4 What capital demands in such investments is certainty of tenure, and security from confiscation, sufficient to warrant dependence upon reasonable returns. such security can only be afforded by laws, which, at the same time that they protect the interests of the public, also protect the investments which shall be made in furtherance of the public interest in the utilization of water-power resources. rived from the utilization of water powers, is an assertion that natural water powers are intended to produce only for the public treasury. Such a view of water-power resources leads to the legislative policy of imposing by statute the utmost burdens possible, and even impossible burdens, upon private investment. Experience has demonstrated that utilization of wasting water powers cannot be accomplished by their de In none of the countries of Spanish-velopment by the public authorities; but America are the laws formulated in such a way as to attract private investment. The fact that there are already such investments only indicates the certainty of much greater development in the immediate future in un reasonable legislative hazards to investment are decreased or eliminated. Water Rights in Spanish-American Countries: In the remaining part of this paper is summarized the laws and regulations of water rights in the countries of Argentina, Chile, Colombia, Cuba and Porto Rico. Uruguay, Venezuela, Brazil, and Mexico. Conclusion:-It is apparent that the conservation of water resources, through the utilization of the wasting water powers of the Pan-American countries, including the United States, can only be accomplished by the adoption of a legislative policy which shall invite private investment in such enterprises. The universal fault with existing policies of legislation, in these matters, is, that the prospective investor, asking for a grant, or concession, or permit, is viewed as one asking, for his own private benefit, a gift from the public. The theory is too much prevalent that, because water resources are a natural resource, they are, for that very reason, a purely public resource, and not by nature or by law for development in any other way than through the direct supervision of public authorities and for the exclusive and direct benefit of the public at large. But water powers are local in their very nature. The assertion of a right of benefit, through direct participation by the general public in the proceeds de only through the capital of private investors. Such investors, however, rightly demand that security for their investment which shall afford to them reasonable protection against confiscation and loss of their investment, and against failure to receive fair returns therefrom. There are millions of dollars of capital in the hands of American financiers ready for investment in water-power developments, not only in the United States but in all of the Pan-American republics, but which are withheld from such investments because of the financial obstacles presented in these various countries through an almost universal absence of a legislative policy which will allow such investments to be made with reasonable safety. Minneapolis, Minn. ROME G. BROWN. FRAUDULENT CONVEYANCES-CLAIM FOR TORT. HENRY v. YOST, et al. Supreme Court of Washington. Nov. 12, 1915. 152 Pac. 714. A claimant ex delicto is a "creditor," within the meaning of the rule that conveyances may be set aside when made to defraud the grantor's creditors. ELLIS, J. In February, 1911, A. H. Yost and J. W. Day, sheriff of Yakima county, wrongfully seized and converted a band of sheep belonging to James Henry. On August 30, 1912, Yost and wife were indebted to the Outlook State Bank in the amount of $3,300. On that day they executed to H. E. Schroeder, cashier of the bank, and wife, a chattel mortgage covering their personal property, and a quitclaim to their farm near Outlook, and received from him a trust agreement, which declared that the property was deeded to Schroeder, to be held by him in trust for Mrs. Yost, and covenanted that upon demand the property would be reconveyed to her, or to whomever she should direct, for her separate estate. Subsequently Henry sued Day and Yost for the conversion of the sheep seized by them, and on February 25, 1913, the jury in that action returned a verdict in favor of Henry for the value of the sheep. Judgment upon this verdict was entered by the clerk, but no formal judgment was ever signed and entered. An execution was issued upon this judgment directed against the property of Yost, and returned by the sheriff nulla bona. On July 10, 1913, Henry commenced this action against Yost and wife and Schroeder and wife. The complaint alleged the institution of the action by Henry against Yost and Day, service on and appearance of Yost, the trial of the cause, resulting in the verdict against Yost, the entry of a judgment thereon, and the absence of an appeal therefrom or modification thereof; alleged that the judgment was on account of a community obligation; alleged that the conveyance by Yost and wife to Schroeder was made with intent to defraud plaintiff in the collection of any judgment he might obtain, that the conveyance to Schroeder was made without consideration, and that Schroeder had no claim to the property, and further that Yost and wife had no other property out of which the judgment might be satisfied. Plaintiff prayed that the conveyance be declared void and the property subjected to the lien of his judgment. Upon the trial of the cause counsel for Henry introduced, over objection, the summons, complaint, and proof of service, the verdict, the clerk's minute entry of the judgment, and the execution in the case of Henry v. Yost. Schroeder testified that the quitclaim deed was given to secure the indebtedness to the bank, since reduced to $2,835 by various payments, and that, when this was paid in full, the understanding was that Schroeder should reconvey the property to Yost. Having proved the entry of the judgment in the Henry v. Yost action, the conveyance to Schroeder, and that the claim of Henry had not been paid, the plaintiff rested. The defendant thereupon moved for dismissal on the ground that the plaintiff had not proved a lien against the defendants, and that he had proved no fraud. The case was reopened to permit evidence of the value of the property, and at the close of this testimony defendant renewed his motion for dismissal, which was refused. The trial judge gave a written opinion, in which he concluded that Henry had failed to prove that he was a creditor of Yost when the quitclaim deed and trust agreement were executed and delivered to Schroeder; therefore the burden was on him to prove that Yost executed the deed to defraud subsequent creditors, and that, as he had failed to do so, the action should be dismissed, and a judgment of dismissal with prejudice was accordingly entered. A timely motion for new trial was made by the plaintiff and denied by the court. A motion to modify the judgment, to make the dismissal without prejudice, was likewise denied. This appeal is from the order denying the motion for a new trial, or, in the alternative, for a modification of the judgment, and from the judgment as entered. [1, 2] The right to have conveyances made with intent to hinder, delay and defraud creditors set aside has long been recognized as a part of the common law of this state. Wagner v. Law, 3 Wash. 500, 28 Pac. 1109, 29 Pac. 927, 15 L. R. A. 784, 28 Am. St. Rep. 56. To attack the validity of a conveyance, the person asserting the fraud must be one who has been injured by the fraud; and accordingly a creditor of the debtor may so attack the conveyance. A conveyance made without consideration is presumptively fraudulent as to existing creditors of the grantor. However, there is no presumption that such a transfer was made with a view to defraud subsequent creditors. It becomes material, then, to determine whether Henry was a creditor of Yost and wife when the deed to Schroeder was executed. [3, 4] It has been our uniform holding that a claimant ex delicto is a creditor, within the meaning of the rule that conveyances may be set aside when made to defraud creditors of . the grantor. Bates v. Drake, 28 Wash. 447, 68 Pac. 961; Sallaske v. Fletcher, 73 Wash. 593, 132 Pac. 648, 47 L. R. A. (N. S.) 320, Ann. Cas. 1914D, 760; Allen v. Kane, 79 Wash. 248, 140 Pac. 534. Had Henry proved that his cause of action existed when the deed was given to Schroeder, he would have established a prima facie case of fraud, and the burden then would have been on the grantor and grantee to prove the validity of the convey ance. [5] The only proof offered of this claim, however, was the record in the case of Henry v. Yost and Day. The judgment in that case is not even prima facie evidence, as against Mrs. Yost and Schroeder and wife, who were strangers to that judgment, of any indebtedness or liability of Yost to Henry prior to the time it was rendered. Eggleston v. Sheldon, 148 Pac. 575. To hold that as against Mrs. Yost and Scroeder ́it proves the previous existence of the alleged facts on which it was based and the time when those alleged facts occurred would be to bind Mrs. Yost and Scroeder by the results of a litigation in which they did not appear, of which they had no notice or knowledge, and in which they had no opportunity to participate. The judgment established the indebtedness of Yost to Henry, but did not of itself prove the previous existence of the facts on which it was based. No other evidence of the indebtedness was introduced; consequently Henry did not establish that he was a creditor of Yost when the conveyance was made, and did not show a prima facie case of fraud. The judgment did prove him to be a creditor as of the date it was rendered, which was six months after the execution of the deed. [6, 7] Henry, having proved himself to be a subsequent creditor, could, by showing that the conveyance was made with intent to defraud him, have had it set aside and the property subjected to the lien of his judgment. The burden of such a showing was on him, and he failed to meet it. No evidence was introduced, except the judgment in the tort action, to show that the deed was given in anticipation of the judgment, and we have found that the judgment alone was ineffectual to prove the cause of action then existing against Yost. The appellant, then, has failed to prove either that he was a creditor when the deed was executed, which would have put upon Mrs. Yost or Schroeder the burden of vindicating the deed, or that the conveyance was made to defraud him as a subsequent creditor. Failing in both, he has not established his right to have the deed set aside and the property subjected to the lien of his judgment. The trial court properly dismissed the action. Judgment affirmed. NOTE-Holder of Claim for Tort as an Existing Creditor.-It seems true that the great weight of authority supports the ruling in the instant case, that an existing claim for unliquidated damages founded on a tort constitutes the injured party a creditor under statutes avoid ing conveyances for fraud, the judgment subse- It becomes only of interest to notice a few In Evans v. Lewis, 30 Oh. St. 11, it was held that the possessor of a claim for damages arising out of tort at the time of an alleged fraudulent conveyance did not become a creditor until judgment had been rendered in his favor. As a subsequent creditor he had the right to prove, if he could, that there was intent in the making of the conveyance to defraud him as a subsequent creditor. See also Detweiller v. Lomison, 10 O. C. D. 95. In Langford v. Fly, 26 Tenn. (7 Hump.) 585, it was said: "A party who has a right of action for a tort cannot be deemed a creditor until he obtains a judgment. The wrongdoer is in no sense a debtor by reason of the wrong, until the judgment of a court shall fix upon him a pecuniary burden for the redress of the wrong." In Michigan it was assumed by the court that the rule was that a claim for damages being unliquidated and sounding in tort, could not become a debt until it had been prosecuted to judgment, and the case in which this assumption was made was distinguished upon its facts. Clinton v. Rice, 79 Mich. 354, 44 N. W. 790. In Meserve v. Dyer, Me. (4 Greenl.) 52, it was held that in a case for trespass the court below rightly held that plaintiff was not a creditor prior to obtaining judgment: "Until judgment all was contingent and uncertain; had Jacobs (the defendant) died before judgment, the right of action would have died also." In Gebhart v. Merfeld, 51 Md. 322, the conveyance was set aside, where claimant only had a right of action for tort, because the statute of 13th Eliz. Ch. 5 was said to embrace conveyances "made to the end, purpose and intent to delay, hinder or defraud creditors and others of their just and lawful actions." It extends not only to creditors, but to all others who have cause of action or suit or any penalty or forfeiture, and embraces actions of slander, trespass and other torts." In Green v. Adams, 59 Vt. 602, 10 Atl. 742, it was held that a claim founded in tort was not within the statute regarding fraudulent conveyances, the word "right" in the statute being synonymous with debt or duty. For similar ruling see Fox v. Hills, I Conn. 299; Fowler v. Frisbie, 3 Conn. 324. In McInnis v. Wicassett Mills, 78 Miss. 52, 28 So. 725, the conveyance objected to was made after action was begun on a claim founded in tort, and the court said: "We reject as unsound the proposition that complainant, whose claim rested on tort, could not come within the protection of the statute. In determining who is a creditor, the statute must be liberally construed, and it protects, at least as against actual fraud, one who, at the time of the conveyance, is suing the grantor in an action of tort." Missouri Court of Appeals fairly represents supporting cases to the instant case in saying: "Clark became a creditor the day the assault conferred on him a valid demand for damages against his assailant." Carrel v. Meek, 155 Mo. App. 337, 137 S. W. 19. C. ed with anxious interest by all members of the profession who have the proper administration of the law at heart. A. H. Robbins.] ESTATES BY ENTIRETIES. CORRESPONDENCE. WORK OF THE CHICAGO SOCIETY OF ADVOCATES. Editor Central Law Journal: A course of lectures under the auspices, of the Chicago Society of Advocates will be delivered in the South Room of the University of Chicago Law School, University Avenue and Fifty-Eighth street (Midway Plaisance), on the dates below given, at 7:30 p. m. Each lecture will consist of two parts about fifty minutes in length, separated by a brief intermission. The History and Nature of the Art of Advocacy.-Eugene E. Prussing, Thursday, Jan. 6. Jury Trials.-Friday, Jan. 14. James G. Condon. Criminal Cases.-Tuesday, Jan. 18. Fletcher Dobyns. Cases in Appellate Courts.-Thursday, Jan. 20. Albert M. Kales. Cases Before International and Parliamentary Tribunals.-Monday, Jan. 24. John M. Zane. Chancery Cases.-Thursday, Jan. 27. Hon. Jacob M. Dickinson. All the classes of the Law School will attend and the members of the Society and their friends are invited to come. Respectfully, HERBERT HARLEY, Secretary. [The undersigned received the above announcement with interest and pleasure. This society is a new venture which we had occasion to approve in these columns not many months ago. See 81 Cent. L. J. 112. We enjoyed the privilege of meeting many of the gentlemen who are mentioned above at a dinner given by the society last October. At that time the writer was informed that one of the first definite undertakings by the society would be the introduction of a thorough and competent course on advocacy in each of the Chicago law schools. This work is deserving of hearty commendation and its successful fruition will be regard Editor Central Law Journal: In the report of In re Finch v. Cecil et ux, on page 460 of No. 26, Vol. 81, in the Central Law Journal, appears the following: "In others it has been held that estates in entirety were abolished inferentially by such statutes, changing the relation of married women as to the control of their property, as in Mississippi, Nebraska, West Virginia and Michigan, and in England. 21 Cyc. 1202, etc." This is a misstatement of the law in Michigan. The Michigan case cited in 21 Cyc., 1202, is Dowling vs. Salliotte, 83 Michigan, 131. The compilers of Cyc. overlooked in re Appeal of Nellie B. Lewis, 85 Michigan, 340, in which case, on page 346, the court directly overrules Dowling vs. Salliotte on this point of estates by entireties. I thought you might be interested to call attention to this error, as I see it is not noticed in your note. Yours very truly, JESSE ARTHUR. Battle Creek, Mich. BOOK REVIEWS. THE HAGUE CONVENTIONS AND DECLARATIONS OF 1899 AND 1907. This work containing the declarations of those conventions and the names of the gov ernments participating therein, and by what governments notified, and by what governments there were reservations, is a wonderfully interesting book. It is very lamentable that these conventions did not provide some way of preventing nations from starting the world-wide conflict now pending. It would seem that no provision could better preserve peace than for aggrieved nations to submit their differences to the arbitrament of others before war begins. But this collection by James Brown Potter, Director of the Division of International Law in the Carnegie Endowment for International Peace may be of value as a basis for other steps not only in the prevention of war, but for its settlement if it does come, just as the 1899 convention was the forerunner of the 1907 convention. This book is by Oxford University Press, the American branch of which is in New York, at 35 West 32d street, this volume issuing in 1915. TIFFANY'S FORM BOOK. This book, by Mr. Francis B. Tiffany, is a very handy, well conceived and excellent book for forms, other than court forms and those peculiar to corporations acceding according to requirement of the law of their incorporation. It contains forms for deeds, wills, mortgages, acknowledgments, building contracts, publishers' and authors' contracts, with statutory forms by states, say, for example, chattel mortgages. There are forms strictly to be followed and others serve by way of suggestion to meet the needs of particular cases, and the language and general construction of the latter are valuable to the practitioner. They are particularly useful as convincing a draftsman that nothing is omitted in drawing up contracts and agreements for particular needs and all is embraced that is required and nothing purely superfluous is included. Mr. Tiffany has prepared a very useful work that lawyers should appreciate and its arrangement is such that easy effort to find the particular thing desired is readily appreciated. The volume, including an excellent index, is handy in size, printed on a light weight, tough paper, bound in buckram and comes from the well-known publishing house of Vernon Law Book Company, Kansas City, Mo., 1915. BOOKS RECEIVED. The Monroe Doctrine, an Interpretation. By Albert Bushnell Hart, Ph. D., Litt. D., LL. D., Professor of Science of Government in Harvard University; with colored map. Price, $1.75; Boston. Little, Brown & Co. 1916. Review will follow. Readings on the Relation of Government to Property and Industry. Compiled by Samuel P. Orth, Professor of Political Science in Cornell University; author of "Socialism and Democracy in Europe," etc. 1915. Price, $2.25. Ginn and Company. Boston, New York, Chicago, London. Review will follow. HUMOR OF THE LAW. Champ Clark of Missouri, Speaker of the lower House of Congress, feeling it his turn to enliven a story-telling party, said that a man-not in Missouri-found himself in such financial straits that he couldn't pay his debts. A creditor, who also needed money, made a tearful appeal for at least partial settlement. "I'm very sorry," the delinquent dolefully informed him, "but I cannot pay you anything this month." "That's what you told me last month," complained the creditor. "Well, I kept my word, didn't I?"-St. Louis Post-Dispatch. Congressman Frank E. Wilson of New York, tells of an Irishman who had been arrested on the charge of assault and battery and was up for trial. "Pat," said the Magistrate, "you are charged with having punched Dennis McGinley in the face. What have you to say about it?" "Shure, Yer Honor," meekly answered the prisoner. "Oi did it in fun. Oi only meant to have a little joke wid him." "You did, did you?" said the court, attempting to inject severity into his tone. "Well, in the future I would suggest that you bear in mind that your right to a joke ends where Dennis' nose begins." "Peter Cooper, stand up." The raw-boned "poor-white trash," holding his ragged hat in one hand and the tail of his shabby coat in the other, walked slowly un to the stand. "Yes, Judge." "You are accused of profanity in a public place." "I guess I did it, Judge. Nigger was tryin' to steal ma hoss." "But you should know better than to take the name of the Lord in vain, Mr. Cooper. "It warn't in vain, Judge, you jes' ought ter have seen that nigger run!"-Case and Comment. A story told us by one of our subscribers is apropos to the question as to whether officers of trust companies or other corporations should act as attorneys in the settlement of estates: A banker was acting as the attorney in administration proceedings upon an estate for which he was also administrator. The parties interested all being of lawful age, he prepared for them and had them sign a paper styled "voluntary appearance," wherein he made them to say, "and we hereby waive appearances." |