Kentucky Bank & Trust Co. v. Pritchett

• Opinion by

RITTENHOUSE, C.

On August 12, 1908, T. W. Pritchett, W. IT. Pritchett, and C. W. Pritchett executed and delivered to the Kentucky Bank & Trust .Company three promissory notes of $1,835 each, and on said date W. IT. Pritchett was the owner of lot 7. in block 42, in Sayer’s subdivision of lots 10 to 14 in block 42 in the city of Chickasha, Okla., and the money received by Pritchett on said notes was used in paying the purchase price of said lots and for the purpose of constructing a brick building thereon.. On the 15th day of May, 1909, W. H. Pritchett and Martha Pritchett, his wife, conveyed an undivided half interest in said lot to C. W. Pritchett, and on the 15th day of February, 1910, W. H. Pritchett and Martha Pritchett, his wife, and C. W. Pritchett made, executed, and delivered a deed to said property to T. W. Pritchett, who was the father of W. H. Pritchett and C. W. Pritchett, and on the same day T. W. Pritch-ett conveyed said property to Martha Pritchett in consideration of love and affection and services to be rendered; and it is alleged by plaintiffs that all of said conveyances were voluntarily made without a valuable consideration and for the purpose of defrauding plaintiffs and other creditors of W. H. Pritchett, T. W. Pritchett, and C. W. Pritchett. On October 13, 1910, Willis C. Hopewell, trustee in bankruptcy of the estate of W. H. Pritchett, intervened in said action and filed his answer, alleging, in substance, that W. H. Pritchett on June 21, 1910, filed a voluntary petition in. bankruptcy in the District Court of the United States for the Western District oí Kentucky, and was adjudged a bankrupt, and that he, Hopewell, was elected and had qualified as trustee of said estate; ¡.hat there were proved debts against said estate in the sum of $8,978.47; that the assets were not sufficient to pay any of the general claim, and prayed that the deeds be set aside and held for naught, and that the property be subjected to payment of claims as proved in said estate. The evidence shows that the transfers were made to the parties as alleged, and that at the time the said T. W. Pritch-ett became the owner of said property, his sons W. H. Pritchett and C. W. Pritchett were indebted to him in the sum of $5,000, and that said property was transferred to him in payment of said sum; he being preferred over other creditors to that extent. The court impaneled a jury, instructing them on the law of the case, and submitted to them special interrogatories, but not a general verdict. After the answers were returned, the court rendered judgment in favor of the defendant. The plaintiffs in error complain of the several instructions given to the jury, and also of the ambiguity of the answers made to the several questions submitted, and insist that under the answers the court would be compelled to render judgment in favor of the plaintiffs.

A suit to cancel a deed on the grounds of fraud is an equitable action, and the parties are not entitled to a jury trial as a matter of right, but the court may, in its discretion, submit to the jury special interrogatories, but the answers thereto are merely advisory to the trial court, and it may adopt or reject such advice as it may deem just and proper under the evidence in the case. The plaintiffs in error complained of the instructions which the court gave to the jury, and the answers which the jury made to the special interrogatories. If there was error in the instructions or the special interrogatories, such error is immaterial, and cannot be the basis for a reversal in this cause, as the trial court has the power, and it is its duty, to pass upon the law and the facts independent of the advice furnished by the answers to such special interrogatories.

It has been said in Barnes et al. v. Lynch, 9 Okla. 191, 59 Pac. 1008:

“The law is, however, in cases of equitable cognizance, that, while the judge may call in a jury or consent to one, for the purpose of advising him upon questions of fact, he may adopt or reject their conclusions, as he sees fit, and that the whole matter nutst eventually be left to him to determine, and that the instructions furnish no ground of error, upon appeal. It was not only the right, but the duty, of the court to finally, determine all questions of fact, as well as of law.”

And this holding has been adhered to in the following cases: Mosier v. Walter, 17 Okla. 805, 87 Pac. 877; Richardson D. G. Co. v. Hockaday, 12 Okla. 546, 73 Pac. 957, Wattah-noh-zhe v. Moore, 36 Okla. 631, 129 Pac. 877; Apache State Bank v. Daniels, 32 Okla. 121, 121 Pac. 237, 40 L. R. A. (N. S.) 901, Ann. Cas. 1914A, 520; Murray v. Snowder, 25 Okla. 421. 106 Pac. 645; Hogan et al v. Leeper, 37 Okla. 655, 133 Pac. 190, 47 L. R. A. (N. S.) 475; Mo. Valley Lbr. Co. v. Reid, 4 Kan. App. 4, 45 Pac. 722; Shorten v. Judd, 60 Kan. 73, 55 Pac. 286.

There remains only one question for determination in this cause, and that is whether there is sufficient evidence to support the judgment. There was evidence to show that T. W. Pritch-ett was in good faith a creditor of W. H. and C. W. Pritchett in the sum of $5,000 at the time of the transfer of the property in this cause, and that the property did not exceed in value that amount. The court was justified in finding that he was a creditor in good faith, and that he could be preferred over other creditors, even though in preferring him there would not be sufficient assets left to satisfy such other creditors.

It was said in Brittain, Smith & Co. v. Burnham et al., 9 Okla. 522, 60 Pac. 241:

“Under the laws of this territory a debtor in failing or insolvent circumstances has a right to pay one creditor in preference to another or to give to one creditor security in payment of his demand, in preference to another; and if accepted by the creditor in good faith, for the payment or the securing of a subsisting, honest debt, due from the debtor to the creditor, it will be sustained, although it has the effect to delay, hinder, or defeat other honest debts of the debtor.”

20 Cyc. 472; Pollock v. Meyer, 96 Ala. 172, 11 South. 385; Carter v. Coleman, 84 Ala. 256, 4 South. 151; Lewy v. Fischl, 65 Tex. 311; Bamberger v. Schoolfield, 160 U. S. 149, 16 Sup. Ct. 225, 40 L. Ed. 374; Birmingham v. Smith, 93 Ala. 97, 9 South. 548; section 4434, Comp. Laws 1909; section 2901, Rev. Laws 1910.

The trial court had under consideration these questions and also the question as to whether the transfer to Martha Pritch-' ett by T. W. Pritchett was in fraud of the creditors of the said T. W. Pritchett, and, after weighing all the evidence, the court found every material fact in favor of the defendants; and, as there was sufficient evidence in the record to support this finding, this court cannot weigh the evidence in order to grant or refuse a new trial, but is bound by the judgment of the trial court under such circumstances.

■For the foregoing reasons, the cause should be affirmed.