McCole v. Loehr

79 Ind. 430
CourtIndiana Supreme Court
DecidedNovember 15, 1881
DocketNo. 6294
StatusPublished
Cited by19 cases

This text of 79 Ind. 430 (McCole v. Loehr) 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
McCole v. Loehr, 79 Ind. 430 (Ind. 1881).

Opinions

Elliott, C. J.

— The complaint of the appellees charges, that a deed and mortgage executed by Jacob C. Loehr, in his lifetime, were made with the intent to cheat and defraud his. creditors, and asks to have them set aside and the property subjected to sale for the payment of his debt. The complaint is bad. A material allegation is lacking. It is not alleged, that, at the time the conveyances were made the grantor did not. have other property subject to execution, out of which the: claims of creditors could have been satisfied. It is well settled, that a complaint to set aside a conveyance as fraudulent must affirmatively show that the debtor did not have other property subject to execution at the time the conveyance was. made. Spaulding v. Blythe, 73 Ind. 93; Noble v. Hines, 72 Ind. 12 ; Pfeifer v. Snyder, 72 Ind. 78; Hardy v. Mitchell, 67 Ind. 485. It is also necessary to aver that the debtor did hot have' property other than that conveyed at the time the suit to set-aside the conveyance was instituted. Bruker v. Kelsey, 72 Ind. 51; Sherman v. Hogland, 73 Ind. 472. "Where property remains in the hands of the debtor, which can be reached by process of law, there is no reason for setting aside conveyances made by him. Before resorting to such a proceeding, property in the hands of the debtor should be first exhausted.

The allegation, that the debtor was in embarrassed and failing circumstances, is not equivalent to an averment that he did not possess property other than that conveyed, out of which the claims of creditors could have been made. It may be true that the debtor was financially embarrassed, and yet be the owner of property out of which the claims of creditors could have been satisfied.

[432]*432The allegation, that the grantor died notoriously insolvent, does not make the complaint sufficient. The character of a transaction is to be determined by the circumstances surrounding the parties at the time it took place. The validity of a conveyance does not depend upon subsequent events. The .question in such cases is the financial condition of the grantor at the time, for, if then solvent, his subsequent insolvency will not invalidate the conveyance. Sherman v. Hogland, 54 Ind. 578; Whitesel v. Hiney, 62 Ind. 168.

The appellees’ cross error is well assigned. The court erred jn overruling the demurrer to the complaint.

The tenth instruction given by the court reads thus: But even if you believe that said Jacob B. Loehr intended to defraud his creditors at the time of making said conveyance, still you should not find for the plaintiffs unless the defendant Julia C. Loehr had a knowledge of such fraudulent intent on •the part of her husband, Avhether she paid any valuable consideration for such property or not.” This instruction is radically Avrong, Where the conveyance is purely voluntary, and the grantor has not other property out of Avhich the claims .of creditors can be satisfied, it may be set aside as fraudulent ngainst those to \yhom the grantor is at the time indebted. A man can not make gifts of his property, and thus take it from his creditors. Spaulding v. Blythe, supra ; Sherman v. Hogland, 73 Ind. 472; Wynne v. Cornelison, 52 Ind. 312; McCormick v. Hyatt, 33 Ind. 546,

It is insisted that other instructions were given, which cured the error contained in that under immediate mention. Contradictory instructions were given, and it was impossible for the jury to ascertain what rule of law the court intended to lay doAvn for their guidance. It is not for the jury to select from .contradictory instructions those which correctly express the law. It is the duty of the .court to state the rules of law without confusion or contradiction. Where an erroneous instruction is clearly and fully Avithdrawn, no harm results, but where it is simply contradicted by another instruction, it is otherAvise.

[433]*433The judgment must be reversed. A reversal, however, will not authorize a judgment upon the appellants' complaint. No ■cause of action is stated. Until an amendment has been made, ■there is no complaint upon which a judgment can be supported. The fundamental error in this case was that committed in overruling the demurrer to the complaint. It is just, therefore, that the appellants should pay all costs back to the first error, as well those of this appeal as those in the trial court. As there was no cause of action stated, the appellants were not entitled to any relief whatever. Another and different complaint is required, or their action must fail. It is not just to tax the appellees with any costs in a case where there never was any cause of aetion alleged against them, and as much as the appellants can reasonably ask is to be allowed the privilege of amending their complaint at the expense of the costs in the trial and appellate courts. If we should adopt the rule that where the appellant’s complaint is found to be bad, the judgment will be affirmed without allowing him an opportunity to amend, we should be doing that which in many cases might result in a denial of justice. A complaint lacking such allegations as demand, notice, that the claim is unpaid, or the like, is in many cases bad on demurrer, and yet these defects are remediable by amendment. To deny an opportunity to amend would, in many cases, be to sacrifice substantial rights. We think that the better practice in such cases is to adjudge costs against the appellant and allow him an opportunity to make good, if he can, his complaint by amendment. If he has a cause of action, he ought to be allowed to enforce it. If he is driven to a new action, the statute of limitations might often defeat him. No substantial injury is done the appellee by this rule. If he is really in the wrong, he can not justly complain, because the appellant is given an opportunity to vindicate his rights. As the costs go against the appellant, the appellee loses nothing. The rule here declared is substantially the same as that laid down by the Supreme Court of the United [434]*434States in the case of Goodman v. Niblaek, 102 U. S. 556. In Robertson v. Cease, 97 U. S. 646, the same court recognize the rule, that, where it appears that a complaint or declaration may be made good by amendment, it is proper to remand with leave to amend. In Buskirk’s Practice, a different rule is-stated, and several cases are cited. Buskirk’s Pr. 119. We-have carefully examined the cases relied upon by the author,, but find in them nothing lending the slightest support to the text. It is undoubtedly true that there may be cases where-the court can readily perceive that no amendment can be made-which will cure the defect in the complaint, and it was probably that class of cases which the author had in mind when he wrote.

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Bluebook (online)
79 Ind. 430, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mccole-v-loehr-ind-1881.