Segraves v. Brooks , 123 Ark. 261 ( 1916 )

Wood, J.,

(after stating the facts). Appellant contends that since the assignment or transfer of the note and mortgage in suit, was adjudged by the referee in bankruptcy of the United States District Court to be fraudulent and void, that such assignment did not vest appellee Brooks with any title of the property in controversy and therefore that the appellee could not maintain this suit. This is not a good defense.

(1) “A conveyance to defraud creditors is good, as between parties and their privies but may be avoided by the creditors of the grantor. If they condone the fraud, the conveyance will stand against all comers. ’ ’ Millington v. Hill, Fontaine & Co., 47 Ark. 301; Bell v. Wilson, 52 Ark. 171; Bank of Little Rock v. Frank, 63 Ark. 24. The creditors are not parties to this suit. They may have condoned the fraud.

The statute 3658 of Kirby’s Digest, declaring conveyances and assignments in fraud of creditors void, was enacted for the benefit of creditors and not to enable the debtor to escape his liabilities. Doster v. Manistee National Bank, 67 Ark. 325; 20 Cyc., p. 625b. See Bigelow on Frauds and Conveyances, p. 192, section 14. The court did not err therefore in refusing appellant’s prayer for instructions. The testimony as to verified statement of the account and as to copy of such account being furnished appellant before the institution of the suit, was but in compliance with the provision of section 5415 of Kirby’s Digest, which was necessary in order to enable the appellee to maintain the suit. Lawhorn v. Crow, 92 Ark. 313.

(2) The verdict and judgment were in due form under section 6869, Kirby’s Digest. In Shaffstall v. Downey, 87 Ark. 5, we held: “In replevin to recover a mortgaged chattel from the mortgagor, the mortgagee should have judgment for the property or the balance due on the mortgage. ’ ’ Citing § 6869 supra.

The undisputed evidence shows that there was a balance due on the note of $198.50. The affidavit recited the value of the property and the appellant while denying verbally all the allegations of the affidavit did not testify that the value was not correctly stated therein. There was no issue under the affidavit, which served as the complaint, as to the value of the property; and under the above statute the court correctly rendered a judgment for possession of the property or the balance due under the mortgage.

(3) The appellant urges that the judgment should be reversed, because- the bond did not follow the precise language of § 6863 of Kirby’s Digest. The.bondsmen did not appeal. The appellant was allowed to retain possession of the property under the bond that was executed and he is not in an attitude to complain because the bond in form contained more than is required for a retaining bond.

The contention that there was no testimony to show that the appellee held any account against the appellant, can not be sustained. Appellant did not plead non est factum. He admitted the execution of the note; and the undisputed testimony of Lee Brooks shows that he admitted that he owed the amount secured by the mortgage. If appellant had paid the note, the burden was upon him to show it.

There is no reversible error in the record and the judgment is therefore affirmed.