Case Name: CLARA PYBUS KNAPP, Administratrix of the Estate of RALPH H. PYBUS KNAPP, Deceased, Respondent, v. GEORGIA KNAPP, Appellant
Court: St. Louis Court of Appeals
Jurisdiction: Missouri
Decision Date: 1906-04-10
Citations: 118 Mo. App. 685
Docket Number: 
Parties: CLARA PYBUS KNAPP, Administratrix of the Estate of RALPH H. PYBUS KNAPP, Deceased, Respondent, v. GEORGIA KNAPP, Appellant.
Judges: All concur.
Reporter: Missouri Appeal Reports
Volume: 118
Pages: 685–708

Head Matter:
CLARA PYBUS KNAPP, Administratrix of the Estate of RALPH H. PYBUS KNAPP, Deceased, Respondent, v. GEORGIA KNAPP, Appellant.
St. Louis Court of Appeals,
April 10, 1906.
(Opinion by Bland, P. J.)
1. FRAUDULENT CONVEYANCES: Fraudulent Grantee. The administrator of an intestate can not recover from the fraudulent transferee, money disposed of by the intestate for the purpose of defrauding his creditors.
2. BAILMENT: Money. The rule that there can be no bailment unless the identical thing bailed is to be returned to the bailor does not apply to money which came into the possession of the bailee, knowing that it belonged to the bailor, without any agreement, and which was deposited by the bailee to her own credit in a bank; the same sum of money she received was in law the same money.
(Nortoni, J., on Motion for Rehearing.)
3. -: -. The opinion in this case is not in conflict with the case of Coleman v. Lipscomb, 18 Mo. App. 443, nor with the case of Corn v. City of Cameron, 19 Mo. App. 583, both of the Kansas City Court of Appeals, and it will therefore not be transferred to the Supreme Court on account of conflict.
4. -: -: Intention. Where the money of one comes into possession of another with the intention that it should be a bailment, the law will treat it as such, though the bailee deposited the money to his own account in the bank; the evidence in this case is examined and held sufficient to support a finding that the parties intended a bailment, so that the administrator of the bailor could recover the same sum of money from the bailee, though it was not the identical money.
5. -: Fraudulent Conveyances. The administrator of a bailor can recover from the bailee property placed in bailment with the fraudulent intent to defeat the rights of the bailor’s creditors because there was no transfer of title and the title to the property still remained in the bailor.
6. -: -: Executed Fraud. And this may be done although the fraudulent purpose of the bailment was fully accomplished'. The rule that a fraudulent grantor cannot recover property conveyed- in fraud of creditors does not apply; the bailee is precluded by the nature of the transaction from setting up the illegality of the bailment.
7. -: -: Locus Poenitentiae. The rule that a fraudulent grantor may repent and recover the thing fraudulently conveyed, only while it is executory, does not apply to a case of bailment.
Appeal from St. Louis City Circuit Court. — Hon. Warwick Hough, Judge.
Reversed and remanded (with directions).
John 8. Leahy and Bond, Marshall & Bond for appellant.
(1) The general rule of law applicable to the last proposition is clearly stated in 14 Am. and Eng. Ency. of Law (2 Ed.), page 273, et seq. And this has been the rule in Missouri (as.announced not only by the Supreme Court, but by both Court of Appeals), almost since Missouri became a State. Brown, Adm., v. Finley, 18 Mo. 378. In this case it was pointed out that this rule obtained everywhere, except in States having peculiar statutes on the subject, and it was expressly held that an administrator could not recover personal property of his intestate which had been disposed of by the intestate in fraud of his creditors, even though the estate be insolvent. The rule laid down has been followed ever since, both with respect to real property and personal property, without any distinction being drawn as to the character of the property. Hamilton v. Scull’s Adm., 25 Mo. 166; George v. Williamson, 26 Mo. 190; Jackman v. Robertson, 64 Mo. 292; Hall v. Calaban, 66 Mo. 323; Zoll y. Soper, 75 Mo. 462; Tyler v. Larimore, 19 Mo. App. 445; Rozelle y. Harmon, 29 Mo. App. 569; Hayes y. Fry, 110 Mo. App. 20, 83 S. W. 772. (2) The law is also well settled in this State that an administrator of a fraudulent grantor, who is also a judgment creditor of the fraudulent grantor, cannot maintain an action to set aside a fraudulent transfer by the deceased. Goldstein v.„ Winkelman, 28 Mo. App. 432. The same rule obtains as to the heir or devisee of the fraudulent grantor. Ober v. Howard, 11 Mo. 425; Thomas v. Thomas, 107 M'o. 459, 18 S. W. 27; Davidson v. Dockery, 179 Mo. 696, 78 S. W. 624.
W. W. Henderson and Goalee & Trigg for respondent.
(1) (a) An agent, having received from his principal goods or money for the avowed purpose of shielding same from the principal’s creditors, will not be heard to set up the fraudulent nature of the transaction in order to defeat a recovery of same by the principal. So long as the illegal design has not been accomplished there remains to the principal a locus poenitentiae. Gowan’s Admr. v. Gowan, 30 Mo. 472; Block v. Darling, 140 IJ. S. 234; Taylor v. Bowers, 1 Q. B. D. 291; Adams Express Co. v. Reno, 48 Mo. 264; Bowes v. Foster, 2 H. .& N. (Court of Exchequer) 779. (b) Where a party, being in possession of personal property, admits that he is the custodian thereof for another, the relation of bailor and bailee is thereupon created — it not being-essential that the formality of a redelivery of the res be gone through with. “In such case mere words are sufficient to pass the title.” Allgear v. Walsh, 24 Mo. App. 144; Robinson v. Haas, 40 Cal. 474; Lide v. Lide’s Admr., 32 Ala.. 449; Beale on Bailments (1900), pp. 284 and 280; Hale on Bailment's (1896), pp. 13-14. (2) The declarations of a party, while in possession of either realty or personalty, and made in disparagement of his title, or in explanation of the character of his possession, have always been deemed admissible evidence tending to show in whom the real ownership and title rested. Meier v. Meier, 105 Mo. Ill; Anderson v. McPike, 86 Mo. 293; Oavin v. Smith, 24 Mo. 221. It, therefore, follows that the admission of the appellant, made on the 9th day of February, 1903, to the effect that the money then in her possession was the property of plaintiff’s intestate, created the relationship of bailor and bailee between the parties. But, independently of the transaction of February 9, 1903, the evidence being that it was never contemplated by the parties that title to the funds should vest in the appellant, it is unimportant to inquire as to whether the identity of the res was preserved, for, both in contemplation of law, and of the parties, plaintiff’s intestate was the rightful owner of the funds. Clarke, Harrison & Co. v. Brown, 77 Ga. 606; Repplier v. Jacobs, 149 Pa. St. 167; Love v. Harvey, 114 Mass. 80; Morgan v. Groff, 4 Barb. (N. Y.) 524; Humphreys v. Magee, 13 Mo. 435; Block v. Darling, 140 U. S. 234. (3) Under the answer, which is in the form of a general denial, the appellant may not invoke, as a defense, the illegality of the transaction. McDearmott v. Sedgwick, 140 Mo. 181-183, 39 S. W. 776; McClure v. Ullman, 102 Mo. App. 697, 77 S. W. 325; Gibson v. Jenkins, 97 Mo. App. 27, 70 S. W. 1076.

Opinion:
BLAND, P. J. —
Omitting caption, the petition is as follows:
"Plaintiff states that Ralph H. Pybus Knapp, deceased, late of the city of St. Louis, State of Missouri, departed this life on or about the twentieth day of January, 1904, leaving hijn surviving, as his widow, the plaintiff herein; that thereafter, to-wit, on the eighteenth day of April, 1904, the plaintiff was, by the probate court in and for the city and State aforesaid, duly appointed administratrix of the estate of the said Ralph H. Pybus Knapp, deceased; that, under which appointment, she was duly qualified, and is now in charge of said estate as the administratrix thereof.
"Plaintiff states that in or about the month of May, 1902, the said Ralph H. Pybus Knapp, deceased, placed in the keeping, care and custody of the defendant, a large sum of money, to-wit, the sum of five thousand dollars, with and under the understanding and agreement, then had and made, that said sum of money should be held and retained by the defendant for the said Ralph H. Pybus Knapp, and to -be repaid and redelivered to the said Ralph H. Pybus Knapp, upon request; that the defendant, since said last-mentioned date, has continued to retain the possession and custody of said sum of money; that, though the payment Of said sum of money has been demanded by the plaintiff, as such administratrix, defendant has wrongfully refused, and still refuses to pay the same, or any part thereof, to the plaintiff.
"Wherefore, plaintiff prays judgment for the sum of five thousand dollars, with interest, and the costs of this action."
The answer was a general denial.
The cause was submitted to the court, without the intervention of a jury, who, after hearing the evidence, found the issues for plaintiff and rendered judgment in her favor for twenty-one hundred and eighty dollars and interest thereon. After taking the usual preliminary steps, defendant appealed.
The history out of which the litigation grew, briefly stated, is as follows: In 1902, Ralph Knapp, as the elder son of his father, was, under the law of primogeniture, entitled to an estate, or interest in an estate in England of the value of about seven thousand dollars. He employed the law firm of Dodge & Mulvihill, of the city of St. Louis, to establish his right in the estate. His attorneys were successful and as soon as the matter was settled in his favor, he sailed for England and collected about seven thousand dollars of the estate. He pur chased a draft in London for $5,811.43, payable to his mother, and sent it to her. She received the draft, cashed it and ont of the proceeds handed or gave her'daughter, the defendant herein, two thousand dollars, which the latter, on January 23, 1903, deposited to her individual credit' with the Mississippi Valley Trust Company. Ralph Knapp spent the greater portion of the balance of his inheritance in seeing Europe and then returned to his home in St. Louis. On his return he refused to pay Dodge & Mulvihill their fee of eighteen hundred dollars. They brought suit against him to recover the fee and obtained a judgment for the amount claimed. The judgment was collected of Knapp's mother through garnishment proceedings-.
It is practically conceded by defendant that Ralph Knapp placed the $5,811.43 in the hands of his mother for the fraudulent purpose of defeating Dodge & Mulvihill in the collection of the debt he owed them.
Defendant testified that she had kept a deposit account with the Mississippi Valley Trust Company for several years prior to 1903. The state of her account on May 16, 1903, was as follows:
Balance...............$ 94.77
January 23,1903 . 2,000.00
January 26, 1903 . 30.00
February 4, 1903 . 67.00
February 5, 1903 . $ 7.00
February 9, 1903 . 2,180.00
May 16,1903 .'... 4.77
$2,191.77 $2,191.77
Defendant's evidence shows that her income from all sources was, and had been for several years, thirty-five dollars per month. She testified that after her brother returned from England, she gave him several checks on her bank account for the purpose of enabling him to pay his bills and at one time gave him a check for one hundred dollars. On February 19, 1903, defendant, accompanied by Mrs. Mullins, a friend, went to the Mississippi Yalley Trust Company and withdrew twenty-one hundred and eighty dollars in currency, which she placed in the bosom of her shirtwaist. Defendant and her friend then walked over to the William Barr Dry Goods Company where they met Ralph Knapp and Charles Ramlose, who had been waiting there for them for about half an hour. When the parties met, Ralph Knapp, addressing defendant, his sister, said: "Well, did you get my money, Sis?" Defendant answered, "Yes, Ralph, I have it here," pointing to the bosom of her shirtwaist. Defendant testified' that after she withdrew the money from the trust company she took it home and kept it there. The evidence tends to show that defendant apprehended she might be garnisheed on process against her brother and withdrew the money from the trust company to defeat the garnishment; it also shows that on several occasions she stated that she was taking care of her brother's money for the purpose of avoiding the payment of what she said was "an unjust claim against him." On the death of Ralph Knapp, defendant made arrangements for his funeral and stated she had some four or five hundred dollars of his money with which she intended to pay the funeral expenses, but she never paid them. The evidence for the defendant tends to show that the money sent from England by Ralph Knapp to his mother was in part payment of a debt he owed her, and that out of this money she made defendant a present of two thousand dollars.
It is contended by defendant that the evidence tends to show two theories: one, that the money sent by Ralph Knapp to his mother was in payment of a debt he owed her; the other, that the money was transferred to her by Ralph for the purpose of defrauding his creditors; and it is strenuously contended there is no evidence that the money was deposited by Ralph Knapp with his mother to he returned to him, and hence there is no proof of a bailment. If either theory of defendant is correct, then the judgment should be reversed, for if the money was sent from England to pay a debt, which Ralph owed his mother, of course,it cannot be recovered, nor can it be recovered by Ralph's administratrix if he conveyed it to his mother for the purpose of defrauding his creditors. [Brown's Admr. v. Finley, 18 Mo. 375; Hall v. Callahan, 66 Mo. l. c. 322; Zoll v. Soper, 75 Mo. l. c. 462; Jackman v. Robinson, 64 Mo. l. c. 292; Roan v. Winn, 93 Mo. 403, 4 S. W. 736; Thomas v. Thomas, 107 Mo. 459, 18 S. W. 27; Goldstein v. Winkleman, 28 Mo. App. 432.] There is no evidence showing or tending to show an arrangement or understanding that Ralph Knapp's mother should hold the London draft for him, or that she should cash it and hold the identical cash to be returned to him on demand; and defendant contends that for this reason (that the identical thing or property was not to be returned) it is conclusive there is no bailment in the case. The general rule is that there can be no bailment unless the identical thing bailed is to be returned to the bailor. [Coleman v. Lipscomb, 18 Mo. App. 443; Potter v. Mt. Vernon Roller Mill Co., 101 Mo. App. 581, 73 S. W. 1005; Trunick v. Smith, 63 Pa. St. l. c. 23.] Bailment in most instances is founded on contract, but not in every instance. As said in Hale on Bailments, p. 14, "Wherever possession of a thing is knowingly acquired, unaccompanied by the right of ownership, a bailment relation is established, and the person in possession holds the things acquired simply as bailee."
Schouler says: "The simple fact of knowingly holding possession of property which belongs to another will oblige the possessor, no matter how he came by it, to apply a certain care and diligence, and stand to a certain bailment accountability." [Schouler's Bailments and Carriers (3 Ed.), sec. 3.]
There is evidence in the record tending to show that defendant knowingly came into possession of the two thousand dollars in money belonging to Ralph Knapp, unaccompanied with the right of ownership in herself; if so, then she became and was, as to such money, a bailee. But her counsel insists that as she deposited this money with the Mississippi Valley Trust Company to her personal credit, and as there was no understanding that the identical money she received from her mother should be returned to her brother, there was no bailment.
In Repplier v. Jacobs, 149 Pa. St. 167, the court, speaking in respect to the necessity of identifying money, at p. 169, said: "The argument that it was not the same money [the same argument made here] that plaintiff originally deposited but part of the winnings of the illegal transactions is of no weight. The cases where money is required to be earmarked, or where the law will inquire whether it is the identical coin or bank notes are exceptional. For all ordinary purposes in law as in the business of life, the same sum of money is the same money, whether it is represented by the identical coin or not."
This is sound reasoning and sound practical common sense to make use of in the ordinary purposes of the law and in business life. .It his been repeatedly held in circumstances where the identical grain commingled with other grain is not to be returned to the depositor, but a like quantity of the same kind and quality is to be returned, are not sufficient to convert the transaction from a bailment into a contract of sale. [See authorities cited in Potter v. Mt. Vernon Roller Mill Co., supra, p. 584.] The same rule has been applied in replevin suits to recover specific personal property, as where the goods replevied are mixed with others, but are nevertheless of the same nature and value, as in the case of grain, though an actual separation cannot be made by identifying each particle, if a division of equal value can be made, it has been repeatedly held the plain tiff may seize his aliquot part. [Kaufman v. Schilling, 58 Mo. 218; Groff v. Belche, 62 Mo. 400; Huff v. Henry, 57 Mo. App. 341; Story on Bailments, sec. 40.] As demonstrated by the foregoing cases, the law is not so much concerned with technical rules and subtle reasoning to beach a correct conclusion as it is to adopt practicable and workable rules suitable to the ordinary business of life; and we do not think it was of any consequence that the defendant, after receiving the two thousand dollars from her mother, deposited it with the Mississippi Valley Trust Company to her individual credit, if the money came into her possession unaccompanied by the right of ownership and she knew it was her brother Ralph's money; nor is it of any significance that the money was not earmarked. The same sum of money she received is, for all practical purposes and in law, the same money. There is abundant evidence in the record in support of the finding of the learned circuit judge, that the defendant held the money as bailee, and for this reason this finding is conclusive here. But we think the judgment is excessive. There is not a ray of evidence that defendant ever received more than two thousand dollars of her brother's money. Out of this the plaintiff proved that defendant had returned to her brother at one time, one hundred dollars to pay on some mining stock he had bought. Defendant also testified that she gave him checks at other times to pay his bills. The evidence shows, too, that defendant had a balance of $94.77 to her credit on her account with the Mississippi Valley Trust Company when she deposited the two thousand dollars, and that she afterwards deposited ninety-seven dollars. There is no evidence that any part of either of these sums was the money of Ralph Knapp, therefore, the evidence shows that when defendant drew the twenty-one hundred and eighty dollars from the trust company, she drew out her individual money as well as the money she held as bailee, and placed the package of money, her own and her brother's, in the bosom of her shirtwaist. The only possible theory on which the court could have found that she held the entire sum as bailee, is on the evidence that when asked by her brother at Barr's store, if she had his money, she answered, "Yes, I have it here," and pointed to the bosom of her shirtwaist. Her admission, in the circumstances, was not an admission that all the money she had in the bosom of her shirtwaist was her brother's money. At that time, according to plaintiff's own evidence, defendant could not have had over nineteen hundred dollars of her brother's money in her possession, and the judgment should have been for that sum with six per cent interest thereon from the date the suit was commenced, May 20, 1904. Wherefore it is considered by the court that the judgment be reversed and the cause remanded with directions to the circuit court to render judgment for plaintiff in the sum of nineteen hundred dollars with six per cent interest thereon from May 20, 1904.
All concur.