Nichols v. Wallace ( 1889 )

Green, P. J.

The bills of complaint in this record do not charge that Nichols was insolvent at the time he made the conveyance to his wife, but present as grounds for setting aside the deed and granting the relief prayed for, that the wife holds the property in secret trust for the husband, and the conveyance was made to hinder and delay his creditors in the collection of their claims against him. A man in prosperous circumstances, although in debt, may, without consideration and voluntarily, convey property to his wife for the sole purpose of creating a separate estate in her for her support and maintenance. To maintain such conveyance it must be made in good faith and for the purpose indicated, and without design or intent on the part of the grantor to hinder or delay his creditors, and he must, at the time of conveying,, retain in his possession property sufficient to discharge all his debts then existing. Such is the law, briefly stated, applicable in this case and announced in numerous cases by our Supreme Court. Moritz v. Hoffman, 35 Ill. 553; Bridgford v. Riddell, 55 Ill. 261; Bittinger v. Kasten, 111 Ill. 260,.and cases there cited. In the opinion in Bridgford v. Riddell it is said> ‘‘It is not doubted that it is competent for the husband to create a separate estate for his wife out of his own property, if there are no creditors of the husband at the time whose rights will be put in jeopardy, and even if there.are creditors, < if the husband retains a sufficient amount to liquidate their claims, it is still lawful. No one can impeach the transaction or inquire into its propriety, unless he was a creditor of the husband at the time and was thereby injured. . It has never been held to our knowledge that a subsequent creditor can inquire into the fairness of the transaction, even if the conveyances to the wife be regarded as voluntary conveyances without actual consideration, for the so7e purpose of creating a separate estate in the wife. It seems to us that it would be inequitable to hold that a man in his prosperous days could not create a-separate estate for the wife, which should be for her maintenance in case disaster should overtake him in his business transactions in later life; and that the estate thus created for the wife would not be beyond the reach of his subsequent creditors. The law not only sanctions such a course, but in many instances it is nothing more than simple justice to the wife.”

Counsel for appellees do not contend the law is not as above stated, but insist the evidence establishes the truth of the allegations that Nichols conveyed the lands to be held by his wife in secret trust for his benefit, and with intent to hinder and delay his creditors. We do not concur with counsel in this, but after a careful examination of the record are led to the conclusion that the conveyance was made in good faith for the purpose of creating an estate in the wife for her benefit, and without intent or purpose to hinder or delay the creditors of Nichols in the collection of their claims. Direc - ing our attention to his financial condition at the time he executed this deed (and it is the intent and purpose at this time entertained by Nichols we are called upon to determine) we find he then owed H. Seiter & Co. nothing; he owed the claim of Wallace, amounting to §600, and interest from May 6, 1885, due in six months, and at least eight days before the deed to Mary W. Nichols was executed ; and he owed some other debts, small in amount, all of which wére paid before the filing of said bills. At the time of the conveyance lie owned three farms besides the one conveyed, and also an interest in other real estate. There were mortgages then upon the farms but we are satisfied from the evidence that the property retained by Nichols at the timehe conveyed the land in controversy to his wife, was worth, over and above all incumbrances, several thousand dollars, and was not only ample to satisfy all claims against him then existing, but greatly in excess of their aggregate amount. The conveyance was made directly to his wife and the deed recorded on the day it was executed. No creditor was then pressing him, and he and his wife both testify the conveyance was made in pursuance of the promise of Nichols to deed her this land, made at the time of their marriage, and thus it would seem no sudden emergency or sinister purpose prompted'the conveyance; and ever since it was made, she has received all the rents and profits and paid all taxes on the lands conveyed; True, her husband acted as her agent in looking after and managing the farm, and collected the rents, and for two )rears after the conveyance' the grain dea’ers credited him, and sometimes him and the tenant, for the grain delivered from the. land, but this was done without direction from her, or her husband, and she received the money paid Nichols for the grain so delivered. It was natural and proper for him to look after and manage the business for his wife, and she might lawfully permit or employ him to so act as her agent. Oubberly v. Scott, 98 Ill. 38 ; Bennett v. Stout, 98 Ill. 47.

Counsel for appellees invite our attention to the testimony of Tipton, against whom, .jointly with Nichols, H. Seiter & Co. recovered their judgment. This witness testified Nichols told him after said judgment was obtained, “that he had conveyed that farm to his wife for the purpose of having a living out of it; that he would retain it for a living; ” that in reply to the remark of witness, “ Why then did you deed her the place ?” N ichols said, “ I have got to have a living for myself and the children, and for that reason I deeded the property this way.” This testimony is contradicted by Nichols, but aside from that ought not be considered as against the wife. If it is true he made such declarations, she was not present, nor did she admit they were true, and as is said in the case of Bennett v. Stout, supra, “it would violate all rules of evidence to permit his declarations to defeat the title of his grantee.”

We have examined the cases cited on behalf of appellees, and under the facts disclosed by this record find nothing therein to incline ns to a different view of this case than that we have expressed.

We think the decree was not warranted by the evidence and the law applicable to the facts proven, and the same is reversed and the cause remanded.

Reversed and remanded.