First National Bank v. Smith

49 N.E. 376, 149 Ind. 443, 1898 Ind. LEXIS 31
CourtIndiana Supreme Court
DecidedFebruary 15, 1898
DocketNo. 18,252
StatusPublished
Cited by12 cases

This text of 49 N.E. 376 (First National Bank v. Smith) is published on Counsel Stack Legal Research, covering Indiana 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. Smith, 49 N.E. 376, 149 Ind. 443, 1898 Ind. LEXIS 31 (Ind. 1898).

Opinion

Howard, C. J.

This was an action by appellant upon two promissory notes; also to set aside, certain deeds made in fraud of the rights of appellant and other creditors, and to subject the lands conveyed to the payment of the debt due appellant. The complaint is in two paragraphs, the first counting on a note for $742.00, given January 28,1896, by the appellees John A. Smith and John Enright, and the second on a note for $1,000.00, given February 15, 1896, by the same appellees. It is alleged that at the dates of execution of the notes, and for many years prior thereto, the appellee John Enright was the owner in fee simple • [444]*444of the lands in controversy, described in the complaint. It is then further alleged: “That on the 25th day of March, 1896, without any consideration, and for the purpose of and with the intent to cheat, hinder, and delay his creditors, including the plaintiff herein, and to avoid the payment of said note [notes], the said defendant John Enright conveyed said real estate to his wife, Ann Enright, by deed, for a color-able consideration of $6,830.00, but for no actual consideration1 whatever; and plaintiff avers that at the time of such conveyance, prior thereto, and at all times since said conveyance, and now, the said defendant John A. Smith was and is wholly insolvent, and that no part of said indebtedness could be made by execution against him; which facts were fully known to said John Enright, Ann Enright, and Levi H. En-right at the date of such conveyance, and at the time , of the conveyance to Levi H. Enright hereinafter mentioned. That the defendant John Enright did not retain sufficient property with which to pay the said claim of plaintiff, and that he had not at the time of such conveyance, nor has he since had, nor has he now, sufficient otherproperty subjectto execution to pay his debts. Plaintiff further says that afterwards, to wit, on the 2d day of June, 1896, the said defendant Ann Enright, her codefendant and husband, John Enright, joining with her, executed and delivered to the defendant Levi H. Enright a deed of conveyance for the real estate described herein as being owned by the defendant John Enright; that Levi H. Enright is a son of John and Ann Enright, and was fully acquainted with all the facts and circumstances herein set forth, and had notice of the fraudulent transfer of said real estate from John Enright to Ann Enright, and of the fact of plaintiff’s claim against said John Enright, and that the same was unpaid; that such conveyance was [445]*445so made to Levi H. Enright for a colorable consideration of |5,400, but was, in fact, for no actual consideration, but was so executed and delivered in furtherance of the fraudulent intent on the part of John En-right, Ann Enright, and Levi H. Enright of cheating, hindering, and delaying the creditors of said John Enright, and of preventing the collection of plaintiff’s claim.”

The court, having heard the evidence, found for the appellant against the appellees John A. Smith and John Enright on the notes in suit, and for the appellees Ann Enright and Levi H. Enright for their costs; and over a motion for a new trial judgment was entered in accordance with -such finding.

It is assigned as error that the court overruled the motion for a new trial. The chief reason urged in favor of a reversal is that the decision is contrary to law and to the evidence. That the evidence shows that John Enright made the deeds in question with the intent to prevent appellant from collecting its debt does not seem to be seriously controverted. The deeds were plainly fraudulent as to him.

In 2 Thompson Trials, section 2016, it is said that one badge of fraud consists in “the transfer by a debtor in failing circumstances of all or most of his property to his near relations.” And in 2 Rice Ev. 955, the author says that slight evidence will be sufficient proof of fraudulent intent between parties who occupy confidential relations. In Hoffman v. Henderson, 145 Ind. 613, it was held, citing Bump. Fraud Conv. (2d ed.) 565, that evidence of other fraudulent transactions at or about the time of the transfer in controversy is also competent to prove the fraudulent intent of the debtor; and that there is, moreover, a probable connection in a series of sales nearly at the same time, the result of which is to strip a man of his available property.

[446]*446In the case before us it is not questioned that John Enright, besides the two deeds in controversy, executed about the same time deeds to his other children, without consideration, for other lands, and that by all his conveyances made at and near the time he was left without any property from the sale of which his debt to appellant could be paid. Indeed, he practically admits this himself. Asked as to why he gave away 200 acres at that time, he answeréd: “Well, to my children, I must admit I gave the land away.” Asked again why he did it, he said, “Well, that is the question now.” “Well, I wanted them to have the farm.” And when the question was whether he wanted them to have it rather than his creditor, the appellant, he answered: “Well, I can’t answer that question at all.” “Well, I don’t know.” ■

Whether the evidence shows the deeds to have been fraudulent as to the appellee Ann Enright, is a more difficult question. It is alleged in the complaint that the deed to her and that to their son, Levi, were without consideration. It is also there alleged that at the time of said conveyance to her by her husand, as well as at the time of the conveyance by her and her husband to their son, Levi, the facts in relation to these transfers, which include the fact of her husband’s “intent to cheat, hinder, and delay his creditors,” were “fully known” to her, as well as to her said husband and son. If either of these -allegations, the want of consideration for the deeds, or the knowledge on her part of the fraud about to be practiced on appellant and other creditors of her husband, were established by the evidence, then the law would impute fraud also to her, and the deeds should be set aside.

The evidence shows that the land was held in John Enright’s name for nearly twenty-two years before he conveyed it to his wife, and that there was no con[447]*447sideration then paid °to him for the deed to her. She even testified that she was not' present when the deed to her was executed, and that she did not know anything about her husband having excuted a deed to her until he handed it to her., In the light of this ■testimony, the deed to Ann Enright would look very much like a voluntary conveyance.

If the deed to Ann Enright was fraudulent as to her, then the deed by her and her husband to their son, Levi, was confessedly fraudulent also, and that as to all the parties, for it is admitted that there was no consideration whatever for the deed to him.

On January 28, 1896, the day on which the first of the renewal notes in suit was executed, John Enright filed in the circuit court, as replevin bail, in a cause there pending, his affidavit that he was worth, in unincumbered real estate, over and above all indebtedness, the sum of ten thousand dollars. So far as the public records then showed, he might well take this oath. Those records represented him to be the owner in fee simple of 400 acres of land, with no lien whatever standing against it; and it is admitted that this land was then worth $40.00 an acre, except sixty acres, which was worth $35.00 an acre; in all about $16,000.00 worth of unincumbered real estate.

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Cite This Page — Counsel Stack

Bluebook (online)
49 N.E. 376, 149 Ind. 443, 1898 Ind. LEXIS 31, Counsel Stack Legal Research, https://law.counselstack.com/opinion/first-national-bank-v-smith-ind-1898.