F. M. TENNY
v.
THE HILTON CORPORATION, MABEL W. TENNY AND DELOS C. WRIGHT
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The Florida Supreme Court affirmed the dismissal of a bill of complaint brought by F. M. Tenny, who sought to recover property and stock he had transferred to a corporation controlled by his wife for the admitted purpose of protecting assets from creditors. The court held that a person cannot ask a court of equity to undo a fraudulent transfer undertaken to defeat creditors.
A court of equity will not grant relief to a person who has deliberately transferred his property for the purpose of defrauding his creditors. A man may not transfer property to his wife with the avowed purpose of defeating creditors and then expect a court of equity to relieve him from the consequences of his own fraudulent act.
“a temporary cover up" and a protection against "possibility of judgments being executed against me”
Tenny's own stated purpose for the corporate transfer, demonstrating fraudulent intent to defraud creditors
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Join FLexlaw to unlock all legal intelligenceTenny formed a corporation and deeded his Florida property to it, explicitly stating the purpose was a 'temporary cover up' and protection against 'po…
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The story unfolded before the chancellor by witnesses of the complainant, appellant in this Court, was that a corporation had been formed at the instance of complainant, to which was deeded certain property he owned in Florida, the purpose being, to quote the complainant, “a temporary cover up” and a protection against “possibility of judgments being executed against me,” as a result of “several unfortunate investments.”
The corporation possessed no assets other than this property and no consideration was paid for the forty-eight shares of capital stock issued to complainant’s wife, one to his mother and one to himself.
In the bill of complaint relief was asked against the wife, the wife’s father and the corporation, which he described in his bill as a “dummy.” He prayed specifically that the court of equity would effect the return of his stock and property and enjoin dominion and control over it by the *522defendants, in other words, free him from his “Frankenstein.”
The chancellor dismissed the bill and his action in doing so had the support of abundant authority.
“If appellant sold and conveyed his stock of goods for the purpose of defrauding his creditors, he, of course, cannot be heard in a court of justice' to question the sale, although he may not have received a cent for the transfer.” Kahn v. Wilkins, 36 Fla. 428, 434, 18 South. Rep. 584, 586.
A man may not transfer his property to his wife with the avowed purpose of defeating his creditors and then expect a court of equity to relieve him of the predicament in which he has placed himself.
Affirmed.
Terrell, C. J., and Buford, J., concur.
Brown, J., concurs in opinion and judgment.
Justices Whitfield and Chapman not participating as authorized by Section 4687, Compiled General Laws of 1927, and Rule 21-A of the Rules of this Court.
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Citator
Cited By
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Warfield v. Drawdy, 41 So. 2d 877 (Fla. 1949)…d he dismissed the cause. We see no need to tarry in a discussion of the principle, oft announced, that one who conveys his property to another for the purpose of defeating his creditors will be denied relief in equity, Tenny v. Hilton Corporation, 140 Fla. 521, 192 So. 180, and Scott v. Sites, Fla., 41 So. 2d 444, not yet reported in State reports, for it is not clear to us whether there was any real danger from an impending suit mentioned by the witnesses, and for the further reason that there is actuall…
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Hill v. Lummus, 123 So. 2d 365 (Fla. 3d DCA 1960)…ty will not aid him in extricating himself from the situation he has created. In such circumstance he becomes a victim of his own fraudulent devices and cannot enter a chancery court with clean hands, * * * Tenny v. Hilton Corporation, 140 Fla. 521, 192 So. 180, * * * ” See also Spector v. Ahrenholz, Fla.App. 1958, 107 So. 2d 34; Kahn v. Wilkins, 36 Fla. 428, 18 So. 584; 15 Fla.Jur., Fraudulent Conveyances, § 40. Since the actions of the decedent worked an estoppel against the administrator, he would not…
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Sponholtz v. Sponholtz, 180 So. 2d 497 (Fla. 3d DCA 1965)…proceedings consistent with this decision. . Turk v. Turk, Fla.App.1960, 118 So. 2d 67, 70. . Shaffran v. Holness, Fla.App.1958, 102 So. 2d 35, Brumick v. Morris, 131 Fla. 46, 178 So. 564 (1938). . Tenny v. Hilton Corporation, Inc., 140 Fla. 521, 192 So. 180 (1939). . Rappaport v. Kalstein, 156 Fla. 722, 24 So. 2d 301 (1946).…
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- Kahn v. Wilkins, 36 Fla. 428 (Fla. 1895)