Case ID: hill_1/html/0438-01.html
Source: Caselaw Access Project
Author: {"author": "Cowen, J. \n      Bronson, J. dissenting.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Butler & Barker vs. Van Wyck.
    Since the decision of the court for the correction of errors in Smith §■ Hoe v. Acker, (23 Wend. 653,) if there is evidence that a mortgage of chattels was given for a true debt, the question of fraud as to creditors, arising from continued possession in the mortgagor, must be submitted to the jury, whether such possession be satisfactorily explained or not; and a verdict either way will conclude the parties.
    And semble, the rule is the same where a like question is raised upon a bill of sale absolute on its face.
    Quere, whether the court of chancery is not still left to act upon the doctrine as formerly understood in reference to questions of this character.
    Bronson, J. dissented, holding that though the decision in Smith and Hoe v. Acker, was binding on the parties to the particular suit, it should not be followed as a precedent.
    Replevin, tried before Ruggles, C. Judge, at the Dutchess circuit in October, 1839. The plaintiffs are paint, oil and dye-wood merchants in the city of New-York. Prior to 1837, Washington Davids kept a paint and oil store, and was engaged in the business of house painting in Poughkeepsie. In 1837, Davids kept a tavern called the Forbus House, in Poughkeepsie, where he continued until April, 1838, when he removed to and kept another public house in the same village, called the Mansion House. On the 19th June, 1837, Butler, one of the plaintiffs, went to Poughkeepsie and presented an abstract or statement of moneys claimed to be due the plaintiffs from Davids,- who thereupon gave the plaintiffs a bond conditioned for the payment of $2355,34, the balance claimed—payable, one third in twelve, one third in eighteen, and one third in twenty-four months, with interest. Davids at the same time executed to the plaintiffs a mortgage, with the like condition, of the' carpeting, matting, chairs, tables, looking-glasses, settees, beds, bedding and bedsteads, spoons, knives, forks, candlesticks, crockery and glass ware, beer-pump, and other furniture of the Forbus House, which Davids was then keeping, together with some other property. The mortgage was filed pursuant to Statutes of 1833, [ch. 279.) Stephen Cleveland, a counsellor at law, was consulted by the plaintiffs at the time the papers were executed. He testified that he was then a boarder with Davids; that it was agreed between the plaintiffs and Davids, that the property should be deemed to be in witness’ possession, and it was put in his possession as the agent of the plaintiffs so far as it could be so without a removal, and it was agreed that the property should be under his control. The property was not removed and no actual delivery took place, otherwise than as above stated. Cleveland used as much of the property as was necessary in the rooms which he and his family occupied as boarders. When Davids removed to the Mansion House, about the 1st of April, 1838, he took nearly all the property with him, and all of it was carried there within a month, where it was used by Davids, except some few things which were boxed up by order of Cleveland. Cleveland did not remove with Davids to the Mansion House.
    In May, 1838, Pascal B. Smith recovered a judgment in this court against Davids, in an action upon promises, for #333,73; and on a fi. fa. issued upon that judgment, the defendant,, as sheriff of Dutchess, levied on the property in question on the 18th August, 1838; the property then being in the Mansion House and in the use of Davids. The defendant did not take any property which had been boxed up. The plaintiffs thereupon brought this action of replevin.
    The plaintiffs gave in evidence an account, and a letter in their handwriting directed to Davids, dated 9th January, 1837, and post marked “ New-York, Jan. 9.” The account stated a balance of #2293,78, as due the plaintiffs— and the letter called on Davids for a remittance. The plaintiffs also gave in evidence several letters or bills, in their handwriting, purporting to be bills of paints sold to Davids in the years 1835 and 1836. All of these papers were produced by the witness Cleveland, who said he received them from Davids after the mortgage was executed, and before this suit was commenced. They were admitted in evidence, subject to the objection that they were inadmissible, as being, at least, evidence made by the plaintiffs themselves.
    
      The plaintiffs insisted that the matters given in evidence should be submitted to the jury. But the judge said, as there was no change of possession, the mortgage was invalid against the execution creditor, and directed the jury to find a verdict for the defendant. The plaintiffs excepted. Verdict for defendant; and the plaintiffs now move for a new trial.
    
      S. Barculo, for plaintiffs.
    
      Wilkinson & Street, for defendant.
   Cowen, J.

The cause was put to the. jury on the ground of possession continuing in the mortgagor; and the question is, therefore, the same in effect as if there had been actual proof tending to show that the bond and mortgage were given to secure a true debt. There was no change of possession, nor any excúse expressly set up for not changing it. It was however obviously for the convenience of Davids to keep possession, and it might have helped him in his business.

The judge was clearly right, according to the decisions of this court, and the uniform current of judicial authority from Twyne's case, (3 Rep. 80,) in the reign of Elizabeth, down to but not including Smith & Hoe v. Acker, decided by the court for the correction of errors in December term, 1840. (23 Wend. 653.) Several cases are before us on possession of goods by insolvent debtors after a bill of sale or mortgage, both being, as is well known, placed by our statute on the same footing in respect to the evidence of fraud derivable from such possession. Some of these cases were argued or submitted before and some since the decision by the court of errors, which is now urged upon us as subverting the ancient doctrine of the courts, by requiring the question of fraud to be submitted to the jury, and malting their decision final and conclusive in all cases. I have accordingly looked into that case, and am of opinion that it has not been materially misunderstood by counsel who contend upon it for the absolute power of the jury. This, I think, will be obvious from a brief review of it; and, at any rate, it will be clearly seen that it was considerably stronger in favor of the execution creditor than the one now before us. Yet the court of errors forbade the interference of the judge, and said the case belonged to the jury.

In that case the plaintiffs, Smith &. Hoe, claimed as mortgagees of a valuable printing apparatus (presses, types, &c.) in the city of New-York, where both parties resided. The mortgage was executed by one Bell, an insolvent debtor, and included also his household furniture at two houses in the city. It was professedly taken to secure a debt of $10,000. The whole was described in a schedule attached to the mortgage, without any value being affixed; and no appraisal was made at the time, though a witness stated that he afterwards estimated the printing materials at $10,000. No estimate appeared to have been at any time set on the furniture; and some of it was described as consisting of lots or parcels. The money was professedly secured to be paid in about one month. The mortgage was filed. It contained a covenant that, till default in payment, the whole should remain in the possession and enjoyment of the mortgagor. The apparatus remained in his office and the furniture at his houses in the city, (though, as alleged, he had paid none of the money said to be due,) till some time in January, 1838, when the sheriff levied on one of the printing presses to satisfy an execution for a small debt due to Mr. Voorhis. -A witness stated that had a sale of the apparatus been forced at auction in the meantime, it would not have brought 20 per cent, of its real value; and that Bell was allowed to retain possession, and was assisted in his business by the plaintiffs, in the hope that he might be enabled to pay his creditors. Business was in the meantime dull; and Bell was sick in the summer and fall, and when the sheriff came to "levy. No reason whatever was given for leaying the furniture with Bell, which was apparently valuable and equal to a handsome domestic establishment in the city, allowing not only for a scale of convenience, but elegance. Parol evidence was given of á balance on book account in favor of the mortgagees, against Bell, of about §10,000; and it was claimed that the mortgage had been given to secure this balance.

The cause was tried on these facts, in the New-York common pleas, where the mortgagees had brought replevin against the sheriff. At the close of their evidence before the jury, that court thought the transaction such a palpable device to delay, hinder, or defraud Bell’s creditors, that they refused to submit the case to the' jury; and nonsuited the plaintiffs. On error to this court we thought the court below were clearly right and affirmed the judgment. Our judgment was reversed by the court of errors, which held that the question was one of actual fraud for the jury.

It will be perceived, that here was such a possession by the mortgagor as the statute (2 R. S. 70, 2d ed. tit. 2, § 5,) declares to. have been presumptively, indeed conclusively fraudulent and void as against the levying creditor, unless it was shown on the fart of the flaintiffs that their mortgage was made in good faith, and without any intent to defraud creditors. ' The fourth section of the next title declares, that the question of fraudulent intent in such case is one of fact and not of law. A brief examination of the principle and history of our decisions under these statutes, will exhibit more clearly the difference .between the construction which we have placed upon them, and that adopted by the court of errors..

We understood the' statutes, not as narrowing and weakening, but rather as extending and strengthening the rules of evidence which had before been adopted for the detection and suppression of fraud. Section one, of title three, is- a re-enactment of the 13 Eliz. Section five, of title two, puts absolute bills of sale and mortgages of goods on the same footing, declaring that both shall be presumptively fraudulent, and conclusively so unless proved to have been made in good faith and without any intent to defraud.

The case cited from 3 Rep. 80, arose under 13 Eliz. on a sale to Twyne in satisfaction of a debt, the vendor being indebted to others, and continuing in possession, as Bell had done in Smith & Hoe v. Acker. All the judges of England resolved, (p. 81,) that notwithstanding here was a true debt due to Twyne, and a good consideration of the gift, yet it was not bona fide ; for no gift shall be deemed to be bona fide which is accompanied with any trust, as if the donee allow the donor to continue in possession, &c. The rule of this case having long prevailed, and having been extended, as we understood the revised statutes, to mortgages as well as sales, we held in both instances, that the proof of a true debt taken by itself did not tend to shew that the sale or mortgage was bona fide. We required, in addition, that some extraordinary reason should be shown for the continuance of possession; and not merely such as may always be set up and established by a wary insolvent, and his mortgagee or vendee; and that if something more were not shown, proof of a real consideration came short of the mark, and amounted to nothing. We proceeded on the ground deduced by Mr. Roberts, from Twyne’s case,' viz: That evidence of the fraudulent intent supersedes the whole inquiry into the consideration; for no merit in any of the parties to a transaction can save it, if it carry intrinsically or extrinsically the plain characters of fraud.” (Roberts on fRaud. Conv. 548.) Twyne’s case specifically denied all force to one very common excuse. At p. 81, the report declares, that a sale leaving the goods with the vendor with intent to favor him, being content that he should pay the .debt when he got able, should not be deemed bona fide. Accordingly, an excuse that the goods were left for the accommodation or convenience of the insolvent vendor, has been repeatedly disallowed. (Gardner v. Adams, 12 Wendell, 297. Doane, v. Eddy, 16 id. 253. Randall v. Cook, 17 id. 53.) So, that he retained the use and possession to enable him the better to pay the debt due the mortgagee. (Beekman v. Bond, 19 Wendell, 444.) The principle of these decisions was, as already mentioned, that the excuses were such .as could be manufactured by the parties at pleasure, and always would be. These and the like reasons for retaining possession can always be proved. Most of them are self-evident; and if not, the parties can express and make a show of them at the time, and so prove them by witnesses. Being matters by which they may always cover and disguise the transaction, we thought them of no force, and not such evidence as should go to the jury. In this we proceeded on the rule that though a question be one of fact, yet whether the evidence offered may tend to its elucidation, is always a question of law for the judge.

Having thus noticed the principles on which our decisions proceeded, it becomes necessary to inquire how far they were overruled by the court for the correction of errors in Smith Hoe v. Acker. The excuses set up by Bell’s mortgagees were of a character which the parties to an insolvent’s mortgage may always bring into the case and make out in proof; and if such are fit to be submitted to a jury, as relevant evidence, it follows that every other excuse within the power of the parties to invent must also be deemed relevant. The presiding judge has no discretion; but is bound to submit the alleged excuse to the jury as a part of the evidence to be considered and allowed or disallowed by them, as they shall think meet. The line which has heretofore been maintained in this respect between the relevancy and the weight of evidence has been obliterated; and both have been confided to the jury. The court for the correction of errors held this anomaly as matter of construction on the declaration of the fourth section of title three, that the question is one of fact and not of law. Senator Hopkins, who delivered the only opinion in that case coming fully up to the principle which alone can be considered as governing the decision, in speaking of this provision, said it- seemed Unnecessary to look into the previous state of the law. He admitted that the onus probandi was thrown upon the persons claiming under the sale or mortgage. But in his enumeration of the matters tending to discharge that onus, I find much alluded to as admissible which had not been deemed so under the previous state of the law; but nothing specifically which the judge would be authorized to reject as irrelevant. Indeed in looking through the evidence and considering it in the light of any judicial rule for weighing it which I remember to have seen laid down before, I have been at a loss to find an excuse that the mortgagees could have set up, which did not rather tend to increase the presumption against them already raised by the statute.

The two prominent excuses seem to have been, 1. That Bell was insolvent, and, by keeping his property, he would the better be enabled to pay his debts; and 2. That a forced sale at auction would have brought less for the property. The former reason had no application to the valuable household furniture; and if allowed by the law on the ground that the mortgagor might make a profit by keeping his tools and implements of business, and so possibly pay his creditors some time or other, that would go to save every insolvent’s property for his own use. The excuse would always be true at the time, and might continue to be so during his whole life. Bell and his mortgagees might as well have agreed on a credit and possession for years, and extended the time still for years beyond the day of payment. That a forced sale would have brought less than a leisurely one, is equally applicable to all property. But that was an argument rather for than against a change of possession. A change would have enabled the mortgagees more readily to exhibit the property, and seek opportunities for an advantageous sale, which the mortgage stipulated they might do. That they were occasionally aiding Bell by advances, thus keeping up the balance due on book, and giving him color for opposing the claims of small execution creditors like Yoorhis, was a bad earnest of the pretended purpose to pay debts. The sickness of Bell in the summer and fall, and in January when Yoorhis came with his execution, was also mentioned. But if this excuse were admissible at all, it had. no existence when the mortgage was given, nor when the default in payment was made. In the face of the statute, the mortgagees, so far from the thought of taking the property, actually disqualified themselves from doing so till the first of May, by a covenant that it should remain for the exclusive enjoyment of Bell. From that day they waited till he became sick. He was in a-state of imbecility which they admit called for their farther assistance, and must have sunk him deeper in debt. Independently of sickness, the argument is far from being solid, that a solvent man who in good times with a flourishing business wanted forecast to avoid insolvency, could be entrusted to recover himself by the management of a sinking fund in bad times with a narrowed business and laboring under the distrust of community.

The evidence did indeed tend to show that the mortgage was given at the time to secure a bona fide debt. But even this evidence, which the law has never heretofore regarded as a sufficient explanation when standing alone, was far from being satisfactory. The debt was proved to rest in a book account, which does not appear even to have been produced at the trial. But if the book account had been produced and had shown a debt of exactly $10,000, that would have been far from conclusive. It is very easy for an insolvent and his mortgagee to keep up appearances of a large balance on book or otherwise, whether there be really one or not. A fraudulent mortgage generally assumes a round sum, convenient to cover the property, avoiding to break dollars or even hundreds or thousands; and the only way for creditors to meet the assumption, is on facts like those disclosed in the case before the court of errors.

Without going farther into particulars, it seems to me that, with the single exception of evidence to support.the consideration of the mortgage, the presumption of fraud arising from Bell’s possession, would be considered as rather fortified than weakened, if any of the old rules of evidence were left to us.

In holding that such a case must be submitted to the jury, the court of errors virtually decided that a verdict m favor of the mortgagees could not with propriety have been disturbed by the court' below. If that court had not power to nonsuit, it follows that they could not have granted a new trial, had the jury found a verdict for the plaintiffs. In short, the court of errors must have considered the1 power of the jury as absolute in almost every conceivable case.

The mortgage of Bell was duly filed, according to the requisition of 2 R. S. 71, 2d ed. § 9. But both Senators Hopkins and Edwards expressed a clear opinion that this circumstance did not mitigate the force of the presumption against the mortgagees which would otherwise have arisen under section five. Those opinions accord with the settled doctrine of this court. (Wood v. Lowry, 17 Wendell, 492.) The decision in Smith & Hoe v. Acker, thus being made irrespective of section nine, must therefore be received to govern our judicial action on absolute sales attended with circumstances similar to those in evidence respecting the Bell mortgage. This results from both sales and mortgages being put on the same footing by section five.

Under the construction which the court of errors have thus thought it their duty to give the fourth section of title three, creditors cannot, I think, any longer look for the direct action of this court in deciding on' the usual indicia of fraud. The question must, in almost every case, begin and end in the court of original jurisdiction when it arises on the common law side. I speak not of the court- of chancery. That court is perhaps left to govern itself by the ancient rules. -But it seems to me that where there is a trial by jury, whether at the circuit, in the common pleas, or in a justice’s court, the law must be considered as confiding little if any thing more than a mere advisory control to the presiding tribunal; and that therefore, a review of the question on motion for a new trial, or in any form which presupposes the existence of controlling rules of evidence, is pretty much at an end. Perhaps it is necessary for the vendee or mortgagee claiming in the face of a continued possession in his vendor or mortgagor, to give evidence, slight at least, that the consideration was a true debt. But beyond this, the verdict of the jury must be received as final. The convenience of the vendor or mortgagor, the declared purpose of enabling him to pay debts, even the comfort of his family in retaining household furniture according to their rank in life ; in short, motives of humanity, and almost of mere courtesy, may, I think, on the authority of Smith & Hoe v. Acker, be given in evidence to the jury, who may, if they please, allow them as legitimate excuses. But whether allowed or rejected, the court cannot interfere. This is most clearly so, as I have entirely satisfied myself on examining the circumstances of Smith & Hoe v. Acker ; and my conclusion will, I think, be found as clearly supported by the general scope of Senator Hopkins’ argument ; and by many of his particular expressions. He says, indeed, that the court are to decide questions of relevancy; but he does not, as I before suggested, admit that any one circumstance, before that time held irrelevant, is any longer to be considered so; the case itself shows that it is not; and he expressly mentions several instances in which facts before held to be irrelevant, are no longer so ; such as, that the mortgagor required the property mortgaged in his business, and to aid in his earnings for the payment of debts and the support of his family. And he concludes by saying, the jury must decide the question according to their own convictions as one of actual fraud, It seems to me that the rules cited from Twyne’s case, in Lord Coke’s' reports, and all the decisions following them, down to and including our own, are stricken from existence*, and the question comes nearly, if not quite, to one of actual mental fraud, to be. finally disposed of by the jury. The case before the court of errors was the very strongest which could be presented as a test of the ancient rules, and the learned senator who gave the prevailing opinion, expressed himself as became him, clearly and. strongly. He said at the outset, that his vote would directly conflict with our whole course of decision. It did so; and I feel bound to consider the case of the same force as if the whole court had in terms overruled all our decisions in detail. It virtually says, that in Doane v. Eddy, (16 Wendell, 523,) the jury might have allowed the mortgagor to keep his mare and use her. So in Randall v. Cook, (17 id. 53,) they might have sanctioned the mere wish of the mortgagor and the consent of the mortgagee, that the former should continue the use of the property. So, under the hill of sale and mortgage in Wood v. Lowry, (id. 492.) So, the retaining of the boat by the insolvent mortgagor in Beekman v. Bond, (19 id. 444,) to enable him by its earnings to pay the mortgage debt. So, possession after the sale in Gardiner v. Tubbs, (21 id. 169;) since a mortgage and absolute sale stand on the same footing. Indeed an absolute sale may be made a more effectual instrument of fraud, for it need not be deposited in the clerk’s office, as a mortgage must.- In Gardner v. Adams, (12 id. 297,) a bureau was left with the mortgagor for his accommodation. That was denied to be a sufficient excuse. This case must now also be taken as overruled.

In the case before us, Butler was somewhat shy of avowing his consent to leave the furniture with Davids for his use; but there was no need of his being so. Davids retained it obviously because it' was convenient, and one of the mortgagees consented. Another excuse might have been effectually urged upon the jury, viz. that it enabled Davids the better to carry on his business and earn money to pay his debts. The court of errors hold, in so many words, that the jury may allow either. Bell’s retaining his furniture, was less important. The parallel is more striking between Davids’ furniture and Bell’s printing apparatus, for each was necessary in their respective business. The mere accommodation of the vendor or mortgagor, may now be allowed by the jury as a sufficient excuse.

On the whole, I think the case now before us was disposed of on rules of evidence which were repudiated by Smith Sf Hoe v. Acker ; and my opinion, therefore, is, that there should be a new trial, the costs to abide the event.

Nelson, Ch. J. concurred.

Bronson, J. dissenting.

The pretence that this tavern furniture was in the possession of one of the boarders in the house, and not in the custody of the keeper of the inn, shows to what poor shifts men will resort for the purpose of evading the law, and getting rid of the payment of their debts. There was no change of possession. Nothing was done beyond an attempt, by creating a formal paper lien, to place the goods beyond the reach of legal process.

If the plaintiffs were, in fact, creditors of Davids, they neither sued for their debt, nor did they take the whole or any portion of his property in satisfaction of the demand. They were content that their debt should remain unpaid, and that the insolvent debtor should go on, as he had before, in the full enjoyment of property which rightfully belonged to his creditors. This is not all. The plaintiffs were not only content to forego their own rights, but they were willing to lend further aid to the debtor by taking a nominal conveyance of his effects, and thus stepping in between him and those creditors who might resort to legal coercion for the recovery of their demands.

It requires but a moderate knowledge of human affairs to understand how men reason in cases of this character. It is but too commonly the case that the insolvent debtor is unwilling to surrender the remnant of his estate to the creditors from whom it was obtained, and to whom it rightfully belongs; and looking upon that man as a tyrant who says, “ Pay me what thou owest,” he is soon able to persuade himself that it is justifiable to defeat the oppressor by any means which wear the semblance of legal authority. He sometimes contents himself with giving a preference to a favored creditor, by confessing a judgment, or by making an actual transfer of his effects; and this the law tolerates. But as that course involves the necessity of giving up his property, he more commonly resorts to some contrivance by which, under the forms of law, he hopes to retain the undisturbed enjoyment of his goods while the execution creditor is defeated. This device is a mortgage or bill of sale of his personal effects. He casts about for some relative or friend who either has or pretends to have a debt, and who will consent to receive a conveyance with the understanding, either express or implied, that the property is not to be removed; and having signed the deed and deposited it in the clerk’s office, the debtor goes on with his affairs just as though nothing had happened, and sets at defiance those creditors who may be so unreasonable as to insist on the payment of their demands. Now gloss this over as we may, it is nothing but a scheme ££ to delay, hinder and defraud creditors,” which the statute law for nearly three centuries, and the common law at all times, has declared utterly void.

Questions of this kind have so frequently been before us, and we have so often held these pretended transfers of personal property void as against creditors and purchasers, that I shall spend no time in reviewing the decisions. Without noticing other features in this case, it is enough that there was no change of possession. That fact alone, according to the law of the land as settled by many judicial decisions, was sufficient to invalidate the mortgage as against an execution creditor, and a new trial should therefore be denied.

But we are referred to a recent decision of the court for the correction of errors, in the case of Smith & Hoe v. Acker, (December, 1840,) as laying down a different doctrine, and as being moreover a decision of paramount authority. I have procured copies of the papers in that case, and a newspaper copy of the only opinion delivered in favor of the judgment which was rendered by the court for the correction of "errors; and it must be admitted that a new doctrine was laid down in that case. Indeed, the learned senator who delivered the prevailing opinion, commenced by saying, “ My vote will directly conflict with the whole course of decisions of the supreme court upon the principal question.”. That this avowed departure from the law as it had been previously settled, has made a precedent of “ paramount authority,” I most respectfully deny. Let us notice very briefly what the case was, and how it was disposed of.

Looking at the case in the most favorable light for the plaintiffs, Smith & Hoe, they were creditors of Bell in the sum of ten thousand dollars, and Bell on the 26th of March, 1837, gave them a mortgage on his printing press, types, household furniture and other property, conditioned for the-payment of ten thousand dollars, with interest, on the first day of May then next, with a provision that until the debtor should make default in payment, he should “ remain and continue in the quiet and peaceable possession of the said goods and chattels, and the full and free enjoyment of the same.” Bell continued in possession of the property until the 20th of January, 1838, when the defendant Acker, sheriff of New-York, levied on the printing press, by virtue of an execution in favor of Abraham Voorhis; and for that taking an action was brought in the New-York common pleas, where the plaintiffs were non-suited. The judgment of the common pleas, after being affirmed in this court, was reversed by the court for the correction of errors, on the ground that the question of fraud should have been submitted to the jury.

Without mentioning any other feature calculated to throw discredit on the bona fides of the transaction, I will only notice three leading facts: First, there was no change of possession; second, it was expressly stipulated that there should be no change until default should be .made in payment; and third, the debtor remained in possession until the execution was levied, which was nearly nine months after the mortgage had become forfeited by a default in payment. Now it'was said so long ago as Twyne's case, (3 Co. R. 80,) that continuance of the possession in the donor is a sign of a trust;” and it was resolved, “that notwithstanding here was a true debt due to Twyne, and a good consideration of the gift,” yet the transaction was not bona fide ■ within the proviso to the act of 13 Eliz., because there was a trust that the donor should remain in possession. In the case of Smith & Hoe v. Acker, there was not only the “ sign of a trust,” but there was an express trust between the parties. Bell was not to be disturbed in the enjoyment of the property. This privilege must have been- worth at least seven hundred dollars a year—the interest upon the value of the property mortgaged— to say nothing of the deterioration of the goods "by time and continued use. E we stop here, this decision, E followed, will not. only upset all the adjudications on this subject under the revised statutes, but it will overthrow many precedents of. a much more ancient date.

But let us proceed a step further. Assuming that Bell’s mortgage was originally valid, all his interest in the property became forfeited by the non-payment of the money on the first of May in pursuance of the condition, and the title of the mortgagees thereupon became absolute. (Langdon v. Buel, 9 Wendell, 80. Patchin v. Pierce, 12 id. 61.) What was before a mortgage, had now become an absolute sale of the property; "and yet Bell continued in the quiet enjoyment of the goods until he was disturbed by the execution of Yoorhis nearly nine months after the mortgage had become forfeited. This possession was inconsistent with the deed, and in such cases there never has been much room for question that the transac- • tion was void as against creditors, and that the fraud was a question of law for the court, and not of fact for the jury. (Sturtevant v. Ballard, 9 John. R. 337.) In Divver v. McLaughlin, (2 Wendell, 596,) the mortgagor continued in possession after a default in payment until the goods were seized by a creditor. In an action by the mortgagee for the taking, the right of the creditor was maintained, and that too as a question of law. The court of C. P. had refused to , nonsuit the plaintiff, and for that cause the judgment was reversed. The case was decided before the' revised statutes took effect.

It is worthy of remark, that neither this question, nor the case of Divver v. McLaughlin, which is precisely in point, was oven mentioned by the senator who delivered the prevailing opinion in Smith & Hoe v. Acker; and it would be strange indeed if any decision should have much force as a precedent upon a point which was never considered by the court.

But our decisions have gone beyond this point, and held the mortgage void before, as well as after the money fell due, if there was no change of possession. They have had reference to the new provision in our statute, which applies alike to mortgages and absolute sales, and in both cases requires an “ immediate” delivery of the property.

Without again going into questions which have already been sufficiently discussed in the books, a few remarks may be proper, by way of explanation, This court has never denied that there may be many cases where the question of fraud in relation to these conveyances will be one of fact for the jury. There may be a question upon the evidence whether the possession was actually, or only colourably changed—whether the change was continued, or only of a temporary character— whether the goods were of such a nature, or were so situated that there could not be an immediate delivery, and then whether possession was taken within a reasonable time; or, if there was an actual and continued change of possession, whether there was a bona fide debt or other good consideration for the transfer. And beyond all this, there may still be a question of good faith; for although the property may be delivered, and a sufficient consideration paid, yet if the real object of the parties was to delay, hinder or defraud creditors, the transaction cannot stand. In eases of a mixed character, such as have been mentioned, the question of fraud, or the facts out of which the inference of fraud may arise, must undoubtedly be submitted to the jury; and it is a great mistake to suppose that this court has ever held the contrary doctrine. But when there is no dispute about facts— when it plainly appears that the possession was not changed, and there was no obstacle in the way, other than the interest, convenience or accommodation of the debtor, then it has been held that fraud is an inference of law to be declared by the court; and I see nothing in the reasoning of the court, in the case of Smith & Hoe v. Acker, to change the opinion I have heretofore entertained upon that point.

True, the statute declares that the question of fraudulent intent shall in certain cases be deemed a-question of fact, and not of law. In Beekman v. Bond, (19 Wend. 444,) an attempt was made to show that this provision had ample scope for operation without touching, and that it did not in fact touch, this point. It is not only enacted that conveyances made with a fraudulent intent shall be void, but the legislature has gone farther, and singled out and seized upon that common and strong badge of fraud—continued possession in the vendor or mortgagor—-and declared, that without an immediate delivery, the transfer “shall be presumed to be fraudulent and void.” The law itself makes the inference, and nothing is left for a jury.

I am aware that this is not the whole of the section. It proceeds to declare, that the presumption mentioned in the first clause shall be conclusive evidence of fraud, unless it shall appear that the sale “ was made in good faith and without "any intent to defraud.” How is this “good faith” to be made out? Proving a consideration, notoriety, and the like, although very well so far as they go, will not be enough, for the plain reason that the statute requires a change.of possession. When that is wanting, the statute is so far from allowing that there can be “ good faith” towards creditors and purchasers, that it declares the transaction, as to them, “ fraudulent and void.”

But suppose that on proving a consideration, &c. the evidence of fraud is no longer conclusive, the most that can justly be said is, that the last clause of the section has ■then ceased to have any influence upon the transaction. The first clause is not nullified, and the declaration still remains, that the sale shall be “presumed to be fraudulent and voidarid without altering the language of the statute, there is, I think, no way in which this presumption can be got rid of, so long as the fact out of which it springs—unchanged possession—continues to exist. «

It may be quite easy to call this a perversion, or to declare that the statute plainly means something else; but such remarks prove nothing.

As I understand the statute, the moment it appears that the possession was unchanged, the law draws from that fact a presumption of fraud; and this presumption becomes conclusive, unless the fact out of which it springs can be explained. It is not enough to show a good consideration, notoriety, &c. without also explaining the possession. And it is no explanation of that, to show that it was convenient for the insolvent debtor to keep his property after he had sold it, or that the vendee was his relative or friend and disposed to do him a kindness. The statute has made no such exception, and those, who make it are more benevolent than the law of the land. ;

It may be remarked here, that this court has never decided, as seems to have been supposed in Smith & Hoe v. Acker, that “ evidence of the change of possession being impracticable, is the only evidence of good faith required by the statute;” and having never said any thing of the kind, the court cannot be responsible for the absurdities and inconsistencies which would have followed, had they fallen into such a blunder. It has .undoubtedly been held, that whatever else may appear, the fact of unchanged possession must be explained ; but it has never been intimated that the satisfactory explanation of that fact—as by showing an immediate delivery impracticable—would alone be sufficient. Beyond all doubt, a vendee who leaves the goods with the debtor, must not only show a good reason for doing so, but he must make it appear that there was a sufficient consideration and good faith in the whole matter.

If we have not mistaken the true import of the statute, it is not very important to inquire whether the rule it gives be a salutary one or not; and I will not, therefore, stop to vindicate the- remarks which fell from me' on that subject in Randall v. Cook. Although those remarks have on several occasions been made the text for some very spirited and witty comments, I am quite content to leave both text and comment to go for whatever others may think them fairly worth.

The suggestion that it may be best for creditors that the mortgagor should be suffered to remain in possession, because he will thus be enabled to make money and pay his debts, is objectionable in every point of view. Who has ever heard of a debtor who either bettered his condition or paid his creditors, after he had got to the point of covering up his goods by a mortgage or bill of sale? The thing may sound well enough in theory, but it will prove wholly fallacious in practice. But the conclusive answer to the argument is, that creditors whose debts are due have the right to judge for themselves whether they will grant indulgence, or resort to legal process for the recovery of their debts; and the law declares, that all conveyances made to delay, hinder or defraud them, shall be utterly void.

If after thirty years of legislation for their relief, our laws are not yet sufficiently favorable to debtors, let us proceed by open and direct means to grant them further privileges. If enough of their property has not already been exempted from the reach of legal process, let the exemption be extended; but wherever it ends, let the creditor have efficient means for reaching the residue. Do not let us hold out the hope of legal redress when it is so likely to prove delusive that prudent men dare not venture upon the experiment of seeking it. If it-be not enough to exempt particular kinds of property from execution, let us have general íí stop laws,” I certainly would not be understood as approving of any such questionable expedient. But if debtors must have “relief” in some form, it is better that it should be brought about by direct legislation; than by yapping existing laws to the exigency of the times.

Owing to the peculiar circumstances1 of the times, the recent struggle to uphold chattel mortgages and bills of sale without a change of possession, has been a severe one. The fortunes of many men had suddenly fallen into ruin by the failure of the hazardous speculations in which they had embarked ; and in their fall they had carried along friends who were chargeable with no other imprudence than that of having loaned their names to those who were in haste to become rich. Some had suffered by the negligent, and some by the fraudulent conduct of those who had been entrusted with the care or management of their property; while others had" been overwhelmed by the general derangement of business, and’ the alarm which prevailed through the whole commercial world when an overstrained system of credits so unexpectedly gave way. The man who had lived in affluence, and the man who fancied he had inexhaustible stores of wealth almost within his reach, had, in some respects; shared a common fate. The riches of the one had taken wings, and the gilded phantoms of the other had suddenly disappeared. Neither could descend at oncé to the level of his new condition and prospects. When creditors began to press, some made voluntary transfers of their goods to friendly assignees, who left the property where they found it under the pretence that the debtor could best wind up his own affairs. Others executed mortgages and bills of sale of their household furniture and other personal effects, to friendly creditors who would consent to stand between the property and the expected execution. In the meantime no body was paid. Creditors who resorted to legal process were not paid, because an assignment stood in .their way. The assignee was not paid, because he did not take the property. He took nothing but a nominal paper lien; and when the property had been .dissipated, his debt remained in as fall force as though nothing had happened. In short, these transfers answered the precise end which they were designed to accomplish. They left' the debtor to eat, to drink, to wear, and to squander his effects, while the creditors from whom the property was obtained, if they were not actually suffering from want, were at the least delayed, hindered and defrauded of their rights. Although the circumstances of many debtors and the condition of their families were such as to appeal with great force to. the sympathies of all, still the courts were bound to see that the stream of justice flowed onward in its accustomed channel. If judges had the wish, they had not the power to bend the law to hard cases, and all such transfers as those to which I have alluded were declared fraudulent and void. .

After the question had been settled by the two highest courts of original jurisdiction in the state, an appeal was taken from a decision of the chancellor, and the case of Stoddard v. Butler, (20 Wendell, 507,) was brought before the court for the correction of errors. The decree was affirmed, though by an equally divided vote.. Debtors and their sympathizing friends then turned to the legislature for relief, and a bill was soon after brought in to legalize mortgages of personal property, without a change of possession. I was glad to see that movement; not because I thought the measure a good one, but because, if the law was to be altered, I wished to see the change made by legislation, and not by judicial decision. Statutes are usually made to operate prospectively, and do not disturb rights already acquired. But when the law is changed by judicial decision—especially on a question of such widely extended influence as that relating' to conveyances of personal property among a commercial people—it is impossible to foresee all the evil consequences- which may follow. Such decisions act upon the past, as well as the future; and no man can feel secure in a community where that which is settled law to-day, may .be overthrown to-morrow—in a mode which has an ex post facto operation, and thus either legalizes acts which were originally void, or makes those things vicious which were faultless when they happened. To say nothing of personal security, there can be no stable title to property where great and sudden changes in the law are brought about without the intervention of the law-making power.

' Changes in the forms and modes in which judicial proceedings axe conducted, may sometimes be made by the courts, in a way which will do harm to no one. And in relation to questions affecting the title to property, I do not intend to say that there can be no improvement in jurisprudence without the intervention of the legislature. Judges, like other men, will feel the influence of the world around them, and the law cannot remain absolutely stationary while other sciences are advancing. The impulse which carries forward the work of civilization—which opens and enlarges the mind, and improves the social condition of man—cannot fail to reach the halls of justice; and many of those rugged features in the law, which are no longer suited tovthe condition of the people, will gradually disappear, and give place to doctrines and maxims better adapted to the advanced state of society. The common law is not so inflexible as a statute. It embodies maxims which provide, in some degtee, for its own improvement, and give the assurance that its leading principles cannot fall very far behind the spirit of the age. But these changes must be wrought out by such slow and imperceptible degrees that no one can mark the precise period when the transition happened. They must not be so sudden that any man can say he has lost his house, his lands, or his goods. When there is any deformity in the law which cannot await this slow process of amendment, it is for the legislature, and not the courts, to apply the remedy. Legislation leaves men secure in the rights which they already possess, and only establishes new modes of acquiring and losing rights for the future.

The bill before the assembly for altering the law and legalizing mortgages of personal property without a change of possession, was debated very much at large at different periods of the session of 1839. At ‘the first, a considerable majority of the house seemed disposed to pass the bill. But the more the matter was discussed, the more the policy of the measure was doubted. The original majority in favor of the project soon began to dwindle, and before the session closed, the bill was lost—a majority voting against it.

I have omitted to mention that this subject was also before the legislature in several forms in the preceding session of 1838, when a bill was before the assembly to legalize mortgages without á change ■ of possession; but the project seems not to have found favor with the house. Some account of these movements, though an imperfect one, may be seen in the Assembly journals of 1838 and 1839.

Thus terminated, as I had supposed, the agitation of this question, unless it should again be brought before the legislature. Certainly no one could anticipate that a question which had passed through all the courts of the state with a uniform result, and upon which one branch of the legislature had twice deliberately refused to interfere, was again to be brought forward as a proper subject for judicial discussion.

The case of Smith & Hoe v. Acker was not discussed at the bar by counsel, but was submitted on written arguments, in which particular it is like the case of Root v. Stuyvesant, (18 Wendell, 257,) which has been virtually overruled on several 'occasions by the same court which pronounced the judgment. Whether it happened in Smith & Hoe v. Acker, as it has, I believe, happened in other cases, that the counsel were all employed1" by the same party, I am unable to say; but I find in the "printed brief on the part of the defendant in error, admissions which would not be very likely to come from counsel whose client was deeply interested to uphold the judgment which was reversed. I notice also that some of the arguments which might very well have been pressed upon the consideration of the court, were either very lightly touched, or entirely overlooked. I mention these things, because the weight of a judicial decision may depend in a considerable degree Upon the aid which the court received from the discussions :at the bar. No man can feel entirely sure in his conclusions until the subject has been viewed in all its various aspects.

Although the case of Smith & Hoe v. Acker plainly departs from the law as it had been previously settled, it has been strongly urged that, as the decision of a court of last resort, it is a conclusive precedent which must be followed until the legislature shall change it. (See per Colden, senator, in Mackie, v. Cairns, 5 Cowen, 567, 9.) 'It is undoubtedly true, that the other courts of Westminster Hall have generally considered themselves bound by the decision of the house of lords, though more than one instance might be mentioned where that doctrine did not prevail. But it may be remarked in relation to the house of lords, when sitting as a court of review, that it not only abides by its own judgments, but considers itself bound by the law as it has been settled by other courts, whatever may be its own notions of the matter as an original question. No case can, I think, be found, where any member of that court has -started with an avowal that his vote would directly conflict with the whole course of decisions” of any other court upon the question to be reviewed. When there has been a uniform course of decisions” in England on a statute or any other branch of the law—especially in cases where those decisions affect the title to property—the house of lords, however erroneous those decisions may be deemed, does not feel itself competent to apply a remedy without the concurrence of the house of commons.

It is going quite too far to say -that a* single decision of any court is absolutely conclusive as a precedent. It is an elementary principle, that an erroneous decision is not bad law—it is no law at all: It may be final upon the parties then before the court, but it does not conclude other parties having rights depending on the same question.

I will refer to a, few cases, for the purpose of showing that our court for the correction of errors does not abide by its own decisions. The case of Murray v. Riggs, (15 John. Rep. 571,) was very much shaken, if not completely overturned, by the case of Mackie v. Cairns, (5 Cowen, 547.) Forgey v. Sutliff, (7 Cowen, 713,) was virtually overruled by Priest v. Cummings, (20 Wendell, 338.) The case of Livingston v. The Peru Iron Company, (9 Wendell, 511,) so far as it stands on the reasons assigned for the judgment, was wholly disregarded in Humbert v. Trinity Church, (Dec. 1840.) In Root v. Stuyvesant, (18 Wendell, 257,) it was held that a will, void in part, though only to a very limited extent, was void in toto. This case has been repeatedly overruled. (Hone v. Van Schaick, 20 Wendell, 564. Kane and wife v. Gott, [Dec. 1840.] ) And see Darling v. Rogers, (22 Wendell, 483.) These examples are sufficient to show, that our court of dernier resort does not regard its own decisions as conclusive by way of precedent: and if not so regarded by that court, it would be strange indeed if other courts were bound to follow them at all events, and without looking into the reason on which they stand.

There is a further reason why the decisions of the court for the correction of errors should not be implicitly followed. It is well known that some of the members of the court do not consider themselves tied down to what are sometimes called the strict and technical rules of law, but feel at liberty to decide according to their own sense of what is right in the particular case under consideration, without much regard to legal precedents. That this sentiment has not often found its way into reported cases, may be accounted for by the fact that it is more commonly adopted by those members of the court who are not in the habit of preparing written opinions, than by others. And besides, cases in which such opinions have been expressed—to say nothing of those in which such opinions have been acted upon in silence—would be less likely to be reported than others, for the 'reason that lawyers—to which fraternity reporters usually belong—are in the habit of adhering with much zeal to legal precedents.

But we shall be able to find a trace of this doctrine in the books. There are several reported cases where its influence might be discovered on a close1 scrutiny; but it will be sufficient to mention one or two, where the sentiment is quite apparent. In Smith & Hoe v. Acker, which has so often been mentioned, the learned senator who delivered the prevailing opinion very frankly avowed that his vote would “directly conflict”—not simply with the judgment of this court in the particular case then under review, or- with any other single judgment of a recent date, but—“ with the whole course of the decisions of the supreme court upon the principal question.” He added, that the question seemed a very simple one “ to a mind not embarrassed by the decisions.” And after having thus thrown off the shackles of legal authority, he proceeded to assign the reasons for his judgment.

In Lovett v. Pell, (22 Wendell, 369,) it was held that a misjoinder of counts ■ in the declaration was not a sufficient ground for reversing a judgment; although the precise question had been decided the other way twenty years before in Cooper v. Bissell, (16 John. Rep. 146,) and although there never had been any conflicting decisions upon the question. It is true, that the learned senator who delivered the prevailing opinion, seemed to lay some stress upon the word mispleading in our present statute of amendments ; but as that word had been in the statute of jeofails for three hundred years—(it will be found in 32 Hen. YIH c. 30)—we cannot for a moment suppose that the decision turned on the notion that this was a new provision in the law. The court evidently thought itself at liberty to lay down what was deemed a more wholesome rule than that which prevailed in Cooper v. Bissell, although that case had not only stood unimpeached long enough to give it sanction as a precedent, but was' at the time nothing more than declaring over again a point which had been settled a hundred and fifty years before, as abundantly appears by the cases referred to in the opinion of the chancellor. Here then is a case where the court, plainly and beyond all room for question, acted upon the principle that it was not tied down by adjudged cases, but was at liberty to follow its own sense of what Was right between the litigant parties.

The court not only acted upon this doctrine, but it was, I think, plainly avowed by the learned senator who delivered the prevailing opinion. He not only remarked, that the supreme court had followed a “rigid technical rule,” which means, I presume, that it had decided according to law, but he proceeded in the plainest terms to' admit, that the judgment which he proposed to reverse was in accordance with legal precedents both here and in England. It is then intimated, and subsequently repeated in the course of the opinion, that the question was open for review, because it had not been previously adjudged by the court for the correction of errors.

In Warner v. Beers and Bolander v. Stevens, [April, 1840,] the same learned senator again touched upon this doctrine. After stating the inquiry, whether, certain associations fell within “the policy and intent” of a-particular restriction in the constitution, he proceeds to answer, that “if this were indeed the case, a court like this, organized expressly to qualify and regulate the decisions of inferior tribunals, (which must of necessity be governed by precedent and authority,) by infusing into the law a larger spirit of equity and general principle—such a court might well deem it their duty to disregard the rigid legal interpretation of the language of the constitution, and to look only to its intent and ultimate object.” How far it was intended to go by way of affirming the power of the court for the correction of errors over the constitution, I will not venture to say; but, at the least, the language seems fairly to imply that that court is not, like inferior tribunals, necessarily governed by precedent and authority,” which is equivalent to saying, the court is not bound by the law of the land.

Without pursuing the subject further, it must be apparent that some of-the members of the court of the last resort claim for that high tribunal a much larger license in disposing of the questions brought before it than is exercised by other courts. Whether this be right or wrong, is a question upon which at this time I shall say nothing. I merely state the fact for the purpose of drawing the very obvious conclusion, that the decisions of that court, although final as between the parties litigant," are so far from being conclusive by way of authority, that they are entitled to much less weight than the judgments of those courts which consider themselves bound by legal adjudications. This must be so in all'cases. But where, as in Smith & Hoe v. Acker, the court has professedly departed from “ the whole course of decisions,” the judgment is entitled to no weight at all.

I cannot concur with my brethren in following a decision which we all agree is repugnant both to the statute and the common law.

There was no sufficient proof of a consideration for the mortgage from Davids to the plaintiffs; but as the judge did not put his decision upon that ground, I have considered the case as though a good consideration had been shown.

New trial granted. 
      
       That case has been reported (23 Wendell, 653,) since this opinion was prepared. It is proper to add: that although other opinions are now published, Mr. Senator Hopkins delivered the only written opinion, as is said, in favor of the judgment .which was rendered by the court for the correction of errors in that case, and to his opinion reference is made on the present occasion.
     
      
      
         The reversal by the house of lords, of Lord Somers’ decree, in Kettle v. Townsend, (1 Salk. 187,) is one instance. Sir John Trevor, M. R. denied the authority of that decision, affirming moreover, that if the same case were to come again into the house of lords, they would decide differently. (Watts v. Bullas,1 P. Wms, 60, 1.) Lord Harcourt seems also to have refused to follow it as a precedent. (Id.p. 61, note.) Of. the same case, Lord Loughborough spoke as follows: “ I have no difficulty in saying, I think of that determination of the house of lords as Lord Harcourt and other judges have done.” Adding: “ Upon the journals of the house of lords, it appears no one was present upon that reversal who could know much of the matter; it was not determined by lawyers : and Lord Harcourt speaks of it certainly as not such a decision as he would follow: and one or two other judges have not treated it with much respect” (Hills v. Downton, 5 Ves. 565.)
     
      
       24 Wendell, 587.
     
      
       24 Wendell, 641.
     
      
      
         93 Wendell, 103.