Fellows v. Lewis

65 Ala. 343

• Court: Supreme Court of Alabama
• Decided: November 15, 1880
• Status: Published

Opinion

STONE, J.

— Although it is true decedents can leave but one estate, in whatever different jurisdictions it may be situated, there may be, and often are, two or more different administrations, if the property be in two or more States. The administration granted at the place of the last re sidence, is called tlie domiciliary administration ; but administrators appointed in other jurisdictions have the same title in, and power over the property within their jurisdiction, as the chief administrator has over the property within his jurisdiction. Each, in the performance of his duties, must conform to the laws of the State in which he receives his appointment. When administration is granted on the estate of one decedent in two or more jurisdictions, the questions of State policy and the duty of the sovereignty are brought into requisition and exercise. The duty of the State to its own citizens requires that, to the extent of the assets within its jurisdiction, resident creditors, if there be such, shall suffer no wrong, and shall not be subjected to any discriminations in favor of creditors residing within a different jurisdiction, although it may be the State of the decedent’s last residence. Neither jurisdiction can force the other to yield to it precedence, or dictate to it in what manner it shall exercise its authority. “ The rules of every empire, from comity, admit that the laws of every people, in force within its limits, ought to have the same force everywhere, so iar as they do not prejudice the power or rights of 'other governments, or of their citizens. ” • Comity goes no further than this. — Story’s Confl. Laws, § 29. So, in the matter of administering assets, and of making settlements, each administrator must conform to the rules and forms prescribed in his own State, no matter how variant the rules and forms of the two States may be.

Mr. Grey died, having his last residence in Alabama. He owned property in this State, and also in the State of Kentucky. There was, also, a valuable property in this State, conveyed by him shortly before his death, which his creditors claimed was liable to the satisfaction of their demands. The grounds on which this claim was founded were — first, that the conveyance was voluntary, and without valuable consideration ; and, second, that it was made with intent to delay, hinder, or defraud his creditors. These debts were contracted long before the making of the conveyances which the bill seeks to set aside. On this hypothesis, the administrator could assert no power or right over this property, and the creditors alone could move in the matter. The defense set up by the cross-bill is, that deeedent left ample property in the State of Kentucky, for the payment of his debts, and that most or all of the creditors, complainants in this suit, had instituted proceedings in Kentucky for the collection of their claims there. The prayer of the cross-bill is, that complainants be required to exhaust the assets in the State of Kentucky, which had not been conveyed, by Mr. Grey, before proceeding to subject the property in controversy, which had been conveyed to the complainants in the cross-bill. The chancellor took this view of the case, and so decreed.

There is no question, that there was, and is, a deficiency of assets in the hands of the Alabama administrator, to pay the debts which this bill seeks to collect. This being the case, complainants had a clear right to file this bill. Pharis v. Leachman, 20 Ala. 662; Watts v. Gayle, Ib. 817; Bibb v. Freeman, 59 Ala. 612. We hold, also, that they had an equal right to proceed to collect their claims out of the Kentucky assets, and that pursuing one, did not disable them from prosecuting the other recourse. This might, and in many cases would become necessary, to prevent a failure of justice. Of course, there could be but one satisfaction. The case is not distinguishable, in principle, from several actions prosecuted against different persons liable on a several, or joint and several debt. A judgment may be recovered against each, but a payment of one is a satisfaction of all the plaintiff is entitled to. The chancellor erred in decreeing this relief on the cross-bill.

We think the conveyances to Mr. and Mrs. Lewis, as against existing creditors of ¡Mr. Grey, must be pronounced voluntary, and, at least, constructively fraudulent. — Bibb v. Freeman, supra; Sandlin v. Bobbins, 62 Ala. 477.

But this question, as to the plantation conveyed to Mrs. Lewis, is presented in another aspect. The deed to Mrs. Lewis had the effect of rendering Mr. Grey’s estate insolvent, so far as there w’ere assets in the State of Alabama. The deed of December 5th, 1874, and the “ certain contract in writing ” therein referred to, of the same date, were executed at the same time, relate to the same subject-matter, and one is made a part consideration of the other. The .two must be construed together, as constituting one transaction and one contract. — 1 Brick. Dig. 386, § 169. The deed conveys to Mrs. Lewis a plantation of over 800 acres of land, “ in consideration of a certain contract in writing this day entered into between Charles T. Lewis, husband of Henrietta Lewis, and myself [Grey], and in further consideration of the sum of one dollar, to me in hand paid by Henrietta Lewis.” The deed is absolute and unconditional on its face, and purports to convey the absolute, unconditional, and unincumbered title, “ to have and to hold to the said Henrietta Lewis, her heirs and assigns, forever.” The deed was properly acknowledged on the 14th day of the same month, and was duly recorded in- the proper office. The contract in writing that day executed between Grey and Charles T. Lewis, referred to in the deed, reserves a very substantial benefit and interest to the grantor, Grey, to continue during his life. This contract in writing was not recorded. This avoided the deed as to existing creditors. — Code of 1876, § 2120; Montgomery v. Kirksey, 26 Ala. 172; Wiley, Banks & Co. v. Knight, 27 Ala. 336; Reynolds v. Crook, 31 Ala. 634; King v. Kenan, 38 Ala. 63. See, also, Bryant v. Young, 21 Ala. 264; Hartshorn v. Williams, 31 Ala. 149; Sims v. Gaines, 64 Ala. 392. So, the deed from Grey to Mrs. Lewis must be pronounced fraudulent in law, whether intentionally so made or not.

One purpose of the cross-bill is, to assert in Mrs. Lewis, the grantee, a right to Grey’s homestead exemption in the lands conveyed. As against debts contracted before April 23, 1873 (See Pamph. Acts, 64), this claim, if valid, can not in quantity exceed eighty acres of the land. It is governed by the provisions of the constitution of 1868. — See Wilson v. Brown, 58 Ala. 62. The grounds on which this claim of exemption is based, are, that, at the time of the conveyance, Mr. Grey had his homestead and residence on these lands ; that the homestead was; in his favor, exempt from levy and sale for the payment of his debts; that not being liable to his debts, his conveyance, even without consideration, could not delay, hinder, or defraud his creditors, for they had no rights in the premises, of which such conveyance could deprive them. If this position be sound, then Mrs. Lewis’ claim and title are good; for Grey’s deed to her is valid and binding between them, even though tainted with a fraudulent intent.

This question has been a great many -times before the courts of the country, and, in a large majority of cases, the ruling was against the right of the creditor to subject the homestead, merely because its owner and occupant had conveyed his right to another, even though the conveyance was voluntary, or made under circumstances which would ordinarily stamp it as fraudulent. ' There can be no fraud, unless there are claims and rights which can be delayed and hindered, and which, but for the conveyance, could" be asserted. The law takes no cognizance of fraudulent practices that injure no one. Fraud without injury, or injury without fraud, will not support an action. Unless they co-exist, the courts are powerless to render any relief.— Castle v. Palmer, 6 Allen, 401; Legro v. Lord, 10 Me. 161; Foster v. McGregor, 11 Ver. 595; Danforth v. Beattie, 43 Ver. 138; Crummen v. Bennett, 68 N. C. 494; Sears v. Hanks, 14 Ohio St. 298; Vaughan v. Thompson, 17 Ill. 78; Muller v. Inderreiden, 79 Ill. 382; Anthony A. C. Co. v. Wade, 1 Bush, Ky. 110; Marton v. Rayan, 5 Bush, Ky. 334; Fishy v. Perry, 6 Bush, Ky. 515; Knevan v. Specker, 11 Bush, Ky. 1; Vogler v. Montgomery, 54. Mo. 577; Smith v. Brunsey, 33 Mich. 183; Hugunin v. Dewey, 20 Iowa, 368; Drentzer v. Bell, 11 Wisc. 114; Pike v. Miles, 23 Wisc. 164; Murphy v. Crouch, 24 Wisc. 365; Succession of Cottingham, 29 La. Ann. 669; Edmonson v. Meacham, 50 Miss. 34; Wood v. Chambers, 20 Texas, 247; McFarland v. Goodman, 6 Bissell, 111; Cox v. Wilder, 2 Dillon, 45; Smith v. Kerr, Ib. 50. The following cases hold the contrary doctrine ; but in some of them, it will be seen, the facts were different: Gotzler v. Saroni, 18 Ill. 511; Currier v. Sutherland, 54 N. H. 475; Henry's appeal, 29 Penn. St. 219.

In the cases cited above, negativing the liability of the homestead which has been fraudulently conveyed, the reasons given are substantially a.s follows. The property, homestead, is not liable to seizure under execution, and, therefore, a conveyance of it is a question in which the creditor has no interest. It was not liable, before conveyance, to the claim he asserts; and the conveyance, though fraudulent, puts the creditor in no better condition than he was in before. If the conveyance is set aside as fraudulent, this leaves the homestead as if no attempt had been made to convey it, so far as any claim can be asserted by the creditor. It is void as to him, ¡to all intents and purposes. He cannot be heard to say, in one and the same breath, that the conveyance is void, in its attempt to devest title out of the debtor, but is valid in destroying the homestead right. He can not claim both under and against the conveyance; under it, as a valid parting with the homestead right; against it, as an abortive effort to pass title out of the debtor. It must stand, as to him, as if no conveyance had been attempted.

The case of Cox v. Wilder, 2 Dillon, 45, was a suit by an assignee in bankruptcy, to set aside as fraudulent a deed by the bankrupt and his wife, conveying a body of lands. The deed was pronounced fraudulent, and was set aside. The question was, did these proceedings bar the dower-right of the wife? The rule as to dower is said to be the rule as to homestead. — Thompson on Homestead, sections, 405 to 409. Dillon, J., with his accustomed force, said : “We solve the question here presented as to dower, when we determine under whom the assignee claims, and to whose rights he succeeds. . . He claims not under, but adversely to the deed of Wilder. He succeeds to all the interests of the bankrupt, and represents his creditors, so far as to enable him to attack conveyances made by the bankrupt in fraud of their rights. He claims that the deed is void as to creditors, and on this ground alone he attacks it; and upon this ground alone has he any right to the property. He says it is void as to creditors, because fraudulent, and for this reason asks to be invested with the title which it fraudulently conveyed. He cannot claim under it, and must claim against it. When it is decreed to be fraudulent and void at his instance, how can he set it up to defeat the right of the wife to dower ? Such a position involves this inconsistency, viz., that it asks that the same instrument be held void as to creditors, and then in their favor held valid as to the wife.” In another place he says : “Similar considerations, in my judgment, apply to the homestead right.”

Lishy v. Perry, 16 Bush, Ky. 515, was a case of homestead conveyed, -which creditors, sought to subject to their demands, for alleged fraud in the conveyance. The court said: “ Whatever may have been his intention in making the conveyance to Olayton, it can not be said that any legal right of the appellants was violated by the conveyance of property which was exempt from liability to sale for their debt.”

The deed under which Mrs. Lewis claims was, as we have said, executed on the fifth day of December, 1874. Mr. Grey, the grantor, died three months afterwards, and long before the bill in this case was filed. Neither at the making of the deed, nor at the time of his death, had he wife or child. He had his domicile- on the lands in controversy, when he made the conveyance; and was entitled to a homer stead exemption therein, under the constitution of 1868. What was the duration of his homestead claim ? Did he hold the homestead by a tenure different from that by which he held his other lands? and if so, in what respect different? His title to the entire tract was a fee. The constitution and statute declare, that the homestead “ shall be exempted from sale on execution, or any other process from a court, for any debt contracted since the thirteenth day of July, 1868, or after the ratification of this constitution.” Mr. Grey, as we have seen, left neither wife nor child surviving him. Supposing he had died the owner of the homestead, without conveying it, what would have been its status ? how held, and by whom held, after his death? Would its exemption from sale on execution, or other process of a court, for debt, have adhered to it, in the hands of his next of kin, as heirs at law? If so, then the homestead would have passed by 'descent to his heirs at law, and could not have been taken possession of, or utilized by his personal representative in the payment of his debts, although his estate otherwise might be insolvent. No one ever supposed that, on the death of a landholder, having a homestead, leaving neither minor child nor widow, the descent of the homestead is governed by rules 'different from those which govern in the descent of his other landed estate. All go alike to tbe devisee, or Heir, subject to a prime and paramount liability for the debts of the ancestor. If decedent leave minor child, or widow, him surviving, then the exemption is prolonged; not otherwise. — Const, of 1875, Art. 10, sections 2, 3, 5; Code of 1876, §§ 2820, 2821,2840. The exemption of Mr. Grey’s homestead from his debts was only during his life.

In the case of Chambers v. Sallie, 29 Ark. 407, the court said : “ The legal effect of the act is to create no new estate, but to protect the occupant of the land in the use and occupancy of the land so set apart as a homestead, during the time of such occupancy; but, if abandoned, by removal or death, leaving neither wife or children to succeed to his rights, the rights of the judgment creditor would be fully restored.” — See, also, Norris v. Kidd, 28 Ark. 485. If we were to hold that, by Mr. Grey’s conveyance of the homestead while he occupied it as such, he invested Mrs. Lewis with a fee exempted from his debts, notwithstanding the deed was voluntary or fraudulent, the result would be to accord to a conveyance, which all the authorities say is inoperative against creditors, the wonderful power of converting a temporary exemption from debt, into a fee simple absolute. Upon a consideration merely good, he could not convey to her greater rights and greater exemptions than he had himself. Although Mrs. Lewis could hold the homestead during the life of Mr. Grey, her authority and right ceased at his death, and the property then became liable to his debts. In other words, the conveyance vested in her all the rights in the homestead which he could assert against his creditors ; nothing more.

With the single exception of the error announced above, we concur in all the conclusions reached by the chancellor, in his very able and carefully prepared opinion. The conveyances must be pronounced voluntary, and constructively fraudulent, as againt existing creditors. — Bibb v. Freeman, supra; Sandlin v. Robbins, 62 Ala. 477. We hold, also, there is no ground on which to claim homestead. We hold, too, that the chancellor did right in decreeing that the assets in the hands of the Alabama administrator must be first exhausted, before these creditors shall be allowed to sell the property conveyed to Mr. and Mrs. Lewis; and to enable the court to administer the assets on this equitable principle, we approve the order, removing the administration into the Chancery Court. This the chancellor was authorized to do, under the prayer for general relief, found in both the original and cross bill.

The decree must be reversed on the errors assigned for the complainants in the court below, and the cause remanded, to be proceeded in according to the principles of this opinion. There is nothing in the cross assignments by Mrs. Lewis, and she can take nothing thereby.