Lockard v. Nash , 64 Ala. 385 ( 1879 )

BRICKELL, C. J.

The correctness of the decree, so far as it affects the appellant personally, is the only question now presented; the other parties bound and charged by it not having joined in the appeal, or in the assignment of errors. Conceding that the gift of the cotton to appellant, by his father, in 1865, could not have been supported as against the creditors of the donor, and that the appellant could have been compelled to account to them for its value, or for the money into which he converted it by sale, actual fraud, and no intent to hinder or delay subsequent creditors, being either averred or proved, no other than creditors existing when the gift was made could impeach it.-r-Huggins v. Perrine, 30 Ala. 396; Stiles & Co. v. Lightfoot, 26 Ala. 442, Miller v. Thompson, 3 Port. 196. The only debt due either of the complainants, existing in 1865, when the gift was made, is that of Nash, as administrator of McCorkle, contracted in December, 1860, on which judgment was obtained, or is claimed to have been obtained, on the 13th April, 1875. The other debts were contracted in 1869, and 1871. The error of the decree, so far as the appellant is charged with the payment of any part of the debts contracted by the donor subsequent to the gift, is apparent.

We repeat, the pleadings do not impute to either donor or donee actual fraud — no intent to hinder or delay present or future creditors. From motives of affection and generosity, a father of ample ability, so far as is shown by either pleadings or proofs, to pay all his existing debts, not contemplating the creation of future debts, openly makes a gift to his son, of personal property, which the son, in the usual course of business, converts into money, at its value in the markets. An existing creditor can compel the application of the money received to the satisfaction of the donor’s debt. The right of the creditor does not spring out of any contract between him and the donee. It arises by operation of law, upon the broad principle that justice must precede generosity, and that the claims of creditors, who have parted with a valuable consideration, must be satisfied before the claims of others, resting merely on affection or generosity, can be recognized. The money derived from the sale of the cotton, was money held by the donee in trust for existing creditors. The liability of applying it to their satisfaction arose, and was complete, on the day it was received. The trust was implied, or constructive : it was created by the law; it was imposed on the donee in invitum. The statute of limitations operates to bar the enforcement of such trusts; and when there has been no concealment — when the gift is of personal property, and the transaction is open, attended with all the publicity usually attending similar transactions; if creditors permit six years to elapse, without suit to enforce their rights, the donee may invoke the statute for his protection. — Snodgrass v. Br. Bank at Decatur, 25 Ala. 161; Martin v. Br. Bank at Decatur, 31 Ala. 115.

The orders and decrees of the chancellor, so far as they charge appellant with the payment of any part of the,debts claimed by the complainants, must be annulled and reversed, and a decree here rendered, dismissing, as to him, the original bill.