Case ID: iowa_129/html/0317-01.html
Source: Caselaw Access Project
Author: {"author": "McClain, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

A. M. Campbell, Admr., Appellant, v. L. E. Campbell, Lulu E. Jackson, Charles F. Jackson, and Susie B. Campbell.
    1 Fraudulent conveyances: burden of proof. A voluntary conveyanee to a child is constructively fraudulent as to existing creditors where the grantor does not retain sufficient property to satisfy his debts; and the burden is on the grantee to show that the remaining property of the grantor is sufficient for that purpose.
    2 Presumption as to remaining property. A return of an execution of “ no property found ” raises a presumption that the debtor did not, at the time of a previous voluntary conveyance, have sufficient property remaining to satisfy'his debts, and this presumption can only be overcome by a showing that he in fact had such remaining property.
    3 Presumption as to foreign laws. Where the law of another state is not alleged and proven, it will be presumed to be the same as the law of this state.
    4 Homesteads: exemption of proceeds. The proceeds of a homestead located in a foreign state which are represented by notes held in this state are subject to execution here, except as affected by the exemption law.
    3 New trial: surprise. A new trial will not be ordered on the ground of surprise, where the proffered additional evidence would not have required the entry of a different decree.
    
      Appeal from Hardin District Court.— Hon. W. D. Evans, Judge.
    Thursday, January 11, 1906.
    Action to set aside conveyances by L. E. Campbell to his children, Erank W. Campbell and Lulu E. Jackson, co-defendant in this action, for fraud as against plaintiff, the administrator of the estate of the mother of L. E. Campbell. Decree for the defendants, from which plaintiff appeals.—
    
      Affirmed.
    
    
      
      Albrook & Lundy, for appellant.
    
      Ward & Hays, for appellees.
   McClain, C. J.

The mother of L. E. Campbell died in New York in 1897, holding a claim against him on which judgment was rendered against him in this state in the year 1901 for $1,544. This claim, it appears, originated in 1869. The indebtedness was denied by L. E. Campbell, and from the judgment he appealed to this court, and the judgment was affirmed in 1903. Soon after the claim was first made against L. E. 'Campbell in 1897 by the administrator of his mother’s estate, he conveyed to his son, Frank W. Campbell, 170 acres of land in Hardin county for the consideration of $1,000 paid in cash and an agreement on the part of grantee to pay $500 to his sister, Lulu E. Campbell, now Mrs. Jackson, codefendant in this action. About the same time he conveyed an 80-acre tract of land to Lulu E. Campbell, and another 80-acre tract to Harry Campbell, subject to an obligation to pay $500 to said Lulu E. Campbell. The land conveyed to Harry Campbell has since been purchased by Charles E. Jackson, husband of Lulu E., and, as Jackson is shown to be a purchaser for value, the conveyance cannot be set aside as to him. It appears, however, that the conveyance to Frank W. Campbell was without consideration, save as to the $1,000 paid, and the assumption of the obligation to Lulu E. Campbell to pay $500, and the land is agreed to have been worth at that time $35 an acre. The conveyance to Lulu E. Campbell was wholly voluntary, as was also the conveyance to Harry Campbell, saving the $500 agreed to be paid to Lulu E. Campbell.

For appellant it is contended in the first place that, there was actual fraud in these conveyances participated in by the grantees such as to warrant the court in setting them aside; but we think the allegation of fraudulent intent is not made out. To establish^ actual fraud tbe burden is on tlie plaintiff, and the evidence does not support the claim. Klay v. McKellar, 122 Iowa, 163. But a voluntary, conveyance, even to children as to whom there may be presumed an inducement by way of love and affection, is constructively fraudulent as to an existing creditor, unless the grantor had remaining after the conveyance sufficient property to satisfy the claims of his creditors; and the burden is on the grantee to rebut the constructive fraud by proving that the remaining property of grantor was sufficient for this purpose. Elwell v. Walker, 52 Iowa, 256; Ware v. Delahaye, 95 Iowa, 667; Baxter v. Hecht, 98 Iowa, 531; Lloyd v. Fulton, 91 U. S. 479, (23 L. Ed. 363).

The question, of course, is as to the financial condition of the grantor at the ' time the conveyances were made; but, when it appears subsequently that he has no property remaining sufficient to meet the claim of a cred-4 4 , itor existing at the time the voluntary con- ° ^ ** veyance was made, it will be presumed that such insolvent condition existed immediately after the voluntary conveyance, unless the contrary is shown. Strong v. Lawrence, 58 Iowa, 55; Tyler v. Budd, 96 Iowa, 29; Seekel v. Winch, 108 Iowa, 102; Gardiner Savings Ins. v. Emerson, 91 Me. 535, (40 Atl. Rep. 551). When execution was finally issued on the judgment of plaintiff against L. E. Campbell, it was returned by the sheriff with the statement that no property of the execution defendant could be found, and the presumption from such return would be, according to the authorities already cited, not only that he then had no property to meet plaintiff’s claim, hut- that he had no such property remaining after the making of the voluntary conveyance; and this presumption is to be met and overcome only by evidence that he had sufficient property after the conveyances to meet the claim, which has been dissipated by some casualty or loss. It seems that it is not sufficient to show that by the ordinary fluctuations in the value of the property that which was at the time sufficient has subsequently become insufficient to extinguish the creditor’s claim. Elwell v. Walker, 52 Iowa, 256.

It appears from the evidence that at the time these voluntary conveyances were made L. E. Campbell was not indebted otherwise than on this claim in favor of his mother’s estate, and he had remaining the $1,000 received from his son, Frank W. Campbell, paid as part consideration for the conveyance to him, a claim of $500 against one Hass, which was subsequently collected by judicial proceedings, and $4,700 in notes received in part consideration of the sale of his former homestead in Chicago, and secured by mortgage on the property. If this personal property was subject to the claims of creditors, and was reasonably available within the state for the satisfaction of his indebtedness to plaintiff, then he had ample means to meet such -claims, and the voluntary conveyance to his children should not be set aside in satisfaction of his indebtedness. Substantially the only contention with reference to this personal property is aé to whether the $4,700 evidenced by notes which were a part of the proceeds of the sale of the Chicago homestead, and secured by a mortgage thereon, constitute an asset available to creditors in this state.

It is argued in behalf of the plaintiff that under the law of Illinois the proceeds of the homestead are exempt from the claims of creditors. But, as the law of Illinois is not alleged nor proven, it must be presumed i -i • 1 • í 1 to be the same as the law m this state; and under our statutes and decisions the proceeds of a homestead are only exempt for a reasonable time, during which they are held for the purpose of investing them in another homestead. Benham v. Chamberlain, 39 Iowa, 358; Huskins v. Hanlon, 72 Iowa, 37; Schuttoffel v. Collins, 98 Iowa, 576.

It does not appear that at the time these conveyances were made L. E. Campbell could have acquired a homestead if he had desired to do so, for the evidence indicates that he was a widower without family depend-. ent upon .him. Nor is there any indication 1 n - , . that he had any intention oi attempting' to acquire a homestead. The proceeds of his former homestead were therefore subject to the payment of his debts. But it is further argued that the proceeds of the homestead could not be reached in this state. • It appears, however, that he had the notes in his possession in Ilardin county, and we see no reason why they were not available to the creditor-under an execution. If L. E. Campbell had attempted to conceal or withhold them, he could have been compelled by proceedings supplemental to execution to disclose and surrender them for the benefit of his creditors. There is no evidence, however, of any attempt to put or keep them beyond the reach of plaintiff, and we are justified in finding that, if plaintiff had at the time been in position to enforce his claim, it could have been satisfied by levying upon these notes. It is to be borne in mind that plaintiff was not in condition to enforce his claim by execution until several years later, and in the meantime, as L. E. 'Campbell testified, he had lost considerable money by speculations.

As the primary inquiry was whether L. E. Campbell had remaining, after the voluntary conveyances were made to his children, property amply sufficient and available to meet his existing indebtedness, and as we find that he had such property, we concur in the conclusion of the trial court that plaintiff is not entitled to have the conveyances to the children set aside.

In his motion for a new trial plaintiff asked that he be allowed opportunity to show by additional evidence that L E. Campbell did not have, at the time the voluntary conveyances were made, the property disclosed by him in his evidence, and it was urged that plaintiff had been taken by surprise and could meet and overcome Campbell’s testimony if he were allowed an opportunity to do so. But, so far as any specific showing was made, it related to a tract of land in another county, which Campbell claimed to have received from his son Harry in exchange for the eighty acres deeded to his son, which we have in the prior discussions of the case treated as a purely voluntary conveyance, subject only to the obligation to pay $500 to his sister. It appears that the introduction of this evidence would not have required an entry of any different decree from that which was entered by the trial court. The attempted showing as to evidence to contradict Campbell’s testimony with reference to the possession of the notes for $4,700, proceeds of the homestead was entirely insufficient. There was no showing that any such evidence could be produced, had a new trial been granted.

Under the record the decree of the trial court was correct, and it is affirmed.

Weaver, J., takes no part.