Court Opinion

ID: 3249280
Source: CourtListenerOpinion
Date Created: 2016-07-05 16:20:40.786496+00
Date Added: 2024-06-11T07:40:51.386714
License: Public Domain

This bill is by simple contract creditors against the debtor and its grantee to set aside, as void, under the provisions of section 8038 of the Code, a contract and conveyance of its property, alleged to have been made by the debtor and received by its grantee "for the purpose of hindering, delaying or defrauding" complainants in the collection of their debts.
The defendants' separate demurrers to the bill for want of equity, and on specific grounds that the averments of the bill were not sufficient to show that said contract and conveyance were made by said debtor with intent to hinder, delay, or defraud its creditors, and that the same was accepted by the grantee with like intent, were sustained; hence this appeal.
While the general rule is that a fraudulent intent on the part of the grantor is necessary to bring a conveyance within the terms of the statute, it is well settled that fraud may arise as an inference of law, and that, where a conveyance is made under such circumstances that the result must necessarily be to hinder and delay existing creditors, it will be presumed that such was the intent of the grantor in making it. Gazzam v. Poyntz, 4 Ala. 374, 37 Am. Dec. 745; Huggins v. Perrine,30 Ala. 396, 68 Am. Dec. 131; Crawford v. Kirksey, 55 Ala. 282, 28 Am. Rep. 704; Reynolds v. Welch et al., 47 Ala. 200.
"The intent put into action, and which merely hinders or delays the creditor, is sufficient. It need not defraud him, nor deprive him wholly, or even partially, of his remedy for finally obtaining satisfaction of his debt or demand. The intent to defraud, however, must exist to render the transaction void; but this intent is sometimes a question of fact and sometimes a question of law. If the necessary consequence of a given act, on the part of a debtor, is to hinder, delay, or defraud his creditor, then the law conclusively presumes that it was committed with the intent to defraud, no matter *Page 58 
what was the motive that prompted the act." Skinner et al. v. Southern Grocery Co., 174 Ala. 359, 365, 56 So. 916, 918.
Circumstances of undue publicity and particularity, as well as secrecy in the reservation of benefits to the grantor, are regarded as indicia of fraud. Crawford v. Kirksey, supra.
The bill alleges the circumstances in detail under which the contract and conveyance were made, and the averments, when considered in connection with the provisions in the conveyance and contract reserving to the grantor benefits and limited control over the disposition of the property, were sufficient to sustain the general averment in the seventh paragraph of the bill, that "the said contract and conveyance were executed by the Satsuma Company and received by the said T. B. Daves for the purpose of hindering, delaying, or defrauding your orators in the collection of the debts which the Satsuma Company was then owing and still owes to your orators respectively," etc.
There is nothing in the averments of the bill to show that the conveyance was executed in satisfaction of the Bestor mortgage in lieu of foreclosure, and Dennis v. McEntire Mercantile Co., 187 Ala. 314, 65 So. 774, is inapposite.
The right of subrogation on the part of Daves to the Bestor mortgage lien is not presented, either by the averments of the bill or the demurrer. If such right exists, it may be asserted in a cross-bill.
The court erred in sustaining the demurrers, and the decree is reversed and the cause remanded.
Reversed and remanded.
ANDERSON, C. J., and THOMAS and KNIGHT, JJ., concur.