Haynes v. Bunting

147 S.E. 211, 152 Va. 395, 1929 Va. LEXIS 178
CourtSupreme Court of Virginia
DecidedMarch 21, 1929
StatusPublished
Cited by9 cases

This text of 147 S.E. 211 (Haynes v. Bunting) is published on Counsel Stack Legal Research, covering Supreme Court of Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Haynes v. Bunting, 147 S.E. 211, 152 Va. 395, 1929 Va. LEXIS 178 (Va. 1929).

Opinion

Campbell, J.,

delivered the opinion of the court.

This is an appeal from a decree setting aside a deed from Josie R. Haynes to her son, W. R. Haynes, as voluntary and fraudulent. The facts may be summarized as follows:

Josie R. Haynes purchased a house and lot in the city of Richmond in the year 1918, and placed thereon a deed of trust securing the sum of $3,765.00. On February 12, 1925, Josie R. Haynes entered into a contract with Martha J. Bunting for the lease of a piece of property situated at Ocean View, Virginia, known as the “Georgia Cottage,” for the purpose of [398]*398conducting a hotel or boarding house! The lease was for a two year period,- beginning March 1, 1925, at an annual rental of $1,500.00.

On August 6, 1926, Josie R. Haynes and her husband, J. T. Haynes, executed a deed conveying the Richmond city property to their son, W. R. Haynes. The consideration stated in the deed is the sum of ten dollars and the assumption of a deed of trust upon the property in favor of Pollard and Bagby, Incorporated, Trustee, for the sum of $3,765.00. It is contended, however,, by the appellants that the actual consideration was the sum of $6,000.00, and that under an agreement between the mother and son the latter was to have credit for certain sums of. money due him by the mother, and a further credit for a large sum of money paid by the son upon the indebtedness of his mother.

Default having been made in the payment of the rent due Martha J. Bunting, she brought suit to obtain judgment for the balance due upon the rental notes and to have the deed from Josie R. and J. T. Haynes set aside as having been made with the intent to hinder, delay and defraud their creditors. and to subject the land to the payment of the debt asserted.

The law governing cases of this nature is well settled.

In Lipman v. Norman Packing Co., 146 Va. 466, 131 S. E. 798, McLemore, J., said:

“A few general legal principles may be kept in mind as bearing upon the issues involved:

“ ‘Fraud is not to be assumed on doubtful evidence, or circumstances of mere suspicion. It must be clearly and distinctly proved. The law never presumes fraud, but the presumption is always in favor of [399]*399innocence and honesty.’ New York Life Ins. Co. v. Davis, 96 Va. 739, 32 S. E. 475, 44 L. R. A. 305.

“ ‘(4) A fraudulent intent concurred in by both grantor and grantee always vitiates a conveyance, as indeed the statute declares affirmatively by pronouncing its nullity, and negatively by providing that it shall not be void if founded on a valuable consideration, and the grantee had no notice of the fraudulent intent.’ 2 Minor on Real Property, section 1173.

“ ‘Relationship is not a badge of fraud, and there is no law which forbids persons standing in near relationship of consanguinity, affinity, or business, from dealing with each other, or which requires them to conduct their business with each other differently from the manner in which they deal with other persons, though when fraud is charged their dealings with each other will be closely scrutinized, as they may strengthen a presumption arising from other circumstances.’ Johnson v. Lucas, 103 Va. 36, 48 S. E. 497.

“ ‘The relationship of the parties (father and son) and the insolvency of the grantor, do not of themselves constitute badges of fraud and relieve the creditors from proving the charges of fraud set up in their pleadings.’ Johnson v. Lucas, 103 Va. 36, 48 S. E. 497.

“ ‘As a general rule, the burden of proof rests on him who charges fraud, and not on him whose conduct is charged to be fraudulent. But, where the transaction assailed is between brother and brother or other near relatives, only slight evidence is required to shift the burden of showing its bona fides.’ Mankin v. Davis, 82 W. Va. 757, 97 S. E. 296; Carlsbad Mfg. Co. v. Kelley, 84 W. Va. 190, 100 S. E. 65; Hickman v. Trout, 83 Va. 478, 3 S. E. 131; Todd v. Sykes, 97 Va. 143, 33 S. E. 517.

[400]*400“In Crowder v. Crowder, 125 Va. 80, 99 S. E. 746, Judge Burks, speaking for the court, says:

“ ‘While fraud must be clearly proved by bim who alleges it, it is not necessary that it should be expressly shown. It is rare that it can be. The participants are not apt to discuss it, but actions speak louder than words, and the transaction itself often furnishes proof of the fraud that is entirely satisfactory. Hazlewood v. Forrer, 94 Va. 703, 27 S. E. 507; Todd v. Sykes, 97 Va. 143, 33 S. E. 517.’

“ ‘A transaction may of itself and by itself furnish the most satisfactory proof of fraud so conclusive as to outweigh the answers of the defendants and even _the testimony of witnesses.’ Parr v. Saunders, 1 Va. Dec. 731, 11 S. E. 979; Hazlewood v. Forrer, 94 Va. 706, 27 S. E. 507.

“As was said by that distinguished jurist, Judge Riely, in Furguson v. Daughtrey, 94 Va. 308, 26 S. E. 822:

“ ‘It was not necessary, in order to avoid the conveyance, to prove that she had positive knowledge of the fraudulent intent of the grantor. Express proof of notice is rarely attainable. The doer of an illegal act is not wont to proclaim his unlawful purpose. As the illegal intent may be a just and legal implication from the evidence, so may notice of the illegal intent be a just and legal imputation from knowledge possessed by the grantee. It is sufficient to prove that the grantee had knowledge of facts and circumstances which were naturally and justly calculated to excite suspicion in the mind of a person of ordinary care and prudence, and which would naturally prompt him to pause and inquire before consummating the transaction, and that such inquiry would have necessarily led to a [401]*401discovery of the facts from which the law imputes fraud to the grantor.’ ”

The trial court held the proof sufficient to set aside the deed on the ground that it was voluntary, except as to the sum of $400.00 paid by the grantee to the grantor on June 2, 1926. The action of the court in impressing the land with a lien of $400.00 in favor of W. R. Haynes is assigned as cross-error by the appellee. The correctness of the decree complained of must be determined by the proof.

In Neff v. Edwards, 148 Va. 628, 139 S. E. 295, Judge Burks said: “There are many cases in this jurisdiction on the subject of fraudulent conveyances, some upholding and others setting aside the conveyance, but precedent in such cases is of but little aid as there is such a variance of the facts, and each case must be determined upon its own facts and circumstances.”

While it is true that the relationship of mother and son does not of itself constitute fraud, yet a transaction between parties so closely bound together, where the rights of third parties are involved, calls for the closest investigation. The deed from the mother to the son conveyed the entire estate of the mother. The mother was absolutely insolvent. A part of the alleged consideration is an $800:00 payment made by the son on an automobile, which the proof shows belonged to the father and was registered in his name. Another part of the alleged consideration was a debt assumed by the son which was barred by the statute of limitations.

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Bluebook (online)
147 S.E. 211, 152 Va. 395, 1929 Va. LEXIS 178, Counsel Stack Legal Research, https://law.counselstack.com/opinion/haynes-v-bunting-va-1929.