Walker v. Laugharn

GRIFFIN, J. This is an action to quiet title to certain real and personal property commenced by plaintiff and appellant Avril Walker against defendant and respondent Laugharn, as trustee in bankruptcy of Dr. R. H. Gerber, a bankrupt. Respondent answered • and also filed a cross-complaint alleging that the purchase and assignment to appellant of the property involved was made to hinder, delay and defraud the creditors of the bankrupt, and was fraudulent and void, and prayed that the property be declared to be an asset of the bankrupt estate. The court rendered judgment in favor of defendant and cross-complainant, and plaintiff and cross-defendant has appealed.

The property in dispute was: (1) Assignment to appellant of various accounts of the face value of approximately $10,000 due- to Dr. Gerber. This assignment was claimed to have been made in August, 1936, as security for past-due wages and rents due appellant. (2) One Texas & Pacific Certificate claimed to have been purchased by appellant on June 22, 1936, for the price of $1,017. (3) Mexican bonds claimed to have been delivered to her in January, 1935, as the result of an agreement made with Dr. Gerber in 1931 to repay a loan of $400 made by her to him. (4) Real property [471]consisting of a six-room house on Irolo Street known, and hereinafter referred to, as Irolo Street house.

The court found that on May 18, 1937, Dr. Gerber was adjudicated a bankrupt upon a voluntary petition; that the assets of his estate were only nominal or of no value at all, and that the liabilities were approximately $48,000; that for a long time prior to 1931, he was and now is indebted to various and sundry creditors in said sum; that Gerber was the actual owner and possessor of the properties above mentioned at the time that certain of the indebtedness above mentioned was incurred; that in contemplation of legal action being taken on said indebtedness and for the purpose of placing said real and personal property beyond the reach of attachment or execution or other legal process by his creditors, and in order to hinder, delay, and defraud his said creditors and to prevent the application of said assets and properties to the satisfaction of the claims of said creditors, the said Gerber and the appellant and each of them conspired together and with each other to wilfully defraud the creditors of said Gerber by concealing and transferring the assets and said properties, real and personal, of said Gerber; that pursuant to said conspiracies and in furtherance thereof, various and sundry sums of money, comprising all of the earnings of said Gerber, were so transferred and placed in the hands of the appellant over a period of several years and while said Gerber was indebted to certain creditors who are now creditors of his bankrupt estate, with the intention to defraud the creditors of Gerber; that there was no actual change in possession of said property and said properties remained in the actual possession and control of said Gerber; and that said purported transfers are invalid and fraudulent.