Court Opinion

ID: 3879069
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:11:11.015726+00
Date Added: 2024-06-11T07:41:51.405155
License: Public Domain

I am firmly convinced that this case presents a deliberate and ingenious conspiracy, on the part of J.J. Hiers, his wife, Mobley H. Hires, and M.I. Rizer, aided and abetted by H.M. Thomas, to put the 304 acres of land which belonged to J.J. Hiers, in his wife's name, beyond the reach of his creditors, and, therefore, respectfully dissent from the conclusion to the contrary, announced in the opinion of Mr. Justice Carter.
The chronology of the case, with its swiftly succeeding events, is exceedingly significant:
On September 15, 1924, the plaintiff served upon the defendant J.J. Hiers summons and complaint against the Ashton Produce Exchange and the members composing that unincorporated body, including the defendant J.J. Hiers, for the amount of a bill of goods which it had shipped to the exchange, order notify, but which H.M. Thomas, the *Page 96 
secretary of that body and the cashier of the Ashton Bank, had procured to be delivered without production of the bill of lading, upon his guaranty, as cashier of the bank, that the bill would be paid, but which never was.
On October 1, 1924, the defendant by his attorneys filed an answer to the complaint, setting up a general denial.
On October 15, 1924, subsequently to the commencement of the action and after J.J. Hiers had filed his answer, J.J. Hiers executed and delivered to the defendant M.I. Rizer a deed, upon the stated consideration of $2,000, by which he conveyed to him the 304-acre tract described in the complaint, upon which the defendant Mobley H. Hiers renounced her dower. The deed recited the existence of a mortgage of $675 by J.J. Hiers to the defendant bank, which it is claimed was deducted from the purchase price, and which as a matter of course was assumed by Rizer.
On October 20, 1924, the plaintiff, by its attorneys, served upon the attorneys for J.J. Hiers, notice of a motion to be made before his Honor, Judge Dennis, at Walterboro, on October 27th, for an order striking out the answer of J.J. Hiers as sham.
On October 24th (three days before the motion was to be heard), M.I. Rizer executed and delivered to the defendant Mobley H. Hiers, wife of J.J. Hiers, a deed, upon the stated consideration of $2,400, by which he conveyed to her the 304-acre tract which had been conveyed on October 15th, by J.J. Hiers to M.I. Rizer.
On October 27th, the motion of the plaintiff to strike the answer of J.J. Hiers was heard by his Honor, Judge Dennis, who on October 30th passed an order striking the answer out as sham, and ordering judgment in favor of the plaintiff for $929.35.
The judgment was duly entered up, and execution issued thereon, which was returned by the Sheriff nulla bona.
Thereafter, on April 15, 1926, the present action was instituted for the purpose of setting aside the deed from J.J. *Page 97 
Hiers to M.I. Rizer and the deed from M.I. Rizer to Mobley H. Hiers, as fraudulent and made to hinder, delay, and defraud the plaintiff and other creditors of J.J. Hiers.
The case was referred to the Probate Judge simply to take the testimony and report the same to the Court.
Upon the coming in of the report with the testimony, the case was heard by his Honor, Judge Johnson, at Chambers, at Allendale (I assume upon the day noticed therefor), July 29, 1926. On August 5, 1926, he filed a decree dismissing the complaint, from which the plaintiff has appealed.
In the opinion of Mr. Justice Carter, it is practically conceded "that there were circumstances surrounding the transaction clouded with suspicion." I entirely agree with this statement, and go farther than suspicion.
The defendant J.J. Hiers says that he was in debt and anxious to be relieved; that he owed his brother, who drew up the various papers, $900, Dr. Clarke, $300, and H.M. Thomas, $200; and that he proposed to sell the 304 acres in order to pay them off. At that time he owned only his home place of 66 acres, outside of the 304 acres; he was farming upon that tract, as well as upon the home place; he had a large family to support, a son at one college and another at another. It was in evidence that the land was worth $25 per acre. Is it not strange that he was willing to deprive himself of the means of a livelihood and his family's support, at a loss of $3,500, in order to pay some of his debts, without advertising to any one but Rizer that he wanted to sell?
The celerity of the trade between him and Rizer is significant. "Mr. Rizer, I want to sell my 304-acre tract. What do you ask for it? $2,200. I will give it" — is the substance of what occurred between them. I have never heard before of a land trade so quickly consummated. J.J. Hiers then, according to his statement, put out for Hampton to have the deed drawn; he was so anxious to dispose of a $7,500 plantation for $2,200. He had his brother, to whom *Page 98 
he claims to have owed $900, to prepare the deed. There is no reason why he could not have executed the deed at that time in Hampton; it was not necessary that the grantee be present to witness the execution; yet he gathers up two witnesses, this same man Thomas, the secretary of the defunct exchange and the cashier of the bank, who had procured the delivery of the goods shipped "order notify" without the production of the bill of lading and who admits that he had sent out misleading statements as to the financial condition of the exchange, and one Breland, and induced them to leave their business and travel five miles to the home of Rizer for the needless purpose of having Rizer witness their attestations. I cannot but believe that they were carried to Rizer's home to witness the sham proceeding of his paying over $1,500 in cash to J.J. Hiers.
It cannot be expected that these parties will tell all that they know about this deal, but circumstances inexplicable upon any other theory are loud in their tones.
Is it not remarkable that Rizer should have so quickly closed the trade without a moment's hesitation; without an inspection of the premises; without an examination of the title? His deed is dated October 15th; he reconveyed on October 24th. During that interval there is not the slightest evidence of his taking possession of, or exercising any act of ownership over, the property; he did not even inquire as to the payment of taxes which were then due and payable. It is to be presumed that at that date, October 15th, all of the crops upon the place had not been gathered. His deed, if valid, entitled him to all of these remaining crops. There is not the slightest evidence that he, during that intervening period, made any such claim, or that J.J. Hiers relaxed his efforts to gather the crops remaining.
That a change of possession does not accompany the execution and delivery of a deed is a badge of fraud is decided in Hudnal v. Wilder, 4 McCord, 294; 17 Am. Dec., 744.McElwee v. Sutton, 2 Bailey, 128. Madden v. Day, 1 *Page 99 
Bailey, 337. Smith v. Henry, 2 Bailey, 118. Anderson v.Fuller, McMul. Eq., 27; 36 Am. Dec., 290. Cordery v.Zeaty, 2 Bailey, 205. Hipp v. Sawyer, Rich. Eq. Cas., 410.Maples v. Maples, Rice Eq., 300. Footman v. Pendergrass, 3 Rich. Eq., 33. Belk v. Massey, 11 Rich., 614. Kohn v.Meyer, 19 S.C. 190. Nelson v. Good, 20 S.C. 223.McGee v. Wells, 52 S.C. 472; 30 S.E., 602.
Another remarkable circumstance is that, although Rizer had dealings with not less than three banks, in which he had considerable deposits, the purchase price was paid in cash and not by check; and that he with money in bank should assume the payment of the bank's mortgage, which he had not paid on October 24th.
And then consider the conduct of the defendant J.J. Hiers: He testifies that he sold the land to pay his debts; that he received about $1,525 in cash, and on that day or the next paid his brother $900 upon a note or duebill held by him, paid Dr. Clarke $300 for medical services and borrowed money, and paid Thomas $200 upon a duebill. All of these payments he claims to have made in cash. He was not able to produce a scrap of paper evidencing the existence of these debts which he admits were in writing; he does not even say that he took up such evidences. His brother, who had loaned him the $900, and who prepared all the papers of these devious transactions, was not produced as a witness; the man who knew more about them than any one else, and who could, if such had been the fact, have corroborated the statement of J.J. Hiers as to the loan and payment. Neither was Dr. Clarke, who he claims was his debtor to the extent of $100 medical bill and $200 borrowed money, called to corroborate his statement. Only the man Thomas was called, whose testimony, in view of his intimate connection with the whole nefarious transaction, has not impressed me as being worthy of credence.
The testimony of Mrs. Hiers strikes me as most remarkable, and is totally insufficient to satisfactorily explain the *Page 100 
damning circumstances which "surround the transaction with suspicion." She testifies that J.J. Hiers had talked about selling the place for several months, and that she had expressed her willingness to sign her dower, and yet, within 9 days after the deed to Rizer was executed, she became dissatisfied with the sale and wanted to buy it back, for the reason, which existed all along, that she had six boys who should be provided for as farmers. It is passing strange that, if she was actuated by this motive after the sale, she, with $1,800 in cash on hand, had no such thought before the sale; and that she did not propose to do what she afterwards did, at a cost of $200 profit to Rizer. The truth of the matter is that a direct conveyance by J.J. Hiers to his wife would not have looked well, and the circuitous and devious plan of passing the title through Rizer was adopted. Her explanation of having more than $1,800 on hand in cash, derived from the sale of chickens, eggs, and hogs, and the income from the 110-acre farm, strains my credulity to the breaking point.
The attitude of J.J. Hiers to the debt for which he was being sued, supplies a reasonable explanation of his efforts to avoid payment of it. Evidently it was a debt contracted by the exchange, for which J.J. Hiers had received no benefit. He did not consider that he was justly obligated for it, and under such circumstances the effort was human, if not moral, to avoid it, if he could. It appears that, outside of the debts to his brother, to Dr. Clarke, to Thomas, and to the bank, he owed comparatively little. Not one of these creditors appears to have been pressing him; all of their alleged demands had been running for a long while; the only creditor who was pressing was the plaintiff, and it was the only one for which, in his anxiety to sell his property to pay his debts, no provision was made.
The result of the transactions is that J.J. Hiers has divested himself of everything except his home, protected by *Page 101 
the Homestead Law (Civ. Code, 1922, § 5490 et seq.), and the 304-acre tract is in his wife's name.
Under the evidence I do not see how it is possible to conclude that the conveyance to Rizer was a bona fide sale, or that both conveyances were not parts of a scheme to evade the payment of honest debts, of which all parties concerned were participants.
I regard this transaction as having the same effect as if J.J. Hiers had conveyed the property directly to his wife, and that it comes within the doctrine declared in Farmers'Bank v. Bradham, 129 S.C. 270; 123 S.E., 835, the syllabus of which is:
"A deed from judgment debtor to his wife made to prevent a creditor bank from collecting its expected deficiency judgment will be set aside in a proceeding by bank after it had secured such a judgment and a return of nulla bona had been made."
The intention to defraud may be shown by surrounding circumstances and from the acts of the parties, and need not be proven as an independent act. Greig v. Rice, 66 S.C. 171;44 S.E., 729. McGee v. Wells, 52 S.C. 472;30 S.E., 602.
In Hart v. Sandy, 39 W. Va., 644; 20 S.E., 665, it was held:
"Wherever there appears to be connected with the transaction circumstances indicating excessive effort to give it the appearance of fairness or regularity, which are not usual attendants of such business, the Courts will regard such circumstances as badges of fraud."
"If a transfer is made by a debtor in anticipation of a suit against him, or after a suit has been begun and while it is pending against him, this is a badge of fraud." 20 Cyc., 144, citing Smith v. Henry, 2 Bailey, 118. Hipp v.Sawyer, Rich. Eq. Cas., 410. Watson v. Kennedy, 3 Strob. Eq., 1. Pettus v. Smith, 4 Rich. Eq., 197. *Page 102 
"In a case of this kind the burden is undoubtedly upon the defendant to explain away and rebut the badge of fraud the testimony shows, and this can be done only by the most positive and clear testimony." From the decree of his Honor, Judge Johnson, affirmed by this Court in Miller v.Erwin, 129 S.C. 415; 125 S.E., 36.
In McCarthy Co. v. Saunders, 83 W. Va., 612;98 S.E., 800, it was held:
"In a suit by a creditor to set aside as fraudulent a deed made by his debtor, the failure of the debtor to call important witnesses to his transaction relating to such deed, constitutes a badge of fraud."
The cases like Lenhardt v. Ponder, 64 S.C. 354;42 S.E., 169. Magovern v. Railroads, 27 S.C. 386; 3 S.E., 340.McElwee v. Kennedy, 56 S.C. 154; 34 S.E., 86, and others of like character, are not in point. They all are cases of an honest purpose of a creditor to secure the payment of a debt due to him by an insolvent debtor.
The testimony in this case does not show a purpose on Mrs. Hiers' part to secure a debt; her husband owed her nothing; it shows a combined purpose on the part of all concerned, when the trial of the plaintiff after J.J. Hiers was getting hot, to aid his escape into the underbrush.
I think, therefore, that the decree of the Circuit Court should be reversed.