Court Opinion

ID: 8018042
Source: CourtListenerOpinion
Date Created: 2022-09-09 02:07:08.724356+00
Date Added: 2024-06-11T16:36:29.010210
License: Public Domain

BROWN", P. J.
Action in equity to set aside conveyance of corporate stock and to subject said stock to payment of judgments. From a decree for plaintiff, defendants appeal.
*652This action grows ont of prior litigation between plaintiff Ella Pickel and defendant Frederick J. Pickel in the circuit court of St. Louis city.
On June 22nd, 1910, plaintiff seperated from her husband, Frederick J. Pickel, and retained the custody of their only child, a son, of the age of sis years. In November, 1910, plaintiff instituted against defendant Frederick J. Pickel, a suit for maintenance of herself and child, under section 8295, Revised Statutes 1909. In that suit she was allowed $80 per month for her maintenance during the pendency of the action, and upon the final hearing thereof, on March 15th, 1911, she was awarded $100 per month for the permanent support of herself and said child, together with costs of the action.
This final judgment for support and maintenance of plaintiff and her child was rendered by Division No. 3 of the circuit court of St. Louis City, and at the time of entering said judgment, said trial court retained jurisdiction of the subject matter and parties to the action, and leave was granted to each of said 'parties to apply for such supplemental or additional orders as they might think necessary for the protection and enforcement of their rights under the judgment.
This part of the decree for maintenance is of some importance, in view of the contention of defendants that the judge who tried the present action did not sit-in Division No. 3 of the circuit court of St. Louis City, and therefore, possessed no jurisdiction of this action, one of the purposes of which is to aid in carrying into effect the decree for maintenance.
On March 27th, 1911, said Division No. 3 of the circuit court of St. Louis City entered a further order in said action for maintenance, allowing to plaintiff therein the sum of $750' for attorneys’ fees in prosecuting said cause.
There is oral evidence that an appeal was taken from said allowance of attorneys’ fees, but such evi*653deuce is unsatisfactory; and as the pendency of such appeal is not set up in defendant’s demurrers nor in their answer in this cause, we will infer that no such appeal is pending. [Sec. 1800, R. S. 1909.]
On October 25th, 1910, defendant Frederick J. Pickel instituted a suit for divorce against plaintiff. On January 14th, 1911, the circuit court of St. Louis City rendered a judgment awarding plaintiff $400 for suit money and attorneys’ fees in said divorce suit. On February 7th, 1911, Frederick J. Pickel dismissed his divorce suit, and the costs of that action, amounting to $290.85, were taxed against him. No appeal was taken from said allowance of suit money and attorneys’ fees, nor from the judgment for costs.
Defendant Frederick J. Piekel, having failed to pay some of the installments of the judgment for maintenance and the judgment given in plaintiff’s favor for attorneys’ fees, suit money and costs in the divorce suit, plaintiff caused execution to be issued on said judgments, and levied upon five shares of stock in the Pickle Marble & Granite Company, standing in the name of defendant, William Pickel, but which had been transferred to him by his son, Frederick, after the latter was separated from his wife. Upon the seizure of said stock, defendant William Pickel lodged with the sheriff of St. Louis City written claims as owner of said stock. The plaintiff duly filed with the sheriff her indemnifying bonds under each of said executions; whereupon defendant William Pickel, to prevent a sale of the stock so levied on, executed and delivered to said sheriff his bonds, conditioned for the safe-keeping and preservation of said stock, and that same should be produced when and where the court might direct, as provided by section 2204, Revised Statutes 1909. These claims and bonds were returned by the sheriff to the court out of which the execution issued, and the claims of William Piekel to the ownership of said stock are now pending as independent actions between plain*654tiff and William Pickel in the circuit court of St. Louis City. However, by stipulation of the parties, the claims of plaintiff and defendant William Pickel in the actions’growing out of the aforesaid executions shall be considered and determined in this action.
The object of this action is to set aside transfers of corporate stock of Frederick J. Pickel to his father, William Pickel, which transfers are alleged' to have been made to defeat plaintiff’s claim for support of herself and child. Said stock so alleged to'have been fraudulently transferred is described as follows:
' Seventy-five shares of the capital stock of the Pickel Marble & Granite Company, a corporation, of the par value of $7,500, but of the actual value of at least $15,000;
Ten shares of the capital stock of the German American Bank, of the par value of $1,000, and of the actual value of about $2,000;
Five shares of the capital stock of the Broadway Savings Trust Company, of the par value of $500' and of the actual value in excess of $1,000';
Fifteen shares of the capital stock of the St. Anthony Improvement Company of San Antonio, Texas.
Upon final hearing the court dismissed the plaintiff’s bill as to the defendant Pickel Marble & Granite Company, and plaintiff did not appeal from that part of the judgment.
The judgment below in this case was rendered July 24, 19.11, and finds that defendant Frederick J. Pickel is insolvent and execution proof except as to the corporate stock hereinbefore described; and further finds that said stock was fraudulently transferred by said defendant Frederick J. Pickel to defendant William Pickel for the purpose of hindering, delaying and defrauding plaintiff of money to become due her under such judgments as have been rendered in suits then contemplated.
*655The judgment herein finds that there is due plaintiff for attorneys’ fees in the divorce suit instituted against her by defendant Frederick J. Piekel, the sum of $350, also $380 as balance awarded to her for maintenance of herself and child up to and including July 1st, 1911, also the sum of $760.10, balance on attorneys’ fees and suit money allowed to her for prosecuting the action for maintenance, together with the further allowance in the sum of $500, for attorneys’ fees in prosecuting this action to set aside the fraudulent sale of corporate stock, making a total indebtedness of defendant Frederick J. Piekel, to plaintiff, exclusive of interests on said judgments and allowances, the sum of $1990.10.
The judgment of the circuit court directed defendant William Piekel to pay to plaintiff within ten days all of the amounts due her under the judgments, orders and allowances above recited and to give bond to plaintiff in the sum of $10,000', for the payment of such furture installments of the judgment for maintenance as might become due to her. Defendant William Piekel was also enjoined from transferring the corporate stock fraudulently conveyed to him by his son.
1. The defendant admits that the corporate stock in controversy was transferred by Frederick J. Piekel to his father, William Piekel, about August 1st, 1910, but contends that the transfer was not fraudulent as to plaintiff, for the reason that William Piekel was at all times the equitable owner of said stock, and had merely caused it to be issued to his son Frederick to enable the latter to receive the dividends which might accrue thereon. That at the time said stock was placed in Frederick Piekel’s name there was ah express understanding between the son and father that the father should retain the equitable title to said stock and that the same should be retransferred to him at any time he might for- any cause so request.
*656Defendants ¡also rely upon the following additional grounds to secure a reversal of the judgment entered below:
2. That the obligation of defendant Frederick J. Pickel to support his wife (the plaintiff), and her child (their mutual offspring), places her and her child in the position of subsequent creditors and does not render invalid the transfer of stock to his father, even if such was really transferred without consideration.
3. That the plaintiff’s petition does not recite any facts which if true will sustain the judgment.
4. That even if it be true that defendant Frederick J. Pickel has transferred his stock to William Pickel for the purpose of defrauding plaintiff, she has a complete and adequate remedy at law by garnisheeing William Pickel as the fraudulent transferee of said stock.
5. That the petition and evidence do not show that defendant Frederick J. Pickel is insolvent.
6. That the decree in this casé amounts to an excessive levy upon the property of defendants, and is so unreasonable that it should be reversed.
7. That the allowance of attorneys’ fee of $500' to plaintiff for prosecuting this action is not within plaintiff’s pleadings, and is erroneous and illegal.
8. That the trial court did not have jurisdiction in this action, because it is a continuation of the original action for maintenance, and should have been brought and presented before the judge of Division No. 3 of the circuit court of St. Louis City.
Such further points in the pleadings and evidence as are necessary to a full understanding of the case will be noted in our opinion.
OPINION.
It will be entirely unnecessary to determine the legal effect of the alleged contract by Frederick J. Pickel to retransfer to his father the corporate stock *657issued to Frederick. The evidence fully satisfies us that no such contract was made at the time such stock was issued to huh. '
Aside from the inherent improbability of such an agreement having been entered into, the evidence of Frederick and "William Pickel themselves establishes the fraudulent character of the transfer of the corporate stock in dispute from Frederick Pickel to William Pickel almost as completely as if they had confessed in open court the charges contained in plaintiff’s petition.
It is proven that the plaintiff left the home of her husband and returned to her mother, at Chicago, Illinois, with her son, on June 22, 1910. Within a few days thereafter, she employed an attorney, who wrote letters to both Frederick and William Pickel, notifying them that plaintiff would no longer live with her husband, and asking some arrangement be made for the support of herself and child.
During July, 1910, a consultation was held in St. Louis between the attorney for the plaintiff and Frederick J. Pickel and his attorney, looking toward a settlement of the plaintiff’s claim for support; but those negotiations did not result in any agreement.
About the 1st of August, 1910', Frederick retransferred to his father the corporate stock déscribed in plaintiff’s petition. This corporate stock had been given or donated to Frederick Pickel by his father William Pickel, in amounts and on the dates following:
In Pickel Marble & Granite Company, 25 shares on March 17, 1900;
In the same company, 20 shares on March 27, 1902;
In the same company, 30 shares on July 7, 1906';
In the German American Bank, 10 shares on February 15, 1910.
*658In the Broadway Savings & Trust Company, 5 shares on January 31, 1905'.
At the trial of this action on July 24th, 1911, both Frederick J. Pickel and William Pickel testified that at the time these shares were given to Frederick there was an understanding between said fathér and son that the father was to retain the equitable title to all of said shares; that the transfers were only made to enable the son to receive the dividends thereon and that at any time the father might so desire, the stock should be retransferred to him.
On September 20, 1910, the deposition of Frederick J. Pickel was taken under a stipulation, and in that deposition Frederick Pickel admitted that the stock was a gift from his father, and when asked by plaintiff’s counsel why he retransferred it to his father, he replied: ‘‘I didn’t like your program; I didn’t know what was in future for me. My father had given it to me, and I gave it back to him. Q. What program? A. Well the letters you were writing. I didn’t know what was in future for me, and I turned it over to him. Q. Do you mean the letter I wrote to you or to Mr. Noonan? A. Well the character of all of it. Q. Did you tell your father about it? A. No further than the one he had gotten from you. Q. He told you that he had received a letter from me? A. Certainly.”
In giving his evidence in the action for maintenance on March 4th, 1911, before the present action was instituted, defendant Frederick Pickel testified as follows :
££Q. State what was said by you and your father at the time the certificates were issued? A. Well, he told me he wanted to encourage me in business, and I must not sell the stock; that they would probably pay a dividend to help me along.
££Q.. State all that was said. A. The conversation was along, that line, that he wanted to encourage *659me in business; wanted me to work hard; that this was valueless unless I worked hard and made money so that they could render a dividend. He did not want me to sell it.
“Q. State all of the conversation, if you have not. (Plaintiff’s counsel objects to the question as leading. Objection overruled). A. He said that if at any time I misbehaved myself, as he put it, didn’t do right or sold any of the stock, he would not give me any more.”
The deposition of defendant William Pickel was also taken on November 30,1910, in which, when called upon to explain why the stock in controversy was re-transferred to him by his son, he testified as follows:
“Q. Did you have any conversation with your son at or about the time of these transfers? A. Yes, sir.
“Q. What was said in that conversation? A. I said to him, ‘I have advanced you a good deal of money and you have no way of paying it back, and you had better transfer those stocks back to me to get even;’ and he was willing to do that; and done that.
“Q. Was that before you received a letter from me? A. Afterwards.
“Q. How long after you received a letter from me? A. Maybe a couple of weeks.
“Q. Did you make any answer to the letter you received from me? A. No, sir.
“Q. I understood you to say awhile ago, Mr. Pickel, you did not lend your son any money; you simply gave it to him. A. That is so. He had no way of paying it back. I just gave it to him. •
“Q. You kept no track of the amount you gave him? A. No, sir.
“Q. Did you at the time of transferring these stocks know how much money you had given him? A. I figured it up in my head, and in the last four or five years, and I came to the conclusion he ought to re*660turn those stocks to make it square in the family.
“Q. 'Have you told everything that ivas said at the time this transfer was madel A. I think I have.
“Q. What did your son say at that time? A. I didn’t speak to him at the time about your letter or anything else; didn’t want to talk about it.
“Q. Did he say anything at all when you told him you wanted him to transfer those stocks? A. I think it was my proposition to do that after I got your letter.
“Q. Did my letter cause you to make that proposition? A. Well, your letter and other points together helped to bring it on”.
In the present case after testifying most positively that he retained the equitable title to the stock in controversy when he caused it to be issued to his son, defendant William Pickel was asked the following questions and gave the following answers:
“Q. At the time you were asked these questions and gave these answers, at the time this deposition was taken before Mr. Hennings, did this occur: ‘Q. Did you say anything else when you told him you wanted him to transfer those stocks? A. I think it was my proposition to do that after I got your letter.
“ ‘Q. Did my letter cause you to make that proposition? A. Well, your letter and other points helped to bring it on.
“ ‘Q. What other points helped to bring it on? A. Advancing him money these last four or five years out of my pocket.
“ ‘Q. Anything else? A. Nothing else.’
“Q. Did you so testify? A. Yes, sir.
“Q. Was it true? A. I think so, as far as I remember.
“Q. Then, if the prior arrangement or agreement made between you and him by which he was to *661retransfer those stocks to you on request, when you were a’sked these questions as to why you caused this transfer to he made, why didn’t you then tell about that kind of an agreement? A. Maybe I didn’t think of it.
“Q. Didn’t think of it? A. No.
“Q. ' You had forgotten it, hadn’t you? ‡.. I suppose so.
“Q. You didn’t remember it until you employed Messrs. Barclay, Pauntleroy & Cullen as your attorneys in this case ? A. They had nothing to do with it all.
“Q. I know; but you didn’t remember it until after you employed them; then you thought about it and told Mr. Cullen? A. I don’t remember any conversation with Mr. Cullen about that.
“Q. When did you first remember that kind of an agreement?' A. Never spoke to Mr. Cullen about it.
‘ ‘ Q. Whom did you speak to about the agreement first? A. Nobody.
“Q. Never mentioned a word about it to anybody before you went on this stand? Is that right"? A. Yes, sir. ” v
Further testifying in this case, defendant William Pickel said:
“Q. Why didn’t you have your son transfer that stock to you before his. wife ran away? A. Well, I had it transferred to him while he was living with her; I supposed they were going to live together. That was the purpose of transferring the shares to him, to help them along; paid all his bills, doctor bills and everything.
‘ ‘ Q. You wanted to help him take care of his wife and child as long as she lived with him? A. I wanted to take him up and help him along.
“Q. Why didn’t you have that transfer made back to you before she left him? A. I don’t know anything about that.
*662££Q. Did her leaving him have anything to do with yonr causing him to transfer it back? A*. No, I suppose not,
££Q, You suppose not? A. No.
“Q. You can’t give any reason how it is that you happened to cause him to transfer it at the time he did, can you? A. No, I can’t give any reason; no.
££Q. You can’t explain it at all? A. No, sir.”
The evidence of William Pickel further shows that he had given corporate stock to another son and also his daughters; but those gifts were entirely unconditional and accompanied by no obligation to retransfer to the father.
William Pickel testified that the aggregate value of the stocks retransferred to him by his son Frederick about August 1st, 1910, was $7225; other evidence indicated that it was worth more.
Another item of evidence in the case is that at the time plaintiff separated from her husband, the Pickel Marble & Granite Company, of which defendant William Pickel is the principal owner, were paying him for his services a salary of $150 per month. When the litigation between plaintiff and Frederick Pickel was initiated his salary was cut to $75 a month, and subsequently he was dropped from its pay-roll altogether.
There was other evidence, not necessary to recite, which satisfied the trial judge and satisfies us also that no contract was ever made whereby William Pickel was to retain the equitable title to the stock issued to his son Frederick.
II. The obligation of Frederick J. Pickel to support his wife (whom the trial court found he had abandoned without good cause), and his further obligation to support his infant child, were matured obligations at the time the corporate stock in controversy was fraudulently transferred to William Pickel. The obligation of a husband to support his wife becomes complete at their marriage, and the obligation of the father to *663support his child is complete when such child is horn. Such claims for support can not he classed with “subsequent creditors.” [Maze v. Griffin, 65 Mo. App. 377.] The laws of our State recognize these claims as of the most binding force and for their payment, no property of the husband is exempt. [Sec. 8296, R. S. 1909.]
III. Defendants contend that plaintiff’s petition does not specifically allege the fraudulent acts against which she seeks relief. After the evidence was closed, plaintiff, by leave of court, filed an amended petition so as to conform her pleadings to the facts proven. No effort was made to strike out this amended petition as a departure; consequently the judgments rests upon the amended petition. We find it was entirely proper under the facts in this case to permit snch an amended petition to be filed. Not only did the defendants change their evidence as previously given in their depositions, but by stipulation of the parties certain issues pending in other suits were engrafted upon this action, and the court was given jurisdiction by such stipulation to determine same in this case. [Sec. 1848, R. S. 1909.] The amended petition states grounds for equitable relief, and defendant’s general attack upon it is disallowed.
IV. While it is true that the plaintiff has a remedy at law by garnishment against defendant William Pickel as the fraudulent transferee of the corporate stock in controversy, such remedy is entirely inadequate under the facts in this case.
If the plaintiff’s judgment for maintenance had been rendered for a gross sum, she would perhaps have an adequate remedy by garnishment against William Pickel as the fraudulent holder of Frederick J. Pickel’s stock, but her judgment is not for payment of a gross sum, but for payment of $100 monthly.
With the legal title to the corporate' stock standing in the name of William Pickel, plaintiff could by *664garnishment only reach a sufficient amount of said stock to pay the installments due her on her judgment for maintenance, and she would have no assurance that William Pickel would hold the stock until other installments of her judgment for maintenance became due.
The evidence shows a determination upon the part of defendant William Piekel to defeat plaintiff’s claim for support of herself and child by any means within his power. By filing third party claims to the stock levied upon, he had needlessly brought about a multiplicity of suits, and if this practice were persisted in it would cost plaintiff more to collect her judgment than she would receive. The arm of a court of equity would be short indeed if it could not put forth its hand and impound a fund out of which plaintiff is entitled to relief as a judgment creditor after she has uncovered such fund in the hands of a person to whom it was fraudulently transferred to defeat her judgments, and to compel Frederick J. Pickel to give security for plaintiff’s support.
We hold that the trial court has a right to appoint a trustee to take charge of, hold, manage, and sell the corporate stock in controversy to pay the installments of plaintiff’s judgments for maintenance as they become due.
V. The amended petition filed by plaintiff recites that defendant Frederick J. Pickel has transferred all his property which possesses any value to his codefendant William Pickel; consequently, his insolvency is fully charged in said petition.
VI. “That the decree amounts to an excessive levy upon defendant’s property.”
Under the peculiar facts of this case this point deserves very little consideration. The laws of our State and the demands of civilized society require defendant Frederick J. Pickel to support his wife and child; and having divested himself of all his property for the pur*665pose of evading those obligations, he should not be heard to complain of a decree which places property thus fraudulently transferred in the hands of a trustee, to the end that so much of such property as is necessary may be applied in support of his family. The evidence shows that defendant Frederick J. Pickel is thirty years of age, of fair business experience, and able to support himself and family, if he applies his talents to that end.
The conduct of both defendants establishes the fact that if any of the property of Frederick J. Pickel be left in the possession of either him or his father, it will, if possible, be placed beyond the reach of plaintiff. Under such condition of affairs, if is entirely proper for a court of equity to sequester the property of plaintiff’s husband.
VII. The allowance in this action of an attorney’s fee of $500 to plaintiff for prosecuting this action is not supported by any rule of law or equity to which our attention has been called.
“Upon a conveyance by a debtor being set aside as fraudulent, at the suit of a creditor, and a sale of the property being ordered, the creditor’s attorney may be allowed a fee out of the proceeds, but such fee should be paid out of that part applicable to the de1-mands of creditors, and not out of such balance as may come to the debtor after the liquidation of the debts proven and passed.” [20 Cyc. 824.]
That part of the judgment entered below which awards an attorneys’ fee to plaintiff for prosecuting this action, is erroneous.
VIII. The defendants assert that the circuit court-possessed no jurisdiction of the suit, because it is a continuation of the plaintiff’s action for maintenance, in which last named action the trial court retained jurisdiction of the parties and subject-matter. This contention is much more subtle than substantial.
*666In the action for maintenance the trial court did not acquire jurisdiction of the fraudulent transfer of the corporate stock William Pickel, nor did it have jurisdiction of said William Pickel. One of the purposes of this action is to subject the corporate stock of defendant Frederick J. Pickel to the payment of part of the attorney’s fees and suit money awarded to plaintiff in the divorce suit; which award is a matter wholly disconnected from the action for maintenance. We rule this point against defendants. [Glen & Hall Mfg. Co. v. Hall, 61 N. Y. 226, l. c. 236.]
IX. Defendants in their motion for new trial attempt to challenge the constitutionality .of that part of section 8295, Revised Statutes 1909, which authorizes the court to sequester a husband’s property and compel him to give security for the support of his wife and child. This belated effort to nullify said section 8295, must be disregarded for two reasons: (1) It was not called to the attention of the trial court in a timely manner. [Hartzler v. Railroad, 218 Mo. 562] (2) The motion for new trial does not designate the particular clause or provision of the State and Federal Constitutions which render said section 8295, Revised Statutes 1909, invalid. [State v. Brockmiller, 107 Mo. App. 600; Hulett v. Railroad, 145 Mo. 35.] Therefore, this point is not before us for review.
That part of the judgment of the trial court which awards and allows an attorney’s fee of five hundred dollars to plaintiff’s (respondent’s) attorney for prosecuting this action, is reversed, and the judgment of said trial court is in all other respects affirmed.
Ferriss and Kennish, JJ., concur.