McGahan v. Crawford , 39 S.C. 64 ( 1893 )

The opinion of the court was delivered by

Mr. Justice McGowan.

Previous to the 1st of January, 1885, the defendants, D. R. and W. R. Crawford, brothers, were partners in business at Goldsville, Laurens County, and, to all appearances, doing a prosperous business. But it now appears that they were then indebted to wholesale merchants in large sums. The plaintiffs in February, 1885, obtained a judgment against D. R. & W. R. Crawford for $760.85, and about the same time nineteeu other judgments were obtained against them, amounting in the aggregate to a very large sum. And on December 20, 1890, the plaintiffs instituted this proceeding, for the benefit of themselves and other creditors, against the brothers of the said firm of Crawford, and their sister, Dolly M. Crawford, charging, among other things, that at the date of their aforesaid judgment, in the early days of January, 1885, they, being totally insolvent, conveyed and assigned to their sister, Miss Dolly M. Crawford, their entire property, consisting of notes, mortgages, choses in action, accounts, and about 1,300 acres of land, in different tracts. The consideration mentioned in these deeds was some $12,000 or more. Miss D. M. Crawford did not reside on any of this property at the time, nor has she resided there since. Her brother, D. R. Crawford, was her general agent to transact all of her business. That the said assignment was prearranged between said defendants for the purpose of defrauding the creditors of the said D. R. & W. R. Crawford, and that the sale was without consideration and void. That the said conveyances covered the entire property of the brothers, and were equivalent to an assignment, and as such were in violation of the law of the State. That the fraud was not discovered by the plaintiffs until within the last six years. Wherefore', the prayer was that said assignments and conveyances be declared void, and that said defendants account for said property, &c. The defendants auswered, denying every charge in the complaint, and insisting that every transaction between the parties was bona and pleading- the statute of limitations.

It seems that much testimony was taken in open court by his honor, Judge Fraser, who held: (1) That inasmuch as there was no allegation in the complaint that Miss D. M. Crawford, to whom the transfers of the property were made, was a creditor, no case was made out under the assignment act, even if the allegations of the complaint are assumed to be true. (2) That the allegations of actual fraud made it necessary to show that the creditor was jparticeps criminis, in order to defeat the claim under the deed or deeds by which property is transferred, and it was not shown that Miss Crawford had notice of the insolvency of her two brothers, or of the fact that they had conveyed to her all of their property. He further held that-, if the plaintiffs have any claim, it is not barred by the statute of limitations; but he dismissed the complaint. From this decree the plaintiffs gave due notice of appeal upon sundry grounds, all stated in the record. Most of them are as to pure questions of fact, and, from the view which the court takes, it will not be necessary to refer specifically to any of them but the first three, viz: “(1) Because, it is respectfully submitted, his honor, Judge Fraser, erred in not holding that the complaint was sufficient under the law known as the ‘Assignment Act.’ (chap. 72, Gen. Stat.) (2) Because he erred in not amending said complaint to conform to the said assignment act, and in not rendering-judgment for the plaintiffs in conformity to the evidence. (3) Because he erred in not recommitting the cause, with leave to the plaintiffs to amend the complaint as they might be advised, to conform to the proof,” etc.

1 2 The complaint certainly stated very strongly some of the usual badges of fraud, but there was no distinct allegation that Miss Crawford was a creditor to a large amount of her brothers, codefendants, and that the aforesaid conveyances of their property were in payment of her claims as creditor, thus giving an unlawful preference under t-he'assignment act. And we cannot, therefore, say that the Circuit Judge committed error, in holding that “no case was made out under the assignment act.” See Miller v. Hughes, 33 S. C., 630. It is a little remarkable that the joint answer of the defendants also failed to state that Miss Crawford was a creditor of her brothers, or that the aforesaid conveyances were executed to her in discharge, in whole or in part, of her claims as such creditor. But, on the contrary, the answer of the defendants stated, in the most general way, that every transaction had between the parties was based upon a full and valuable consideration, and was entirely free from all fraud, or intention to defraud anybody; thus indicating that she was a purchaser bona fide, and for full value. This may account for the fact that no motion was made to amend the complaint in the matter to which objection was made. In looking through the case, it seems that the whole of it was not heard, or at least not considered, and that there may possibly be enough in it to authorize the court to remand it to the Circuit Court for a new trial, when the whole case and all parties may be heard, with leave to the plaintiffs, if so advised, to apply to that court for such amendments as may be deemed proper to effect the ends indicated. Elder v. Greene, 34 S. C., 169.

The judgment of this court is, that the judgment of the Circuit Court be reversed, and that the case be remanded to the Circuit Court for a new trial, with leave to the plaintiffs, if so advised, to apply for such amendments of the complaint as may be deemed proper by the Circuit Court.

Mr. JUSTICE Pope concurred.