Schaefer v. Fisher

137 Misc. 420, 242 N.Y.S. 308, 1930 N.Y. Misc. LEXIS 1305
New York Supreme Court·Decided May 2, 1930·Published·Cited by 8 cases

Opinion

Townley, J.

This is an action in equity brought by the plaintiff to declare null and void as a fraudulent conveyance a certain written instrument dated July 1, 1924, and acknowledged July 14, 1924, at Lausanne, Switzerland, alleged to be a release or transfer by the defendant Blanche Morange Rausch of all her interest in her father’s estate and to subject the interest of said defendant Rausch in said estate to the lien and to procure satisfaction of a certain judgment secured against said defendant Rausch by this plaintiff in the Supreme Court, New York county, on February 2, 1925, for the sum of $100,194.50, damages and costs, in an action brought by plaintiff for the alienation by said defendant Rausch of the affections of plaintiff’s husband, together with appropriate incidental relief. The said judgment recovered February 2, 1925, was and is in all respects a good and vahd judgment. There was a substantial compliance with the statutory provisions relating to attachment and to service of process by publication, and the contentions of the defendants that jurisdictional defects exist in respect to the acquirement of jurisdiction over the defendant Rausch and over the trust res within this State are in all respects overruled. The alleged defects complained of by the defendants are not jurisdictional defects, but at most, if defects at all, are mere immaterial irregularities. On October 6,1924, the court duly issued a vahd warrant of attachment in said action for ahenation of affections. On or about October 16, 1924, the sheriff of Westchester county made a vahd levy under said warrant upon the remainder interest of the defendant Rausch in her father’s estate by due service of the necessary papers prescribed by statute upon Mary M. Fisher, individually and as executrix, pursuant to subdivision 3 of section 917 of the Civil Practice Act. The case of Judds v. Martin (218 App. Div. 402), cited by the defendants, in no way concerns an attachment upon a remainder interest, but relates solely to the question whether an attachment could be levied upon an income of a trust fund. The court in Judis v. Martin (supra) in its opinion by Dowling, J., states: “ But it is to be noted that the levy of the attachment [under section 916, Civil Practice Act] is limited to a right or interest of defendant to any of the estate of a deceased person which may belong to him and which could be legally assigned by him as legatee or distributee. [Italics of the court.] The right of a beneficiary to enforce the performance of a trust to receive the income of personal [423] property and to apply it to the use of any person cannot be transferred by assignment or otherwise. (Pers. Prop. Law, § 15, subd. 1, as amd. by Laws of 1911, chap. 327.) The trust in the instant case is one to receive the income of personal property. But the same provision is to be found in the Real Property Law [§ 103, subd. 1].” As a matter of fact and of law, no prior levy of attachment was at all necessary under subdivision 3, section 232 of the Civil Practice Act, to support the order of publication of November 3, 1924, because at that time the defendant Rausch was a resident of the State of New York. The new article 10 (sections 270-281) of the Debtor and Creditor Law, entitled Fraudulent Conveyances,” added by chapter 254 of the Laws of 1925, effective April 1, 1925, is a remedial statute designed to furnish a creditor as therein defined full, complete and speedy relief against his fraudulent debtor, and should receive a liberal construction to accomplish that purpose. Its provisions are merely declaratory of common-law principles, with the single radical change that a judgment at law and the return of an execution thereon unsatisfied are no longer necessary to enable a creditor to maintain an action to annul a fraudulent conveyance. Even if defendants’ objections respecting alleged procedural defects had merit, which they have not, this statute renders them untenable and without effect. In American Surety Co. of New York v. Conner (251 N. Y. 1, at pp. 6 and 7), May 28,1929, in the Unanimous opinion of the court, Chief Judge Cardozo states: Article 10 of - the Debtor and Creditor Law is substantially the same as the Uniform Fraudulent Conveyance Act, prepared by the Commissioners for the Promotion of Uniformity of Legislation in the United States, and is to be so interpreted and construed as to effectuate its general purpose to make uniform the laws of those States which enact it ’ (Debtor and Creditor Law, §• 281). * * * We think the effect of these provisions is to abrogate the ancient rule whereby a judgment and a lien were essential preliminaries to equitable relief against a fraudulent conveyance. The Uniform Act has been so read in other States. (Citing cases.) * u * * A creditor may insist upon the satisfaction of his debt out of any property of the debtor fraudulently conveyed.”

The present equitable action is not purely in personam, but is substantially in rem or quasi in rem. A court of equity, having once acquired jurisdiction, will retain hold of the subject-matter for all purposes and not lift its hand until plenary and perfect justice is done, as near as may be, under the issues; equity deals with the kernel of things and not the mere shell; form gives way to substance and the matter is adjudicated according to the real nature of the transaction, the relief being adapted and measured by the situation [424] at the time of the final decree. The summons and complaint in the present action were served upon the defendant Mary M. Fisher, individually and as executrix, on June 29, 1928. On July 31, 1928, the court made an order for the service of the summons and complaint herein by publication upon the defendant Blanche Morange Rausch. The said order of publication was amply supported by adequate affidavits, and was proper and valid in all respects and in accordance with subdivisions 1 and 6 of section 232 of the Civil Practice Act. The provisions of said order of publication were duly complied with by the plaintiff, both as to publication and mailing.

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Schaefer v. Fisher, 137 Misc. 420, 242 N.Y.S. 308, 1930 N.Y. Misc. LEXIS 1305 (N.Y. Super. Ct. 1930).

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