a fraudulent grantor can not enforce a secret trust or agreement, or a resulting trust for his benefit, as against the grantee. In pari delicto melior est conditio possidentis. King v. King, 61 Ala. 479; Kelly v. Karsner, 72 Ala. 106.

Section 1845 of the Code, declares that “No trust concerning lands, except such as results by implication or construction of law, can be created, unless by instrument in writing,” &c. These principles apply in favor of a grantee claiming the property in his own right, under the conveyance, and adversely to the grantor. A fraudulent grantee is not compelled to invoke or plead the statute of frauds against the grantor, and he may also, if he sees proper, waive any rights received by a fraudulent conveyance, and hold the property conveyed for the benefit and use of the grantor. When thus held, and no claim or ownership is set up to the property by the grantee under the conveyance adversely to the fraudulent grantor, it is subject to the payment of his debts.

If the averments of the bill had shown an adverse holding by Amanda Taylor, we do not say that she or her grantee could not invoice the benefit of the statute of limitations of ten years by a demurrer to the bill. — Proskauer v. Savings Bank, 77 Ala. 257; Snedecor v. Watkins, 71 Ala. 48; Pochard v. Nash, 64 Ala. 385. Under the averments of the bill as framed such a defense is not available by demurrer.

By answer or plea the respondents may become entitled to the benefits of the principles of law, invoked in support of the demurrer.

Complainant avers that the purpose and intention of Fred Hall in making the conveyance was to defraud existing and future creditors, but as we construe the bill, the relief sought is rested, not alone upon these allegations, but; upon those averments, which if true, show that the property in fact belonged to Fred Hall, and was so recognized and held for him by Amanda Taylor, notwithstanding the legal title was in her name, and that the conveyance to Louisa Hall was for a voluntary consideration .

Reversed and remanded.