Case ID: sc-eq_19/html/0095-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Curia, joer Dunkin, Ch.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Fulmore & Mowzon vs. George S. Burrows and Thomas Burrows.
    
    Where a father, being insolvent, sold slaves to his son and continued in possession as visible owner: held, that the presumption of fraud arising from the retention of possession, was not rebutted by the testimony of another son that there was an agreement for the hire of the slaves every year, but he could not tell what hire was to be paid, and the production in evidence of notes, receipted in full, purporting to have been given for the hire of the slaves for three successive years, — no evidence being given as to the time the notes were given, or of the actual payment of any hire, or of the time when the receipts were entered on the notes.
    Before the sale, the son had taken up a mortgage which bound one of the slaves ; held that he was entitled to be reimbursed to the amount of the mortgage.
    
      Before Dttnkin, Oh. at Williamsburgh,
    
    
      March, 1844.
    
      The Chancellor. The complainants are execution creditors of Thomas Burrows. The execution was entered on the 28th January, 1842, the cause of action having originated in 1841. The sheriff, being about to levy on three slaves in the possession of the defendant, Thomas Burrows, was forbid by the other defendant, George S. Burrows, on the ground that the slaves were his property, under a bill of sale from Thomas Burrows.
    This bill of sale bears date 30th March, 1840, and was recorded in the office of the register of mesne conveyances on the 13th April, following. George S. Burrows is the son of the other defendant, Thomas Burrows, but he has not lived at his father’s since 1831 or ’32. In 1836 and 1837, he was the overseer of Joseph Scott, Senr. His wages were about one hundred dollars per annum at that time. Mr. Hanna testified, that a year or two after this, he and Capt. Snowden employed George S. Burrows, and paid him two hundred and forty dollars. The consideration mentioned in the bill of sale, is eight hundred dollars. George S. Burrows proved that bis father Thomas Burrows, was then indebted to him, in about the sum of sixty-five dollars, which he had paid for him to William Hanna on the 30th December, 1839. This debt to Hanna was secured by a mortgage of Hester, one of the slaves included in the bill of sale. His father was also indebted to him in the sum of fifty-two dol-lavs and fifty cents which he had paid for him to John C. Fulmore on the 27th February, 1837. On the 12th March, 1840, Thomas Barrows gave his son a receipt for six hundred and seventy-one dollars and sixty cents, expressed to be “the balance due for three negroes, Silvy, Frank and Hester, which I will give a bill of sale for, to him.”
    At the time of the alleged sale, the negroes were in the possession of Thomas Burrows, and they always so continued. All the rest of his property has been sold to pay his debts.
    The complainants insist that, upon general principles, this sale is void as to creditors, and the case of Kennedy vs. Moss, 2 Mill, 125, was cited in support of the position. Judge Nott there says, “ I have always considered it a settled rule of law, that where the vendor of personal property continues in possession after the sale, as visible owner, the sale is to be considered fraudulent and void against creditors.” — “ Paying a valuable consideration does not alter the case. The fraud consists in exhibiting the party to the world, as a man of substance, by permitting him to keep property in his possession which is not his own, and obtaining credit by these false appearances.” In this opinion the whole Court, consisting of Justices Colcock, Johnson and Cheves, concurred. In Smith vs. Henry, 1 Hill, 16, the Court expressly recognize the cases on which Kennedy and Ross was decided, and especially the case of Edwards vs. Harben, 2 T. R. 587. It is there also said that if a person buys the goods of an insolvent, and advances his money at the time, and leaves them in the vendor’s possession, that circumstance is only one among the other circumstances of proof by which to determine the fair or fraudulent character of the transaction. “It is not so conclusive as to be incapable of being explained.” But if they are given in satisfaction of a previous debt, if the payment of a previous debt constitutes the consideration, either in whole or in part, “ that is, of itself, conclusive evidence of fraud.” Both in Smith and Henry, and Anderson vs. Fidler, M’M. Eq. 27, it was distinctly ruled, “ to make no difference that, besides the pre-existing debts, additional consideration was advanced at the time of the conveyance.” But it is said the negroes remained in the possession of the vendor under a contract of hiring, and that this circumstance repelled the presumption of fraud which would arise even if the entire consideration were money paid, and that it withdrew the case entirely from the operation of the rule laid down in Smith vs. Henry, and since recognized in other cases. In this latter class of cases it is said that, from the fact of the debtor retaining possession, ■ the law draws the conclusion of fraud; of a corrupt understanding that the debtor should be allowed to retain and use the property. Is there any thing in this case to negative this conclusion ? Any thing to repel the inference of “ a tacit confidence that the creditor would shew the indulgence,” and that this constitutes part of the real consideration on which the transfer was made ?
    Three notes of Thomas Burrows were offered in evidence; the first dated 13th April, 1840; the others on the 1st January, ’41, and 2nd January, ’42, each payable on the 1st January following the date, and purporting to.be. for the hire of these ne-groes. The two first were receipted in full on the very days they respectively became due; the third was receipted on the -18th February, ’43, the day of filing defendant’s answer. No evidence was offered as to the time at which these notes were given, or of the actual payment of any money, or of the time when the indorsements were entered. The notes, although purporting to be paid in full, were admitted never to have been out of the possession of the payee, who produced them at the hearing. Samuel Burrows, another son of Thomas Burrows, said that his father hired the negroes from George; that there was a positive agreement for hire every year; but he could' not tell what hire was to be paid.
    It is to be premised that from the other circumstances the law has drawn the conclusion of fraud. Adopting this conclusion, would any thing be easier, in the view submitted by the defendant, than to consummate the fraud by manufacturing notes and receipts for hire so soon as the transaction was attacked 1 Thomas Burrows was notoriously insolvent; yet he, who can pay nobody else, pays his son the hire of the negroes on the very day it is due. And, although he is careful enough to take a receipt on the back of each note, he leaves the notes themselves in the hands of the party who had no right to retain them. His other son, who says there was a positive agreement each year for hire, yet cannot tell what hire was to be paid, proves the payment of no money, or the demand of payment at any time; and the whole testimony repels the presumption of the ability to pay.
    If the determination of the cause depended on the inquiry whether there was, in fact, any consideration paid beyond the sums advanced to Hanna and J. C. Fulmore, (some one hundred and thirty dollars,) the Court would, on the testimony, have deemed it expedient to ask the aid of a jury. But, conceding that, in addition to the reimbursement of these payments, the balance of the eight hundred dollars was paid by the defendant, the Court is of opinion that the presumption arising from the continued possession of the vendor is not repelled by the circumstances which have been relied on.
    It is, therefore, adjudged and declared that the sale, purporting to have been made by Thomas Burrows to George S. Burrows, on the 30th March, 1840, of the slaves Sylvia, Frank and Hester, is null and void; and it is ordered and decreed that the said slaves, with; their increase, be delivered up to the sheriff of Wil-liamsburgh district, to be sold under execution in satisfaction of the complainants’ demands. Costs to be paid by the defendants.
    The defendant, G. S. Burrows, appealed, and now moved that the decision of the Chancellor be reversed, on the grounds :
    1. Because the sale of the negroes sought to be set aside by the bill, was bona fide, and on full consideration, and should have been sustained by the Court.
    
      2. Because the Chancellor erred in deciding that the circumstances attending the transaction were in law conclusive of fraud; the appellant respectfully submitting, that the facts proved sustained the bill of sale as valid, and should have been so considered by the Court,
    3. That even if the proof had been sufficient to set it aside, his Honor should have regarded the defendant, George S. Burrows, as standing in the position of a prior mortgagee of the negro Hester, and should have ordered him to be repaid the amount which he advanced on the said mortgage, and should have ordered him to be reimbursed the full amount with interest which he advanced on the purchase of the negroes.
    4. Because the costs should not have been decreed against the said appellant.
    5. Because the decree is in other respects against equity and justice.
    
      Moses, for appellant.
    
      Harllee, contra.
   Curia, joer Dunkin, Ch.

On the principal point involved in this appeal, the Court is not disposed to interfere with the conclusions of the Chancellor.

But in Anderson vs. Fuller, McM. Eq. 27, it was ruled that, where .the payments made by the purchaser had removed existing liens, he should be permitted, on the contract being set aside, to have the benefit of such liens, or be allowed re-imbursement of the sums expended in discharging them. On the 30th Dec., 1839, the defendant paid the sum of $65 to Wm. Hanna, for which the slave Hester had been mortgaged. It is proper that this sum, with interest, should be refunded.

It is ordered and decreed, that from the proceeds of sale of the slave Hester, the sheriff pay to'the defendant the sum of sixty-five dollars, with interest from the 30th Dec., 1839; and that in all other respects the decree of the circuit court be affirmed.

Johnsok, Hamper and Johnston, GC. concurred.