Court Opinion

ID: 6961000
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:45:33.13655+00
Date Added: 2024-06-11T16:08:26.377746
License: Public Domain

Mr. Justice Craig delivered the opinion of the Court: This was a bill in equity, brought by Samuel H. Merrell and Rankin P. McPheeters, in the circuit court of McLean county, to set aside a deed executed on the 26th day of March, 1870, by Simeon T. Johnson to his three children, Laura Belle, Lucy M. and Fannie D. Johnson, conveying a tract of land in McLean county, consisting of two hundred acres. It is charged in the bill that Johnson fraudulently and without consideration, except love and affection, and for the purpose of hindering, delaying and defrauding his creditors, conveyed the premises; that at the time of making the deed he was in embarrassed circumstances, and had no property liable to execution, except the lands conveyed. It is also alleged that the title held by Robert McCart to the premises, which was obtained by a sale of the lands under certain judgments and decree of foreclosure obtained against Johnson, is a fraud upon the rights of complainants, and a cloud upon their title, and ought, in equity, to be removed. The appellants, as appears from the record, filed in August, 1870, two bills in equity against Johnson, for the purpose of correcting an alleged mistake in two certain deeds which had been executed by Johnson, conveying certain lands in Moultrie county to them. The summons was served on Johnson on the 22d day of August, 1870, and at the May term, 1871, of the Moultrie circuit court a default was taken, and a money decree rendered in each case against Johnson for $1200. In July, 1871, executions issued on the judgments, and in October, 1871, they were returned no property found. On the 10th day of October, 1873, alias executions issued on the decrees to the sheriff of McLean county, and on the 16th day of December, 1873, the sheriff levied on the lands in controversy, and sold the lands to appellants on the 29th day of January, 1874, and no redemption having been made, deeds were executed conveying the lands to appellants on the 4th day of December, 1877. Under this deed appellants claim to own the premises, and filed their bill to remove the Johnson deed to his children and the deed held by McCart obtained under judgment and mortgage sale. It appears, from the evidence, as early as 1869 Johnson mortgaged a portion of the premises, and subsequently judgments were obtained against him, rvhich also became a lien, before he was sued by appellants. The lands were sold under this mortgage and the judgments, and under the sales the title passed into Robert McCart. It also appears, from the evidence, that Johnson’s wife owned a place in Bloomington in her own right, worth some $3500. She died in the month of January, 1870. Previous to her death, an agreement was made between her and her husband that she should sell her place and payoff the incumbrances on the farm in question, and, in consideration thereof, Johnson agreed to deed the land to her three children, the appellees. After the death of the wife, in considération of the arrangement made between Johnson and his wife, he did,on March 26, 1870, make the conveyance, and subsequently the town property of Mrs. Johnson Avas sold and the proceeds used by Robert McCart, who acted for the children, in buying in the liens against the land. It will be observed that at the time Johnson conveyed, the land to his three children, March 26, 1870, appellants had not commenced suit against him, and, so far as appears, he Avas not aware that they had a cause of action against him. There is no evidence in the record Avhich shows that Johnson actually intended to defraud appellants, or any other creditor, by making the conveyance. If, therefore, the deed is to be held fraudulent, it must be fraudulent in law and not in fact. Was the transaction fraudulent in law? It appears, from the evidence, that Johnson, a short time before his Avife’s death, traded sixty-three acres of land, worth $50 per acre, for a large stock of goods. This stock of goods he retained in his possession, and Avas in business until about the 1st of May, 1870. At the time the deed Avas made to his children, besides the goods, he had other property: horse and buggy, worth $500; house and lot in Heyworth, and some other articles of property. Outside of the debts which were a lien on the land Avheu the deed was made, it does not appear that Johnson was indebted to any person, except to appellants, and this debt had not, at that time, been established. It thus appears, at the time Johnson conveyed the land to his children, he still retained sufficient property to pay all his debts. Now, if the conveyance of the property by Johnson to his children is to be regarded as a voluntary settlement upon them, it could not be impeached unless it was fraudulent. Mere indebtedness, at the time is not sufficient, if the maker of the settlement retains sufficient property to discharge his debts. As is said in Moritz v. Hoffman, 35 Ill. 553: “To impeach such a conveyance successfully, it devolved upon the complainants to aver and prove that they were creditors at the time, and that the grantor was then insolvent, or such facts and circumstances as would authorize a court or jury to presume insolvency.” Here, there is an entire want of evidence, on the part of complainants, to establish the fact that Johnson was insolvent when he executed the deed. But, on the other hand, it is quite apparent that he retained sufficient property to pay all debts which were not secured on the land he conveyed, and the land was conveyed subject to these liens. Under such circumstances, we can not hold that the conveyance was fraudulent. But, aside from this position, there is another feature in the case fatal to a recovery. Johnson’s children received the deed of the land subject to the incumbrances then existing against it. The land was subsequently sold in satisfaction of these incumbrances, and the sale ripened into a title which was procured by McCart, and by him held for the children. If the appellants desired to protect their junior lien on the land, it is obvious they could not do so by remaining silent and inactive, and allow the land to be sold on the senior lien, and the sale ripen into a title at the expiration of the time provided by law for redemption. But they were bound to come forward and redeem from the sale, or lose the benefit of the levy they had made upon the land. This they failed to do, and we are aware of no principle of equity which would deprive the grantees of Johnson from buying in the land when sold on decree of foreclosure or under execution, and if the land was not redeemed, no reason is perceived why they would not acquire the legal title. The decree of the circuit court will be affirmed. Decree affirmed.