Echols v. Orr, Scroggins & Humes

106 Ala. 237

• Court: Supreme Court of Alabama
• Decided: November 15, 1894
• Status: Published

Opinion

HARALSON, J.

— 1. There is no pretense that the bill is not well filed as against the debt contracted before the execution of the alleged fraudulent deeds. The demurrer interposed was intended, no doubt, to apply to a part only of the bill, — to that parD which seeks to set aside the conveyances on account of the debt contracted after their execution and record ; but,-it is not directed to a part only, but to the whole bill, which being confessedly well filed as to a part of the indebtedness, was properly overruled.' A demurrer which goes to the whole bill, but is good in part only, is properly overruled. — Houston v. Williamson, 81 Ala. 482; Burke v. Roper, 79 Ala. 144.

2. But, the bill on its allegations, was not subject to demurrer. Not simply constructive fraud, making the deeds fraudulent as against prior creditors, but actual fraud, making it fraudulent, as well, against subsequent creditors is fully and definitely averred. It is charged, that at the time of the execution of said deeds “the said A. Ewing jpchols contemplated and intended that his said firm of Echols & Sheffey should make the purchase and incur the indebtedness described in paragraph four of this bill, (the debt last contracted, of $671.75), and many other debts and liabilities, * * * * and intended to make default and refuse to pay the same,” and that they were made for the purpose of hindering, delaying and defrauding the creditors of said firm. If these allegations are true, the deeds ■were void as to complainants’ debt contracted by said firm after their execution. The fact that the deeds were of record was not material. As was well said in Burdick v. Gill and wife, 7 Fed. Rep. 668, “A creditor has a right, when extending credit, to rely upon the honesty and good faith of the debtor. He may assume, without inquiry, that the debtor has made no fraudulent conveyances of property. The debtor can not be heard to say, ‘My creditor might have learned that I intended to defraud him,’ if he had searched the records or made enquiry.” Weeks v. Yeend, 104 Ala. 331; Dickson v. McLarney, 97 Ala. 383 ; Gilliland v. Fenn, 90 Ala, 233 ; Garrett v. Hughlett, 1 H. & J. (Md.) 3 ; Bump, on Fraud Con., 131.

The decree is affirmed.