First National Bank v. McClellan

9 N.M. 636, 9 Gild. 636
CourtNew Mexico Supreme Court
DecidedAugust 30, 1899
DocketNo. 780
StatusPublished
Cited by4 cases

This text of 9 N.M. 636 (First National Bank v. McClellan) is published on Counsel Stack Legal Research, covering New Mexico Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
First National Bank v. McClellan, 9 N.M. 636, 9 Gild. 636 (N.M. 1899).

Opinion

PABKEB, J.

This is a creditor’s bill filed by appellants against appellees to subject certain real estate in the city of Albuquerque to the payment of certain judgments obtained by appellants against appellee, William W. McClellan. The cause was referred to one of the standing masters in chancery with directions to take the proof and “report the same to the court, with his conclusions thereon.” The master, after taking the proof filed his report in which he makes findings of fact and draws conclusions of law therefrom, and recommends a decree in accordance with the prayer of the bill. Appellees filed numerous exceptions to both clauses of findings which were sustained by the court and the bill dismissed.

Reference: findings of master: presumption, 1. It will be observed that the reference is not in terms so broad as usually employed, it simply calling for a report of the proofs together with the master’s opinion thereon, nor does it appear from the order that _ the reference was by consent. But the master 4 ° having assumed under the order to find facts and draw conclusions of law therefrom, and no objection being made either to the order or the action of the master thereunder, it is to be presumed by this court that he acted within the scope of his authority and with the consent of the parties. Field v. Romero, 7 N. M. 630; De Cordova v. Korte, Id. 678; Express Co. v. Walker, 54 Pac. Rep.(N.M.) 9.

AwTfeNtoEi“sbíndy to‘ repayfsub^e-6 quent conveyanee to wife: consideration, 2. The master made among others, the following findings: Ninth: That on December 15, 1892, the defendant, W. W. McClellan, transferred to his wife, the defendant, Eunice McClellan, through O. N. Marrón, without consideration, lots 1 to 7, in-_ _ elusive m block K. Tenth: 1 hat defendant W. W. McClellan, by deed dated February 4, 1896, acknowledged February 29, 1896, filed for record March 2, 1896, and recorded March 6, 1896, conveyed lots 17, 18, 19 and 20, block D. for a consideration named in the deed of $2,500 to defendant, Naomi Duncombe, his wife’s mother. Eleventh: The testimony of the defendants, W. W. McClellan and Naomi Duncombe, relative to the time of the payment of the said consideration of $2,500 is so contradictory; the method of transmitting the money is so unusual; the fact that neither of the defendants produce any letters or memoranda relative to the transaction; the secrecy observed by the defendant W. W. McClellan, thereto; „the acts of ownership exercised by the defendant W. W. McClellan, after the date of said deed; the fact that the said property was conveyed by said defendant, Naomi Duncombe, to said defendant, Eunice McClellan, by deed dated May 2, 1896, which deed was kept concealed and unrecorded until the hearing in this cause; and that'said transaction inaugurated immediately after defendant W. W. McClellan, had been served with summons in said suit of complaint, Agnes O. Bobins, are so many suspicious circumstances that the master finds that if there was not an actual conspiracy on the part of defendants, ~W. ~W. McClellan and Eunice McClellan and Naomi Duncombe to defraud the creditors of said defendant W. W. McClellan, there was in contemplation of law such fraud as should vitiate the transaction and the master therefore finds that the above transfers are so tainted with legal fraud that they can not be regarded as valid as against the complaining creditors. Thirteenth: That the transfer referred to in finding number 9 was a gift; that although the money belonging to the separate estate of the defendant, Eunice McClellan, might have been used to purchase the same, there is nothing to show that W. W. McClellan was. on that account morally or legally bound to convey the said property to the said Eunice McClellan; moreover, considering that the property had remained in his name for over a year, during which time it had formed a basis of credit for the indebtedness owing to complainants,his said transfer was a legal fraud upon his creditors, and hence must be regarded as invalid against the complaining creditors.

It will thus be seen that the master found that the transfer through Marrón was a gift and void as to appellant. In this he is overruled by the court, and we think improperly. The testimony shows that the wife, at the time of the purchase, was in ill health and not expected to live; that she furnished the money out of her separate estate with which the purchase of the first two lots was made; that she desired the title taken in the husband’s name; it fails to show any promise, express or implied, to repay the money, or any understanding between them that the property was to be conveyed to her, or that the relation of debtor and creditor was thereby created; that the husband afterwards bought lots adjoining those first purchased, mortgaged them for the purchase price, which mortgage was paid off by the mother-in-law; it fails to show any understanding that this payment by the wife’s mother was to be a consideration for the transfer to the wife; that the husband then conveyed all this property to the wife, through Marrón, without any consideration at the time. We think this transfer to the wife was voluntary in that it was without valuable consideration. Where a wife advances money to her husband, without any promise to repay, or under such circumstances as not to create the relation of debtor and creditor at the time, such advancement is no consideration for a subsequent conveyance to her. Bump, Fraud. Convey. [4 Ed.], see. 286. Hanson v. Manley, 33 N. W. (Iowa) 357; Carbiener v. Montgomery, 66 N. W. (Iowa) 900-902; Bank v. Jenkins, 3 Atl. (Md.) 302; Jenkins v. Middleton, 13 Atl. (Md.) 155, 156; Frank v. Humphery, 12 N. E. (Ill.) 720-722; Jackson v. Beach, 9 Atl.Rep. (N. J.) 380; Hermess v. Scruggs, 94 U. S. 22-28.

This transfer then must be held to be voluntary and consequently void as to appellants, unless the husband retained ample property to satisfy the demands of his creditors. It does appear that he still retained property afterwards conveyed to the wife through the mother-in-law, but it also appears that it was mortgaged for $2,000, that he tried to sell it but could not, until he finally conveyed it to the mother-in-law, who was the only person he could find to buy it. It was doubtful market value and incumbered. ' This was not a sufficient showing. It devolved upon the wife to show that his remaining estate was ample to satisfy the demands of the husband’s creditors, and this she failed to do. Bump. Fraud. Convey., secs. 249, 259; Hoffman v. Nolte, 29 S. W. (Mo.) 1006.

consideration: burden of proof. 3.

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Bluebook (online)
9 N.M. 636, 9 Gild. 636, Counsel Stack Legal Research, https://law.counselstack.com/opinion/first-national-bank-v-mcclellan-nm-1899.