of F. H. McGuire from liability for the debts | tion for this note, and that the reputation of of both of the companies. And it was at this the McGuires for honesty and truthfulness meeting that the lower court found that H. was bad, but we think an afurmance of the H. McGuire was guilty of such conduct as judgment may well be rested on what hapwould estop him from maintaining a suit on pened at this August meeting. The McGuires knew that one of the principal objects of this meeting was to ascertain the financial condition of these companies, and, on the faith and credit of the assumed fact that full disclosures had been made of the entire liabilities of the companies, F. H. McGuire was released from any liability with which he might be chargeable on account of the debts due by the companies.

The two McGuires were acting in concert and both of them were endeavoring to and did conceal the existence of this note, although they both were under a duty to bring it to the attention of those present at the meeting, and it is fair to assume from all the facts and circumstances that, if they had done so, F. H. McGuire would not have been released from liability, and that Carroll and Marshall would then and there have taken different action from .hat they did. It is There is some other evidence in the record also manifest that the McGuires concealed

the People's Bank of Tompkinsville the sum of $1,000.00 and take out of collection of first four miles of road completed, for money advanced. Keating Bros. Con., by P. Keating. Accepted April 1, 1913, U. S. Harlan, R. E."

they disclosed its existence, the agreement and McMillan Ldg. Turnpike: Please pay to by which F. H. McGuire was released from liability would not have been consummated. Considering the doubtful justice of the note, as well as what transpired at this meeting, we think the lower court correctly held that H. H. McGuire was estopped from enforcing its collection, and the judgment is

affirmed.

PEOPLE'S BANK OF TOMPKINSVILLE v.

KEATING BROS.

(Court of Appeals of Kentucky. Nov. 13, 1917.) 1. BANKS AND BANKING 187 - ACTIONS EVIDENCE-SUFFICIENCY.

In bank's action for money lent to contractor for building a turnpike, and for which the contractor gave an order on the county to pay the sum to the bank, evidence held to show that the transaction was not between the county and the bank, but that the contractor borrowed on his own account.

2. APPEAL AND ERROR

ERROR-EVIDENCE.

1050(2)—HARMLESS

board of commissioners the sum of $323.75, There was collected by plaintiff from the which was credited on the back of the writing, and, none of the balance having been paid either by the commissioners or the defendants, this suit was filed to recover the unpaid balance of the $1,000 so advanced. The answer denied the entire transaction, and upon trial before a jury a verdict was returned in favor of the defendants, upon which judgment was rendered dismissing the petition, and to reverse which this appeal is prosecuted.

It is the contention of defendants that, although the $1,000 was placed to their credit, it was nevertheless not a borrowing by them from the bank, and that they did not in any way become obligated to the bank because of the credit, it being insisted by them that the money was obtained by the board for the county and was in the nature of an ad187-ACTIONS-vancement by the latter to the defendants on the work in which they were engaged, and that the bank should collect its money from the county and not from the defendants.

In such action, admission of the contract be tween defendant and the county, if error, was not prejudicial, since it was absolutely immaterial to the questions involved. 3. BANKS AND BANKING

EVIDENCE-ADMISSIBILITY. Evidence that the order upon the county was not signed until after the date which it bore was immaterial.

Appeal from Circuit Court, Shelby County.

Action by the People's Bank of Tompkinsville against Keating Brothers. Judgment for defendants, and plaintiff appeals. Reversed, with directions.

Willis, Todd & Bond, of Shelbyville, for appellant. Beard & Pickett, of Shelbyville, for appellees.

THOMAS, J. The appellees, Keating Bros., who were defendants below, were contractors engaged in the business of constructing roads. They had a contract with Monroe county, Ky., to construct, according

to certain specifications, about eight miles of turnpike leading from Tompkinsville to McMillan Landing, all in that county. The county was to pay a little less than twothirds of the entire cost, and the balance was to be paid by private subscription. Shortly after the work begun, and which was under the charge of the defendant Pat Keating, the appellant, according to its contention, advanced for the use and benefit of the defendants as such firm, and at its instance and request, the sum of $1,000, which was placed to the firm's credit on the books of the bank and subsequently checked out by Pat Keating in payment for material and labor necessary in carrying out the contract. The date of that transaction was December 7, 1912, and at the time the defendants executed and delivered to the plaintiff bank this writing:

"Tompkinsville, Ky., Dec. 7, 1912. To the Board of Commissioners of the Tompkinsville

The cashier of the bank, Kirkpatrick,

states without equivocation that the money was loaned by him as the bank's cashier and

on its behalf to the defendants on the date mentioned, and was placed to their credit on that day; he files a copy of the regularly kept books of the bank, showing that fact, and that the money was afterward drawn out upon the firm's checks. This witness further states that Bradshaw, who was then chairman of the road committee, was present, and that it was at least partially upon his recommendation that the money was advanc ed to the defendants, and that on that date

the writing hereinbefore copied was executed and delivered to the witness.

The witness Bradshaw in his testimony upon this subject says:

"On one occasion I accompanied Pat Keating to the People's Bank of Tompkinsville, and he on that occasion borrowed $1,000 from that bank and gave Price Kirkpatrick, cashier of said bank, an order on the road commissioner for $1,000, to be paid out of the first four miles ber, 1912. Q. You say that he borrowed this of the pike completed. This was about Decemmoney from said bank, you mean to say that Pat Keating made the arrangements with the bank for this $1,000 for the firm of Keating used in paying hands, etc., in the construction Bros.? A. I do; that is, that it was to be of the pike. This order was signed, 'Keating Bros., by Pat Keating.'"

W. S. Harlan, who was the county engineer, in his testimony says:

"Pat Keating told me in the presence of Price Kirkpatrick, cashier of the People's Bank of Tompkinsville, that he (Pat Keating) had borrowed from the People's Bank of Tomp

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

kinsville, for the firm of Keating Bros., $1,000, to be paid out of the first four miles of the pike completed," etc.

any of it is solvent. But, however that may be, the plaintiff is under no obligation to look primarily to that fund and to exhaust it be

The testimony of these witnesses was par-fore it may sue the defendants to whom it tially substantiated by the witness U. G. Boyles, who was in some way appointed to collect the subscription made by private citizens toward the construction of the road.

The only witness who testified for the defendants was Pat Keating, and he acknowledged the execution of the writing and that he used the $1,000 placed to his firm's credit in the manner stated by the cashier of plaintiff; but he states that he did not borrow the money for his firm; that, on the contrary, it was borrowed by Mr. Bradshaw either for the board of commissioners or for the county (which would in law be the same); but he states no fact justifying that conclusion. Nowhere is it intimated by him or any other witness, nor by any circumstance, that the bank at the time gave credit either to the county, the board of commissioners, or any other person or persons except the firm of Keating Bros.

advanced the money in the first instance. If defendants' theory be correct, it would have been altogether unnatural for the county to have made the payments it has without taking care of this $1,000 borrowed from the bank. Somebody owes the money, and it is undisputed that the defendants checked it out of the bank after having obtained credit for it, and there is nothing to show, as we have seen, that the county in settling with defendants deducted anything on account thereof.

The motion for a new trial complains of the instruction, being the only one that the court gave to the jury; none other being offered by either party. Complaint is also made in the motion of incompetent evidence which the court admitted to be heard by the jury over plaintiff's objection, and, lastly, that "the verdict is contrary to the evidence, and not supported by the evidence."

[2, 3] The incompetent evidence complained of is the introduction of the contract which defendant had with Monroe county, but we fail to see what effect, either one way or the other, that contract had upon the While technically it only issue in the case. might have been error, inasmuch as it had no bearing upon the question being investigated, still it cannot in the slightest be considered prejudicial. Neither do we think that the complaint about the witness Keating saying that he did not sign the writing which he executed to the bank until after the date which it bears of any consequence. when that writing was actually signed can have no material effect, as we view it, upon the question being investigated. convinced, however, that the verdict is contrary to the evidence and is not supported by it.

Just

We are

[1] Under the contract with the county, only 85 per cent. of the contract price was to be paid during the progress of the work, and at the time of the transaction in question there had been only about two months' work done on the contract, which was not entirely finished for nearly one year thereafter. As the work had been so recently commenced, but a small per cent. of the contract price was demandable by the defendants at the time of the transaction involved. Material was being obtained, the labor pay roll was large, and defendants necessarily needed funds perhaps in a much larger sum than they were entitled to collect at that time from the county, and to meet their necessities it was arranged that the bank should advance to them the money sued for. At that time it is not contended that the commissioners were vested with any authority to borrow As will have been seen, the testimony of money from the bank on behalf of the coun- the only witness introduced on behalf of the ty, and, indeed, as the record appears, the defendants is the statement of a conclusion of county could not be made to pay the debt, his when he says that he did not borrow even if the commissioners had attempted to the money for the firm, but that the board of bind it. Furthermore, the writing itself commissioners did so. When the facts conshows that the debt was one due from Keat- cerning the transaction as developed by the ing Bros., and it directed therein that such record are looked into, it is clearly, to our debt be paid by its debtor, the county. It minds, a transaction between the bank and would be somewhat of an anomaly for the the defendants. The witness for the defenddefendants to give a writing directing the ants did not deny the statements made by county to pay its own debt, which would plaintiff's witnesses when they stated that have been the case if the defendants' theory he said on several occasions that he had be correct. Moreover, the county seems to borrowed the money from the bank for his have paid Keating Bros. all that was due firm, and it is our conclusion that the court them under the contract, not charging them should have directed a verdict for the plainwith, or in any manner taking into account, tiff for the amount claimed in its petition. the $1,000 in question. It is true that there However, there was no motion made to that appears to be about $2,400 still uncollected effect, but surely a verdict of a jury rendered from the subscriptions of the citizens; but for the party against whom a verdict should whether this will ever be collected does not have been directed is one that is contrary

The judgment is reversed, with directions Auxier, Harman & Francis, of Pikeville, for to grant a new trial, and for proceedings appellant. Childers & Childers, of Pikeville, consistent with this opinion. for appellee.

WALKER v. WILLIAMSON. (Court of Appeals of Kentucky. Nov. 8, 1917.) 1. FRAUDULENT CONVEYANCES OF CREDITOR TO ATTACK.

THOMAS, J. Smith Carter, who was 89 years old, owned a tract of land in Pike acres, and worth, according to the proof, county, Ky., containing between 600 and 900 72-RIGHT from $7,000 to $10,000, upon which he and his wife, the defendant Sarah Carter, residThough the grantor of land in consideration of support by the grantee, if living, or ed; the latter being 88 years of age. his legal representatives after his death, might | husband also owned a small amount of live have attacked the deed because of fraud prac- stock, household and kitchen furniture, and ticed by the grantee in procuring it, a creditor

The

of the grantor was not on the same ground of a few farming implements. He also drew a fraud entitled so to attack the deed; the gran-pension of $30 per month from the federal tor not having done so. government. He had neither lineal nor col

2. FRAUDULENT CONVEYANCES 219-REM- lateral kindred who would inherit his propEDY OF CREDITOR-STATUTE.

Where the grantor of land and the grantee participate in a fraudulent intent to deprive the grantor's creditors of opportunity to collect their debts by putting the property beyond their reach, a creditor has a remedy by Ky. St. §§ 1906, 1907; the procedure being provided in

section 1907a.

3. FRAUDULENT CONVEYANCES 80- VOL-
UNTARY CONVEYANCES CONVEYANCES FOR
FUTURE SUPPORT.
Purely voluntary conveyances are per se
fraudulent as to existing creditors, regardless
of the intent of either of the parties, or knowl-
edge by the grantee of the existence of the gran-
tor's indebtedness, and, seemingly, conveyances
on the sole consideration of future support, to
the extent they have not been executed, are
voluntary within the rule.

erty at his death; his sole dependent being

his wife.

These two old people lived upon the farm and were getting along admirably; the pension, supplemented by the produce of the farm, furnishing an ample competency for them. In addition, Carter had sold timber from the land to the amount of $4,000, as much as $2,500 of which had not been spent. The cultivation of the farm was in a small way only, and was perhaps done entirely by Mr. Carter, who seems to have been very active for one of his age. With matters in this condition, some time during the summer of 1910 Carter and wife conveyed to the appellant, George J. Walker (defendant below), the entire farm upon which they lived, and all personal property belonging to Smith Carter, being all of the property, either real or personal, owned by the grantors, in consideration that Walker would support and take care of the grantors as long as they lived. If a conveyance is voluntary as to the un- At the time of the conveyance Carter was executed part of the consideration, the gran-indebted to John Phillips in a balance on a tee, as against the grantor's creditors suing to invalidate the conveyance, is not entitled to a lien for improvements. 6. FRAUDULENT CONVEYANCES BONA FIDE PURCHASER PROVEMENTS.

4. FRAUDULENT CONVEYANCES

80-AGREEMENT TO SUPPORT-COMPLETE EXECUTION.

A contract to support a man and his wife in consideration of a conveyance of land is not entirely executed where the wife is still living.

5. FRAUDULENT CONVEYANCES 183(3) VOLUNTARY CONVEYANCE GRANTEE'S LIEN

FOR IMPROVEMENT.

183(3) EQUITY FOR IMThough the fact that a grantee of land in consideration of his agreement to support the grantor and his wife knew of the existence of a debt of the grantor is not of itself sufficient to make him a fraudulent grantee, where he knew that the grantor was conveying to him all the property he possessed, leaving nothing to existing creditors, for a consideration of doubtful adequacy, and one deemed by the law at least constructively fraudulent, the grantee was not such an innocent purchaser as would entitle him to an equity for improvements made by him on the land prior to the equity of existing creditors of the grantor.

Appeal from Circuit Court, Pike County. Action by Tom Williamson, executor, etc., against George J. Walker and another. From a judgment for plaintiff, defendant Walker appeals, and plaintiff cross-appeals. Judgment affirmed on the appeal, and reversed on the cross-appeal, with directions to proceed in accordance with the opinion.

note which had been executed in 1890, and upon which payments had been made from time to time, leaving the amount due at the time of the filing of this suit $965.74. Phil lips died testate, and appellee, Williamson (plaintiff below), was appointed executor of his will. Carter died June 26, 1912, leaving surviving him his widow, and on August 27, 1912, this suit was filed by plaintiff as executor of John Phillips' will against the defendant Walker and the widow Carter, charging that the deed executed by Carter and wife to the defendant Walker was fraudulent as to the debt which he represented (being a previously existing one), and insisting that as against such debt the conveyance was a voluntary one, and he asked that it be set aside and held for naught, and that so much of the land as might be necessary for that purpose be sold and the proceeds applied to the payment of his debt. He further alleged that Carter died the owner of a considerable amount of personal property, the exact amount of which was unknown to plaintiff,

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and that there had never been any adminis- | not being a formal deed. Upon the execution tration granted of his estate, but that the of that writing Walker took possession and defendants, Walker and the widow, had charge of the premises, but he did not prowrongfully taken possession of the personal cure a deed for something like 3 months The deed was prepared by a property and were proceeding to appropriate thereafter. it, and he sought a judgment against them man by the name of Campbell, who was one as administrators de son tort. of the men for whom Walker was working. After Walker took charge he repaired the dwelling in which the Carters were living, it having previously been damaged by fire, and built a residence for himself, and perhaps He also conone or more tenant houses. structed some new fencing and cleared up some old ground which had been overgrown with sprouts, bushes, and briers. The greater part of this work was done during the 3 months intervening between the time of the trade and the execution of the deed. At the time of the trade Walker knew of the existance of the debt sued on, but he claims that Carter had told him that it had been settled, and that the son of the creditor, who, as agent of his father, had collected the last payment, had also informed him of the settlement of the note. Just here it may be stated that the son and other witnesses positively contradict the defendant's contention upon the latter point.

The answer put in issue the allegations of the petition, except the execution of the deed for the purposes therein contained was admitted, and it was affirmatively alleged that plaintiff's debt had been settled or paid; another paragraph relied upon the good faith of the transaction, especially on the part of the defendant Walker, and that his services in carrying out the contract up to the time of the death of Smith Carter were worth $2,500, and that he had placed lasting and valuable improvements upon the land which enhanced its value $6,000, and he asked that he be given a prior lien for these two sums should the court determine that the deed ought to be canceled and any portion of the land appropriated to plaintiff's debt. Appropriate counter pleadings put in issue the affirmative pleas contained in the answer, and upon trial the court adjudged that the deed should be canceled, and gave plaintiff a lien for his debt, subject, however, to a prior lien adjudged in favor of plaintiff Walker for the sum of $5,000, and ordered the land sold and the proceeds applied to the payment of the parties' claims in the order named. To reverse that judgment the defendant Walker prosecutes this appeal, followed by a cross-appeal granted by this court in favor of plaintiff.

In addition to what has been stated, the facts, showing the situation and the relation of the parties to the conveyance existing at the time it was made and prior thereto, briefly stated, are: That Walker was not a native of that vicinity, but had come into it as manager and operator of a sawmill owned by a company which was either engaged in or had completed the sawing of the timber which had been purchased from Carter. He had known Carter for about 12 years, but not intimately except for about 3 years preceding the execution of the deed. According to defendant's testimony he knew that Carter and wife had no living relatives, or at least it was so reputed, and he himself testified that the old man for some unaccountable reason formed a great liking for him, and in the early spring of 1910 (as defendant testifies) Carter, to the great surprise of the defendant, broached the subject and made a proposition to convey all of the property covered by the deed for the consideration and upon the terms therein expressed. This was so surprising to Walker that he took time to consider the proposition, but in a few days concluded to accept, and he himself procured the attorney for the company for which he was working, in the absence of Carter, to

Carter was sick but about 3 months before his death, and from the evidence we do not gather that his ailment required constant attention, nor was he excessively troublesome to those who nursed him and administered to his necessities. It does not appear that Walker in person bestowed any nursing attention upon the patient, but according to his testimony, he was in and out and about there for a considerable portion of the time, although he gives as a reason for the bestowal of that much time that Mr. Carter, on account of the attachment which he had formed for the defendant, demanded it. However, a man and his wife who occupied one of the tenant houses which defendant had constructed did administer some to the wants of Carter, and after his death there was provided a board coffin in which to bury him, and a robe, which, with the coffin, according to Walker's testimony, cost some $4 or $5.

It is not shown how many visits the physician who waited upon Carter made, nor does the record disclose the charges per visit, although Walker acknowledges his liability for that bill, whatever it may be. It is shown that the tenant who nursed Carter in the manner stated performed some chores around the premises before the latter's last illness, but we do not gather that they were very extensive, as the old man, up to the time he became bedridden, was able to largely, if not entirely, attend to such matters himself as he had been wont to do all his life.

We have thus gone into somewhat of a detailed statement of facts for the purpose of