Opinion
6 Div. 446.
June 15, 1939. Rehearing Denied October 12, 1939.
Appeal from Circuit Court, Winston County; R. L. Blanton, Judge.
Russell W. Lynne and S. A. Lynne, both of Decatur, for appellants.
The mere fact that a grantor is indebted does not preclude him from conveying his property for a valuable consideration, and where there is no intent to defraud, the conveyance cannot be set aside by his creditors, although the effect of the transfer is to place his property beyond the reach of his creditors, or hinder them in the collection of their claims. The debtor is accountable to no one unless he acts in bad faith. Simmons v. Shelton, 112 Ala. 284, 21 So. 309, 57 Am.St.Rep. 39; Pope v. Wilson, 7 Ala. 690; Gilbert v. Gonyea, 103 Minn. 459, 115 N.W. 640. The party alleging fraud must prove it. Tompkins v. Nichols, 53 Ala. 197.
W. L. Chenault, of Russellville, for appellee.
The burden of proving bona fides of the transaction and valuable consideration was upon the respondents. Calvert v. Calvert, 180 Ala. 105, 60 So. 261; Pasquale v. Francis, 210 Ala. 590, 98 So. 568; Cooke v. Fenner Beane, 214 Ala. 558, 108 So. 370; Murphy v. Pipkin, 191 Ala. 111, 67 So. 675; Watters-Tonge Lbr. Co. v. Knox, 206 Ala. 183, 89 So. 497; Woody v. Tucker, Willingham Co., 215 Ala. 278, 110 So. 465; Davis v. Harris, 211 Ala. 679, 101 So. 458.
On former appeal (Denton v. Lindler et al., 231 Ala. 27, 163 So. 334), the equity of the bill, as one to set aside a voluntary conveyance at the suit of an existing creditor of the grantor, was upheld.
The subject matter was a real estate mortgage held by J. E. Dutton against J. O. Denton, and was transferred by Dutton to his stepdaughter, Nora B. Dusking, a member of his family. The bill disclosed that complainant, Lindler, was an existing creditor of Dutton at the time of such transfer, and alleged the transfer was made without consideration and with the intent to hinder, delay or defraud complainant.
The present appeal is from a final decree on pleadings and proof granting the relief prayed.
Without dispute Lindler was an existing creditor of Dutton. Lindler had first held a purchase money mortgage given by Denton on the same lands, and on January 7, 1931, had sold and assigned the debt and mortgage to Dutton, taking his personal notes, maturing at future dates. They were never paid. A judgment had been taken on the first maturing note before the bill was filed.
The burden was, therefore, on appellants by proper averments and proof to show a valuable consideration for the transfer from Dutton to his stepdaughter, and in what it consisted. Sims v. Dixie Southern Land Co. et al., 209 Ala. 679, 96 So. 885; R. W. Allen Co. v. Sands et al., 216 Ala. 106, 112 So. 528; Davis v. Harris, 211 Ala. 679, 101 So. 458.
Denton had renewed the mortgage after it was acquired by Dutton, including an additional indebtedness he then owed Dutton. This renewal mortgage was transferred to Miss Dusking, and afterwards foreclosed, bought by a relative of Dutton, as a conduit of title to Miss Dusking.
The whole became equitable assets of Dutton subject to the payment of his pre-existing debts, if the transfer was without consideration. Denton v. Lindler, supra.
A careful study of the evidence, direct and circumstantial, leads us to the same conclusion as the court below.
A review of the evidence would serve no good purpose.
Affirmed.
ANDERSON, C. J., and GARDNER and FOSTER, JJ., concur.