Case Name: GUARANTY STATE BANK & TRUST CO. et al. v. MAXWELL et al.
Court: Texas Courts of Civil Appeals
Jurisdiction: Texas
Decision Date: 1929-03-06
Citations: 15 S.W.2d 659
Docket Number: No. 8164
Parties: GUARANTY STATE BANK & TRUST CO. et al. v. MAXWELL et al.
Judges: 
Reporter: South Western Reporter Second Series
Volume: 15
Pages: 659–661

Head Matter:
GUARANTY STATE BANK & TRUST CO. et al. v. MAXWELL et al.
(No. 8164.)
Court of Civil Appeals of Texas. San Antonio.
March 6, 1929.
Rehearing Denied April 3, 1929.
Lee Wallace, of Kerrville, and J. L. Gammon, of Waxahachie, for appellants.
C. M. Supple, of Waxahachie, and H. C. Geddie, of Kerrville, for appellees.

Opinion:
FLY, C. J.
This is a suit by appellees to restrain the sale of three certain tracts of land, containing, respectively, 70, 80, and 160 acres, and aggregating 310 acres of land, one-half of which was claimed by Mrs. Maxwell, in Kerr county, under an order of sale issued out of a certain case styled Guaranty State Bank & Trust Company v. Mrs. R. J. Lawrence, in the district court of Ellis county.
The order of sale was issued by virtue of a judgment in the case named, for $8,970, with foreclosure of an attachment lien on the three tracts of land herein mentioned. J. T. Moore, sheriff of Kerr county, had levied on the land under authority of the order of sale and advertised the same for sale.
Mrs. Maxwell alleged that she was the owner of the land in her own separate right. A temporary writ of injunction was granted "to remain in force until otherwise ordered.'* The cause was submitted to a jury through eight special issues, only the first being answered in following directions of the court. It had been alleged that a deed to the land had been executed by Mrs. R. J. Lawrence to Mrs. Elizabeth M. Maxwell for the fraudulent purpose of placing it beyond the reach of the creditors of Mrs. Lawrence. The jury answered that the deed was not executed with such intent, and upon that finding the injunction was perpetuated, restraining the sale ' of the land as against the First State Bank & Trust Company of Waxahachie, which had entered the suit, and the Guaranty State Bank & Trust Company and J. T. Moore, sheriff of Kerr county, and also an order removing all cloud from the title to the lands held by Mrs. Maxwell arising from said Ellis county judgment, and levy under the order of sale.
On June 2, 1925, the Guaranty State Bank & Trust Company of Waxahachie recovered a judgment in Ellis county, against Mrs. R. J. Lawrence, a feme sole, for $8,970.02, as evidenced by three promissory notes executed by her, and at the same time there was a foreclosure of an attachment lien on the land in controversy, which lien had been acquired by the levy of a writ of attachment issued in the cause on February 20, 1925. On January 24, 1925, while the said suit was pending in the district court of Ellis county, Mrs. Lawrence conveyed to her sister, Mrs. Rhoda Jane Maxwell, of Lamar county, Tex., the land in question .for a recited consideration of $10. Mrs. Maxwell and her husband and Mrs. Lawrence swore that Mrs. Lawrence was indebted to Dr. Maxwell in the sum of $500, also $800 cash paid to her and $300 which Mrs. Lawrence had borrowed from her sister to pay Will Moore at Waxahachie, all of which made $1,100, and the balance of the consideration was, according to Mrs. Maxwell, "$500.00 which I was to pay her as she needed it." So it seems that $5.00 of the purchase money went' to pay debts to Dr. Maxwell and $300 to Will Moore, and the remaining $500 was to be paid at some indefinite time dependent on the necessities of Mrs. Lawrence. She only received $300 and $800 receipted for debts, with a promise of $500 in the uncertain future. No note or other written evidence of the existence of the $500 was given. There was only one witness who swore that the 155 acres of land owned by Mrs. Lawrence was worth only what she received and was promised for it; the next lowest valuation being $1,860, while three others valued the. land at from $4,000 to $5,-000. The land lies on the Johnson fork of the Guadalupe river, about 12 miles from Kerrville on the public highway to Junction. The preponderance of the evidence showed that the property was worth a sum largely in excess of the debts of Moore and Dr. Maxwell and the cash paid to Mrs. Lawrence in the sum of $300. The $500 was to be paid at some indefinite time and was not evidenced by any writing. At least $800 of the $1,600, or one-half, was not used to pay debts.
It is not pretended that the $300 paid to Mrs. Lawrence was intended to be used by her on her debts, nor that the $500, if she ever received it, was to be so used. No one claims that Mrs. Maxwell attempted in any way to have the cash and deferred payment applied on debts which she knew, or should have known, her sister owed. The question of the intention of Mrs. Lawrence and Mrs. Maxwell cannot control, and the court erred in basing a finding for appellees on the intent alone of Mrs. Lawrence. Seligson v. Brown, 61 Tex. 180; Lambeth v. McOlinton, 65 Tex. 108. The mere intention can have no effect standing alone in determining whether a conveyance is lawful or not. A creditor can lawfully receive from his debtor indebted to others, more property than is necessary to satisfy his debt, provided he is bound by his contract of sale to see that the' excess of the purchase money over his debt is applied to the payment of other debts. Ellis v. Valentine, 65 Tex. 532.
It is held in Elser v. Graber, 69 Tex. 222, 6 S. W. 560; "It is the well settled law of this court, that a creditor may lawfully receive of his debtor, a sufficient amount of his property to pay his debt, though the latter be in failing circumstances, and this be known to the creditor, and although the necessary result is to hinder and delay other creditors — provided he receive no more than is reasonably sufficient to satisfy his claim." The facts in that case are somewhat similar to the facts in this case, where a creditor received property of value considerably in excess of his debt, with no obligation to pay the excess to other creditors. In the case now before this court Mrs. Maxwell, not only received sufficient property to pay her husband's debt and that of Moore, but she let her sister have $300 in cash and promised to pay her $500 as she might need it. The necessary consequence of that transaction was to hinder and delay other creditors as to at least $800 and probably considerably more. • As said in Gallagher v. Goldfrank, 75 Tex. 562, 12 S. W. 964: "This court has repeatedly held that although a creditor may accept from a debtor in failing circumstances property in payment of his debt, if not more than reasonably sufficient in value to discharge it, yet if he receives a transfer of property exceeding in value the amount of his debt and pays cash or gives a negotiable instrument for the excess, the transaction is fraudulent."
As before stated, it does not matter what the motive of the parties may have been. As held in Paddock v. Jackson, 16 Tex. Civ. App. 655, 41 S. W. 700: "The absence oí a bad motive does not relieve the transaction of its fraudulent character. The parties are held to have contemplated the consequences of tlieir act, and this constitutes the fraudulent intent which vitiates the conveyance." See, also, Duveneck v. Kutzer, 17 Tex. Civ. App. 677, 43 S. W. 541; Armstrong v. Elliott, 20 Tex. Civ. App. 41, 48 S. W. 605, 49 S. W. 635. The facts showed legal fraud, no matter how innocent the intentions of the parties may have been.
The judgment is reversed, and the cause remanded.