Thomas v. Shoots

651 S.W.2d 663, 1983 Mo. App. LEXIS 3192
CourtMissouri Court of Appeals
DecidedMay 3, 1983
DocketNo. WD 33126
StatusPublished
Cited by5 cases

This text of 651 S.W.2d 663 (Thomas v. Shoots) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thomas v. Shoots, 651 S.W.2d 663, 1983 Mo. App. LEXIS 3192 (Mo. Ct. App. 1983).

Opinion

LOWENSTEIN, Judge.

Bob and Ruby Shoots appeal from an adverse judgment in an equity action brought by Bob’s former wife, Mildred Thomas.

For failure to pay alimony to Mildred, she sought to set aside a subsequent transfer of real estate from Bob to himself and his present wife, Ruby, under § 428.020 RSMo. 1978.1 Mildred further sought to set aside, as a fraudulent conveyance, the transfer of his stock in Advance Electric, Inc. The trial court did not void the stock transfer but did set aside the real estate transfer, this real estate being the building housing Advance Electric, Inc. located in Grand-view, Jackson County, Missouri (Lot 5, GOLDEN HEIGHTS ADDITION). The only question on appeal is whether the trial court was correct in setting aside the deed upon a finding that Bob’s transfer to himself and Ruby, creating title in them as tenants by the entirety, was voluntary and without consideration and for the purpose of hindering, delaying and defrauding Mildred as a creditor of Bob.

A chronology of events may shed some light upon the dispositive facts of this case.

August, 1973 — Bob and Mildred were divorced in Cass County, Missouri. A judgment requiring Bob to pay $350 per month alimony was entered. Payments due on the 16th of the month.
1974 — Bob and Ruby married.
November 15, 1976 — Bob filed to modify downward or cancel alimony payment to Mildred. Court raised judgment to $400 per month.
November 25,1976 — Mildred received November alimony payment.
December, 1976 — On the 20th Bob deeded the property in question to himself and Ruby. This deed was recorded on the 29th. On the same date Ruby deeded her house and several lots owned by her to herself and Bob. These deeds were recorded on the 30th.
January, 1977 — Having all the stock in Advance, Bob transferred one-half to his brother, the remainder to Bob and Ruby.
January 23, 1977 — Mildred received payment for December, 1976 installment.
February 19, 1977 — Mildred received the January, 1977 payment.
April, 1977 — Mildred received $1200 representing February, March and April payments. This was the last payment made by Bob on the judgment until October 1, 1980, two days before this ease was tried.
July, 1977 — Bob ordered to make payments through Cass County Circuit Clerks Office on the 16th of each month. Judgment for Mildred against Bob $3600 for delinquent payments. Execution on judgment returned unsatisfied.
December, 1977 — Motion for contempt filed against Bob.
February, 1978 — Execution returned nul-la bona.
April, 1978 — Judgment debtor’s examination of Bob.
October, 1978 — Petition filed in Jackson County in this case to set aside transfers of real estate and stock.
July, 1980 — Motion to modify filed in Cass County and second amended petition filed in Jackson County. Claim made, Bob was $15,200 in arrears on July, 1977 judgment.
September, 1980 — Execution issued— $16,000 back payments due from Bob.
October 1, 1980 — Bob pays $16,000 in Cass County leaving approximately $2,000 owing in interest.
October 3,1980 — Trial Jackson County on this cause.
May 29, 1981 — Although dated May 29, 1980, judgment entered in Jackson County setting aside real estate conveyance. The court found the real estate deed was entered while Bob was indebted to Mildred, was without consideration leaving Mildred no adequate remedy at law to satisfy the Cass County judgment.

[665]*665The defendants Bob and Ruby Shoots allege error in that there was substantial consideration for the deed, that Mildred was a “subsequent creditor” and that the trial court should not have granted equity relief since Mildred was pursuing other legal remedies in other courts and that she had already received “full and complete relief.”

The scope of review in this case is under Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). Upon this review the judgment of the trial court is affirmed.

Section 428.020 as it applies here holds that every conveyance of any estate in lands made with intent to hinder, delay or defraud creditors shall, as against those creditors be deemed utterly void.

Bob claims in his first point no such mental intent to defraud could be imputed to him by the circumstances since there was consideration for the deed. He relies upon Commercial Bank of Boonville v. Kuehner, 135 Mo.App. 63, 115 S.W. 115 S.W. 510, 511 (Mo.App.1908) which holds that where there is valuable consideration for the transfer the conveyance is not voluntary, not presumed fraudulent and actual intent to defraud must be found to defeat the conveyance. In Kuehner the husband and defendant wife had judgment rendered against them by the bank. The wife being insolvent, assigned a note payable to her from her husband to secure payment of an obligation owed by her husband to Vollrath. Vollrath received payment on this note from the husband’s bankruptcy estate and the bank sought to set aside the transfer as being without consideration. The bank’s claim failed, the court saying the transaction was in essence a pledge to secure payment of a debt and imports a valuable consideration. The facts in this case are not the same as in Kuehner. Since intent to defraud is rarely shown by direct evidence Missouri courts have recognized certain circumstances referred to as badges of fraud which frequently attend conveyance to hinder, delay or defraud creditors. Cohoon v. Cohoon, 627 S.W.2d 304 (Mo.App.1981). These badges of fraud from which the presence of fraud may be inferred are:

These badges of fraud are: conveyance to a near relative; a conveyance in anticipation of suit; a transfer of all or nearly all of a debtor’s property; insolvency; unusual clauses in instruments or unusual methods of transacting business; retention of possession by the debtor; inadequacy of consideration; and the failure to produce abutting evidence when the circumstances surrounding the transfer are suspicious.

Id. at 307. The presence of several of these badges raises a presumption of fraud. As noted in Barnard v. Barnard, 568 S.W.2d 567, 570 (Mo.App.1978) the transfer of the property into an estate of tenancy by the entirety in favor of the husband and present wife are “particularly suspicious, and their good faith must be so clearly shown that there is no reasonable doubt as to the honesty of the transaction.” Once the plaintiff presents evidence of a voluntary conveyance where some of these badges of fraud are present there exists a prima facie case and the burden of going forward and to show good faith shifts to the defendant. Tockman v. Shower Doors, Inc., 568 S.W.2d 74, 78-79 (Mo.App.1978).

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Mark VII, Inc. v. Barthol
926 S.W.2d 128 (Missouri Court of Appeals, 1996)
Security Counselors, Inc. v. Commissioner
1989 T.C. Memo. 580 (U.S. Tax Court, 1989)
United States v. Morton
682 F. Supp. 999 (E.D. Missouri, 1988)
Costley v. Costley
717 S.W.2d 540 (Missouri Court of Appeals, 1986)
United States v. Jones
631 F. Supp. 57 (W.D. Missouri, 1986)

Cite This Page — Counsel Stack

Bluebook (online)
651 S.W.2d 663, 1983 Mo. App. LEXIS 3192, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thomas-v-shoots-moctapp-1983.