34 W. Va. 697 | W. Va. | 1891
This was a suit in equity, brought by L. Spence against Barnes B. Smith and others in the Circuit Court of Wood county, the object of which was to subject to sale the real estate of said-B. B. Smith, which was alleged to consist of seventy nine acres and a fraction, situated in said county, and to set aside and annul certain deeds of conveyance made by said B. B. Smith and wife to their son, J. A. Smith, Jr., and from said J. A. Smith, Jr., to Sallio Smith, the wife of said B. B. Smith, and from said B. B. Smith and Sallie Smith, his wife, to Dixon B. King.
The material allegations relied on by the plaintiff in his hill on which ho bases his claim for relief are as follows: On the 15th day of May, 1879, B. B. Smith, J. A. Smith, and Charles Lucas executed two notes to him or. his order— one for one hundred fifty eight dollars and thirty four cents, due on or before November 1, 1880; and the other for one hundred fifty eight dollars and thirty three cents, due on or before November 1, 1881, both bearing' interest from date at six per cent. — which notes were indorsed by one Jacob Wigal. That payments had heen made on said notes at different times, aggregating one hundred ten dollars and fifty cents, which had heen credited on said last-named note. That plaintiff sent said notes to the defendant Dixon B. King for collection, who was a practicing attorney in the counties of Wood and Jackson, and who had long known and advised the said Barnes B. Smith in his business dealings. Said King failed and neglected to collect said notes, and would not take a judgment thereon, although directed so to do by the plaintiff. Some time in 1887 plaintiff wrote to said King, and directed him to turn said notes over to one H. Ii. Pennybacker, a constable of said county, for collection, but in this the said King also failed; and the plaintiff' threatened to sue him if he did not comply forthwith with his request, and shortly
•The defendant’s Dixon B. King and Barnes B. Smith filed their separate answers to plaintiff’s bill, thereby putting in issue every material allegation therein contained.
Several depositions were taken in the cause, and on the 16th day of July, 1889, a final decree was rendered therein,
The defendants, King and Barnes B. Smith, appear to have been contented with a denial of the allegations of the plaintiff’s bill, as they took no depositions in the cause, which course would indicate that they regarded the burden of proof as resting entirely upon the plaintiff; and for some reason the defendants James A. Smith and Sallie Smith failed to answer the plaintiff’s bill, or plead to it in any manner, and, as to the allegations therein contained, it stands confessed as to them, and, so far as they are concerned, it is admitted that said land was conveyed to J. A. Smith and from hi into Sallie Smith without consideration, and with intent to hinder, delay, and defraud the plaintiff.
It is alleged in the plaintiff’s bill that the defendant King was an attorney at law, practicing in the counties of Wood and Jackson, and this allegation is not denied by said King-in his answer, lie admits that said notes came into his hands, but claims they were placed in his hands as trustee, when he, as such trustee, was about to make sale under a deed of trust, which was executed by Lucas to secure said notes. Be this as it may, the plaintiff, in his deposition, swears that he had to send I. N. Ferguson, his agent, twice to said King, with the instructions if he did not turn them over he would sue him for the amount of the notes; and he thinks said Ferguson had to make a third
Now, Dixon R. King was fully aware that the plaintiff had been urging the collection of these notes while they were in his hands, and that they were turned, over to Pen-nybacker, who had instructions from the plaintiff to take judgment upon them. The summons had been served on Barnes B. Smith on the 15th day of August. On the 17th day of August said Barnes B. Smith and wife acknowledged the deed to Dixon R. King for said tract of land.
On the 22d day of August an ’execution was issued on said judgment, and on the 23d of the same month said Barnes B. Smith returned and filed an exemption list of his personal property, amounting to thirty four dollars and seventy five cents; and on the same day said deed to Dixon B. King was admitted to record in the clerk’s office of the County Court, of Wood county; and it may be regarded as somewhat singular that the payment of the consideration-for said land is provided for as follows: One note in favor of W. A. Cooper, calling for three hundred and thirty dollars, dated the 23d day of July, 1884; three hundred twenty nine dollars and forty cents cash, and three hundred dollars to be paid on or before the 20th day of August, 1887, the day on which said summons was made returnable. It appears on the face of said deed to Dixon B. King that said deferred payment of three hundred dollars was evidenced by a note payable to Barnes B. Smith, and secured by a vendor’s lien; and on the 17th, the day said deed was acknowledged, saidB. B. Smith acknowledges the receipt of three hundred twenty nine dollars and forty cents cash; and yet, on the 23d day of August, when he made out and swore to his exemption list, he stated that all of his personal property owned or claimed by him, including bonds, bills, notes, claims, and demands, consisted of one wagon, fifteen bushels of wheat, five head of hogs, two small hogs,. one plow, one small shovel plow, and three colonies of bees, of the aggregate value of thirty four dollars and seventy five cents.
Again, the notes on which said judgment was obtained are dated on the 15th day of May, 1879, and matured, respectively, on the 1st days of November, 1880, and 1881, while the deed from Barnes B. Smith and wife to James A. Smith bears date on the 5th day of October, 1885, and the
Applying this ruling to the facts developed in this case, the burden of proof surely devolved upon James A. Smith and Sallie Smith to prove the payment of the purchase-money to Barnes B. Smith for said tract of land; yet they not only fail to prove the payment of any portion of said purchase-money, but allow the allegations of the hill, “that neither the said James A. Smith nor the said Sallie Smith ever had any one thousand two hundred dollars, and that no such sum of money or any other was paid at all,” to remain uncontradicted, so far as they were concerned. W e must, then, regard these conveyances to J ames A. Smith and Sallie Smith as voluntary; and in the case of Custard v. Bowles, 24 W. Va. 730, this Court held that “a court of equity will declare a voluntary conveyance fraudulent as.to subsequent creditors if, from the circumstances and other evidence, the court is convinced the deed was made with the intent to defraud such creditors. The conveyance being voluntary, it is immaterial whether or not the grantee had notice of such fraud.” And when we apply the law as stated in Knight v. Capito, supra, to the facts stated by Dixon R. King in his answer, the burden of proof must rest upon him to show the payment of the purchase-money.
At the time said tract of land was conveyed to Dixon B. King, Barnes B. Smith was in possession of it, although the deeds to J. A. Smith and Sallie Smith had been recorded
In Bump on Fraudulent Conveyances, p. 84, we find the author says : “Taking an absolute deed as security for money is a mark of fraud, for it is calculated to deceive creditors, and make them believe that no part of the property is subject to their demands, when in fact it is otherwise.” And the same author says, on page DO : “The retention of the possession of land, and the exercise of unequivocal acts of ownership over it, is a badge of fraud, for it is not in the usual course of business, and indicates a secret trust for the benefit of the debtor.” And again, on page 104, the same author says: “The want of possession' however, is a strong badge of fraud. The property is placed in the purchaser, the possession continues in the debtor, and by that means creditors, perceiving no visible diminution of the debtor’s effects, rest satisfied, and take no measure to
Although we have no such statute in this State, it was held in the case of Western Mining § Manufacturing Co. v. Peytona Cannel Goal Co., 8 W. Va. 409, that “possession of land is evidence that the possessor has the right to the possession that he enjoys. Generally a person purchasing a tract of land is presumed to know who has possession of it, and to ascertain the character of the right by virtue of which he holds the possession, or, if the purchaser fails to do so, he is charged with notice of the character of the right, so far as this may be necessary to sustain the possession.”
The defendant King, then, had notice that said land had been conveyed to J. A. Smith and to Sallic Smith, as their deeds had been recorded in October, 1885. He also knew that Barnes B. Smith still retained the possession, and that, of itself, was sufficient to put him upon inquiry, lie also had notice of the plaintiff’s claim, as plaintiff’s agent had ui’ged him to take judgment upon it; and the plaintiff swears that he urged him to do the best he could to get his money. Mr. Pennybacker swears that the notes were delivered to him by said King, by order of plaintiff, for collection, just prior to the institution of the suit; that the process was served on the 15th of August, 1887, and the deed from Barnes B. Smith and wife to said King was acknowledged on the 17th of the same month. And while' said King claims in his answer that Barnes B. Smith owed him a considerable portion of'the purchase-money, he offered no proof in support of the allegation ; and, even, if
Bor these reasons the decree complained of must he reversed, and the cause remanded to the Circuit Court of "Wood county for further proceedings tobe had therein; and the appellees must pay the costs of this appeal.
Reversed. Remanded.