[13 NJSuper Page 368] On December 18, 1947, the plaintiff, Mary Coles, and her husband, since deceased, became involved in an automobile collision with a fire truck, owned by the Township of Lyndhurst in Bergen County, and driven by the defendant Oscar W. Osback, a volunteer fireman. As a result
of the litigation which arose out of the action, the plaintiffs, on December 28, 1949, obtained a judgment against the defendant Osback, in the sum of $10,675.
In this suit the plaintiff seeks to have set aside a conveyance dated February 16, 1948, made by Oscar W. Osback and wife, to his son Edwin Eric Osback, of property known as 441 Post Avenue, Lyndhurst. Plaintiff charges that the conveyance was without consideration and in fraud of the rights of the plaintiff as a creditor of Oscar W. Osback. In his answer the defendant Oscar W. Osback says that he held the property as trustee for his son Theodore Osback and that the questioned conveyance was made in execution of that trust.
From the testimony the following facts appear:
On August 2, 1940, Theodore Osback purchased the property which is the subject of this litigation. At the time of the purchase, Theodore was 20 years old. According to Theodore's story the bank which was to finance the transaction was unwilling to lend money to the elder Osback, and, as a result, title was taken in the name of Theodore Osback. The purchase price was $3,000. Of this sum Theodore paid $300 in cash and executed a purchase money mortgage in the sum of $2,700.
After the purchase the Osbacks lived together in the house on the property. The family consisted of Mr. and Mrs. Osback, Theodore, and his brother Edwin. In May of 1941 Theodore married and brought his wife to live in the home.
In November, 1942, Theodore enlisted in the Navy and served throughout the war in the Pacific theatre. As was so common, Theodore had a rough time. The ship on which he was serving was sunk, but he survived. In May of 1945 he came home on furlough. His experiences having made him doubtful of the future, Theodore talked with his father and expressed a desire to put his affairs in order, in case anything should happen to him. His assets consisted of the house and an insurance policy of $10,000. Theodore had arranged that the policy should go to his wife but felt that his father and mother should have the house. Accordingly, he conveyed the
Post Avenue property to his father and mother as tenants by the entirety without consideration, but upon the understanding that if he returned safely the property would be reconveyed to him.
In November 1945, Theodore was discharged from the service and returned to the family home. There he remained until August 1947, when a prospective increase in his family caused him and his wife to decide that they needed more room than the Post Avenue house afforded. Theodore, in a discussion with his family, pointed out that he needed a house of his own and said that Oscar W. Osback should convey the family home to Edwin. In that way both sons could take advantage of their veteran's exemptions and would each have a home. And, in addition, they would be complying with the wishes of their mother, who wanted one of the sons to hold title to the Post Avenue house.
Oscar Osback conveyed the property to Edwin in February, 1948, about a month and a half after the accident. Oscar Osback had not paid anything to Theodore for the conveyance to him, nor did he receive any consideration from Edwin. Oscar had paid the taxes, insurance and mortgage interest while he held the property, but, on the other hand, he paid no rent.
After he took title, Edwin took care of the mortgage and tax payments. With the exception of a short period, Edwin and his wife have lived in the home with his ...