Robinson v. Dryden , 118 Mo. 534 ( 1893 )

Macfarlane, J.

This is a suit in equity by judgment creditors of Wm. J. Dryden to set aside, as fraudulent, a conveyance, made by him to defendant, of a tract-of two hundred and ninety acres of land in Lincoln county. The deed expressed a consideration of $2,500, was dated the second day of Februai’y, 1884, and was filed for record on the seventh day of the same month.

The said Wm. d. Dryden was a member of the firm of W; L. Sturgeon & Co. The firm and all the members failed in a few days after the record of the deed and made a number of mortgages on their partnership and individual property to secure their creditors. The evidence shows, fuidher, that defendant was a brother of Wm. J. Dryden and lived in the state of California; that the grantor continued to reside on the farm and manage it until 1887 and when conveyed it was worth $15 per acre, though afterwards sold by defendant for $2,700. Defendant owned considerable other property in the .neighborhood and Wm. J. Dryden acted as his agent in managing it. These were in substance all the facts proved, which bear on the good faith of the parties to the deed. The evidence was all offered by plaintiff.

A jury was impaneled and issues framed for submission to it, At the conclusion of the evidence offered by plaintiff, at the. request of defendant, the court instructed the jury to find all the issues for defendant and judgment was entered accordingly. From this judgment plaintiff appealed.

I. The finding of issues, in chancery cases, is only advisory and the chancellor is not bound by it. There was no error, therefore, in the court instructing the jury to find all the issues in favor of the defendant if, upon all the evidence, the charges made in the petition were not established by the weight of the evidence. Cox v. Cox, 91 Mo. 71, and cases cited.

II. In order for the creditors of the grantor to 'defeat the. deed for fraud it was incumbent on them to prove that it was made by the grantor with a fraudulent intent and that the grantee had notice of such intent when he purchased. Plaintiff insists that such fraud of the grantor and knowledge thereof and participation therein was sufficiently shown by the following undisputed facts: The insolvency of the grantor; the relationship of the parties; the insufficiency of the price paid; recording* the deed before it could have been delivered to the grantee; and the grantee remaining in possession and control of the land for three years after the sale.

The rule is that fraud must be proved and cannot be presumed, and, if the facts shown are all consistent with an honest purpose, honesty in the transaction should be inferred. The relationship of the parties and the insolvency of the grantor are not sufficient in themselves to establish fraud, “but these when added to other suspicious circumstances, may often furnish satisfactory evidence of fraud.” Renney v. Williams, 89 Mo. 86, and cases cited; Chapman v. McIlwrath, 77 Mo. 44.

In this case it was not shown that the money received on the sale of the land was concealed or put out of the reach of the creditors of the grantor; or of the firm of which he was a member. For all that appears, an honest application of the proceeds of the sale may have been made in payment of his debts. If such disposition was made' of it, the fact of insolvency, instead of furnishing a badge of fraud, would serve to explain the necessity of an immediate sale at a price below the actual value of the land.

Ordinarily the fact that the grantor remained in possession and control of the property conveyed would be a circumstance throwing much suspicion upon the good faith of both parties, but the fact of the relationship of the parties in this case and their circumstances ‘tend rather to allay than to create such suspicion. The grantor and grantee were brothers, the former apparently in good circumstances, residing in the state of California; the latter was brought suddenly from comfort to insolvency. Our confidence in humanity does not permit us, without evidence, to attribute a selfish and fraudulent motive to an act of apparent brotherly kindness and generosity.

The fact that the deed was not forwarded to defendant. in California is evidence tending merely to prove that the grantor filed it for record. If done under direction of defendant it was a good delivery and should create no suspicion. It is no unusual act in such circumstances, for the grantor to have the deed recorded. Pearce v. Dansforth, 13 Mo. 364; Kane v. McCown,. 55 Mo. 198.

It is true, the evidence shows that the consideration named in the deed, which must be taken as the price paid, was less than the.market value of the land. We are not informed by the evidence of what urgency may have existed for making a sale, even at a sacrifice. If the sale had been a mere pretense and fraud there is no doubt the consideration would have expressed full value. Moreover, the defendant, after keeping the land for three years, only realized on a sale a profit of $200.

We are of the opinion, from all the evidence, that plaintiff did not establish a fraudulent intent on the part of the grantor and we are unable to discover a reasonable suspicion against the good faith of defendant. Judgment affirmed.

All concur.