Opinion
08-08-1892
LASHLEY v. SOUDDER et al.
William A. Logue, for complainant. John J. Crandall, for defendant George L. Souder.
(Syllabus by the Court.)
Bill in equity by Esther A. Lashley against George L. Souder and others for partition of a farm. Judgment for defendant Souder.
William A. Logue, for complainant.
John J. Crandall, for defendant George L. Souder.
PITNEY, V. C. This is a bill for partition brought by the complainant, as heir at law of Mary Souder, against her brothers and sisters, asking for a partition of a farm in Gloucester county of which Mary Souder died seised on or about the 27th of July, 1885. The bill alleges that the defendant George L. Souder, who with the complainant is entitled to an equal one eighth part of the farm, had been in possession of the premises, and has received the rents and profits, since the death of their common ancestor, but makes no demand for an account of the rents and profits. The defendant George E. Souder answers, denying that Mary Souder died seised of the lands in question, and "avers the fact to be that said lands were at her decease, and still are, the property of the answering defendant." And then, by way of cross bill, alleges that the farm in question was at one time the property of John Souder, the husband of Mary Souder, and the father of the parties to the suit; and that in the year 1871 John Souder, being an aged and infirm man without other property than the said farm, conveyed the same to said George by deed in fee simple, in consideration of the defendant undertaking the care and support of his father and mother during their lifetime; and that the defendant entered into a written agreement, in which he "undertook the care and support of his father and mother in consideration of the conveyance of said land to him as aforesaid; and that afterwards, and while defendant was in good faith carrying out his agreement, it was suggested by defendant's brother that, for the better securing of the said parents' support, it would be more just for defendant to convey said land to his mother, and rely upon his agreement in writing and the possession of the property for his security for a time,—for a few years,—and that later a reconveyance should be made to this defendant." The agreement on his part to support his parents is not set out, except as above, and is not proffered. The cross bill further alleges that the defendant George L. Souder "has, from the first to the last, provided for and cared for his parents, attended them in sickness and health during their respective lives, paid all their expenses, including that of their burial, respectively," and has lived upon the land during all the time, paid the taxes and expenses of the same as his own property, and that John Souder departed this life on the 26th day of January, 1874, and Mary Souder on the 23d of July, 1885, and that for five years previous to her death she was blind, and by reason of her blindness and infirm condition she died without reconveying the property by deed to him; that the agreement signed by him, (George,) with the deeds and muniments of title, were in her possession; and that some time after the decease of Mary Souder he made search for the papers in question, and found them in the possession of the complainant. He prays for specific performance of the contract set forth in his answer, and that he may be decreed to have and to hold the land in fee simple, and for other relief.
It will be observed that this cross bill does not allege in so many words a conveyance by George Souder to his mother, and an agreement on her part to reconvey; but it would seem to be based upon the idea that the written agreement signed by him to take care of his parents entitled him to the fee simple of the property. The complainant files a separate replication to this cross bill, and the other defendants, with the exception of a brother of the defendant, join in replication, which is, in substance, the same as that of the complainant. With regard to the conveyance and agreement to support set forth in the answer, the complainant denies all knowledge, and puts the defendant upon proof, but denies that he ever did takecare of and provide for his father and mother as alleged in the cross bill, or pay their burial expenses; and the answer further states that it may be true that the reconveyance from George to his mother was made at the suggestion of the brother of said George, but she (the complainant) has no knowledge thereof, and expressly denies that the brother had any authority to make any arrangement binding any of his brothers and sisters; and the complainant insists that said conveyance from the said George to the said Mary Souder, his mother, was "for a good and valuable consideration, and if any such agreement [referring to the agreement by defendant to support his parents] did exist, as stated in said cross bill, the said conveyance was intended as a complete abrogation thereof by the said Mary Souder, with the consent of the said George." And, with regard to the possession of the agreement and other title papers, complainant says that they were in a chest brought to her house by her mother, and left there, and that their existence was unknown by her until after the bill was filed. The complainant by her replication to the cross bill further alleges that the defendant had the use of the farm, and all the horses and cattle and farming implements, and other personal property belonging to his father during the joint lives of his father and mother, and alter the death of his father during the life of his mother, and that, in addition to the use of the farm, he cut large quantities of wood, and kept the proceeds thereof, and that his occupation of the farm was by the consent of his brothers and sisters, for the purpose of using the proceeds for the support of his father and mother. The answer further alleges that George never pretended to own the premises until he made the claim in his answer and cross bill, but had always admitted, from the death of his mother up to the time of filing the bill for partition, that he owned the property as tenant in common with his brothers and sisters.
At the trial the defendant George Souder produced a conveyance from his father and mother to him dated the 10th of August, 1871, in consideration of $1,500, with covenant of warranty, duly recorded on the 30th of December, 1871. He also produced a written contract, executed by himself, and dated on the same 10th of August, 1871, in the following words: "Know all men by these presents, that whereas, John Souder and Mary Souder have this day deeded their real estate to me located in the township of Franklin, county of Gloucester, and state of New Jersey, consisting of one hundred acres of land, in consideration that I would furnish them with a good and comfortable support during the remainder of their lives, I hereby, in consideration of the above conveyance, agree to furnish the said John and Mary Souder with a good and comfortable support during life, and to permit them to live in the house located on the premises deeded to me as long as they may choose to live there; and hereby covenant and agree that said property shall revert to John loader in case that he should survive or outlive me, or in case he should die first, and Mary Souder should survive me, that it shall revert to her; and I hereby order, authorize, and direct that my heirs, executors, or assigns that they do make over said property as aforesaid, in case the said John or Mary Souder survive me, as above mentioned. And for a full performance of the above agreement I hereby agree to abandon and reconvey to said John and Mary Souder the said property, in case I fail to furnish a good and comfortable support for them as aforesaid. And for a full performance of the above agreement I hereby bind myself, my heirs and assigns, firmly by these presents. In witness whereof I have hereto set my hand and seal this tenth day of August, in the year of our Lord one thousand eight hundred and seventy-one. George L., Souder. [L. S.] Witness: Franklin Rowell." It further appeared that in the month of March, 1874, and shortly after the death of his father, George Souder was threatened with suit by a Miss Woolbert, or by her parents, for having gotten her with child; and on the 3d of March of that year he conveyed the premises in question to his mother, Mary Souder, by deed of bargain and sale, in consideration of $1,500, the receipt whereof was acknowledged, and containing a covenant of warranty, and that she agreed to reconvey them after Miss W. and her father were settled with; that Mary Souder had possession of the deeds from herself and her husband to George, and from George to her, and of George's contract above set forth, from that time until she died; that she and her husband occupied the premises during their joint lifetime, and that she occupied them after her husband's death, during her lifetime, and that her son George lived upon the premises, and worked the farm, and supported his father and mother, in all respects in accordance with the terms of his contract, so that but for the conveyance from George Souder to his mother of the 3d of March, 1874, his title to the premises would be complete and unimpeachable.
The question raised by these facts is as to the effect of the conveyance from George to his mother. It seems to me quite clear that the agreement of Mary Souder to reconvey the premises to George cannot help him. It is clearly void by the statute of frauds, either as a covenant to reconvey or as a declaration of trust. It was argued that the statute of frauds was not set up by the answer to the cross bill, but the allegations of the crossbill did not call for any such appeal to that statute. It did not allege in so many words either a trust or a contract to reconvey. It is perhaps possible to construe the language used as an allegation that the conveyance to the mother was made in trust for the grantor, but that is, in substance, denied by the answer to the cross bill, where it is alleged that the conveyance was made for a valuable consideration, and that it was an abrogation of the original contract of 1871; hence the party setting up the trust or contract to reconvey was called uponto prove it, and the only mode in which he could prove it was by writing signed by Mary Souder. It is well settled that, if a defendant denies the existence of the parol agreement or a parol declaration of trust, the party setting it up must prove it by evidence which will satisfy the statute of frauds. It is only where the agreement is admitted by the answer that it is necessary to set up the statute of frauds as a defense.
The ground principally relied upon by the counsel of the defendant George was the original written agreement on his part to support his parents, and, in case either of them survived him, his heirs at law were to convey the premises to such survivor. Let us consider what was the situation of the title, viewed from an equitable standpoint, during the lifetime of Mary Souder. I think it maybe accurately stated thus: George Souder held a life estate, which was to become a fee simple in case he survived both his parents, and the whole estate was subject to a charge for the support of his father and mother, who also had a right to occupy the dwelling; or thus: George Souder held his parents' contract to convey to him the property if he supported them during their lives and survived them. If this be so, then his creditors had no right in equity, as against his father and mother, to seize the farm and appropriate it to the payment of their debts; and, when threatened with suit by reason of his escapade in question, it was clearly his right and his duty to prevent any greater interest in the property than that which he actually possessed being subjected to the demand in question. Under these circumstances, what he ought to have done was to have executed a conveyance which would have put the title at law just where it was in equity. Instead of doing this, which would have required the services of an experienced and learned lawyer, he made the simple conveyance in question. In the following June he settled with the lady whom he had wronged, and her father, by joining with his mother in a bond conditioned for the payment of $115, and secured it by a mortgage executed by his mother on these very premises, which bond was afterwards paid in full. In order to succeed now in wresting the title from the heirs of his grantee, defendant must establish two propositions: First, that the conveyance was not intended to hinder, delay, or defraud his creditors; second, that, so far as concerns his contingent interest in the land, it was made by way of mortgage only to secure his mother her support. The conveyance was no doubt constructively fraudulent and void, without regard to the actual intent of the parties, as against Miss Woolbert and her father, so far as it conveyed the estate of George contingent upon his surviving his mother; but so far as relates to her right under the contract of August 10, 1871, to occupation of the house, and to a support out of the premises, it was perfectly valid. In this feature the case resembles Demarest v. Terhune, 18 N. J. Eq. 532, and if a creditor of George, whose debt antedated the conveyance of March, 1874, were here attacking it, he would succeed, as did the complainant in that case. In Demorest v. Terhune, and in the cases which have followed it, the court went upon the ground that the conveyance subjected to criticism was good so far as the debt due from the grantor to the grantee was concerned, and constructively, though not actually, fraudulent as to the surplus. Says Chief Justice Beasley, at page 539 of 18 N. J. Eq.: "The conveyance, though not wholly, is, in some degree, voluntary, and is thus far constructively a fraud, delaying, and, if not set aside or controlled, defeating creditors." And at page 540 he quotes from Chancellor Kent as follows: "A deed fraudulent in fact is absolutely void, and is not permitted to stand, as against creditors, as a security for any purpose of reimbursement or indemnity; but it is otherwise with a deed obtained under suspicious or inequitable circumstances, or which is only constructively fraudulent." Boyd v. Dunlap, 1 Johns. Ch. 482. This doctrine was reiterated by Justice Depue, speaking for the court of errors and appeals, in Heintze v. Bentley, 34 N. J. Eq. 562. At page 566 he says: "It is well settled that a deed fraudulent in fact against creditors is absolutely void as to them, and cannot be permitted to withstand them for any purpose;" citing Demarest v. Terhune.
Was the conveyance here in question actually or only constructively fraudulent? Did George' intend to make use of it for the purpose of defeating or delaying Miss W. and her father in prosecuting their claim against him, or did he intend only to secure his mother her just rights in the property? Upon the solution of this question must his rights be determined, for it is too well settled to be open to a moment's question that, if his object was to use it for the former purpose, he is forever barred as against his mother and her heirs at law. Further, in order to succeed and establish any title, he must, as before remarked, show affirmatively that the conveyance was, in effect, a mere mortgage, and not a conveyance upon a parol trust for the grantor. Several circumstances throw light upon the real nature of the transaction: First. George actually paid and discharged the obligation which menaced him, and there is nothing to show that he made any use of the conveyance in order to secure a better settlement. This is a circumstance tending to negative actual fraud. Claflin v. Mess, 30 N. J. Eq. 211. Vice Chancellor Kindersley in Jenkyns v. Vaughan, 3 Drew, 419, says: "If you can show that the person who executed the deed, though indebted at the time he made it, has paid every debt, it is very difficult to say that he executed it with the intention to defeat or delay creditors, since his subsequent payment shows he had not such intention." Second. The mother retained possession of George's contract to support her, and accepted its execution by him, and received its benefit, and she executed a mortgage on the premises to secure his bond to pay an obligation, the enforcement of which was the occasion of the conveyance. Third. She retained the title until she died, and gaveno written declaration of trust, and seems to have carefully put all the muniments of title beyond his reach, by lodging them with her daughter. This indicates an intention on her part to retain the title, but is not inconsistent with the original intent to convey by way of mortgage merely, and not with intent to defeat creditors. Then there is the express promise made by her to reconvey as soon as Miss W. and her father were settled with. This tends to show that the object was rather to baffle the Woolberts than to secure the mother, though it is consistent with the latter. Fourth. The possession and use of the premises were unchanged. George continued to live with his mother in the house, and to use and occupy the farm, and during such occupation cut and removed a considerable quantity of wood and timber from it. This indicates that the parties treated the transfer as a mortgage. Upon the whole case, and in view of the rule that the presumption should be in favor of honesty and against fraud, I have come to the conclusion that the defendant is entitled to relief on his cross bill, but without costs.