Bates v. Drake
Bates v. Drake
Opinion of the Court
The opinion of the court was delivered by
— In December, 1893, one Alexander S. Bailey and Amanda E. Bailey, bis wife, were tbe owners
The present action was instituted by the appellants while they held only the certificate of sale. In their complaint they alleged the agreement to exchange properties between the Baileys and C. M. Drake; the exchange of the properties thereunder; that C. M. Drake, as an inducement to the making of the exchange, represented and stated that he was the owner of and had perfect title to the property sought by him to be exchanged for the property of the Baileys, all of which was well known to the respondent Maria S. Drake. They alleged the recovery of the judgment against O. M. Drake arising out of the exchange of the properties; that O. M. Drake had no other property in this state out of which the judgment could be made other than the property mentioned; the execution upon the judgment; the sale of the property thereunder, by tho sheriff to the Baileys, and the assignment of the certificate of sale to them. They alleged that the deed made by O. M. Drake to his wife was made without consideration, and with the intent to hinder, delay and defraud their creditors, and especially the Baileys and their assignees, and that the wife received the conveyance with -such intent, and without
The respondents filed a general demurrer to the original complaint, which the trial court overruled. They thereupon answered separately, each denying all of the allegations of the complaint save the exchange of the properties between O. M. Drake and the Baileys, and that he had conveyed the property received in the exchange to his wife, Mariá S. Drake. Dor a further and separate defense the respondent G. M. Drake alleged that he never at any time had any interest in the property in question, but held the same in trust for his wife, who furnished the consideration for its purchase from the proceeds of her own separate funds and property acquired by her prior to1 her marriage with him. He also pleaded, as res judicata, another action between the same parties, brought to eject them from the premises, which was dismissed without prejudice by the court at the conclusion of the evidence. The respondent Maria S. Drake filed an answer containing substantially the denials and allegations set up by her co-defendant; further alleging, however, that the sale made by the sheriff of the property in suit was a cloud upon her title, and prayed that her title be adjudged good and valid, that the sale and muni
As a preliminaiy question, the respondents insist that the appellants cannot maintain this action. It is said that, as their complaint does not allege, and it was not shown by the evidence, that the land in controversy was in the possession of the appellants, or that the same was vacant, at the time the suit was instituted, the appellants cannot recover, because a plaintiff must allege and prove one or the other of these facts before he can maintain an action to quiet or remove a cloud from title. Spithill v. Jones, 3 Wash. 290 (28 Pac. 531), is cited as sustaining this contention. This court in that case did hold that an action to quiet title should be dismissed for want of equity where the proofs failed to show that the plaintiff was in possession of the lands the title to which was sought to be quieted, or that the same was unoccupied by any person. It spoke also as if the question was one of the jurisdiction of the court. It is clear, however, from the opinion as a whole, that the court did not mean by its use of this term that it was without jurisdiction or power to determine the subject-matter of the controversy between. the parties or
The respondents next insist that the appellants cannot, in any event, recover, because the question became res judicata in the former action mentioned, which, as we have said, was dismissed without prejudice. It is not contended that the judgment actually entered therein has the effect of res judicata on the merits of the controversy, hut that the respondents were entitled in that action to a judgment on the merits, and that the court erred in refusing to enter it. It is evident, however, that it is to the judgment actually entered in an action which is or is not a bar to another action, not a judgment that might or ought to have been entered therein. It is, perhaps, needless to add that a judgment of dismissal of an action without prejudice is
Another reason urged why the appellants cannot recover is that they .were not creditors of C. M. Drake at the time he conveyed the property at Tacoma to his wife. It is said that the predecessors in interest to the appellants at that time had at most only an unliquidated claim for damages for a fraud practiced upon them by C. M. Drake, and that one holding an unliquidated claim for damages against another, sounding in tort, does not constitute the claimant a creditor before the claim is prosecuted to judgment, nor invest him with the right given by law to creditors to question fraudulent or voluntary transfers of property made by the person against w7hom athe claim exists before the claim is reduced to judgment. There are cases which maintain this contention, but they are based, as we understand them, upon statutes not so broad as the rule in force in this state. The statute of 13 Eliz. c. 5, which is a part of the common law of this state (Wagner v. Law, 3 Wash. 500-502, 28 Pac. 1109, 28 Am. St. Rep. 56, 15 L. R. A. 784), provided that all conveyances made with the intent to hinder, delay, or defraud creditors and others of their just and lawful actions, suits, debts, accounts, damages, etc., should be deemed and taken as void, and of none effect. In those states where a similar statute is in force, or which recognize this statute as being a part of their common law7, it is the almost uniform holding that a person having a. claim against another for damages sounding in tort is a creditor of that other within the meaning of the rule, and this holding, we think, is supported by the better reason.
Again, it is said the appellants cannot recover because it was not alleged that Drake was insolvent at the time of the conveyance which is alleged to have been fraudulently
On the question of the good faith of the conveyance from O. M. Drake to his wife, we think the trial court erred. By statute in this state (Bal. Code, § 4580) it is provided that in every case where any question arises as to the good faith of any transaction between husband and .wife, whether a transaction between them directly or by the intervention of a third person, the burden of proof shall be upon the party asserting the good faith; and in Liebenthal v. Price, 8 Wash. 206 (35 Pac. 1078), after referring to the statute, we said it was a general rule, where transfers of property from husband to wife are questioned, that the payment of a valuable consideration must be shown by proof of the most satisfactory character. While it may be true that a conveyance from a husband to a wife is not of itself a badge of fraud, either under the rule of the statute or the general rule cited, it is nevertheless a fact, which naturally awakens suspicion, lends greater weight to other unfavorable circumstances, and ■will be for that reason set aside upon less proofs of fraud than will a transaction between parties not having the same confidential relation. Turning to the record, and consid
But, without pursuing the inquiry further, we are convinced that the conveyance in question was not made in good faith, or for a valuable consideration, and was intended to defraud the; Baileys and their assignees of any judgment they might recover for the fraud practiced upon them by O. M. Drake. The judgment of the lower court is therefore reversed, and the cause remanded with instruc
Keavis, O. J., and White, Hadley, Anders, Mount and Dunbar, JJ., concur.
Reference
- Full Case Name
- Charles O. Bates v. C. M. Drake
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- 29 cases
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- ACTIONS-MISTAKE OF PLAINTIFF AS TO FOEM-WAIVES OF OBJECTIONS. Where defendants do not raise the objection until after trial that plaintiffs’ form of action should have been in ejectment instead of one to quiet title, because they were not in possession of the land, and the land was not vacant and unoccupied, the objection must be deemed as waived. SAME-ESTOPPEL OF DEFENDANTS. Where defendants, in an action to remove a cloud and quiet title, themselves submitted to the determination of the court by their answer the very issue appellants sought to submit, and obtained the relief for which they prayed, they cannot upon an appeal by plaintiffs therefrom be heard to say that the plaintiffs originally mistook their form of action. JUDGMENTS-EES JUDICATA. A judgment of dismissal of an action without prejudice would not have the effect of res judicata on the merits of the controversy even if the court erred in refusing to give judgment on the merits. FRAUDULENT CONVEYANCES-WHO ARE CREDITORS-CLAIMANT FOB DAMAGES. A person having a claim against another for damages sounding in tort is a creditor of that other within the meaning of the statute giving creditors the right to question transfers of property made to hinder, delay and defraud creditors. SAME-PLEADING-INSOLVENCY OF FRAUDULENT GRANTOR. In an action to recover land fraudulently conveyed the insolvency of the grantor is sufficiently alleged, as against a general objection to the complaint, where it alleges that the grantor had no other property in the state than that fraudulently transferred at any of the times mentioned in the complaint, out of which execution against him could he made. SAME-BURDEN OF PROOF — -SUFFICIENCY OF EVIDENCE. Under Bal. Code, § 4580, which provides. that in every case where any question arises as to the good faith of any transaction between husband and wife the burden of proof shall he upon the party asserting the good faith, a deed by a husband to his wife should he deemed fraudulent, where it appears that the husband obtained a conveyance and the possession of valuable property without consideration, and that his wife actively participated in the transaction; that the deed by husband to wife was made after the commencement of suit by the husband’s grantors to set aside the deed to him; that the husband and wife had made inconsistent statements as to which of them was the owner before suit, - and after suit it was claimed the consideration for the conveyance between the spouses was the payment of moneys out of the wife’s separate estate to the husband, from moneys he had in his hands as her agent, hut it was not shown how much money of hers he had, nor what sum was actually paid by her for the property.