Summary
In Allred v. Nesmith, 245 Miss. 376, 149 So.2d 29 (1963), this Court held the victim was a creditor of a tort-feasor, and entitled to the benefit of the statute prohibiting conveyances to defraud creditors, presently Miss. Code Ann. § 15-3-3 (Supp.
Summary of this case from Morgan v. SaulsOpinion
No. 42508.
January 21, 1963.
1. Motor vehicles — head-on collision — verdict for defendant against weight of evidence.
Verdict for defendant in action against him for injuries sustained by plaintiff when vehicles collided head-on in plaintiff's proper lane of travel was against weight of the evidence.
2. Fraudulent conveyances — tort claimant, a creditor within meaning of statute.
A tort claimant is a "creditor," within statute providing that a grant of land to hinder, delay and defraud creditors shall as to creditors be void. Sec. 265, Code 1942.
3. Fraudulent conveyances — statute liberally construed in determining who is a creditor.
The fraudulent conveyance statute must be liberally construed in determining who is a creditor. Sec. 265, Code 1942.
4. Fraudulent conveyances — tort claimant may maintain suit in chancery to set aside conveyance without first obtaining judgment at law ascertaining the damages.
A tort claimant may maintain an action in Chancery Court to set aside a conveyance made to hinder, delay or defraud such creditor without first obtaining a judgment at law ascertaining the damages; Jones v. Jones, 79 Miss. 261, 30 So. 651; Rankin v. Ford, 160 Miss. 802, 134 So. 178 overruled.
Headnotes as approved by Gillespie, J.
APPEAL from the Circuit Court of Claiborne County; BEN GUIDER, Judge.
Suit by complainant, Mrs. Sam. S. Allred, against defendant, Benjamin I. Nesmith, to set aside certain fraudulent conveyances, and for a decree awarding her money damages for personal injuries growing out of an automobile collision between the parties. On motion by the defendant, the Court struck the averments having to do with the fraudulent conveyances and transferred the cause to the Circuit Court. The cause was transferred to the Circuit Court, and from a jury verdict for defendant, this appeal was taken. Reversed and remanded to the Chancery Court.
J.T. Drake, Jr., Joseph Davenport, Jr., Port Gibson; Satterfield, Shell, Williams Buford, Jerome B. Steen, Jackson, for appellant.
I. The Court erred in denying to the appellant a peremptory instruction on the issue of liability. Mobile O.R. Co. v. Bryant, 159 Miss. 528, 132 So. 541; Reynolds v. McGehee, 220 Miss. 750, 71 So.2d 780; Russell v. Mississippi Central R. Co., 239 Miss. 741, 125 So.2d 283.
II. The verdict of the jury was manifestly against all reasonable probability and was contrary to the overwhelming weight of the evidence. Belk v. Rosemond, 213 Miss. 633, 57 So.2d 461; Brewer v. Anderson, 227 Miss. 330, 86 So.2d 365; Faulkner v. Middleton, 186 Miss. 355, 190 So. 910.
III. The court below erred in entertaining the appellee's motion to strike those allegations of the appellant's bill of complaint relating to the fraudulent conveyances. Jenkins Boyle v. Rogers, 184 Miss. 182, 185 So. 603; Love v. Love, 158 Miss. 785, 131 So. 280; McDowell v. Minor, 158 Miss. 788, 131 So. 278; Griffith's Mississippi Chancery Practice, Secs. 367, 402 pp. 352, 392.
IV. The Court erred in not proceeding in the one suit to a complete adjudication of all disputed questions. Griffith's Mississippi Chancery Practice, Secs. 28, 36 pp. 29, 38.
V. The Court erred in sustaining the appellee's motion to strike the allegation of the bill of complaint having to do with fraudulent conveyances. Citizens Mutual Ins. Co. v. Ligon, 59 Miss. 305; Jones v. Jones, 79 Miss. 261, 30 So. 651; McBride v. State Revenue Agent, 70 Miss. 716, 12 So. 699; McInnis v. Wiscasset Mills, 78 Miss. 52, 28 So. 725; Myers v. Redmill, 266 Ala. 270, 96 So.2d 450, 73 A.L.R. 2d 746; Rankin v. Ford, 160 Miss. 804, 134 So. 178; Sec. 158, Constitution 1890; Sec. 503, Code 1892; Secs. 265, 1327, Code 1942; Chap. 64, Laws 1898; Anno. 73 A.L.R. 2d 749; 37 C.J.S., Fraudulent Conveyances, Sec. 75 p. 915.
P.M. Watkins, Port Gibson; Berger, Callon, Zuccaro Wood, Natchez, for appellee.
I. The lower court did not err in denying to the appellant a peremptory instruction on the issue of liability. Ballenger v. Vicksburg Hardwood Co., 238 Miss. 654, 119 So.2d 778; Bankston v. Dumong, 205 Miss. 272, 38 So.2d 721; Bridges v. Texaco, Inc., 242 Miss. 705, 136 So.2d 595; Cole v. Tullos, 228 Miss. 815, 90 So.2d 32; Columbus G.R. Co. v. Cobbs, 156 Miss. 604, 126 So. 402; Gulf S.I.R. Co. v. Prine, 118 Miss. 90, 79 So. 62; Lee County Gin Co. v. Middlebrooks, 161 Miss. 422, 137 So. 108; Lowe v. Mobile O.R. Co., 149 Miss. 889, 116 So. 601; Meaut v. Langlinias, 240 Miss. 242, 126 So.2d 866; New Orleans N.E.R. Co. v. Jackson, 140 Miss. 375, 105 So. 770; New Orleans N.E.R. Co. v. Martin, 140 Miss. 410, 105 So. 864; Yates v. Houston Murray, 141 Miss. 881, 106 So. 110.
II. The verdict of the jury was not manifestly against all reasonable probability and was not contrary to the overwhelming weight of the evidence. Cox v. Tucker, 133 Miss. 378, 97 So. 721; Davis v. Temple, 129 Miss. 6, 91 So. 689; Faulkner v. Middleton, 186 Miss. 355, 190 So. 910; Garland v. Stewart, 31 Miss. 314; Gibson v. A.P. Lindsey Distributor, Inc., 233 Miss. 853, 103 So.2d 345; Illinois Central R. Co. v. Harrison, 224 Miss. 331, 80 So.2d 23; Jackson City Lines v. Harkins, 204 Miss. 707, 38 So.2d 102; Lynch v. American Slicing Machine Co., 202 Miss. 522, 29 So.2d 326; Mobile O.R. Co. v. Cox, 153 Miss. 597, 121 So. 292; Montgomery v. Continental Southern Lines, Inc., 241 Miss. 355, 131 So.2d 432; Paine v. Dimijian, 201 Miss. 522, 29 So.2d 326; Shelton v. Underwood, 174 Miss. 169, 163 So. 828; Teche Lines, Inc., v. Bounds, 182 Miss. 638, 179 So. 747; Universal Truck Loading Co. v. Taylor, 174 Miss. 353, 164 So. 3, 178 Miss. 143, 172 So. 757; Wood v. Gibbs, 35 Miss. 559.
Appellant was the complainant in a bill of complaint filed in the Chancery Court of Claiborne County against Benjamin I. Nesmith, appellee, a resident of that county. The bill charged that appellee negligently operated his vehicle on the wrong side of the highway and ran head-on into the vehicle driven by appellant. Damages were sought for personal injuries sustained in the collision. The bill also charged that the accident happened on August 31, 1960, and two days later appellee began conveying his property, except homestead, to his wife and son without consideration in an effort to hinder, delay and defraud appellant. On motion of appellee, the chancellor struck out all the averments with reference to the alleged fraudulent conveyances and transferred the case to the circuit court where the case was tried before a jury. Verdict was for defendant. Plaintiff appeals.
Appellant assigns as error the refusal of the lower court to give appellant a peremptory instruction on liability. We find no merit in that contention, but hold that the verdict of the jury was contrary to the overwhelming weight of the evidence, which is appellant's second assignment of error.
Appellant was driving a pickup truck east on State Highway 547, a graveled road suitable for two-way traffic. Appellee was driving west, meeting appellant. The vehicles collided on the south half of the highway, which was appellant's right hand lane, and appellee's left hand lane. This was established beyond any question. Appellant testified that appellee came around a curve some distance to the east of her and was traveling on appellee's left side of the highway; that appellee was looking off to the left. She stated that she drove as far to the right as she could and appellee ran into her. After the accident appellee told her it was his fault. Appellant's husband testified that appellee talked to him and appellee admitted on two occasions that he came around the curve on the wrong side of the road and hit appellant, and that it was all his fault. All the evidence showed that after the accident appellant's truck had its right rear wheel in the ditch on the south side of the highway with the front end angling toward the center of the highway. Appellee's vehicle was facing that of appellant with the left wheel in or near the ditch on the south side of the highway and the front end angling toward the center of the highway. Between the vehicles water and oil and other debris was on the ground. This was in the south half of the highway. This was shown by photographs taken by a highway patrolman before appellant's vehicle was moved. Two highway patrolmen testified to the position of the vehicles after the accident and that skid marks were in the appellee's left lane in front of appellant's lane of travel which were laid down by appellee's truck. One of the patrolmen stated that appellee told him that he, appellee, was traveling on the wrong side of the road and did not see Mrs. Allred and ran into her. Appellee told two other witnesses, according to their testimony, that he was on the wrong side of the road and that the accident was his fault.
Appellee testified that when he rounded the curve appellant was on his side of the road and it looked like she did not know what she was doing, so he put on his brakes and skidded a little to the left and the two vehicles collided. He said he was in the middle of the road when the accident happened but was on appellee's side of the road when he stopped. He did not deny that he made the admissions of fault but said if he did he "did not mean it."
(Hn 1) Appellee's version of the facts is not convincing, standing alone. His testimony amounts to more than a scintilla, but when it is compared with overwhelming proof offered by plaintiff, the physical facts, the photographs, and appellee's numerous admissions of fault, we conclude that the verdict in appellee's favor is against all reasonable probability. We, therefore, hold that the verdict is against the overwhelming weight of the evidence. Belk v. Rosamond, 213 Miss. 633, 57 So.2d 461; Brewer v. Anderson, 227 Miss. 330, 86 So.2d 365.
Appellant contends in several assignments of error that (1) the chancery court erred in striking from the original bill the averments that appellee had made conveyances of his property to hinder, delay and defraud appellant, (2) that appellant was entitled to have her claim for damages and the fraudulent conveyance issue decided in one suit in the chancery court, and (3) that the cause should be remanded to the chancery court so that the original bill may be prosecuted as filed.
When it has been determined that a case must be reversed, Sec. 147, Miss. Constitution, authorizes this Court to ". . . . remand it to that court which, in its opinion, can best determine the controversy." If appellant was entitled to prosecute her suit for damages and suit to set aside the alleged fraudulent conveyances in one suit, the chancery court can best determine the controversy, and the case should be remanded to that court where the entire controversy can be settled with one decree. Griffith's Miss. Chancery Practice, Sec. 28. This requires us to determine whether the original bill appellant filed in the chancery court was maintainable in that court. Thus the question arises: Does a tort claimant have the right to maintain a suit to set aside a fraudulent conveyance before the claim is reduced to judgment? Our answer is yes.
Sec. 265, Miss. Code 1942, provides at length that every grant of lands made to hinder, delay and defraud creditors shall as to creditors be utterly void. Sec. 1327, Miss. Code 1942, is contained in the chapter on chancery courts, and provides in part as follows:
"The said court shall have jurisdiction of bills exhibited by creditors who have not obtained judgments at law, or, having judgments, have not had executions returned unsatisfied, whether their debts be due or not, to set aside fraudulent conveyances of property, or other devices resorted to for the purpose of hindering, delaying or defrauding creditors; and may subject the property to the satisfaction of the demands of such creditors as if complainants had judgments and execution thereon returned `no property found'. . . . ."
(Hn 2) A tort claimant is a creditor within the meaning of Sec. 265, Code of 1942. McInnis v. Wiscassett Mills, 78 Miss. 52, 28 So. 725. The two pertinent statutes and McInnis would seem to settle the question in accordance with appellant's contention. However, in Jones v. Jones, 79 Miss. 261, 30 So. 651 (1901), this Court held, without giving any reason, that a tort claimant could not sue a resident defendant for the recovery of unliquidated damages and to set aside as fraudulent a conveyance of property alleged to have been made by defendant to defeat the claim. In Rankin v. Ford, 160 Miss. 802, 134 So. 178, in a somewhat different kind of suit, the Court followed Jones. In neither of these cases is there any discussion of the reasons for the rule laid down in Jones. The applicable statutes were practically the same when those cases were decided as they are now. Sec. 1327, Code of 1942, which grants jurisdiction to the chancery court in cases of this kind, specifically provides that the remedy is available to creditors who have not obtained judgments at law.
(Hn 3) In Blount v. Blount, 231 Miss. 398, 95 So.2d 545, we held that a wife was within the protection of the statute declaring void conveyances in fraud of creditors, and that an action for maintenance or alimony could be maintained together with a suit to set aside an alleged fraudulent conveyance. That case is in accord with the rule that in determining who is a creditor the statute must be liberally construed. McInnis v. Wiscassett Mills, supra.
(Hn 4) We have given careful consideration to the argument that the Court should overrule Jones v. Jones, supra, and Ford v. Rankin, supra. Those cases should be, and they are, overruled. We hold that a tort claimant may maintain an action in chancery court to set aside a conveyance made to hinder, delay or defraud such creditor without first obtaining a judgment at law ascertaining the damages. We find that Jones was wrongly decided. The statute is broad in its terms. It protects "lawful actions" and "damages" against fraudulent conveyances. Every lawful action whether sounding in contract or tort is within the protection of the statute. Appellant's claim is within the letter and spirit of the statute. As the decisions now stand, they are inconsistent. McInnis holds that tort claimants are creditors entitled to the protection of the statute. The statute giving the chancery court jurisdiction permits the action by creditors "who have not obtained judgments at law." This inconsistency is removed by overruling Jones and Ford. The Jones rule is also out of harmony with the older case of Citizens Mutual Insurance Co. v. Greenwood Ligon, 59 Miss. 305 (1881), which held that the object of the statute was to prevent the necessity of a creditor resorting first to a court of law to recover a judgment, and then going into equity to secure satisfaction.
Since the decision in Jones there have been significant changes in society. The advent of the automobile, the increase in machines of all kinds, the urbanization of the population, and many other factors have greatly increased the number and importance of creditors whose claims sound in tort. The overruling of Jones brings the rule in this State in accord with the overwhelming weight of authority elsewhere. 37 C.J.S., Fraudulent Conveyances, Sec. 75; Myers v. Redmill, 266 Ala. 270, 96 So.2d 450, 73 A.L.R. 2d 746.
The case is reversed and remanded to the Chancery Court of Claiborne County for adjudication of the issues tendered by the original bill therein filed.
Reversed and remanded.
All Justices concur, except Arrington, J., who took no part.