Opinion
November, 1907.
Otto V. Schmidt, for plaintiff and demurrer.
William C. Rosenberg, for defendants opposed.
This is a judgment creditor's action to reach the proceeds of the sale of certain real property conveyed by the defendant judgment debtor to his codefendant, Ida F. Grote, without consideration, and by her conveyed to an innocent purchaser. The defendant Ida F. Grote interposes three separate defenses, to each of which the plaintiff has demurred for insufficiency of substance. These defenses are that the complaint does not state facts sufficient to constitute a cause of action; that the plaintiff has an adequate and complete remedy at law; and that the cause of action alleged in the complaint "did not accrue to the plaintiff or his assignor within ten years from the commencement of this action."
The question of the sufficiency of the complaint, while it cannot properly be raised by a defense, so styled, is involved in the determination of this demurrer to the answer under the familiar rule that a demurrer reaches the first bad pleading. The remaining defenses, however, are quite clearly insufficient; and the demurrer must be sustained, unless it is to be held that, because of some insufficiency of statement in the complaint, the demurrer to the answer is to be overruled as a whole. The defense that the plaintiff has an adequate remedy at law amounts to a conclusion, merely; and, in view of the averments of the complaint, there can be no question that the character of the action is equitable, if any cause of action at all exists. The cause of action being purely equitable in its nature, a defense that the plaintiff has an adequate remedy at law is insufficient, and its insufficiency is properly to be raised by demurrer, as was held in Edmonds v. Stern, 89 A.D. 539. See also Golden v. Health Dept., 21 A.D. 420; Olivella v. New York H.R.R. Co., 51 id. 612; 31 Misc. 203.
The further defense to the effect that the cause of action is barred because suit was not commenced within ten years after the cause of action accrued is insufficient, because the effect of such a defense is simply to invite the court's scrutiny of the complaint to determine whether, upon the face of the pleading, the asserted cause of action is open to the defense of the Statute of Limitations in view of the allegations as to the accruing of that cause of action. If, from the allegations of the complaint, it appears that the defense of the Statute of Limitations is insufficient as a matter of necessity, a demurrer to the defense will lie, the mere statement of the defense being no more than the averment of legal conclusion. Gray Lithograph Co. v. American W.T.D. Co., 44 Misc. Rep. 206. Here the complaint alleges the issuance of execution on the 7th day of June, 1907, and its return unsatisfied on the twenty-sixth day of the same month. The cause of action accrued at the time when an execution issued upon the judgment was returned unsatisfied (Weaver v. Haviland, 142 N.Y. 534; Baker v. Potts, 73 A.D. 31), and the plaintiff had six years from that date within which to commence his action. Code Civ. Pro., § 382, subd. 5; Weaver v. Haviland, supra. While the judgment was obtained in the year 1888, the plaintiff was not required to allege the fact that leave of court had been obtained prior to the issuance of the latter execution; since the defect, if any, is one which should be corrected upon motion. Aultman Taylor Co. v. Syme, 163 N.Y. 54, 69. It, therefore, appears from the face of the complaint that the action was commenced in time, and if, because of the issuance and return unsatisfied of a prior execution, which is not referred to in the complaint, the cause of action accrued within some period anterior to six years before the date of the commencement of the action, the necessary facts should be set up by the defendant to support the plea of the Statute of Limitations.
Upon the subject of the sufficiency of the complaint, it is contended by the defendant that the pleading is fatally defective because of the absence of an averment that the judgment debtor was at the time of the conveyance insolvent, or that he was unable to pay his debts at the time of the rendition of judgment. Upon this point it suffices to say that the general averment in the complaint to the effect that the transfer was made without consideration and with intent to hinder, delay and defraud the creditors of the grantor and particularly to defraud this plaintiff's assignor, all of which was with the knowledge of the grantee, has been held to include an allegation of insolvency. Kain v. Larkin, 141 N.Y. 144. The reason for the ruling, as announced in the case cited, was stated to be that the general averment of an intent to hinder, delay and defraud includes every element of a fraudulent transfer and suffices to admit proof of the fact of insolvency and of such other evidentiary facts as may be incidentally involved, without their express averment.
The demurrer is, therefore, sustained, with costs, with leave to the defendants to amend within twenty days upon payment of costs.
Demurrer sustained, with costs, with leave to defendants to amend within twenty days upon payment of costs.