Case ID: ohio-st_41/html/0187-01.html
Source: Caselaw Access Project
Author: {"author": "Granger, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Brannan v. Purcell.
    E., as general agent of J., so acted that both were jointly and severally liable to many creditors; while others had a right to elect which of the two to hold as debtor. J. became insolvent. E. owed no debts except those thus incurred with, or instead of, J. Both believed that J. owed no debts upon which E. was not liable in one, or the other, of said modes. E. had no property. In order that J. might not publicly appear as an insolvent assignor, and with intent to so provide that J.’s property should be divided among all of his creditors under the insolvent laws of Ohio, E. and J. agreed that J. should convey the property to E. in fee simple, and that E. should instantly make a deed of assignment to H. in trust for all of E.’s creditors. This was done. E., J. and M. all, at the time, understood that the trust was for the benefit of all who were then entitled to hold J. as their debtor-.
    
      Held: 1. By so acting E. and J. waived the right to claim that any creditor, by electing to hold either, released the other.
    2. To the extent of the property conveyed E. became absolutely liable with J. for all of J.’s debts as they were when the deed was delivered; and J. remained liable for all. No creditor by proving his claim against E. and taking a dividend loses his right to hold J. for the unpaid balance. All creditors of J. are entitled to share in the dividends, upon proving their claims as required by the statute. No creditor by taking judgment against J. loses his right to such share.
    ERROR to the District Court of Hamilton County.
    On tbe 4th day of March, A. D. 1879, John B. Purcell by deed conveyed all of his real estate to Edward Purcell his heirs and assigns. The nominal consideration was one dollar. On the same day Edward Purcell by deed conveyed all of said property to John B. Mannix his heirs and assigns “ in trust for the equal benefit of all my (his) creditors, and to be administered for their benefit under and in pursuance of the assignment laws of the state of Ohio.” This deed was duly filed in the probate court of' Hamilton county, and Mannix duly qualified as such assignee.
    On the 7th day of March, A. D. 1879, Patrick Brannan, a creditor of John B. Purcell, began a civil action in the court of common pleas of said county against the brothers Purcell and Mannix, charging that John’s deed to Edward was made “contrary to the rights of the creditors of said John B. Purcell and with intent to hinder and delay them, and ■within the provisions of section ten (10) of the act relating to insolvent debtors (75 Ohio L., 938) ; ” of all which Mannix had knowledge. .The prayer- asked that both deeds be declared void and for “ all other' proper relief.” Brannan published the statutory notice of suit and several other creditors filed answers and cross-petitions as parties in the case. Amongst them was the Jefferson National Bank of Steubenville. Edward Purcell’s answer admitted that he was indebted to the plaintiff, and the fact of the conveyances, but denied want of consideration and the fraudulent intent as charged, and averred that the deed to him was made “ in good faith for a good and valuable consideration.”
    Mannix by answer denied “ all and singular the allegations ” contained in the petition and in all the cross-petitions.
    John B. Purcell’s answer contained the following paragraphs :
    “He says that all of his indebtedness, whatsoever the amount thereof, was incurred in his behalf by his co-defendant Edward, who had given his individual obligations therefor, either severally, or jointly and severally, with this defendant, except in a very few instances, where the persons dealing with him had demanded security and had obtained the signature of this defendant on their promissory notes, together with mortgages on real estate, fully securing said notes; that he had no other debts than those so contracted on his account by Edward; that he believes and so avers that he has never had a monetary or business transaction of any nature with the plaintiff or any of the defendants, who have filed cross-petitions in this cause, and if they, or any of them, have any claim or claims against him, they are founded upon transactions had by said parties with Edward, and upon evidences of-indebtedness given them by him; and the plaintiff was not, nor was any of the defendants, in .any wise prejudiced by said conveyance of March 4, 1879, from this defendant to Edward, which, on the contrary, inured to the equal advantage of all.
    “ Defendant denies that he did, for the nominal consideration of one dollar, convey to the defendant Edward the premises described in the petition, and that said Edward did without consideration convey the same to John B. Mannix; he avers, on the contrary, that said conveyances were made for sufficient and valuable considerations; he denies that said' conveyance by him was made contrary to the rights of his creditors, or with the intent to hinder and delay them, or in trust in contemplation of insolvency with intent to prefer certain of his creditors; and he further denies each and every other allegation contained in said petition and cross-petitions not herein admitted and asks to be hence dismissed with his costs.”
    A reply denied all the new matter in the answer of John B. Purcell.
    The common pleas dismissed the action. The plaintiff and cross-petitioners appealéd. The district court, upon the request of the appellants, found the facts as follows:
    
      First. — That notice of the pending and object of this suit has been duly published according to law, for at least four consecutive weeks, in a newspaper of general circulation in Hamilton county, Ohio, and that all of the defendants who have filed cross-petitions herein, did so within fifteen days next, after the expiration of said notice, and within said time duly secured the payment of their pro rata share of the costs and expenses of this action, as provided by law.
    
      Second. — That on March 4th, 1879, the defendant, John B. Purcell, executed and delivered to Edward Purcell, a conveyance of the real estate described in the petition of that date, which conveyance is made a part of the bill of exceptions of record herein.
    
      Third. — That no money consideration whatever, for said conveyance, passed from the said grantee to said grantor at any time, nor did any other consideration move from said grantee other than hereinafter stated..
    
      Fourth. — That at the time of said conveyance, the defendant, John B. Purcell, was Archbishop of the Roman Catholic Church, for the Diocese of the city of Cincinnati, and the said Edward, his brother, was a priest of said church, and Chancellor and sole manager of the temporal and monetary affairs of the said diocese.
    And that at the time of said conveyance, the said John and the said Edward were, and each of them was, largely indebted to many persons, including the plaintiff and the cross-petitioners herein, and at said time they were, and each of them was, wholly insolvent and unable to pay said indebtedness in full.
    
      Fifth. — That the said John believed that he owed no debts which were not also owed by Edward, and the said Edward owed no debts which were not also the debts of John.
    
      Sixth. — That the said John made said conveyance to Edward upon the agreement, and in trust that the said Edward should make a general assignment for the benefit of creditors, whereby all said property embraced in said conveyance should be applied according to law, to the equal benefit of all the creditors of the said John, they being also the creditors of said Edward, as hereinbefore set forth, and that the same was not made with any intent to defraud, hinder, or delay, or to prefer any of the creditors of the said John.
    
      Seventh. — That the sole and only object such assignment, through said Edward, was to avoid the appearance of an assignment made directly by an archbishop of said church, which was supposed by said persons to be unseemly.
    
      Fighth. — That immediately after making the said conveyance, and in pursuance of the agreement and trust aforesaid, said Edward executed the deed of assignment described in the petition to John B. Mannix, Esq., for the benefit of the creditors of the said Edward.
    Ninth.— That the moneys owed by the said John at the time of the said conveyance were on account of deposits theretofore made with him, or for sums borrowed by him, all of which he and the said Edward had jointly used for the benefit of the church, and not for their own personal uses; that said indebtedness was evidenced partly by negotiable notes of the said John, negotiated by said Edward, and partly by paper of the same kind endorsed by Edward, and partly by negotiable notes of Edward endorsed by John ; partly by the notes of Edward signed by him alone, and partly by pass-book accounts, kept in the name of said Edward, who had personally received all of said deposits, and managed all of said business on behalf of himself and his said brother, as hereinbefore set forth; that said Edward, at the time of said conveyance, was the duly appointed guardian of certain minors, and was indebted to them for moneys received by him as such, and not accounted for, and for which indebtedness judgments have been recorded against him, and paid by the sureties upon his bond ; but that all said moneys so received by him went into the fund which was jointly held and expended by his brother and himself, as has been heretofore set forth.
    
      Tenth. — That at the time of said conveyance the said John and the said Edward were, and each of them was, indebted to the said plaintiff, and to each of the said cross-petitioners, as claimed by them in their several pleadings, and that said indebtedness has been merged in judgment as set forth therein.
    As matter of law, the court found that John was liable, at the time of said conveyance, for the payment of each and every debt owed by Edward, and that Edward was liable for the payment of each and every debt owed by the said John; and that in the transactions aforesaid there was no fraud in law, and the same had not the effect to hinder, delay, defraud or prefer any of the said creditors, or either of them.
    A motion for a new trial was overruled ; a bill of exceptions containing all the evidence was taken, and judgment rendered dismissing the action. On error the district court affirmed the judgment. The errors relied on in this court are (1) the findings of facts are not sustained by the evidence ; and (2) the court erred in its conclusions of law.
    We are asked to reverse the action of the district court.
    
      Willy & Wald, for plaintiffs in error.
    
      The conveyance to Edward Purcell should be set aside for fraud.
    From the facts as found we submit that the conclusion of law necessarily resulting from them is that the conveyance was within section 6344 of the Revised Statutes, made with intent to hinder, delay and defraud the creditors of John B. Purcell, because the effect of that conveyance must be to hinder, delay and defraud them.
    Here we have surely the facts which are essential in an action under this statute.
    1. The indebtedness to the plaintiff and the cross-petitioners.
    2. The insolvency of the grantor.
    3. The conveyance without consideration.
    If it be urged that this conveyance would not have the effect to hinder, delay, or defraud the plaintiffs in error, or any of the creditors of John B. Purcell, because it may be said to appear by the findings that the plaintiffs in error were creditors of Edward as well as of John B. Purcell, and therefore could share in the property conveyed, as well after the conveyance and assignment as before, we would answer:
    1st. Even if the plaintiffs in error originally could have been creditors of. either Edward or John B., they could never become creditors of both. By suing the principal and taking judgment against him, they have lost their right to hold the agent. They originally had recourse on either, but once having made their election of which one they would hold as their debtor, they then lost their right to hold the other. Lee v. Insurance Co., 1 Handy, 217 ; Jones v. Insurance Co., 14 Conn., 501; Coleman v. Bank, 53 N. Y., 394; Tuthill v. Wilson, 90 Id., 423 ; Kingsley v. Davis, 104 Mass., 178; Clealand v. Walker, 11 Ala., 1058 ; Garrard v. Moody, 48 Ga., 98; Priestly v. Fernie, 3 H. & C., 977 ; Patterson v. Grandesequi, 15 East, 62; Thompson v. Davenport, 9 B. & C., 78; Calder v. Dobell, L. R., 6 C. P., 486; Curtis v. Williamson, L. R., 10 Q. B., 57; Wharton on Agency, §§ 470, 790 ; Paley on Agency, §§ 246, 247 ; Chitty on Contracts, 11 Am. ed., 302; Wald’s Pollock on Contracts, p. 229 and note c; 2 Smith, L. C., 7 Am. ed., 376.
    If, therefore, by electing to hold the principal, John B. Purcell, and suing him, and taking judgment against him, the plaintiff below has lost his right to hold Edward as his debtor, then the conveyance of March 4, 1879, operates to defraud him, because it attempts to withdraw from liability for his claim, the property conveyed. He can only share in that property by proving his claim as a creditor of Edward Purcell, which he can not do, as he has taken judgment against his principal.
    2d. There may be some of the cross-petitioners, or other creditors, who have not yet cut off their rights against Edward, by electing to hold John B., yet the conveyance is fraudulent as against them. They can only share in this property by proving their claims against Edward’s estate, and by this act they extinguish their right to hold John B.
    The effect of the conveyance as to them is fraudulent, because it compels them to abandon their right to hold John B. Purcell, in order to share in the proceeds of so much of his propertyas is conveyed, and which it is their right as his creditors to hold liable for his debts without the abandonment of any of their rights against him.
    3d. Further, it appears from the findings and the pleadings that some of the cross-petitioners and other creditors hold negotiable paper, upon which Edward as well as John B, is liable, either as maker or endorser.
    It also appears from the findings that Edward had other creditors to whom he was liable for money received by him as guardian. The effect of the conveyance is to give to all such creditors of Edward a fund, properly belonging to the creditors of John B. alone.
    The holders of negotiable paper bearing the name of Edward, as well as that of John, have, under this conveyance, not only the right to share in the property conveyed to the exclusion of the creditors of John B., such as the plaintiff below and those of his class, but they have also the right to share equally with them in any assets remaining to John after this conveyance.
    The guardianship creditors have no relation nor connection with John B. Purcell, and by this conveyance a part of his property is diverted from his creditors for their benefit.
    There never was a case of a fraudulent conveyance if this is not one, and without going back of the findings of the court below, we contend that we are entitled to a decree setting aside the deed of March 4,1879.
    King, Thompson & Maxwell, for Jefferson National Bank.
    L Edward Purcell testifies that all of his indebtedness had been contracted as John’s agent, but that he had given evidences of indebtedness (pass books and notes) in his own name, and had therefore made himself personally liable.
    These creditors, on discovering that Edward was in fact only an agent, and John the principal, could hold either Edward or John, but not both. An election to hold one would be a release of the other. Lee v. The Fraternal Mut. Ins. Co. et al., 1 Handy, 217; Priestly v. Fernie, 3 H. & C., 977; Evans on Agency, 450-452; McNaughton v. Partridge, 11 Ohio, 223; Wharton on Agency, § 464; Pollock on Contracts, 229.
    But no one could take under this assignment except as a creditor of Edward, for the trust was in express terms for the benefit of Edward’s creditors. Acceptance of a dividend would be an election to hold Edward, and consequently a discharge of John. The fact that the property came from John, and that he was the assignor, would only strengthen the case by adding the element of estoppel in his favor, as against creditors who should elect to take in terms as creditors of Edward.
    The release of the assignor, John B. Purcell, would therefore be the condition upon which alone the creditors provided for by this assignment, could avail themselves of it. Such a condition inherent in the assignment itself, is not less vicious than if annexed in express terms.
    
      An assignment which stipulates for a release of the assignor as a condition of claiming under it, is fraudulent and void. Woolsey v. Urner, Wright, 606; Barrett v. Reids, Id., 701; Atkinson v. Jordan, 5 Ohio, 298; Repplier v. Orrich, 7 Id., pt. 2, 246.
    II. There were creditors who held the individual paper and obligations of John B. Purcell, alone.
    Assuming, therefore, that, because Edward’s debts had been contracted on John’s account, John had the right to dispose of his property to pay them, even as against his individual creditors, his conveyance was nevertheless “ an assignment in trust to a trustee, in contemplation of insolvency, with intent to prefer” the class of creditors provided for over those who were creditors of John alone. Such a conveyance is illegal and fraudulent. 75 Ohio Laws, 938, § 9. Dickson v. Rawson, 5 Ohio St., 224.
    It is true that the property included in such a deed is not available to a subsequent attaching creditor. [ Conrad v. Pancoast, 11 Ohio St., 685], but the making of such a deed is the conveyance of property with intent to do an illegal and fraudulent thing, and furnishes the ground for an order of attachment, which may be levied on any other property the assignor may have remaining. It is the making of a conveyance, with the intent that it shall operate illegally and fraudulently, that is the ground for attachment, not the realizing that intent. No fraudulent intent can be realized if challenged. The law will frustrate the attempt. As to deeds in trust to prefer creditors, our statute thwarts the illegal intent, not by setting the deed altogether aside, but by substituting lawful trusts, in the place of the illegal and fraudulent trusts declared by the grantor.
    
      Hoadly, Johnson & Colston, and John B. Mannix, for defendant in error.
    I. The creditors of Edward and John B. Purcell are identical, but if not, the property in dispute is liable for the claim of those who are creditors of both, and the complainants are all creditors of both. The creditors of both are not entitled to relief against a conveyance from either to the other until they show that they have been injured thereby. There is no proof that the combined dividends from both estates will be any less if this conveyance is sustained than if it had never been made. Unless the combined dividends will be smaller, how have any creditors who have claims against both been damaged? And all the complainants are creditors of both.
    Creditors are not entitled to claim that the transfer of property from one joint debtor to another is fraudulent; more especialty when the transfer was intended, as it unquestionably was in the case at bar, in good faith for the benefit of the very creditors who are now complaining. A conveyance from one joint debtor to another, for the purpose of enabling such other to make an assignment for the benefit of the joint creditors, can not be successfully assailed by those who are creditors of both the debtors, however objectionable it may be as to the creditors of one only.
    II. It is also contended that the plaintiff is a creditor of John B. Purcell alone, because, having originally a right of action against John B. Purcell or Edward Purcell, at his election, but not against both, he has, by recovering judgment against the former, waived any right he might have had against the latter ; and to support this, it is contended that, when an agent and his principal are both liable upon an instrument, whether because the agent has failed to disclose his principal, or for any other reason, no action can be brought or judgment taken against them jointly.
    This is ingenious ; and, if it were true, Patrick Brannan and John G. Hendricks would be creditors of John B. Purcell, and not of his brother Edward, though, even in that case, they can not complain. ■ The difficulty with this argument, however, is that its premises are unsound. The proposition of law above stated is so far from being true that nothing short of satisfaction, by either agent or principal, will bar an action against the other. M'Alexander 
      v. Lee, 3 A. K. Marsh., 483 ; Stewart v. Strasburger, 7 Hun, 337; Beymer v. Bonsall, 79 Pa. St., 298; Cobb v. Knapp, 71 N. Y., 348.
   Granger, C. J.

The complaining creditors urge that the evidence proved that Edward Purcell owed debts on which John B. was not liable.

The trial court found otherwise, and we have no right to disturb that finding unless the record shows that it is clearly wrong.

Edward was dead when the appellants proved his liability for moneys in large sums received by him as guardian and not accounted for. It was not claimed that Edward was dishonest. His intent to do no wrong was admitted. The testimony of John was that Edward for all the time covered by the transactions, .was a priest of the Roman Catholic church; that he had no property or business of his own; that his business was the management of the financial affairs of John in furtherance of the interests of the arch diocese; that his payments out were for John; that Edward had no debts except such as were John’s debts, and that he (John) was liable for all of Edward’s debts. Although Edward’s deposition, taken prior to the trial, contains no question or answer touching directly upon his liabilities as guardian, it did contain the following questions and answers:

Q. 15. State whether the moneys received by you in the course of said business were to any extent used or expended by you for yourself or your own benefit, or for the benefit of the archbishop, and if for the latter, state in what way and for what purposes? A. They were .not expended for my use or benefit, but for the use of the archbishop, as archbishop of the diocese, for building churches, school houses, orphan asylums, taxes, and several other and divers purposes; much of course was paid back as demanded by the depositors, with interest; also to persons calling for charities or for the education of young men in Rome, France and elsewhere, who aspired to the priesthood.

Q. 16. State, if you know, whether on March 4th, 1879, John B. Purcell had any debts of any kind, excepting those so contracted by you on his account ? A. He had not.

Q. 17. State whether or not, at that time you had any debts excepting those so contracted by you on account of John B. Purcell? A. I had no debts other than the above.

Q. 25. Look at the affidavit signed by you and marked “ P. S.” for identification, and now-exhibited to you, and state if the statements made therein are true, and if you now adopt and make those statements part of this deposition, and if so, attach a copy of said affidavit hereto, and make it a part hereof and mark it “ Exhibit Z.” A. The statements referred to above are true, and I now attach the affidavit marked “ Z.”

Q. 26. Look at the affidavit signed by J. B. Purcell, and marked for identification “ P. S.,” and now shown and read over to you, and state if the statements therein made by him are true, and if so, attach a copy of said affidavit hereto, and make it part hereof, and mark it “ Exhibit W.” A. These statements I believe to be true, and I attach a copy of the affidavit marked “W.” I know of no other indebtedness of the archbishop, excepting that which was contracted by me on his account.

In said “ Exhibit W.” John B.' Purcell testified thus : “ Having no other debts than those standing in the name of Edward, or for which Edward was liable jointly and severally with affiant, and all the indebtedness of Edwmrd having been contracted on affiant’s account, and affiant being morally, equitably and legally as much bound therefor as if he had in his own name given the evidences of such indebtedness to the creditors, affiant took counsel of some of the prominent laymen of his church as to the best course to pursue under the circumstances, and they considering it more befitting and less unseemly that the assignment should be made by Edward than by affiant, and in order to prevent complications from' arising thereunder by reason of affiant holding in his own name by virtue of his office of archbishop of the Roman Catholic church for the diocese of Cincinnati, the legal title to the parochial property of the several congregations under his charge, which had been purchased by them respectively for their own use and was, in fact, held by him in trust for them, advised affiant to convey to Edward all property which he had the right to dispose of for that purpose, to the end that Edward should make a general assignment for the equal benefit of all creditors, and on the 4th day of March, 1879, by deed of same date, recorded March 5, 1879, in Book No. 492, page 627, of the records of Hamilton county, he conveyed to Edward the property therein described, being all the property of which he considered he had any right of disposition, for the benefit of creditors, to the end and with the sole intent that the same should be at once conveyed by-Edward, together with all the property, real and personal, by him owned, to John B. Mannix, by deed of general assignment for the benefit of his creditors, who, as before stated, were likewise the creditors of affiant; that Edward did, simultaneously with the execution of said deed to him, and as part of the transaction, make, execute and deliver to said John B. Mannix a deed of general assignment under the laws of Ohio, conveying to him, for the equal benefit of all of his creditors, all his property, real and personal, and said deed of assignment was filed in the probate court of this county on the 5th day of March, 1879, at eight o’clock A. M., and said John B. Mannix was on the 12th day of March, 1879, duly qualified, and is now engaged in the execution of his trust as assignee under said deed. That being subsequently advised that it was contended that said conveyance and deed of assignment discriminated against the creditors of affiant, he, to remove all misapprehension in the premises, on the 11th day of March, 1879, by deed of that date, conveyed to the said John B. Mannix, in trust for the payment of his debts, including as part thereof the said indebtedness of Edward incurred on his account, all and singular the real and personal property of which affiant was seized at law or in equity, or to which he had any claim, or in which he had any interest at law or in equity, including every species of estate, real or personal, which might by any proceeding at law or in equity be subjected to the payment of his debts, but not including property held by him in trust for others, or which catínot in law or in equity be subjected to the payment of his debts; and said deed of assignment was filed in the office of said probate court, on the 12th day of March, 1879, and said assignee was on the next day duly qualified, and is still engaged, in the execution of his trust under said deed. Affiant further says, that said deed of March 4th, 1879, was made by him in the utmost good faith, and solely for the benefit of his creditors, and that he has not at any time conveyed or assigned .any portion of his property, with intent to hinder, delay or defraud, them, or any of them.”

And Exhibit X ” contains the following sworn statement of Edward Purcell:

“ Affiant further says that for the past forty years he has been the financial agent and representative of the said John B. Purcell, and has had the control and management of his financial affairs, and in said capacity he received and loaned out during said period large sums of money, and purchased with part of said deposits divers tracts and parcels of real estate ; that the title to said real estate was generally taken in the name of John B. Purcell, but the accounts of said deposits were kept in the name of affiant, who gave his individual obligations therefor, and evidences of indebtedness and securities for loans were taken by affiant .in his own name; that in the course of his financial agency and management affiant contracted a large indebtedness on account of his co-defendant, for all of which he was personally liable and bound, having obligated himself therefor individually, or jointly and severally, with said John B. Purcell; that this affiant had no debts whatsoever other than those so contracted by him on account of his co-defendant, nor did the said John B. Purcell have any such item whatsoever other than that so contracted on his account by this affiant; that when affiant became unable to meet the demands of creditors, and after many suits had been brought against his co-defendant and himself upon evidences of indebtedness so given by affiant, the said John B. Purcell, being thereunto advised by prominent laymen who did not consider it seemly that the assignment should be made directly by him, and in order to prevent complications which might arise from such direct assignment by reason of his holding in his name, by virtue of his office of archbishop of the Roman Catholic church for the diocese of Cincinnati, the legal title to the parochial property of the several congregations under his charge, which had been purchased by them respectively for their own use, and was in fact held in trust by him for them, made the said deed of March 4th, 1879, conveying to affiant the premises therein described, most of which had been purchased by affiant with part of said deposits with the object and intent that affiant should at once convey said premises, together with all property, real and personal, owned by him, to John B. Mannix for the equal benefit of all creditors.”

In addition to the ordinary presumption which holds that a witness is truthful until the contrary is in some way shown, counsel have assured us that they do not question in any degree, or manner, the integrity of Edward, or of John. While John was ignorant of the business, Edward was familiar with it. It was his life-work. Either he had wholly forgotten his indebtedness as guardian, or he did not tell the truth when he said that he owed no debts except those contracted for John; or the moneys that he did not refund to his wards were disbursed for like objects with the moneys that he failed to repay to the depositors, to wit, for purposes of the arch-diocese “ in John’s business; ” for purposes that made John a debtor for the money of Edward’s wards, as fully as for the moneys due to the depositors. The record discloses no evidence tending to show any expenditure of money by Edward for any purposes of his own, yet not less than $12,000, and possibly (the evidence is not clear) over $20,000 of moneys received by Edward as guardian had disappeared. Edward had been repeatedly cited to account for them. Suits had been brought. His sureties had paid moneys for him. We think the trial court ought not to have found that he had forgotten his indebtedness as guardian. The alternatives were either (1) his statement that he owed no debts besides those for which John also was liable was wilfully false; or (2) he had expended the money as John’s financial agent under such circumstances that John himself was liable to every creditor of Edward for the whole of Edward’s debts.

We therefore think the finding of the trial court in favor of said second alternative was right. We think it unnecessary to discuss the other findings of fact. It is enough to say that it does not clearly appear that either of them is not supported by the evidence.

But it is urged that for much of the indebtedness Edward and John were liable only in the alternative. That every creditor who so dealt with Edward that he might hold either brother as his debtor, by electing to file a claim against Edward with the assignee, will thereby release John. That the legal effect of the deeds is to compel this class of John’s creditors to release him from all liability, as a condition precedent to sharing in the assignee’s dividends; that he could not lawfully impose such a condition, and therefore his deed was made with an intent, in law, to defraud his creditors. It is true that, ordinarily, one who so deals with an agent that he may choose whether he will make the agent, or the principal, his debtor, by taking judgment against the agent, or by accepting a dividend from the agent’s assignee, estops himself from thereafter suing the principal. But the principal and agent may by agreement, or by act, convert this alternative liability into a joint and several liability; or a liability in succession. Either may estop himself from claiming that the election of the creditor to treat the other as his debtor has released him. It seems to us plain, that the archbishop had no thought of any such release; that neither of the brothers contemplated any such condition precedent, or any advantage over any creditor. Any such stipulation would be a fraud upon that class of creditors. But while courts are continually announcing that “fraud will not be presumed,” we are asked to presume that these brothers so intended, because every such creditor who proves a claim and accepts a dividend from assignee Mannix will thereby release the archbishop. That there is a legal though not an actual fraudulent intent.

In most solemn form both brothers, as shown by this record, have testified that these deeds were made so that the property should be equally distributed to John’s creditors ; that Edward was used for John, in order that an archbishop should not appear as an assignor under the insolvent laws of Ohio; that John’s property should, nevertheless,, be distributed under those very laws to all of his creditors. John, Edward and Mannix, all believed that Edward’s assignment would have precisely the same effect upon property and upon creditors as an assignment by John himself would have; and they intended that it should have that precise effect. The presumption, therefore, is that they intended to reserve no right to either that would prevent the accomplishment of this main purpose. They assumed as the basis of their action that Edward was so liable for all of John’s debts, that his assignment would stand as John’s under the Ohio Statute. John expressly declared that all of Edward’s debts were his debts and all his debts Edward’s debts. Edward by accepting the deed agreed to that basis ; John, by so making the deed, authorized all his creditors to present their claims against Edward. So doing, without express reservation, he estopped himself from setting up such presentation as a release to him.

It seems to us, therefore, that John is forever estopped from claiming that any creditor by proving his claim and taking a dividend from the assignee, thereby released him from liability for the unpaid balance. By equally solemn statements Edward estopped himself, and all claiming under him, from asserting that any creditor who, before, or after, March 4,1879, pushed his claim to judgment against John, thereby lost his right to a dividend from the assignee. This record shows, in effect, that on March 4,1879, Edward assumed (at least to the extent of the property conveyed) all the debts of John, and that John assumed all the debts of Edward; that all the creditors could from that time safely prove their claims before the assignee and share his dividends, withont in anjr manner affecting their right to hold John B. Purcell for unpaid balances; and that Mannix, who took with full notice, is bound to treat every creditor of John B. Purcell, who proves his claim, as a creditor of Edward Purcell to the extent of a pro rata dividend out of the trust property, whether such creditor has taken judgment against John B. Purcell, or not. The making by John, and the acceptance by Mannix, of the deed dated March 9, 1879,'following so promptly the first intimation that the deed to Edward was questioned, we think confirms the inference we have drawn from the last named deed, and the agreement under which it was made.

Although the case was argued in print as well as orally, counsel urged nothing under their other assignments of error. We therefore have considered no question touching evidence admitted or excluded. The judgment of the district court is

Affirmed.