Martin v. McDaniel

53 So. 790, 170 Ala. 270, 1910 Ala. LEXIS 253
CourtSupreme Court of Alabama
DecidedNovember 24, 1910
StatusPublished
Cited by3 cases

This text of 53 So. 790 (Martin v. McDaniel) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Martin v. McDaniel, 53 So. 790, 170 Ala. 270, 1910 Ala. LEXIS 253 (Ala. 1910).

Opinion

EVANS, J.

This is the case of a creditors’ bill, filed by J. H. McDaniel and G. E. McDaniel, doing business as McDaniel & Son, against J. W. Martin and P. E. Pulsifer, doing business as Martin & Pulsifer, and J. W. Martin and F. E. Pulsifer personally, and Clark H. Pulsifer, Grant Pulsifer, and Ardell Pulsifer, seeking to have a conveyance of real estate from F. E. Pulsifer to his four brothers and sister, above named, declared void as a fraud on said complainants as creditors, and to have the property conveyed sold to meet judgments held by McDaniel & Son against the firm of Martin & Pulsifer and J. W. Martin and F. E. Pulsifer individually. Upon a hearing on the pleadings and proof, the judge of the lower court decreed the relief prayed for, and from this decree the respondents prosecute this appeal.

From the pleadings and proof it appears that in the fail of 1906 the respondents J. W. Martin and F. E. Pulsifer formed a partnership for the sale and installation of waterworks systems for country and suburban homes, and bought considerable machinery from the complainants, McDaniel & S'on. Martin was the business head of the firm, managed the money affairs, and had charge of the general business. Pulsifer was the practical man' and installed the machinery, being ah-[273]*273sent from borne for long periods for that purpose. In the fall of 1907, McDaniel & Son began pressing Martin & Pulsifer, through Martin, the bead and business manager of the firm, for a settlement of their account; and finally, on November 2, 1907, Martin executed in the name of the firm, and for the firm of Martin & Pulsifer, and delivered the same to McDaniel & Son, three promissory notes in full settlement of the account. These notes were.for the following amounts, payable as follows: $324.85 due 1st of April, 1908; $519 due 1st of June, 1908; $519 due 1st of August, 1908. These notes were unpaid when due, except for small credits. McDaniel & Son sued thereon in the city court of Montgomery, and on the 5th of October, 1908, after the filing of their bill in this case, obtained judgment thereon against the firm of Martin & Pulsifer and J. W. Martin and F. E. Pulsifer individually, amounting to $1,487.47.

On the 23d day of April, 1908, respondent F. E. Pul-sifer executed a deed conveying his one-sixth undivided interest in certain lands to his brothers and sister, the other respondents to the bill, for the consideration of $2,500 cash in hand paid. We conclude from the evidence that these brothers and sister knew' that McDaniel & Son claimed that Martin and Pulsifer owed them in some amount at the time the $2,500 was paid and the deed executed and delivered, and that the consideration was in fact paid. There was an incumbrance on the land when this interest was sold, and F. E. Pulsifer paid back to his grantors $500 of the money to discharge the amount of the debt which his share that he had sold was liable for. as between the said Pulsifers. There is no evidence tending to show that the said F. E. Pulsifer was insolvent or in failing circumstances; nor is there any evidence tending to show that he was converting his property subject to execution and sale, into [274]*274cash, so as to put it out of reach of creditors. The burden of proving these matters, if true, was upon complainants ; and, they having failed to make any attempt to adduce such proof, we must conclude, for the purposes of this decision, that F. E. Pulsifer was entirely solvent and-had ample property easily subject to execution and sale to satisfy all his debts in the event F. E. Pulsifer were found liable therefor, and that his sale of this particular property did -not in any way hinder, delay, or defraud 'the complainants.

It is true that in this transaction the burden is upon the respondents to show that a bona fide valuable con-si d'eration was paid; but, when this duty was performed, the burden of showing that the sale was made by F. E. Pulsifer with intent to hinder, delay, or defraud his creditors, and that this intent was participated in by the grantees, rested upon the complainants; and they have failed to carry this burden. The presumption is, therefore, that it is not true. In this state voluntary conveyances and gifts are declared by law to be void as to creditors of the grantor or giver, without regard to the solvency or insolvency of the grantor or giver. But this state has never applied the same rule in the case of conveyances upon a bona fide valuable consideration. When such a consideration is shown, then the burden is upon the complainant creditor to show affirmatively that the intent of the grantor, or effect of the conveyance, was to hinder, delay, or defraud his creditors, and that the grantee or grantees knew of such intent or effect, or was in possession of the knowledge of facts, which would put a reasonably prudent person upon inquiry, which, when followed up, would lead to the knowledge of such intent or effect.

In the case sub judice there is no proof that F. E. Pulsifer was insolvent or in1 failing circumstances at [275]*275the time the deed in question was executed; nor was there any proof that he was converting his property subject to execution into money, so that he might get it out of the reach of creditors. After the respondents had shown a bona fide valuable consideration for the conveyance, the burden of showing that, notwithstanding that fact, it was made to hinder, delay, or defraud his' creditors, was cast upon complainants; and this burden the complainants have failed to carry.

As tending to show fraud the complainants insist that the erasures of certain figures in the bond for title, and the substitution of others, show that the transaction was not bona fide. It is the contention of appellees here, complainants below, that the bond for title was made and dated in the year 1908;-and, in order to make the original land trade- antedate the debt, the respondents, or some of them, scratched out the “8” and substituted a “7All of the witnesses, cognizant of the facts swear that such was not the case. They say that the original date was 1906; and we can see, after careful examination with a microscope, no evidence upon the paper itself what the original number was that was scratched out. The erasure seems to have. been complete. The respondents contend that in 1906 — in the fall of that year — respondents Avent to their lawyer to get their contract with reference to this land in writing, and that he then Avrote out a skeleton, so to speak, of a bond for title, and dated it, as to the year, 1906; that upon finding that he would have to make investigation of the records in the probate office to get a proper description of the lands their laAvyer informed them that he would charge $10 for the work; that respondents then decided not to incur this expense and departed; that on April 11, 1907, they returned to their lawyer and decided to execute the bond for title; that the [276]*276said lawyer was sick at tbe time, and got bis son to copy tbe skeleton bond for title that bad formerly been drawn and fill in tbe description of tbe lands, etc.; that tbe son, in copying, copied “1906” as in tbe original, and that before tbe execution of tbe paper tbe “6” Avas erased (evidently, from tbe appearance of tbe paper, with a knife or some other sharp instrument) and a “7” put in its place. Tbe paper, from its appearance, Avas draAvn by some person not much accustomed to Avriting, and one who Avould likely have copied anything that was in tbe original. Tbe whole body of tbe paper sustains this theory.

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Bluebook (online)
53 So. 790, 170 Ala. 270, 1910 Ala. LEXIS 253, Counsel Stack Legal Research, https://law.counselstack.com/opinion/martin-v-mcdaniel-ala-1910.