Opinion
7 Div. 615.
April 18, 1940. Rehearing Denied May 16, 1940.
Appeal from Circuit Court, Etowah County; J. H. Disque, Jr., Judge.
McCord Miller, of Gadsden, for appellant.
It is not averred in the bill that the property conveyed by Beck to his wife constituted all or substantially all of his real estate. Demurrer to the bill should have been sustained. The proceedings in this case should have been stayed pending the bankruptcy proceeding of D. M. Beck. There was no sufficient evidence upon which to base the decree.
Goodhue Lusk, of Gadsden, for appellee.
The bill, seeking to set aside fraudulent conveyances against an existing creditor, is not subject to demurrer for failure to aver want of assets still owned by the grantor sufficient to meet creditors' demands, or that the grantor is insolvent. Such allegations, required in a bill to declare a conveyance a general assignment, are not necessary in a bill such as this. Whaley v. First Nat. Bank, 229 Ala. 153, 155 So. 574; Harris v. First Nat. Bank, 227 Ala. 86, 149 So. 86; Henderson v. Farley Nat. Bank, 123 Ala. 547, 26 So. 226, 82 Am.St.Rep. 140. The allegation in the bill of voluntary conveyances without consideration and that the purposes of the conveyances were fraudulent and made with intent to hinder, delay or defraud complainant, and proof that complainant's debt antedated the conveyances, cast upon respondents the necessity of showing by averment and proof the bona fides of the transaction. Smith v. McAdams, 207 Ala. 118, 92 So. 411; Landham v. Commercial Co., 227 Ala. 18, 148 So. 434; Allen v. Sands, 216 Ala. 106, 112 So. 528; Morrison v. Federal Land Bank, 232 Ala. 138, 167 So. 288. Where suit is brought by a creditor to set aside a fraudulent conveyance made more than four months before a petition in bankruptcy, the court in which the proceeding is pending is not required to stay the proceeding. Connell v. Walker, 291 U.S. 1, 54 S.Ct. 257, 78 L.Ed. 613; 11 U.S.C.A. § 29; Pocahontas Graphite Co. v. Minerals Sep. N. A. Corp., 215 Ala. 225, 109 So. 873; Johnson D. G. Co. v. Drake, 219 Ala. 140, 121 So. 402.
The suit was to set aside fraudulent conveyances.
The errors assigned challenge the overruling of demurrers to the bill on the ground that the property voluntarily conveyed is not alleged to have been substantially all of the property owned by D. M. Beck at the time of the conveyance.
A bill to set aside a fraudulent conveyance is not demurrable for failure to aver want of assets still owned by grantor sufficient to meet creditor's demands, or that the grantor is insolvent. Whaley v. First National Bank of Opp, 229 Ala. 153, 155 So. 574; Harris v. First National Bank, 227 Ala. 86, 149 So. 86; Henderson v. Farley National Bank, 123 Ala. 547, 26 So. 226, 82 Am.St.Rep. 140.
When the suit is by a creditor to set aside a voluntary conveyance made more than four months before a petition in bankruptcy, the court in which the proceeding is pending challenging the fraudulent conveyance is not required to stay proceedings. Connell v. Walker, 291 U.S. 1, 54 S.Ct. 257, 78 L.Ed. 613; U.S.C.A. Title 11, Section 29 as last amended; Pocahontas Graphite Co. v. Minerals Separation North American Corporation, 215 Ala. 225, 109 So. 873.
Where creditors' bill to set aside fraudulent conveyances and the proof introduced shows that the debt antedated the conveyances attacked as fraudulent, the burden is shifted to the grantees to sustain by averment and proof the bona fides of such conveyances. Smith v. M. C. McAdams, 207 Ala. 118, 92 So. 411; Landham v. Commercial, etc., 227 Ala. 18, 148 So. 434; Allen Co. v. Sands, 216 Ala. 106, 112 So. 528; Umphrey Barfield, 238 Ala. 11, 189 So. 64; Morrison v. Federal Land Bank, 232 Ala. 138, 167 So. 288.
We find no reversible error in the action of the trial court and the decree is affirmed.
Affirmed.
ANDERSON, C. J., and BROWN and KNIGHT, JJ., concur.
On Rehearing.
Application for rehearing overruled.
THOMAS, BROWN, FOSTER, and LIVINGSTON, JJ., concur.