Marmon v. Harwood

16 N.E. 236, 124 Ill. 104
CourtIllinois Supreme Court
DecidedMarch 28, 1888
StatusPublished
Cited by18 cases

This text of 16 N.E. 236 (Marmon v. Harwood) is published on Counsel Stack Legal Research, covering Illinois Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Marmon v. Harwood, 16 N.E. 236, 124 Ill. 104 (Ill. 1888).

Opinion

Mr. Justice Craig

delivered the opinion of the Court:

This was a creditor’s bill, brought by Thomas F. and Willis S. Harwood, in the circuit court of McLean county, against Mary A. Marmon, Maria Paist, Owen L. Cheney, Mary L. Cheney, his wife, and William W. Marmon. The object of the bill was to set aside certain deeds executed by Maria Paist to Mary A. Marmon and Mary L. Cheney, whereby certain real estate was conveyed to them, and subject the jiroperty to "the payment of a judgment which complainants had recovered against Maria Paist. Upon the hearing in the circuit court, •on the pleadings and evidence, a decree was rendered in favor ■of the complainants. Mary A. Marmon appealed to the Appellate Court, where the decree' was affirmed. To reverse that judgment she has appealed to this court.

There is no material conflict in the evidence, nor do the parties disagree in regard to the facts established by the evidence, upon which the decree was rendered; hut it is insisted that the conveyance from Maria Paist to Mary A. Marmon was not fraudulent as against creditors; that at the time the deed was executed she retained property sufficient to pay all Jier debts, and for this reason the decree was erroneous.

It appears from the evidence, that in the month of April, 1884, Maria Paist, and her son, O. L. Cheney, executed and •delivered to H. T. Levin a promissory note for $3556, due in iwo years, with interest at seven per cent per annum. This note was sold to the complainants, and they recovered a judgment upon it for $4053.84. On April 30, 1886, an execution was issued upon the j udgment, and returned no property found. At the time the note was executed, Maria Paist was the owner in fee of lot 16, the east half of lot 1Y, and the south half of lot 19, all in White’s addition, and was the owner of lot 6, of ■assessor’s subdivision of lots 50, 51, 52, 53 and 54, of the original town, all in the city of Bloomington, and the east half of lot 4, in block 1, in Normal. She also had notes, made by W. W. Marmon, for about $2300. The first mentioned piece ■of property is known as the “homestead,” the second piece as the “Cheney homestead,” and the third as the “Hammerslaugh building.” Appellant and O. L. Cheney are the daughter and «on of Maria Paist, and Mary Cheney is the wife' of O.L. Cheney.

On the 5th day of November, 1884, Mrs. Paist made two deeds,—i. e., one to appellant, for the homestead, reciting a ■consideration of $Y000, the other to Mary Cheney, for the Cheney homestead, the Hammerslaugh building, and the Normal property. The homestead, Avhich was conveyed to appellant, was clear from incumbrance, and worth $7000. The Cheney homestead was incumbered for $1000, but was worth $2500. The Hammerslaugh property was mortgaged for some $8000, but worth $4000 above the mortgage. The lots in Normal were worth $300. _ The deeds purporting to convey the property to appellant and to Mary Cheney were executed without consideration. At the time of these conveyances Mrs. Paist was indebted on a promissory note, which she had signed with her son, in the sum of $1000, in addition to the debt she owed complainants. The property she conveyed without consideration exceeded in value $13,000. She retained no real estate, or property of any character, except notes of W. W. Marmon for $2300, and a note, secured by a second mortgage on the fair grounds at Bloomington, for $6000. This claim was subject to a prior mortgage of over $11,000, held by one Brokaw. On the 16th day of March, 1885, the Hammerslaugh property was sold to Dr. Barnes for $4000, subject to the mortgage on the property. Soon after this sale, the fair grounds, upon which Mrs. Paist held a second mortgage, were advertised for sale on the first mortgage, and at the sale Mrs. Paist became the purchaser, for the amount of the debt and costs. Upon making the purchase she paid $5000 cash down, and gave a mortgage on the property to secure the remaining $7000. The cash payment was made up of $4000 which Mrs. Cheney had received from the sale of the Hammerslaugh property, and $1000 which she borrowed. On the 29th day of September, 1885, Maria Paist conveyed the fair grounds to James B. Stevenson for $7500, subject to the mortgage she had given, of $8000. She received cash, $2000, Normal property, $2500, notes, $3000. The Normal property was soon sold, and the cash, notes and proceeds of the Normal property were all turned over by Mrs. Paist to her son, O. L. Cheney, and he lost the entire amount on the Chicago Board of Trade. The notes Mrs. Paist held against Marmon had all been disposed of before complainant’s debt matured, except a note for $1300, which was turned over to secure attorney’s fees to defend this suit.

In Patterson v. McKinney, 97 Ill. 41, where a voluntary ■conveyance of lands had been made by Patterson for the benefit of his wife, the grantor retaining property which exceeded in nominal value the total amount of his indebtedness existing at the time of the conveyance, it was insisted, as it is in this •case, that the transaction was not fraudulent as against creditors ; but the position was not sustained. In deciding the case the court held that a voluntary conveyance to a wife or child when the donor is in embarrassed financial circumstances, is fraudulent as to pre-existing creditors, even though the party retains estate nominally in value equal to, or more than equal to, all his indebtedness, when the event shows that the prop-erty retained is in fact not sufficient to discharge all his liabilities. In the Patterson case, the grantor, at the time he made the conveyance to his wife, had more property than Maria Paist had when she conveyed to appellant, and was indebted to a greater extent; but this case can not, in principle, be ■distinguished from the Patterson case. The principle which controlled the one must govern the other.

In April, 1884, when the note upon which complainants ■obtained judgment was executed, Maria Paist owned property (mostly real estate) exceeding in value $13,000, but when 'the judgment was rendered, two years thereafter, shé had no property liable to execution, and almost all her property had, .between the date the note was given and the date of the judg•ment, been transferred to her children without consideration. Seven months after the note upon which complainants obtained judgment, was given, Mrs. Paist conveyed to appellant the homestead,—the property here involved,—the property at the time being worth $7000; but no consideration passed from the grantee to the grantor. It may be that Mrs. Paist did not, .at the time she conveyed this property to her daughter, design to defraud her creditors; or it may be that the transaction, was not fraudulent in fact,—that she expected to pay her debts from the property she retained, when she made the conveyance to appellant. But however that may be, we think it plain, from the evidence introduced on the hearing, the transaction is one which,- as against pre-existing creditors, was fraudulent in law. What may have been in the mind of the grantor when: she conveyed the property to her daughter, is immaterial. The conveyance being voluntary, if it resulted in hindering, delaying or defrauding creditors, it must be regarded as fraudulent in law. This view of the law is well expressed by Bump on Fraudulent Conveyances, secs. 271, 272, as follows: “The law will not speculate about what is actually passing in the donor’s mind, for the act need not be immoral or corrupt. The law does not concern itself about the private or secret motives which may influence the debtor. It does not deal with his conscience.

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Bluebook (online)
16 N.E. 236, 124 Ill. 104, Counsel Stack Legal Research, https://law.counselstack.com/opinion/marmon-v-harwood-ill-1888.