Finch v. Cecil, 170 N.C. 114 (1915)

Nov. 17, 1915 · Supreme Court of North Carolina

170 N.C. 114

T. J. FINCH, Trustee of P. S. CECIL, v. P. S. CECIL and Wife, ABBIE W. CECIL.

(Filed 17 November, 1915.)

1. Husband and Wife — Estates by Entireties — Creditors—Erand.

Where a conveyance of lands is made to the husband and wife in en-tireties, expressing a valuable consideration, it will not be set aside at the suit of the husband’s trustee in bankruptcy, alleging it was purchased with the money of the husband, while insolvent, for the purpose of defrauding his creditors in having it conveyed to him and his wife, there being no evidence of the insolvency or fraud of the husband at the time of the deed, and evidence that he was then indebted to his wife.

2. Same — Retaining Property — Interpretation of Statutes.

A conveyance of lands to husband and wife by entireties which was paid for by the husband will not be considered as fraudulent with respect to his creditors, when he retained property amply sufficient to pay them at the time of the deed. Revisal, sec. 962.

Appeal by plaintiff from Justice, J., at August Term, 1915, of Davidson.

Emery E. Paper and Walser & Walser for plaintiff.

L. A. Martin and Phillips & Bower for defendants.

Clark, C. J.

‘ Tbis is an action by tbe trustee in bankruptcy of P. S. Cecil to subject certain lands now beld in entirety by tbe said bankrupt, P. S. Cecil, and bis wife to payment of tbe debts due by P. S. Cecil. Tbe plaintiff alleges tbat said P. S. Cecil was insolvent for more than two years before be failed, and tbat during tbat time be took deeds in tbe joint names of bimself and wife for said lands, which were paid for by said P. S. Cecil alone, and tbat tbe title was tbus taken in entirety to binder and delay bis creditors, and asking tbat tbe said Cecil and wife be adjudged to bold said lands in trust for bis creditors and tbat tbe same be sold by tbe plaintiff under tbe orders of tbe court. The defendants allege tbat P. S. Cecil was not insolvent at any time prior to tbe bankrupt proceeding, and tbat tbe said deeds were not voluntary, but were made in tbe usual course of dealing, without any purpose of delaying, hindering or defeating creditors.

Taking tbe evidence in tbe most favorable light, tbe plaintiff failed to show insolvency on tbe part of P. S. Cecil, fraud or intention to hinder and delay bis creditors. Tbe deeds in question, according to tbe evidence, were based on good consideration. Even if the deeds were voluntary the joining of tbe wife as grantee would not make them fraudulent if sufficient property was retained to fully satisfy tbe then creditors of P. S. Cecil. Revisal, 962.

Tbe plaintiff’s evidence showed tbat both defendants owned some property and tbat in one case tbe land was bought by tbe husband and wife jointly, she being made one of the grantees, it would seem, because, according to the evidence, her husband was indebted to her.

There being no sufficient evidence to contradict the express terms of the deeds, which recite that they are based on a valuable consideration, or to show that the grantors therein executed them through fraud, or that the defendants participated in any fraud, and in the absence of evidence that any of said lands were conveyed.to defendants to hinder, delay, or defeat the rights of creditors, and the plaintiff having failed to establish the insolvency of the defendant P. S. Cecil, or to show that he did not retain property sufficient and available to satisfy his then creditors, the judgment of nonsuit was properly granted.

Affirmed.