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26 Ark. 20

Cox v. Fraley

Supreme Court of Arkansas

Decided December 15, 1870

Supreme Court of Arkansas · decided 1870-12-15

'Host. Elisha BaxteR, Circuit Judge. 1. The demurrer should have been stricken out. The causes ’.assigned were general in terms and extended to the whole Bill. The only causes assigned being multifariousness and want of equity. The filing of the plea was a waiver of the demurrer, the •demurrer being to the whole bill. 'The cross bill was not multifarious. 1 Danl. Ch. PI. A demurrer for multifariousness goes to the whole bill. 1 Danl.

Cited by 1 later decisions — most recently July 1893

1 state decisions

Cited in Bouvier (1914)’s definition of “Badge Of Fraud”

Good law ✅— No negative treatment on recordhow we know

Decided 1870-12-15

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<xREÜO, J.

¶1On the 7th of May, 1868, the appellees brought their suit, in equity, against Benjamin E. Burns, James F. Jordan and Stephen M. Henley, to foreclose a mortgage executed by them upon a portable steam engine and apparatus, to Jesse H. Henley, and by him assigned to Mrs. Fraley.

¶2Hpon petition, the appellant was made a defendant, and for answer to the bill, he alleged that the note, to secure the payment of which the mortgage was given, was executed without ■consideration; that it and the mortgage were given to delay and defraud creditors, etc., and that the mortgagors were indebted to him, and that his equities were known to Fraley and wife before they purchased the note and mortgage.

¶3On motion of the complainants, the court struck the answer from the files. The appellant excepted, and then filed a cross bill. After several motions and the forming of some immaterial issues, the court, sustained a demurrer to the material parts of the cross bill.

¶4Upon the hearing, a final decree was rendered against the original defendants, foreclosing their equity of redemption, etc., and Oox only excepted and appealed to this court.

¶5There is no proof of fraud on the part of B. E. Burns & Co., in executing the note and mortgage. This court has repeatedly held that the fact of grantor being embarrassed is no proof that a conveyance is fraudulent. Splawn v. Martin, 17 Ark., 146; Dardenne v. Hardwick, 9 Ark., 482; Hempstead v. Johnson, 18 Ark., 124.

¶6If acting in good faith, a debtor may pay or secure one creditor in preference to another. Huff v. Roane, 22 Ark., 184; Williams v. Buzzard, 11 Ark., 718; Cook v. Cook, 12 Ark., 387; King v. Payne, 18 Ark., 589.

¶7But there was no issue in this cause presenting that question, which the appellant seemed to be seeking to raise.

¶8The object of the bill was to foreclose the equity of redemption of Burns & Co , and have the property sold to satisfy a debt against them. The appellant was a general creditor of that firm, and had no interest whatever in the property mortgaged and no more right to inforce his demand against it than any other creditor had. If he attached the property, it was after the execution and recording of the mortgage, and with a full knowledge of the existing lieh. This he had a legal right to do, and if the value of the property was greater than the amount due under the mortgage, he can have the excess applied toward the payment of any judgment he may obtain; but a mere obligation that he owned a valid claim against Burns & Co., did not authorize him to come into a court of equity and set up fraud to prevent other creditors, who had been more vigilant than himself, from recovering against a failing firm. Appellant showed no interest in the property, and no claim even reduced to judgment; and there was no error in sustaining the demurrer to the material allegations in his cross bill. And if there was no equity in appellant’s cross bill, and we are clearly of opinion there was none, he was not aggrieved upon any ruling of minor points in the cause, as the final decree would, of necessity, have been against him. Certainly no small amount of the time of the court below was consumed in motions that did not go to the real merits of the cause.

¶9Binding no error in the final decree of the court below, the same is in all things affirmed, with costs.

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