First National Bank v. Reece

89 N.W. 804, 64 Neb. 292, 1902 Neb. LEXIS 158
CourtNebraska Supreme Court
DecidedMarch 19, 1902
DocketNo. 10,420
StatusPublished
Cited by6 cases

This text of 89 N.W. 804 (First National Bank v. Reece) is published on Counsel Stack Legal Research, covering Nebraska 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. Reece, 89 N.W. 804, 64 Neb. 292, 1902 Neb. LEXIS 158 (Neb. 1902).

Opinion

Dtjppie, C.

This is a creditors’ bill to subject to the payment of certain judgments held by the plaintiff the west half of the northwest quarter of section 26, and the east half of the northeast quarter of section 27, township 12, range 9 east of the 6th P. M. as the property of the defendant, Thomas Reece. Thomas Reece and his wife moved onto the land in 1884, the wife holding title. In the year 1890 she conveyed the land to one of her sons, and he, in turn, conveyed it to his father, Thomas Reece. Whthe the record is not clear that this conveyance to the son was for the purpose of placing the title in the name of his father, we infer that such was the case, and that the son never had any [293]*293real interest in. the property. Reece and Ms wife continued to. occupy the property until the summer of 1890, when they removed to an adjoining farm owned by another son, and rented the home farm to this son. The purpose of such removal, as shown by the evidence, was to better provide for Mrs. Reece, who was sick and not expected to recover, and the son’s house was better and more comfortable than the house on the home farm. Mrs. Reece died in the spring of 1891, and Thomas Reece then returned to the farm and boarded with his son. The value of the farm, as shown by the evidence, was from $6,400 to $8,000, and it was incumbered by mortgages to the amount of $3,500. Reece was also indebted to the appellant on unsecured claims to the amount of about $2,350. About August 15, 1896, Thomas Reece executed a warranty deed conveying the farm to Ms son Philip for the expressed consideration of $6,400. In the deed, Philip agreed to assume and pay the mortgages upon the place, and executed to his father five promissory notes, amounting in the aggregate to $2,900, payable in one, two, three, four and five years, for the balance of the consideration. At the time of this conveyance, Philip Reece, the son, was residing in Montana, and the negotiations for the sale of the farm, if any really took place, were by letters passing between them, none of which appear in the record before us. The plaintiff, the First National Bank of Greenwood, shortly after the conveyance to Philip Reece, reduced its claims to judgment, and had execution issue thereon; and the sheriff’s return thereon recites that “after diligent search, I find no goods and chattels whereon to levy belonging to either of the within named defendants; I therefore levied the same on the 24th day of May, 1897, at 11:30 A. M. on the west one-half (-J) of the northwest quarter (f) of section twenty-six (26), and the east one-half (•£) of the northeast quarter ({-) of section twenty-seven (27), township twelve (12), range nine (9), .east of the 6th P. M. in Gass county, Nebraska.” The petition alleges that the conveyance made to Philip Reece by his father was without consideration, and for the purpose [294]*294of hindering, delaying and defrauding the creditors; that by reason of said conveyance the land can not be sold on execution, or if sold would not bring a sufficient sum to satisfy the claim,—and asks that said conveyance may be set aside and made subject to the payment of the plaintiff’s judgments. The answer of the defendants, whthe denying any fraud in the conveyance of the property, also alleges that, at the time of the conveyance, Thomas Reece had a homestead interest in the farm; and they ask that the plaintiff’s petition may be dismissed, or that, in case the court should find for the plaintiff upon the question of the bona fides of the conveyance, that $2,000 in value of said premises, free and clear from all liens, and exclusive and in addition to the two mortgages thereon, be decreed to be the property of the defendants. A decree was entered as prayed in the petition and from this decree the defendants have appealed to this court.

We think the evidence was amply sufficient to uphold the finding of the district court that the defendant, Thomas Reece, was insolvent, and that the conveyance made to his son Philip was fraudulent as to creditors. It. would serve no useful purpose to review at length the evidence on these questions. Suffice to say that the debts due the plaintiff were long past due, and the defendant could not pay them in the usual course of business, as they matured. Judgments were entered thereon and the sheriff’s return made on the executions issued show that he could find no property of Thomas Reece out of which to satisfy the judgments, save this farm, the legal title to which stood in the name of Philip Reece. No further or greater proof of insolvency was required. The bona fides of the conveyance to Philip,-if submitted as an original proposition to this court, would, we think, have to be determined against the defendants. The deed was made to Philip whthe he was in Montana and the evidence that any negotiations took place between the parties by correspondence is not of a satisfactory character. No money was paid on the consideration going to the father. Two hundred and eight [295]*295dollars was sent by Philip to pay interest due on the mortgages on the farm, but nothing has ever been paid on the notes given to his father. Negotiations were had between the officers of the bank and Thomas Reece and another son, who held a power of attorney from Philip, looking to a sale of the farm, and securing payment to the bank from the proceeds. Whthe Philip testified that he bought the place for a home, we can imagine no good reason for his giving a power of attorney to his brother, unless it was to make a sale. There are other circumstances, which we will not take the time to note, all tending to impeach the bona tides of the conveyance to Philip, and which fully sustain the finding of the district court.

Relating to the homestead claim of the defendants, it is the settled law of this state that creditors can not complain of the transfer of exempt property by their debtor; and in Stubendorf & Co. v. Hoffman, 23 Nebr., 360, it was held that a fraudulent grantor of premises occupied as a homestead might assert his homestead exe'mption, if the court should find against the bona fides of the conveyance; and in Horton v. Kelly, 40 Minn., 193, it was held that “where a conveyance is set aside as fraudulent as to the creditors, the homestead interest of the grantor will be protected as if it had not been made.” This requires us.to consider whether Thomas Reece had a homestead right in the premises at the time of the conveyance to his son. Up to the date of the death of his wife, there can be no doubt that the farm was his homestead. He had occupied it as such from 1884. The removal to the farm of his son in 1890 to give his sick wife the benefit of a better house can not in any sense be considered an abandonment of the homestead. The cases in this state establish the rule that, once a homestead, that character continues to attach to the property until the contrary is shown, and the burden is on those who seek to show an abandonment. Union Stock Yards Nat. Bank v. Smout, 62 Nebr., 227. No act of the defendant himself, so far as the record discloses, can be pointed out that goes to impeach his right of homestead in the [296]*296premises if his personal status is such as to give him that right. It is insisted that after the death of his wife, there being none of his children residing at home and dependent on him for support, he does not come within the provisions of section 15 of our homestead law. To acquire a homestead in the first instance, there can be no doubt that the party asserting such right must be the head of a family, as defined in section 15 of the homestead act (Compthed Statutes, ch.

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Cite This Page — Counsel Stack

Bluebook (online)
89 N.W. 804, 64 Neb. 292, 1902 Neb. LEXIS 158, Counsel Stack Legal Research, https://law.counselstack.com/opinion/first-national-bank-v-reece-neb-1902.