Court Opinion

ID: 9830929
Source: CourtListenerOpinion
Date Created: 2023-09-01 20:38:08.0991+00
Date Added: 2024-06-11T07:43:28.412372
License: Public Domain

On Motion for Rehearing.
The case was made to turn upon the intent of the parties in the transfer of the property, and the jury found that there was no fraudulent intent in the transaction. Mrs. Lawrence and Mrs. Maxwell are sisters, and the facts indicate that Mrs. Maxwell, when she accepted a transfer from her sister of the land in controversy, knew that her sister was insolvent. All of the facts point to this conclusion. Mrs. Maxwell did not pay value for the land, and it was uncontradicted that only $800 was claimed to have been paid to creditors and the larger portion of that to the husband of the sister of the vendor. At least one-half of the purchase money was not paid to creditors, but, if paid at all, was paid to Mrs. Lawrence. Under all Texas authorities, this was fraud on its face, and the court should so have declared as a matter of law. Mrs. Lawrence knew that she was indebted to other parties and could not have acted in good faith, and Mrs. Maxwell must have known the same facts.
It is in effect admitted that the law as declared in our original opinion was sustained by the cases cited in the opinion, but it is claimed that they are overruled by the decision in Sanger Bros. v. Colbert, 84 Tex. 668, 19 S. W. 863. In that case the purchaser was a creditor, who had paid full value for the land, and the purchase money for the property was paid by the vendor to his creditors. That is an entirely different case from this, and there was nothing said in that case that is in conflict with Seligson v. Brown, 61 Tex. 180; Lambeth v. McClinton, 65 Tex. 108; Ellis v. Valentine, 65 Tex. 532; Elser v. Graber, 69 Tex. 222, 6 S. W. 560; and Gallagher v. Goldfrank, 75 Tex. 562, 12 S. W. 964, which are cited in the former opinion and which fully sustain it. Citing the case of Gallagher v. Goldfrank, the Supreme Court held in Coughran v. Edmondson, 106 Tex. 540, 172 S. W. 1106: “A creditor of an insolvent debtor may receive property for his debt if not more than reasonably sufficient in value to discharge it, but where the value of the property materially exceeds the debt, the transaction is deemed fraudulent in law, since its necessary effect is to place the surplus beyond the reach of creditors.” The case of Paddock v. Jackson, 16 Tex. Civ. App. 655, 41 S. W. 700, was the ease of a purchaser from an insolvent vendor. The judgment of the trial court was reversed and judgment rendered against the purchaser, and a writ of error was refused by the Supreme Court. The court said: “We cannot agree with the trial judge, that Jaclíson can be treated as an innocent purchaser without notice of any fraudulent intent on the part of Ayers, for that is the view upon which the judgment is based. In our opinion, the evidence conclusively shows that, when the sale was made Ayers was insolvent, and that the facts actually within Jackson’s knowledge showed this to be the facf. Ayers had been unable to meet the debt secured by the deed of trust to Brown Bros., and his lands had been sold. Judgment had been obtained against him by those parties and other lands sold, and he was unable to redeem it or pay the balance, and had to apply to Jackson for assistance, which was given upon the security of the land. He stated at the very time of the sale that he wanted the proceeds of the property with which to pay debts. These facts were certainly at least prima facie evidence of insolvency.” The facts in that case were not near so strong against the purchaser as are the facts of this case against Mrs. Maxwell. She knew that her sister was in debt, she knew that the consideration for the land was utterly inadequate, and she could not have been a purchaser in good faith for value.
There is no merit in the motion for rehearing, and it is overruled.