Case ID: nys_51/html/0513-01.html
Source: Caselaw Access Project
Author: {"author": "ADAMS, J. HARDIN, P. J. (dissenting).", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

TOWNSEND v. BUMPUS et al.
    (Supreme Court, Appellate Division, Fourth Department.
    May 7, 1898.)
    1. Fraudulent Conveyance—1Trust in Favor op Grantor.
    Where a deed of real estate contains a covenant of the grantee to support the grantor during life, as a part of the consideration for the transfer, such provision creates a trust in favor of the grantor, which renders the deed fraudulent and void as against creditors of the grantor.
    2. Same—Adoption by Grantee.
    Where a covenant creating a trust for the support of a grantor is inserted in a deed without the knowledge of the grantee, making' the transfer void as to the creditors of the grantor, and the grantee, after discovering such covenant, takes no steps to repudiate it, she will be held to have adopted the provision, and will be bound thereby.
    Hardin, P. J., and Ward, J., dissenting.
    Appeal from special term, Seneca county.
    Action by C. O. Townsend, as receiver, against Sarah. E. Bumpus and another. From a judgment dismissing the complaint upon the merits, plaintiff appeals.
    Reversed.
    Argued before HARDIN, P. J., and FOLLETT, ADAMS, GREEN, and WARD, JJ.
    John A. Milne, for appellant.
    J. N. Hammond, for respondents.
   ADAMS, J.

This is an action brought in behalf of a judgment creditor of the defendant Harry Bumpus to set aside, as fraudulent, a deed of a farm situate in the town of Romulus, Seneca county, and also a bill of sale of certain personal property, both of which were executed by the judgment debtor to his daughter, the defendant Sarah E. Bumpus. The farm consisted of 106 acres. Its value was from §30 to §40 per acre, and it was conveyed subject to a mortgage of §2,500, upon which a small amount of interest had accumulated. The evidence tends to show that several years prior to the date of the conveyance the father told his daughter that if she would remain in the family, and take care of him and his wife, he would see that she was paid for her services; that she did remain at home, and performed such household duties and other labor as were required of her; that the same were of the value of §1.50 per week, and that at the time of the transfer they amounted, in the aggregate, to the sum of §1,669.50, which constituted the consideration for the conveyance of the farm. It also appeared that some four or five years previous to this time .the father had given a note to his daughter, upon which the sum of §135.93 was found to be due; and this, together with a note of §64.07, which was executed and delivered by the daughter to the father, made up the consideration for the bill of sale by him to her of all his personal property, the value of which, it was agreed between them, was §200. The learned trial court found that the allegations of fraudulent intent upon the part of the daughter were not established, and that she paid a full consideration for the property transferred to her. The evidence which is relied upon to support this finding is not altogether satisfactory, especially in view of the fact that the note given by the father to his daughter is prima facie evidence of a settlement between them at the-time of its execution. But we should, nevertheless, be inclined to-accept the finding as conclusive, and to affirm the judgment, if it were not for an additional fact, as to which there is no dispute. It seems that the deed of the farm contained the following covenant, viz.: “The party of the second part hereby covenants and agrees to support and maintain the party of the first part so long as he lives, as a part of the-consideration of this transfer.” This, clearly, is a provision which was-designed to create a trust for the benefit of the grantor; and, if so, then the deed was, upon its face, fraudulent and void as to his creditors, even though a portion of the consideration therefor was valid. 2 Rev. St. p. 135, § 1; Kain v. Larkin, 4 App. Div. 209, 38 N. Y. Supp. 546. We do not understand that this proposition is controverted by the respondent, but it is contended that the reservation for the benefit of the father was inserted in the deed without her knowledge or consent, and that the same was so inserted contrary to the actual agreement and understanding between the parties. The evidence does tend' to show that, prior to the execution of the deed, it was read over to-the grantee; that thereupon the grantor, who was quite deaf, went into another room, with the scrivener, where the deed was again read over in the absence of his daughter, and at the suggestion of the grantor the obnoxious provision was then added, whereupon the deed was executed and delivered to the respondent without her attention being-directed to the additional clause which had been inserted. It also appears, and this fact was testified to by the respondent, that she became-aware of the existence of this provision in the deed within a month after its delivery; that she was then informed.of its effect upon the transfer, and that, notwithstanding the information thus furnished her, she made no attempt to have the deed reformed, nor did she repudiate the obnoxious provision, but, on the contrary, she continued to live-upon the farm, and to furnish her father .with the support and maintenance which he had been careful to reserve to himself. This, it seems to us, must, in the absence of a satisfactory explanation, be regarded as an adoption by the respondent of the objectionable clause, which places her in practically the same attitude she would occupy had she accepted the deed with full knowledge of its contents. For-this reason we think the judgment must be reversed, and a new trial' had.

Judgment reversed, and a new trial ordered, with costs to the appellant to abide the event.

FOLLETT and GREEN, JJ., concur.

HARDIN, P. J. (dissenting).

According to the evidence, the farm-was subject to a mortgage of $2,500, and was purchased by the daughter, subject to the mortgage, .in settlement of her claim of some $1,600 against her father, without any intent to defraud his creditors. The insertion in the deed of the clause as to the support of the father was-no part of the actual consideration or agreement upon the part of the-daughter. Under such circumstances, if she is required to account for any excess of value of the property purchased above her debt, equity will be satisfied. Clift v. Moses, affirmed 151 N. Y. 628, 45 N. E. 1131, on opinion reported in 75 Hun, 517, 27 N. Y. Supp. 728. I therefore do not favor a reversal, but a modification, of the judgment of the special term.

WARD, J., concurs.