In this suit brought under Code 55-80 to set aside fraudulent conveyances of cash, the only question properly preserved for appellate review is whether the trial court erred by entering in personam judgments against transferees who participated in a fraudulent scheme to delay and hinder a creditor by concealing the debtor's assets. As pertinent, 55-80 provides: "Every gift, conveyance,... transfer of, or charge upon, any estate, real or personal, ... given with intent to delay, hinder or defraud creditors ... of or from what they are or may be lawfully entitled to shall, as to such creditors, ... be void."
Garrard Glenn Fraudulent Conveyances And Preferences
Professor Glenn, in his treatise on fraudulent conveyances, discusses the accountability of a transferee or grantee for proceeds of property fraudulently conveyed. Relating the situation "to confusion of goods," the doctrine he discusses "governs the case where a debtor's property is indistinguishably mingled with that of a third person." 1 Garrard Glenn, Fraudulent Conveyances and Preferences 239, at 415 (rev. ed. 1940). When the property "cannot be identified in any form," such as money placed in a transferee's checking account, Glenn states, "The grantee should respond personally for the value of the property which he has put it out of his power to apply properly." Id. According to Glenn, the grantee is placed, as the result of the creditor's proceeding attacking the fraudulent conveyance, "in the position of one holding for account of the debtor, because, the creditor having taken action under the statute, the grantee's title is avoided. Not being able to produce the property, he must surrender the substitute to the creditor." Id.
In the present case, neither Price nor Gibbs was a legitimate creditor of Gibbs, Sr. Instead, they joined in assisting him in hiding assets that the creditor otherwise would have reached in his judgment collection efforts. Here, an in personam judgment against these transferees in the full amount of the fraudulent conveyances is appropriate under the circumstances. 2ff7e9595c
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