Bigby v. Warnock

57 L.R.A. 754, 41 S.E. 622, 115 Ga. 385, 1902 Ga. LEXIS 424
CourtSupreme Court of Georgia
DecidedApril 29, 1902
StatusPublished
Cited by16 cases

This text of 57 L.R.A. 754 (Bigby v. Warnock) is published on Counsel Stack Legal Research, covering Supreme Court of Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bigby v. Warnock, 57 L.R.A. 754, 41 S.E. 622, 115 Ga. 385, 1902 Ga. LEXIS 424 (Ga. 1902).

Opinion

Fish, J.

J. T. Warnock brought an equitable petition against John S. Bigby and his wife, Elizabeth K. Bigby, and the British American Mortgage Company Limited, hereinafter referred to as the Mortgage Company. The petition alleged, in substance, that on July 8, 1896, petitioner recovered a judgment against John S. Bigby for $9,515.56 principal, interest, and costs, and on September 10 of the same year he recovered another judgment against him for $617.85 principal, interest, and costs; that the executions issued .on these judgments were returned with entries of nulla bona; that John S. Bigby claimed to be insolvent; that prior to 1896 he had large means, consisting of realty, bank, railroad, and other stocks, etc.; that in 1891 be was made president of the Eagle & Phenix Manufacturing Company, of Columbus, Ga., and continued in the control of the affairs of that company until June 13, 1896, when it was placed in the hands of receivers; that while president of that company he became indorser for large amounts on its obligations, and after he discovered that the company would fail he began to hide and dispose of his property, for the purpose of hindering, delaying, and preventing his creditors from collecting their debts; that in pursuance of such purpose, and without any consideration, he transferred to his wife, Elizabeth K., large amounts of stock in two national banks in Newnan and in the West View Cemetery Company and the West View Floral Company, and she knew at the time of .the transfers that they were made for such fraudulent purpose; that on May 4, 1896, for the purpose of hin[387]*387dering, delaying, and defrauding petitioner and other creditors — Mrs. Bigby knowing of such purpose at the time — Mr. Bigby conveyed to her, by a deed, a certain described house and lot situated on Washington street in the city of Atlanta; that though the deed stated the consideration to be $18,700, and though Mrs. Bigby^ claimed that the conveyance was made in payment of debts due to ’ her by her husband, as a matter of fact there was no consideration for the conveyance and it was executed for the fraudulent purpose above stated; that on July 15, 1896, Mrs. Bigby, for the purpose of aiding her husband in hindering, delaying, and defrauding petitioner and other creditors of her husband, conveyed by deed the Washington street property to the Mortgage Company, to secure a loan to her of $15,000, and that she had no property except that which had- been given to her by her husband. The petitioner prayed that the transfers of stocks and the conveyance of the Washington street property be decreed to be void; that the equity of redemption in the Washington street property be decreed to be subject to petitioner’s judgments; and that Mrs. Bigby be decreed to be liable, as trustee ex maleficio, for any sum realized by her upon the security deed given to the Mortgage Company. The Mortgage Company was not served, and made no appearance. Bigby and his wife denied 'specifically all allegations of fraud made in the petition, and set up that the transfers of stock and the conveyance of the Washington street property were executed in good faith and with no intention to hinder, delay, or defraud the creditors of Mr. Bigby; that the consideration of such transfers and conveyance was an indebtedness due her by him, and three notes given by him to her, in payment of which he conveyed to her the Washington street house and lot, were specified, one dated January 4, 1893, due one day after date, for $10,500, being for one hundred shares of stock in the Atlanta & West Point Railroad Co., which he had given to her in 1883 and which she sold to him at the time the note was given, one dated July 12,1893, due on demand, for $3,200, for money borrowed by him from her, and one dated May 3,1895, payable on demand, for $5,000, the consideration being money loaned him by her, which she had received from the First National Bank of New-nan on stock he had given her in January, 1895.

Bigby died pending the suit, and his wife, as executrix of his will, was made a party defendant. On the trial, a verdict was rendered [388]*388finding the conveyance of the Washington street property to be void; that petitioner recover of Mrs. Bigby $9,503.71, “ on account of the proceeds of the mortgage made by her,” and “ in favor of defendant as to the claim on account of stocks.” A motion for a new trial was made by Mrs. Bigby on numerous grounds, which being overruled, she excepted.

1. One of the controlling questions presented in this case for determination is, whether under our law a conveyance of property made by a debtor, with intention to delay or defraud his creditors,, such intention known to the party taking, is void as to other creditors, when made in payment of a debt which in amount is approximately the value of the property conveyed. Whatever may be the rulings of other courts on this question, it is well established by the former decisions of this court that a conveyance made under such circumstances is void as to creditors. In Phinizy v. Clark, 62 Ga. 626, Mr. Justice Bleckley said: “A fraudulent conveyance can not stand against creditors, whether made to secure a debt or not. The conveyance must be pure — it must be made bona fide, and with no purpose known to or suspected by the creditor to hamper or entangle the property as against other creditors for the sake of hindering or delaying them. If made partly to secure a debt, and partly to hinder, delay, or in any way defraud other creditors, and the creditor taking the deed has knowledge of this latter intention, or grounds for reasonable suspicion, no title will pass as against the other creditors.” A like ruling was made in Palmour v. Johnson, 84 Ga. 91. In Conley v. Buck, 100 Ga. 188, a conveyance by a husband to his wife was attacked by his creditors as being void, because made to delay and defraud them. The wife contended that she was a creditor of her husband and had paid him full value for the land he conveyed to her. The case was tried before Judge J. H. Lumpkin, who also presided upon the trial of the case now in hand. His charges upon the question of fraudulent conveyances were practically the same in both cases. In passing upon exceptions to his charge in the former case, this court said: “ There was no error on the trial of such a case, while the court was submitting to the jury the question as to whether or not a given deed from the defendant in execution to his wife, she being one of the defendants to the petition, was made with intent to hinder, delay, or defraud her husband’s creditors, in charging, in substance, that if the [389]*389husband made the deed with such intent, and this was known to the wife, it was void as to the creditors, ‘ even though it may appear that she had paid a valuable consideration’; nor in charging that if in accepting such a deed she did so with the intention and purpose of delaying and defrauding such creditors the deed would be void, ‘although it may have been based upon a valuable consideration.’ ” The doctrine was again recognized in Monroe Mercantile Co. v. Arnold, 108 Ga. 449, where Mr. Justice Lewis said, “Where the sole purpose of a debtor is to secure his creditors, and there is no intent to either defraud or delay others, such preference of a particular creditor will be upheld, although the natural result of it may be to delay other creditors.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Kesler v. Veal
356 S.E.2d 254 (Court of Appeals of Georgia, 1987)
Federal Deposit Ins. Corp. v. United States
654 F. Supp. 794 (N.D. Georgia, 1986)
Skating Clubs of Georgia, Inc. v. Hayes
267 S.E.2d 285 (Court of Appeals of Georgia, 1980)
Cooper v. Mercantile National Bank
224 S.E.2d 442 (Court of Appeals of Georgia, 1976)
Hall v. State
42 S.E.2d 134 (Court of Appeals of Georgia, 1947)
Moncrief Furnace Co. v. Northwest Atlanta Bank
19 S.E.2d 155 (Supreme Court of Georgia, 1942)
American Nat. Bank & Trust Co. v. Powell
178 So. 21 (Supreme Court of Alabama, 1937)
Suttles v. Vickery
177 S.E. 714 (Supreme Court of Georgia, 1934)
Cotton States Fertilizer Co. v. Childs
174 S.E. 708 (Supreme Court of Georgia, 1934)
Cowan v. Bank of Rockdale
125 S.E. 194 (Supreme Court of Georgia, 1924)
Hinkle v. Smith & Son
65 S.E. 427 (Supreme Court of Georgia, 1909)
Graves v. Horton
65 S.E. 112 (Supreme Court of Georgia, 1909)
Brawner v. Maddox
58 S.E. 278 (Court of Appeals of Georgia, 1907)
Mayor of Macon v. Humphries
50 S.E. 986 (Supreme Court of Georgia, 1905)
Freeman & Turner News Co. v. Mencken & Bro.
42 S.E. 369 (Supreme Court of Georgia, 1902)

Cite This Page — Counsel Stack

Bluebook (online)
57 L.R.A. 754, 41 S.E. 622, 115 Ga. 385, 1902 Ga. LEXIS 424, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bigby-v-warnock-ga-1902.