Hardy v. Hardy

311 S.W.2d 761, 228 Ark. 991, 1958 Ark. LEXIS 662
CourtSupreme Court of Arkansas
DecidedApril 7, 1958
Docket5-1415
StatusPublished
Cited by8 cases

This text of 311 S.W.2d 761 (Hardy v. Hardy) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hardy v. Hardy, 311 S.W.2d 761, 228 Ark. 991, 1958 Ark. LEXIS 662 (Ark. 1958).

Opinion

CarletoN Harris, Chief Justice.

Meriwether Wright Hardy, appellant herein, and Robert L. Hardy, one of the appellees, husband and wife, separated on January 20, 1956. Exactly one month later, appellant instituted suit for divorce in the Pulaski Chancery Court. Hardy filed his answer on March 7th. On March 30th, through a discovery deposition taken from Hardy, appellant learned that on March 6th, Hardy had transferred all of his stocks to his mother, Corinne Hardy, and had also, either on that date or sometime earlier, mortgaged certain personal property. On April 24th, Meriwether Hardy filed a substituted complaint, making Corinne Hardy a party defendant, and alleging that Robert Hardy’s business transactions with Corinne Hardy were “fictitious” and entered into for the purpose of defraud-iug her of her interests in his properties, and asking that “Corinne McCombs Hardy be required to release and permit to be transferred to plaintiff one-third of all personal property belonging to defendant -which is now in her custody.” Additional grounds for divorce were alleged at the same time. On May 7th, Corinne Hardy filed her answer, denying appellant’s allegations. On May 15th, appellant filed an amendment to her substituted complaint alleging that Hardy & Co., Inc., 1 was a mere dummy, and was being used by Robert Hardy to cheat and hinder her in her efforts to obtain her dower rights. After several other pleadings had been filed by the parties, including a prayer that the court invalidate the pledge held by Corinne Hardy to one-third of the securities (representing the dower interest allowable to appellant), the case, on October 24, 1956, went to trial. After hearing the evidence relative to the divorce, the chancellor, on October 25th, appointed a special master, who was directed to inquire into the various holdings of Robert Hardy . . . stocks and other personal properties . . . realty owned by Hardy . . . rights of appellant in such properties . . . whether the assignments and mortgages from Hardy to his mother were valid . . . the validity of other transactions hereinafter referred to. On November 7th, the court entered its decree granting a divorce to appellant. Subsequent thereto, the master took testimony and filed his report with the court on December 5th, 1956. On December 28th, the court entered its decree adopting most of the conclusions reached by the master, and awarding appellant her statutory rights in both the personal holdings and realty of Robert Hardy, her dower rights in the stocks, however, being subject to a lien held by Mrs. Corinne Hardy. The decree, including land descriptions, covers twenty pages, and only the controverted findings will be hereafter discussed. Appellant’s notice of appeal lists twenty decretal orders contained in the decree which are contended to be erroneous, though some of these have now been waived, others are not argued, and the balance are covered in six points. Bobert Hardy appeals from fourteen decretal orders in tbe decree, though only four are argued.

Does the evidence reflect that Robert Hardy and his mother, Gorinne Hardy, entered into a scheme to defraud Meriwether .Hardy of her statutory rights in Robert Hardy’s personal property.1

This is by far the most important question, involving, as it does, approximately $90,000, and is the question given the greatest attention by all parties. The record is voluminous, covering testimony before both the Chancellor and the Master, and discussion here must necessarily be limited. Perhaps it would be well to first discuss the applicable law. In Merchants and Farmers Bank v. Harris, 113 Ark. 100, 167 S. W. 706, this Court, through Justice Wood, said:

“Without going into detail in discussing the above facts, arguendo, we are of the opinion that they clearly show that the conveyance from Harris to Hale was for the purpose of defrauding Harris’s creditors, and that Hale participated in such fraud. But if we are not correct in that, certainly the facts and circumstances were sufficient ‘to put a man of common sagacity upon inquiry, and with the use of reasonable diligence, to lead him to the discovery of the fraudulent purpose of the vendor,’ and Hale, having neglected to make inquiry that would have enabled him to discover the fraud, is, charged with notice thereof, and must be held to have assisted Harris in carrying out his fraudulent purpose.” In the old case of Singer v. Jacobs, 11 Fed. Rep. 559, tried in the Eastern District of Arkansas, the court went even further, saying:
“An actual agreement or conspiracy between Jacobs and Thompson that the latter, would aid the former to defraud his creditors does not have to be shown. It is sufficient to avoid the sale if the facts and circumstances within the knowledge of Thompson are such as fairly to induce the belief that he either knew of the fraudulent purpose of Jacobs, or, having good reason to suspect it, he purposely refused to make inquiry, and remained wilfully ignorant. A full consideration paid in cash will not protect a purchaser who has notice, actual or constructive, that the vendor is selling to hinder and delay his creditors; * * * . ”

We think the law is well expressed in the Maryland case, Oles Envelope Corporation v. Oles, 193 Md. 79, 65 Atl. 2d 899.

“There is unquestionably a difference between the claim of a wife upon her husband’s estate, and the claim of a wronged wife, who because of the misconduct of her husband becomes entitled to a divorce and has applied or is about to apply for alimony. * * *

A husband has the right to make a transfer of his property, either with or without consideration, even though he strips himself of all means of supporting his wife, and leaves her without the means of subsistence, provided that he does so in good faith and without intention of defrauding her of her just claims upon him and his estate. * * *

On the other hand, a conveyance made by a husband before and in anticipation of his wife’s suit for alimony, or pending such suit, or after a decree has been entered therein in the wife’s favor, to prevent her from obtaining alimony, is fraudulent and may be set aside, unless the grantee took in good faith, without notice and for value. The grantee’s knowledge of or participation in the fraud of the■ grantor must he gathered from the various facts composing the transaction and all the■ surrounding circumstances. 2 * * *”

In determining whether the facts in this case are such as to come within the cases cited, we deem it appropriate to review the sequence of events.

January 20, 1956 — Robert Hardy and wife, Meri-wether Hardy, separated.

February 20, 1956 — Divorce suit filed by Meriwether Hardy.

February 24, 1956 — Hardy & Company was incorporated.

March 1, 1956 — Appellee was at the Mayflower Hotel in Washington, D. C.

March 1, 1956 — Corinne Hardy, mother of Robert, wrote to appellee saying she would advance up to $850,-000 to Hardy & Co.

March 4,1956 — Robert Hardy arrived in Little Rock.

March 6, 1956 — Chattel mortgages from Hardy to mother were signed.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Lakshminarayana Chekuri v. Madhuri Nekkalapudi
2020 Ark. 74 (Supreme Court of Arkansas, 2020)
Ginsburg v. Ginsburg
120 S.W.3d 567 (Supreme Court of Arkansas, 2003)
Skokos v. Skokos
968 S.W.2d 26 (Supreme Court of Arkansas, 1998)
Wallace v. Wallace
291 S.E.2d 386 (West Virginia Supreme Court, 1982)
George v. George
591 S.W.2d 655 (Court of Appeals of Arkansas, 1979)
Pierson v. Barkley
484 S.W.2d 872 (Supreme Court of Arkansas, 1972)
Horn v. Horn
339 S.W.2d 852 (Supreme Court of Arkansas, 1960)
Robbins v. Robbins
328 S.W.2d 498 (Supreme Court of Arkansas, 1959)

Cite This Page — Counsel Stack

Bluebook (online)
311 S.W.2d 761, 228 Ark. 991, 1958 Ark. LEXIS 662, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hardy-v-hardy-ark-1958.