Strain v. Ferris

272 N.W. 677, 65 S.D. 226, 1937 S.D. LEXIS 30
South Dakota Supreme Court·Decided April 21, 1937·No. File No. 7859.·Published·Cited by 4 cases

Opinions

WARREN, J.

Plaintiff, the Superintendent of Banks of the state of South Dakota, brought an action for the purpose of setting aside a transfer of real property from J. H. Ferris to E. E. Ferris claiming that such transfer -was fraudulent. His statement of the facts and circumstances .pertaining to the transfer is substantially as follo'ws: That J. H. Ferris is the owner of 2-5 shares of stock in the Mitchell Trust Company -which failed on August 8, I933; on September 30, 1933, the conveyances were filed; in December, 1933, an action was brought to set aside the deeds as being fraudulent under the Uniform Fraudulent Conveyance Act (Daws 1919, -c. 209) ; the deed in question -was signed by J. H. Ferris and L. E. Ferris, his wife, was the grantee; the said deed was signed and acknowledged on the 29th day of November, 1919, and it was not recorded in the office of the register of deeds until *228 September 30, 1933, about a month and a half after the Superintendent of Banks took charge of the Mitchell Trust Company as an insolvent institution; there is no evidence to show that L. E. Ferris ever paid any consideration for the deed and that it was never delivered until about September 30, 1933, when it was recorded; the evidence sho'ws that at no time since the year 1929, when there was a pretended delivery of said deed, has J. H. Ferris had any property in South Dakota with which to satisfy plaintiffs claim except a worthless quarter-section of land in Jones county; the property conveyed by the deed in question was worth about $30,000, subject only to a $4,000 mortgage; that the deed was never delivered till the bank closed; that J. H. Ferris, the husband, collected all the rents and income from the real property, signed all leases on the property as owner, and none of them, were signed by L. E. Ferris; that he carried in his own name all insurance on the property until the 21st day of October, 1933, which was a short time after the deed was actually recorded; that he signed all riders and waivers on the insurance policies personally; that in 1925 he filed claim for a fire loss; that in 1932 he again filed a claim for fire loss on the policy of insurance covering the property in question ; the claims were made by him as owner; he collected, in 1932, some $2,800 for fire loss on the property in question, and he deposited the proceeds to his own name at the bank; all rents and receipts from the property were likewise collected by him and deposited in his personal, sole, and individual account; he personally supervised and directed by correspondence and otherwise, all rental arrangements with tenants and agents in charge of the property; all of these things were done with the express knowledge and approval and consent of his wife; the insurance policies were assigned in writing to his wife, L. E. Ferris, on October 21, 1933, at about the same time that he directed the transfer of the rental account in the Mitchell National Bank to his wife, E. E. Ferris; and that by this transaction, the husband became insolvent and unable to pay his obligations: and that thére was no- proof of consideration for the transfer.

We turn now to the statements of the facts in evidence presented by the defendant, which for the purpose of this statement are substantially as follows: At the time of the execution and *229 acknowledgment and -delivery of the deed to his wife, J. H. Ferris was living at Mitchell, S. D.; that they were both registered pharmacists; some time prior thereto, L. E. Ferris had received an inheritance of some $4,000 from her parents, which was put into the business- that they both conducted, and which together with her labor forms a -basis for the consideration in the transfer of the property from J. H. Ferris to L-. E. Ferris; in addition to the property conveyed to the wife, Mr. Ferris owned 320 acres of land in Jones county, S. D., $1,000 worth of stock in an insurance company, 20 shares of stock in the Mitchell National Bank, which he later sold in 1929 for $4,000, 2-5 shares of stock in the Mitchell Realty Company, 25 shares of stock in the Mitchell Trust Company of Mitchell, and- a stock of drugs of the value of $14,000; in 1923 this same stock of -drugs -was sold for $14,000, and J. H. Ferris •moved to California where he and his wife resided until his death; on 'December 18, 1929, J. H. Ferris made a formal delivery of the deeds to the land in question in the presence of witnesses; at that time he owned the properties enumerated immediately above; in August, 1933, an assessment was made of $100 per share on the stockholders of the Mitchell Trust Company; notice thereof was given to the defendant, L. E. Ferris, who thereafter caused the warranty deed to be recorded in the office of the register of -deeds in Davison county, S. D.; shortly thereafter the action to set aside the conveyance was commenced; the defendant E. E. Ferris answered and -claimed to be the owner of the lot; and that the deeds were unconditionally delivered to her on November 29, 1919, -when they were executed, formal proof of -which delivery was made December 18, 1929.

The -circuit court, at the conclusion of the trial, made findings and conclusions and judgment in favor of the plaintiff and against the defendant, decreeing that the real property in dispute, or a portion thereof, should be sold to satisfy the claim of the plaintiff unless plaintiff’s claim-was satisfied -within 60 days of date of judgment. D’efendant, L. E. Ferris, moved for a new trial, which motion -was overruled. She d-s- now appealing from the judgment and the order denying the motion for a new trial.

From the record presented, it is established that J. H. Ferris did, on the 29th day of November, 1919, execute and acknowledge *230 the deeds in question, and that same evening did deliver manual possession thereof to the appellant, L. E. Eerris, the grantee therein named. The evidence shows ¡that statements were made by the grantor as to why he deeded the property to his wife, and testimony to the effect that the grantee took the deeds and was placing them in a safety deposit box with other legal papers.

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Strain v. Ferris, 272 N.W. 677, 65 S.D. 226, 1937 S.D. LEXIS 30 (S.D. 1937).

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