Case Name: Smead, Collard & Hughes vs. Williamson
Court: Kentucky Court of Appeals
Jurisdiction: Kentucky
Decision Date: 1855-01-10
Citations: 16 B. Mon 492
Docket Number: 
Parties: Smead, Collard & Hughes vs. Williamson.
Judges: 
Reporter: Kentucky Reports
Volume: 55
Pages: 492–542

Head Matter:
Smead, Collard & Hughes vs. Williamson.
APPEAR FROM KENTON CIRCUIT.
I. -One having an interest both for plaintiff and defendant, but whose -interest preponderates on one side, is not a competent witness for that party on whose side his interest is greatest; nor is his wife. The rule is general, almost without exception, that a vendor is a competent witness for his vendee, but incompetent for a creditor ■of -such vendor, who levies -upon property, to prove fraud in the transfer.
■2. Where there has been a fraudulent sale made with this intent of securing to the vendor a future interest in the property, and the sale is for less than .the value of the property, the chancellor will set aside such sale, and subject the property to the payment of debts due to judgment creditors.
The facts of the case are stated in the opinion of the court. Rep.
J. W. Stevenson for appellants—
The first question presented in thisrecord is, whether the Circuit Court erred in the exclusion of the depositions of Myers and wife? Their testimony, if admissible, clearly and abundantly establishes the fraud in the sale of the attached boats, by Myers to Williamson. The competency of Mrs. Myers rests ■upon the competency of her husband. We maintain that Myers was a competent witness, and that his deposition, with that of his wife, were erroneously excluded.
1. An-equipoise of interest %etween plaintiffs and defendants, on the part of a witness, renders him competent. (Wright vs. Nichols, 1st Bibb, 299; Doughs vs. Holbert, 7 J. J. Marshall, 2; Bement vs. Me Claren,.I Ben Monroe, 296; T.yler vs. Trabue, 8 Ben Mon rae, 308; Van Meter vs. McFadden, 8 Ben Monroe, 439; Adams vs. Gardiner, 13 Ben Monroe, 202.)
That Myers was clearly responsible on his bill of sale, if made in good faith, for the title of the boats, is clearly shown by the instrument itself. There is an express warranty from all incumbrances; and if this responsibility exists, it is admitted that his interest is balanced.- The opinion of the Circuit Judge assumes, however, that the sale, as between Myers and Williamson, was made to defraud the creditors of Myers; and that, consequently, Myers would not be responsible on his warranty to Williamson; and his interest, therefore, was not balanced. We admit, that decisions are to be found, going to the extent, that a fraudulent vendee cannot recover back the consideration money mentioned in a fraudulent deed. Such was the case of Surlott vs. Beddow, 3 Monroe, 109, so confidently relied on by the Court below. We deny, however, that this or similar decisions, are decisive of the question of the competency of Myers; and if they were, the whole current of modern ■authority have overruled them, and permitted a fraudulent vendor always to testify as between- his vendee and attaching creditors.
In the case of Findley vs. Cooley, 1 Blackford R., 263, it was held, that the vendee of real estate can not object to the payment of a note for the purchase money, upon the ground, that the conveyance had been made to defraud creditors. “Such a conveyance, (says Judge Blackford, in delivering the opinion of the Court,} though liable to be objected to by creditors, is not absolutely void, either at common selves.” So, too, in the case of Surlott vs. Beddow, law or by statute; it is valid as to the parties them-already cited. Surlott was allowed to recover back all the money advanced by him for Beddow, under the fraudulent arrangement made between them to-defeat Beddow’s creditors; and to that extent, this case established a liability on the part of a fraudulent vendor to his vendee. So, too, in Elridge vs. Wadleigh, 12 Maine, 371. The Court say, “Though, as a general rule, a vendor can not be called as a witness for his vendee, to sustain his title, when that title is called in question, yet he may be in cases where his interest is balanced. As where goods are attached as the property of the witness, and replevied by his vendee. If the vendee prevails, his warranty, express or implied, is satisfied; if the creditor prevails, the value of the goods is applied to witness’ debts.” In a still later case, from the same Court, {Gutter vs. Copeland, 18 Maine, 127,) the precise question of competency, in a case in all respects like this, was sustained. The Court hold, “That where the question is, whether it shall be subject to the attachment or seizure of a creditor of a vendor, upon tub ' GROUND THAT THE SALE WAS FRAUDULENT, the interest of the DEBTOR OR VENDOR IS BALANCED, and he IS A COMPETENT WITNESS FOR HIS VENDOR OR ASSIGNEE.”
In support of this decision, see Moulton vs. Moulton, 1 Shepley, 110; Brown vs. Marsh, 8 Vermont, 310-12; McKay vs. Treadwell, 8 Texas, 176. So, too, a vendor of a horse is a competent witness between the buyer and an attaching officer, on the question whether the sale was fraudulent against creditors, his interest being balanced. Ward vs. Chase, 35 Maine, (5 Red.,) 515.
A similar question has also been decided by this Court, in Baylor vs. Smithers’ Heirs, 1 Littell, 111. The facts of that case were, that Smithers’ heirs sued Baylor for a slave, which Baylor had purchased under an execution against Shirley. Shirley was offered as a witness to prove how he held the girl under the ancestor of the plaintiffs. An attempt was made on the trial, to prove a fraudulent and collusive combination between the ancestor of the plaintifFs, and the witness and defendant 'in the execution, (Shirley,) and it was contended, that Shirley was an incompetent witness to prove the alleged fraud, and ought to have been excluded. The Court say, “That the assumed argument assumes an objection which goes to the credit and not to the competency of Shirley. A particeps criminis has always been held a competent witness; and by the Supreme Court of New York, a defendant in an execution was held competent to disprove fraud, alleged to have been committed by him, on the sale and conveyance of property taken and sold to satisfy an execution which issued against his estate.” (6 Johnson, 135.)
“The contest in that case was between the vendee of the witness, and the purchaser under execution; and before the witness was introduced, his interest was released by the vendee; whereas, in the present case, there was no such release to Shirley; but we have seen that Shirley can have no interest in the event of the suit; and the case cited shows, if he have no interest, he is competent.”
The facts of that case greatly resemble this. Shirley advanced to Smithers a sum of money, and took an absolute bill of sale for a slave. This slave is sold on an execution against Shirley; and in a contest between Smithers’ heirs against the execution purchaser, Shirley is decided to be competent. If the sale is declared to be void, Shirley will again have to pay Baylor’s debt, but he will be entitled to recover back the money paid to Smithérs; or, if not entitled to recover it back, on account of his participation in the fraud, still he is decided to be competent. So again in Ragland vs. WicJcware, 4 J. J. Marshall, 530, a particeps fraudis was held a competent witness to sustain a fraudulent bill of sale.
Waiving, however., entirely the depositions of Myers and wife, the decree of the Circuit Court cannot be sustained.
We confidently submit, that this Court has rarely been invoked to examine a record in which the indicia of fraud have been more indelibly impressed upon any attempted sale of property, than those which are developed in this transfer from Myers to Williamson.
Every circumstance, from the inception to the completion of the alleged bill of sale, clearly indicate, that the sole object of its execution was to place these boats temporarily beyond the reach of Myers’ creditors, until the anticipated profits of the fall and winter season would enable him to reduce, if not entirely liquidate, his debts. The alleged sale was whollyfictitious, as a brief notice of some of the facts and circumstances attending it, clearly and conclusively demonstrate.
1.The vendor, Myers, was heavily oppressed with debt on 19th October, 1853, the date of the bill of sale for these two boats. The judgments which constitute the foundation of the present suit, were then in full force and effect. In addition to these heavy amounts, there were other heavy claims against Myers. The deposition of one of these creditors (Isham) show ,t,hat his firm was becoming restless and uneasy, and that Myers’ fear of attachment was well founded.
2. These boats were sold at a price and on terms wholly inconsistent with the idea that the sale was real. The sum agreed to be paid by Williamson was greatly below the true value'of the boats. It was greatly less than Myers had been offered for them some months before. The witness, J. C. Riley, proves that before any repairs were put on the boats, he offered eighteen thousand dollars for them. He proposed paying nine thousand dollars in cash, and the'balance on short time, secured by the endorsement of Maltby, Keys & Co., a mercantile house whose credit and character are unsurpassed in Cin-' cinnati. The sum of twenty-one thousand dollars was then asked by Myers for these boats. The proof also shows that subsequent to this offer, repairs to the amount of four thousand dollars were placed on these boats by Myers. The fair cash value of the boats may therefore be safely set down at from eighteen to twenty thousand dollars, at the date of this alleged transfer.
3. They were sold to a young and inexperienced clerk, of limited means and no credit.
4. The sale was made upon a credit of two years, which is, of itself, unusual and extraordinary. Not a solitary witness, amid all the mass of testimony contained in this record, is enabled to cite a sale of any boat upon a credit anything like this.
5. Although the vendor.was paying interest at the rate of ten per cent, upon many of his debts, as the judgments in this record show, he makes this sale on a credit of two years without interest or personal security, and without retaining a lien on the boat for the purchase money, or any part thereof.
(5. The proof shows, that during the entire summer preceding this alleged sale, the price asked by the vendor for these boats was twenty thousand dollars. (Record, p. 119, Jones’ deposition.)
7. Myers went down with the boat, continued in New Orleans as one of its active agents in obtaining freights, after the sale, and by his course on the arrival of said steamers in- New Orleans during the winter, showed that he was still interested in them.
8. The transaction was secret, and the note of Williamson was not even received by Myers, but was left with Isham. To suppose that Myers, oppressed as he was with debt, after having declined-an offer of eighteen thousand dollars in cash, or its equivalent, for these boats, should incur an additional expense of four thousand dollars in repairs, and then sell them secretly on a credit of two years, without interest, to a young, inexperienced clerk, without credit, and of inconsiderable means, would be to deny to him the power of ratiocination ! What conceivable motive could have induced Myers to bring upon himself so ruinous a sacrifice ? Justice to his creditors, not less than common prudence to himself, would seem to have dictated, that had the sale been real, some personal security should have been taken from Williamson, or at least a lien have been reserved upon the boats themselves. The record shows, however, that not only was this sale made to Williamson on a credit of two years, without security and without interest, and at a depreciated price, but that Myers himself went down on the boat, and continued, during the entire winter, in New Orleans, to give his personal attention and labor in securing both passengers and freight for the Yorktown. To increase, if possible, the improbability of anything like reality in this transfer, and to stamp it with its true and fraudulent intent, although the note of Williamson to Myers expresses, upon its face, that the existing debts against the steamer were to be paid by him, arid when paid to be a credit on his note; yet the proof shows that no memorandum of these debts was retained, and Isham, with whom the note was left, and on whom devolved the alleged duty of making these credits, is unable to name any creditor save his own firm, or the amount of any debt due by said boat and paid by Williamson.
9. But strong and striking as all these badges of fraud are, they are fortified and sealed with the declaration of Myers, (made before the transfer,) of his object, wishes, and design in making it. The depositions of Ames (Record, p. 120) and Feakins (Record, p. 125) were read without exception. Feakins proves that the object of making this transfer by Myers, as detailed to him, was to enable him to run the boats and receive the profits, which he anticipated would enable him to pay off his debts. The boats were in Licking river, and Myers feared that if they were brought to the Cincinnati wharf, they would be immediately attached by his creditors. To obviate and to prevent this anticipated litigation, a sham sede was determined on by Myers — a conveyance to some true and tried friend, in whose integrity he could confide, and who would return the boats after the season was over. The witness states that Mrs. Myers dedesired the boats to be conveyed to him, but he declined. Myers having had, at a former period, O. C. Williamson in his service, and deeming that he was under obligation to him, thought he could safely entrust his interest to his keeping, and determined to make the transfer to him. This conversation between Myers and the witness took place before the transfer. After the conveyance, Myers informed the witness that he had made it to O. C. Williamson, and taken his note, which was locked up in Isham’s safe, and that at the end of the season the note was to be delivered up, and the boat returned to him. This testimony was read without objection or exception on the part of the defendants, and as clearly establishes the fraud as the deposition of Myers himself. This witness is sustained by the deposition of Ames, to whom Myers disclosed his wish and desire to make over his boats temporarily to some friend, to shield them from apprehended attachments. Myers informs this witness of his confidence in 0. C. Williamson, and details the reason why he thought a conveyance could be safely made to him.
These witnesses are sustained by the testimony of Judge Coffin, who stated that early in October, Myers, with one of the Ishams, (and he thinks the witness, J. G. Isham,) called on him for professional advice — that Myers stated to him that he was indebted to Isham, and he desired to have the use of the Yorktown for another season- — that he feared his creditors would attach said boat, and to prevent this, and to enable him to pay off his debts by the anticipated profits of the boat during the ensuing season, he desired to place her in the hands of some friend who would keep her for him during the approaching season. Judge Coffin advised him to mortgage the boat, and Myers and Isham left the office, promising to return in a few days.
Williamson was at that time a clerk in this Isham’s employment. A short time thereafter, this alleged transfer and bill of sale was executed by Myers to him, and his note was left by Myers with this selfsame J. G. Isham.
The bill of sale upon its face shows that the steamer and large were then in Licking river, and not at the Cincinnati wharf, and although Williamson was a clerk m Isham’s store, he has been unable to show that he . . ... ,1 , ,1 t ever examined either the steamer or the barge, or that he had ever been upon either boat before his alleged purchase.
The circuit judge was unable to see anything in all these facts to throw the slightest suspicion on this sale, and although Myers may have designed a fraud on his creditors, yet there was no proof that Williamson participated in it.
With the highest respect for the learning of the court below, it is respectfully submitted, that this is the most lame and impotent of all the singular conclusions which characterize this very remarkable opinion.
What sort of proof would the circuit judge require ? When an oppressed debtor contemplates a fraudulent disposition of his property, it would seem that very few persons would be called in to witness the fraud. Positive proof of a direct fraud is always difficult of access,.owing to the seeresy in which all such combinations are planned. The circuit judge says : “I am not satisfied that Williamson participated in the fraud. He perhaps knew of the purposes of Myers, but there is no sufficient evidence that he ever agreed to hold the boats for Myers.”
We take issue with the learned judge, that any positive proof is necessary. Fraud may be presumed, if there be sufficient evidence of other facts, which authorize the inference of it. The assumption, by the court, that the fraudulent intention cannot be presumed, has long since been exploded.— (Kendall vs. Hughes, 7 B. Monroe, 370.)
It would seem that the facts and circumstances developed in this record have been sufficient to satisfy the circuit court of Myers’ design and object to put his boats beyond the reach of his creditors. Now we assert, that it would have been utterly impossible for Myers to have carried out his purposes and motives of his' fraudulent transfer without a full detail of his object to the confidential friend selected by 'him as temporary vendee. If Williamson was selected by Myers as his fraudulent vendee, to receive the conveyance, it was absolutely essential that Myers should have disclosed to Williamson his purposes and designs, in order to have enabled him to carry out his wishes for the return of the boats. Williamson, therefore, with a full knowledge of Myers’ purposes to place these boats out of the reach of his creditors, and with a full knowledge that they were to be delivered back to Myers in the spring, accepts the conveyance. Did not the acceptance of this voluntary conveyance by Williamson, with a full knowledge of Myers’ purposes, constitute him, in the strongest sense, a particeps fraudis ? Most clearly, as we can conclusively show. We admit the principle, in its broadest sense, that, to render a sale invalid, on the ground of fraud, the intent to defraud must exist with both the vendor and vendee. The vendor’s object in selling must be to hinder, delay, and defraud his creditors, by placing his property beyond their reach. So, too, the vendee must accept the conveyance as a means of aiding the vendor in the accomplishment of his purpose.
Whenever, however, the fraudulent intent of the vendor is established, and a knowledge of that intent is brought home to the vendee, unless opposed by other circumstances, showing fairness, the vendee’s acceptance of the conveyance, under such circumstances, is such evidence of his concurrence in that fraudulent intent as to make him particeps fraudis. The question of the fraudulent intent of the vendee may be inferred from the circumstances attending the transfer. If the vendee, under no necessity to purchase, but fully cognizant of the -vendor’s fraudulent purpose in making the sale, should make a purchase without taking any means to prevent the effectuation of the fraudulent vendor’s object, he will always be regarded as having participated in the fraud. {Brown vs. Foree, 7 Ben. Monroe, 858.) And although the knowledge of a purchaser that the vendor of proper ty intends to defraud his creditors, does not in all cases, per se, render the sale fraudulent, still it creates a presumption of a fraudulent participation on the part of the vendee, which must be repelled by other facts and circumstances showing a lawful inducement to the purchase. (Kendall vs. Hughes-, 7 B. Monroe, 369.)
When, therefore, the circuit court admits the fraudulent intent of Myers in this sale, and Williamson’s knowledge of it, no other legal deduction can be drawn, but that Williamson made the purchase to further and carry out the purposes of Myers. He must repel this presumption by circumstances tending to show that he had sufficient lawful inducement to make the purchase, or attempted to prevent the intended and unlawful consequences of the sale. It would be a difficult task for even the astute mind of the circuit judge, to extract from this voluminous record, one solitary fact tending to rebut, in the slightest degree, the presumed participation in the fraudulent transfer of these boats on the part of Williamson. He was not only informed by Myers of his object and motive in making the conveyance, but he was cognizant of, and participated in, the contrivance, by an acceptance of this bill of sale. Williamson has offered no plausible pretext for making the purchase, and, by his own showing, has paid not a solitary debt of Myers, pre-existing at the time of the transfer, unless it be the debt of Isham & Fisher. So far from repelling the legal inference of Williamson’s participation in Myer’s purposes, resulting from Williamson’s knowledge of them, every fact and circumstance connected with the transaction, tend directly to show that Williamson’s acceptance of the transfer, was done solely in aid of the settled plan of Myers, as admitted by himself, and disclosed by the testimony.
10'. The deposition of Isham, although evidently-taken to prove the fairness of this sale, conduces strongly to establish its fraudulent character. This witness accompanied Myers to Judge Coffin’s office, when he went to ascertain how these boats could be fraudulently conveyed. He was, therefore, fully acquainted with the proposed plan and purpose of Myers, in this temporary disposition of these boats. Williamson, to whom the transfer was made, was then a clerk in J. G. Isham’s employment. The note of Williamson to Myers was left with this witness, and to him is confided the duty of crediting on this note all the pre-existing debts of the boats which Williamson had a right to pay off.
We have already commented on the singularity of the coincidence, that, had a real sale been contemplated, Myers should take Williamson’s note at two years for fifteen thousand dollars, and allow him to pay off debts due by Myers, which were to constitute credits upon his note, and yet that none of these debts were scheduled and specified. Isham, however detailed a still more remarkable fact. He states that he was authorized verbally, by Myers, to credit on this note all these payments by Williamson. Accordingly this same witness, on the 18th of May, 1854, did, in Myers’ absence, credit on this note the sum of $13,654,34 of pre-existing debts of the Yorktown, as paid by Williamson, without any other proof whatever of the payment having been made, except Williamson’s statement. This course of the witness was still more extraordinary, as he expressly states the amount of the debts which Williamson was to pay for Myers, and contained in the memorandum, amounted only to $10,000, and yet, without consultation with Myers, and during his absence, without any knowledge, whatever, save Williamson’s statement, he credits the note with $13,654,34, as made on the 18th of May, 1854.
The witness refused to swear, that the endorsement of this credit was made on the 18th of May, 1854. He was unable to give any satisfactory reason why he fixed on that day. He was unwilling to swear, that the credit was not endorsed by him in June, and if so, it was done after the bringing of this suit. This bill was filed on the third of June, 1854, and this witness was unwilling to swear whether an endorsement of $13,654,35, in his own handwriting, dated 18th of May, 1854, was made in June or not.
Under such circumstances, the credibility of the witness seems severely tested. He does not present himself certainly under the most favorable circumstances for credit. His deposition, were there no ■other proof, would be conclusive of the fraud. It, unfortunately for Williamson, proves too much.
This witness states, that he was aware before this transfer, that Myers had become bound to J Dickson and T. S. Dugan & Co. to bring up a certain amount of molasses at a rate greatly below the usual freight. This contract with Myers, had not been fulfilled on -the 18th 'October, 1853. If his sale to Williamson was valid, he placed it out of his power to comply, and Dickson & Dugan would have a right to look to Myers for damages. Under what obligation was Williamson, if he had made an honest purchase of these boats, to fulfill this contract of Myers? Why should he bring up this molasses except on his own account? If the sale was Iona, fide, what had Williamson to do with Myers’ existing contract for freight? Upon what ground did Williamson undertake to fulfil these contracts of Myers to Dickson, Dugan ■& Co., and charge to Myers the difference in price between the sum for which Myers had undei'taken to bring up the molasses, and the price which Williamson chose to charge? The statement of Isham proves that there was no agreement between Myers & Williamson at the time of this transfer, that the unliquidated liability of Myers to Dickson & Dugan for a violation of his freight contracts with them was estimated in the list of debts which Williamson was authorized to pay off. Williamson has offered no proof showing that Myers consented to his performance of his liability to Dickson & Dugan. On what basis Williamson brought up the molasses for Dickson & Dugan, and was authorized to charge the difference in the freight bill to Myers, he has not attempted to show. It is still more extraordinary, that Isham should have recognized this credit in Myers’ absence, without any consultation with him, and without any proof that the services had been performed by Williamson.
But again, we ask the especial attention of the court to the alleged memorandum of payments made by Williamson for Myers, and audited by the witness Isham on the $15,000 note.
Many of these payments are for liabilities created after the transfer of the boats to Williamson. On what pretence was Myers to be bound for the debts of the Yorktown after a valid sale to Williamson.
It will be perceived that many of those having claims against the Yorktown prior to the 18th October, 1854, have interpleaded on this suit, and seek a lien against the boat for an enforcement of their claims. Such a course on their part establishes beyond doubt, that they were kept in utter ignorance of the transfer to Williamson, and that they did not assent to it. It establishes the further fact, that while debts created by Myers for supplies to the boat, prior to his transfer, and which Isham proves were assumed by Williamson, have been unpaid by him, yet that he has received credit on his note for an alleged payment of unliquidated damages on the part of Myers to Dugan & Dickson, and which, so far as the proof goes, was made by Williamson, without the knowledge or consent of Myers. The alleged conversation of Myers and Williamson, as detailed by Isham after the transfer, is wholly inconsistent with a valid sale. It is too strong a tax on human credulity to ask us to believe, that if Williamson had pui’chased this boat and barge in good faith, Myers would ask Williamson to allow him to take the boats back in the spring. It is very natural to conceive, however, that in a fictitious transfer, such a conversation should be brought about in the presence of a wit ness, who, in the event of an attempt by creditors to set aside the sale, should be ready to prove that it was bona fide and genuine.
Finally, we submit that the continued connection of Myers with the boat, from the time of the alleged transfer to the period of her being laid up, is wholly inconsistent with the supposition that the sale was made in good faith. During the whole winter he seems to have been actively engagedinNew Orleans, in obtaining passengers and freight for the boat. It is in proof that on the 23d May, 1854, Samuel Williamson telegraphed to Myers “that the Yorktown was laid up — nothing done.”
What was the meaning of this dispatch? It certainly had a meaning, and its explanation is given in Myers’ deposition. If that explanation be untrue, why has not O. 0. Williamson explained it by the deposition of Samuel Williamson.
In a sale surrounded and marked by so many striking and significant badges of fraud as characterize this, is it not amazing that Samuel Williamson should not have been called on for some explanation of the cause and meaning of this dispatch? Is it an improper or illegal inference, that from his failure to do so, we have a right to presume it was incapable of any explanation favorable to his interest? This record presents a strong case, as we confidently submit, of an unmitigated fraud.
Upon the part of Myers, the evidence conduces to show that he had no intention ultimately of defrauding his creditors. His only motive in the transfer, seems to have been to run his boat for another season, and from his anticipated profits, to pay his debts. His fear of being thwai’ted in this purpose, from attaching creditors, induced him most imprudently, illegally and unwisely, to execute this fictitious transfer to Williamson. The. evidence clearly shows that he had the fullest confidence in Williamson and Isham. How this confidence has been valued, this controversy sufficiently attests. Williamson has play ed the game boldly; and so far as poor Myers is concerned, but too successfully. With all his cool and adroit determination as against Myers’ creditors, to appropriate these boats to his own use, his effort has signally failed. Fraud, in its darkest aspect, with or without the disposition of Myers & Halderman, stands out in bold relief, from the inception of this scheme to its termination, and we confidently submit, that no candid or impartial mind can examine this record without the clearest conviction, that the plaintiffs below were fully entitled to the relief sought in their petition.
A reversal is respectfully and confidently asked for at the hands of this court.
M. C. Johnson on the same side—
1. The question is as to the competency of Myers and wife.
Their competency is contended for on the ground of the equipoise of interest.
If plaintiffs succeed the steamboat and barge will be used in paying Myers’ debt. But their success will destroy the validity of the note for $15,000. The interest is here balanced, as shown by the authorities cited by the opposite side, of 2 Phillips' evidence.
Williamson, however, has advanced money to Myers, as admitted by Myers, to the amount of $450— see his deposition; as contended by Williamson, $850, but of this there is no proof. This money was advanced or loaned when there was nothing due, and could be recovered back; but even if it could not the proof clearly shows that the steamboat had deteriorated more than $2,000 between the time of the bill of sale and the attachment of it in this suit, still leaving the balance of interest against the plaintiffs — see deposition of W. H. Pierce.
Williamson also paid debts upon the boat, and against Myers, for some $12,000. Myers is still liable to him for these debts — see the case of Planters Bank of Tennessee vs. Baker, decided at the last term, where the court, in the case of a fraudulent conveyance, allowed the fraudulent vendee the debts of the vendor, which he had paid as the consideration of the fraudulent conveyance. 'These debts are improperly credited on the note. By Williamson’s answer it was not to be done until two years, when the note was due. The order of Myers, if genuine, is one of the strongest evidences of fraud. The order is to credit any bill that Williamson may render, It is not proved that this was done until after this suit was commenced. After suit commenced one party cannot, by his own act, disqualify a witness — for instance, Williamson could not, by releasing Myers from these debts, and thereby destroying the balance of interest, disqualify him; nor could he, by causing these debts to be entered as credits on this note, effect the same end, even if so entering them would release him, which it would not. The liability of a fraudulent vendor to his vendee, for debts paid by the vendee, is not opposed to any Kentucky decision, and is thoroughly sustained by the case of the Planters Bank.
2. The fraud of the sale.
If Myers’ deposition be sustained by the court there is no question as to the fraud.
Mr. Stevenson’s brief of the evidence omits several depositions which I consider quite important, and will not dispense with reading the record — Jason Gowdy, John C. Riley, Thomas Feakins, Danl. Ames, H. A. Jones, R. M. Wade, J. J. Warman.
The circumstances proving fraud .are numerous. -Myers sold a boat, which, whatever differences of opinion may exist as to its value, he, Myers, evidently valued at $20,000 at least, for $15,000, on two years’ credit, equal, at Cinicnnati interest, to only about $12,000, to a youth without means, and with no earthly security, who was a clerk in the store of his principal creditor, who insisted, (as stated by himself,) on a change in the management of the boat with a view to his .own security, and who keeps the note and holds-it to this day. Such a sale, (as a genuine sale,) has no parallel.
It is exactly consonant with such a transfer as Myers wished to make and proposed to make. Williamson was a steamboat clerk. His brother was a steamboat pilot, who had been in the employ of Myers for some-years, and was engaged for the following season. He was approved by J. G. Isham, the principal creditor of Myers on the boat, and who told Myers uthat the boat would have to be put in other hands for management.” Williamson was to be liberally paid; his brother made captain; he was to be in no danger; the note he gave was not to be delivered to Myers but kept by Isham, and could be given back to him if accidents happened. He did not, in the note, assume'the debts of the boat, and substantially he came under no responsibility. The boat was insured for Isham-’s benefit.
It has all all- the ear-marks of fraud—
1. It is a sale when Myers evidently did not wish to sell.
2. Myers was embarrassed, and urged by Isham to let the boat go into other hands for management.
3. Myers and Isham go to a lawyer, Mr. Coffin, to consult about the best mode to make a sham sale.
4. The price was inadequate — see depositions of Riley and others — also, the price at which the boat sold by the sheriff, after it had been run a season — 114,500—when it was worth some three or four thousand dollars less.
5. The terms of sale, length of credit, and want of security, and small means of Williamson, were utterly absurd as a real bona fide and sane transaction.
6. The order given by Myers to Williamson, directing J. G. Isham “to credit on Williamson’s note you (Isham) hold for me, the amounts he may render you a bill for debts paid, &c.,” placing it wholly in Williamson’s power to-render any bill he chose, and obtain a credit for it, shows either the order was fraudulently obtained, if the transaction was bans, fide, or that the whole thing was a mere sham, and the order given to protect Williamson in regard to the note.
7. The conduct of Isham in giving a receipt on the note, after a difficulty had arisen between Myers and Williamson, and leaving all vouchers and evidences of debt in Williamson’s hands, shows a combination between Isham and Williamson.
8. Isham says, in his deposition, that Williamson, in the spring, wished him to • enter a credit on the note for debts he had paid off, but he (Isham) refused without Myers’ order; that order is dated February 17, 1854,- and was then in Williamson’s hands !
9. The business relations of Isham and Williamson ; Isham’s going with Myers to consult Coffin, the lawyer, about a sham sale ; Isham’s insisting on the .change of hands of the boat for management; his retaining possession of the note; his manner of entering credits, without retaining even a list of them, or vouchers for them, all show a combination between Isham and Williamson in the making of the sham sale, and in the attempt to convert it into a real sale.
10. The evidences brought forward, of its being a genuine sale, do not, in fact, militate against its being a mere sham. Of course the sale was to be publicly spoken of as a genuine sale. Even when the contract is made it is usual for the parties to agree to speak, even among themselves, at that time, as if it was a real sale. The understandings are all previous. These understandings are not generally in express terms, but in. such general terms as, “I will bring you out,” or “I depend on your friendship,” “I have confidence you will do right,” -&c.
11. There is no doubt that Myers understood that it was a sham. His unwillingness to sell; his valuation of the boat; the price given, so inadequate to his ideas; the terms of credit, so unsuited to his condition ; the interest he afterwards manifested in the success of the boat, all plainly prove it. Neither is there a doubt that Williamson knew that Myers so understood the sale, even if we should come to the conclusion that he designed, from the first, to hold to his purchase as genuine.
In regard to the credit due to Myers5 statement.— Although legally a fraud, his conduct, with the motives that actuated him, was not morally wrong. He wished to pay all his creditors; he could only do it by running the boat the next boating season. Had his arrangements been carried out he could have paid all or nearly all; as it is he is, in any event, insolvent. And that fact, independent of all technical rules, makes him actually disinterested. It is now really a question with others, in which his insolvency deprives him of pecuniary interest.
Menzies Spihnan for appellee—
1. The only witness who proves that there was an understanding that the boat should revert to Myers, after the expiration of the season, is Myers himself, whose deposition was excluded, and we have no doubt rightfully, as abundantly shown by the authorities cited by the circuit court; and although it is true, as stated by him, that there is some conflict of authorities upon the subject, we cannot doubt this court will give the greater weight to that current of decisions which is most consonant with natural equity, and in so doing follow our- own adjudications. We shall therefore consider the evidence of Myers (as well as that of his wife, and of Walker and Halderman, joint debtors with Myers in the judgments sought to be satisfied out of the sale of these boats,) out of the question, which takes away all the direct evidence on behalf of the plaintiffs upon this branch of the subject, and turns us over to the circumstantial department. But we must not fail to add, that while there is an entire absence of competent evidence to sustain the plaintiffs5 charges, there is positive proof to the contrary in the deposition of J. G. Isham, of Capt. Hawley, of S. Williamson.
2. But we are pointed with great emphasis, and characteristic confidence of language and manner, by appellants’ counsel, to the alleged facts that the boats were sold too low, on unprecedently long credits, without any cash payment, and without security.— The first of these positions we confidently deny.— The others are easily explained. There are some witnesses who think the boat and barge were worth $18,000 to $20,000, but the weight of evidence is that they were worth less than $15,000. Capt. Hawley thought them high at that price. (See his deposition, p. 192.) All the following witnesses — men of large experience and good judgment — put the value below $15,000 — Pierce, inspector, Wm. H. Pierce, Spencer, Searles, Withenburg, and Fisher.
Next, as to the credit. It is true the sale was nominally on a credit of two years, but the boat was under liens to the amount of $8,000 or $9,000 (besides mortgages to secure the fulfillment of large contracts for carrying freight,) which were assumed by Williamson, and, to save the boat, must of necessity be paid promptly, which was equivalent to a cash payment to that amount; and the individual debts of Myers, assumed by Williamson in the purchase, amounted to almost the entire balance of the purchase money. And as it would take Williamson some time to arrange these, the balance coming to Myers could not be ascertained until these debts were settled; hence the nominal credit was put at two years, as by that time it was supposed the balance could be ascertained.
As to the failure to take security by reserving a lien on the boat, or other mortgage, two reasons can be assigned for it. First, Myers was well acquainted with Williamson, and had great confidence in his integrity and capacity, and was willing to trust him. In the second place, we agree with the counsel for appellants, whatever may have been. Williamson’s motive in the transaction, Myers’ motive was fraudulent. His object was to hide from his creditors.— Had he, therefore, placed on record ar mortgage on the boat, or anything else, it would have .been a finger board to point his creditors just where he did not wish them to look. His object was to keep his effects in as intangible a form as possible. And he preferred trusting Williamson without security, to incurring the hazard of a suit by his creditors to subject his claim on Williamson to their debts.
3. But the interest which Myers continued to take in the success of the boat after the transfer, and some slight circumstances tending to show control on his part, are paraded with considerable pomp, and great zeal, as unmistakable evidences of ownership.
The principal circumstance tending to prove control of the boat by Myers, after the transfer, was the renting by him of the bar of the boat for that'season, and receiving the rent. But it turns out on cross-examination, that this renting was done before the transfer, and for the whole season; and of course Williamson took the boat subject to it. And this, and perhaps some other similar drawbacks, may account to plaintiffs’ attorney for the supposed low price at which the boat was purchased. Some fugitive remarks of Williamson about consulting Myers about an old carpet, the object of which we are not informed, and the giving awray by Myers of an old cable box, which may or may not have been known to Williamson, or assented to by him as a matter of no-consequence, constitute the foundation of this branch of plaintiffs’ argument.
There is no difficulty in accounting for Myers’ interest in the success of the boat. He had a pecuniary interest in its success. Not, however, as the owner of the boat, but its success was his security.— It was the security which he had chosen to trust, and of course he watched it with much anxiety, and did all he could to secure both freight and passengers for the boat. One-half of the mental force and discrimination expended by the learned counsel in endeavoring to torture these acts into badges of fraud, would have enabled him to see them in their true light, and reconcile them with honesty of purpose.
We cannot doubt the correctness of the judgment of the circuit court.
George Robertson on same side—
A few facts and ideas, in addition to those suggested in the brief of Messrs. Spilman & Menzies, will constitute this hurried supplement.
1. The competency of depositions rejected by the circuit judge, is the first matter material for consideration.
Walker & Haldeman, who are sureties for the debt sued for, are undoubtedly interested in the success of the complainants; for, though they speak of an indemnity, yet the court knows nothing of its sufficiency, and even were its adequacy and certainty for ultimate security established, the direct and immediate liability is a legal interest sufficient to disqualify them as witnesses for exonerating themselves from it. Jonathan Myers, the vendor, is equally incompetent.
The old doctrine that a witness was incompetent to prove his own fraud, is properly overruled. But, when it is his interest to set aside his own contract by testifying that it was fraudulent, the presumed bias of that interest will, unquestionably, close his mouth on that subject. And, in most cases in which a witness had transferred his property in the form of a sale, and received any value from the vendee, it is his interest that his creditor should subject the property in satisfaction of his debt — because, thereby the vendor will have been paid twice for the same property — once by his vendee, and again by his creditor. {Paul vs. Rogers, 5 Monroe, 167; Bailey vs. Foster, 9 Pickering, 139; Bland vs. Owsley, New R. English.)
It is conclusively settled that a fraudulent vendor could not, by any form of suit, be compelled to make restitution of the sum he had received from his ven dee on a contract for defrauding his creditors. In such fraudulent contracts the law will not imply either warranty of title or an assumpsit to pay back. If there be even an express warranty, it will not be broken by a recovery of the property by a defrauded creditor. (Ragland vs. Wickware, 4 J. J. Mar. 530.) And, besides, no express executory stipulation, which is an element of such a contract, or is superinduced by it, will be enforced by the law, whose wholesome maxim, for the prevention of such fraud, is, in pari delicto potior est conditio defendentis. No doctrine is now more firmly established here than that which withholds, from each party to such a contract, all remedy for enforcing the fulfillment of it. Anciently this doctrine was not understood or settled in England, where, in the case of Hawes vs. Leader, (Cro. Jas.) the court sustained an action of covenant made for defrauding creditors ; and in 7th and 16th Johnson’s New York Reports, and in 1st Black]ord, 263, that dictum was obsequiously and inconsiderately followed. The only reason for such decisions, was that the statute provided that such a contract was void only as to the creditors, and the court, therefore, considered it as binding between the parties. In one sense it is so binding — that is, the law will not help either party to avoid it. But it does not follow that it should help either of them to enforce it; and, by the wise application of the foregoing maxim of policy, it will refuse to aid either of them in enforcing it. And we need go no further than the cases of Surlot vs. Beddo, 3 Mon., 109; Norris vs. Norris, 9 Dana', Balt vs. Rogers, 3 Paige’s R.; Herrick vs. Grow, 5 Wend., 579 ; Bailey vs. Foster, 9 Pickering, 139, to prove that this is modern doctrine in America. Indeed it is now the settled doctrine in England as well as here. In a note in Phillips on Ev., {part 1 ,p. 122,) the author, after analyzing cases, concludes as follows — “that the vendor is a competent witness for Ms vendee, but not so for his levying creditor, who offers him on the assumed ground of fraud.” This doctrine is in no de gree shaken, or even questioned, in the cases of Bay-' lor vs. Smither’s heirs, 1 Littell, 111, and Ragland vs. Wickware, 4 J. J. Marshall, 530, the principle of each of which cases is misconceived by Mr. Stevenson in Ms printed brief. In the case in Littell, a party to a contract charged to be fraudulent against creditors, was admitted to be competent to prove, not that the contract was fraudulent, but that it was not fraudulent; and the following extracts from the opinion of the court show why he was adjudged competent: “An attempt was made on. the trial to prove a fraudulent and collusive combination between the ancestor of the heirs (plaintiffs) and Shirley (the witness) to defraud the creditors of Shirley; and it may be contended that Shirley was an incompetent witness to ¿iisprove the alleged fraud, and, on that ground, ought to have been rejected-. But it may be replied, that the supposed argument assumes an objection which goes properly to the credit, and not to the competency of Shirley.” And why? The court had just before assigned the reason in the following, language : “He cannot be said to have such an interest in the support, o-f the right of the heirs as to render him incompetent on that ground; for, by proving the property of the girl (slave)' to be in the heirs, he would subject himself again for the amount for which she had been sold (for his benefit), without conferring on himself any right to be restored to her possession.”
In the case in 4th J. J. Marshall, á slave, Ned, having been levied on as the property of Samuel Wick-ware, the said Wickware, being offered as a witness to prove the bona jides of a transfer of Ned to his brother, E. Wickware, the plaintiff in the action for recovering him from the purchaser under the levy, was adjudged to be competent to prove that said transfer was a bona fide sale, and was not a fraud on his creditors; and the chief reason assigned, was that Samuel’s warranty would not be broken by the recovery of the slave on the ground of fraud, because that would only prove that his title- was, as warrant =ed, good, and that the fraud, in which the plaintiffs had participated, was the only ground of the recovery.
In the case of Surlot vs. Beddo, a slave of Beddo’s having been fraudulently transferred by him to Surlot, Shanks, as creditor of Beddo, levied his execution on the slave and sold it for $500; and Surlot, having previously become Beddo’s surety in a replevin bond to Shanks, paid, on that bond, $209 as the Balance unpaid by said sale. To recover the $209, and the $500 for which the slave was sold, Surlot sued Beddo in assumpsit, and Beddo having pleaded that the transfer of the slave to Surlot ’was made to •defraud Shanks, the jury, under the instructions of the aourt, found against Surlot as to the $500, and gave him only the $209. On an appeal, by Surlot, to the appellate court, that verdict was sustained on the ground that, by the fraud, Surlot ivas precluded from recovering on Beddo’s warranty. Beddo not objecting -to the verdict, the court said nothing, of course, about the $209 found against him. And, had Beddo sought to reverse the judgment for that sum, he could not have done it for fraud in the negro contract, because it was not paid to his use under that contract, nor as any part of the consideration of it. And Mr. Stevenson -is grossly mistaken when he says that “Surlot ■was allowed -(by this court) to recover back all the money advanced by him for Beddo under the fraudulent arrangement made between them to defeat Bed-do’s creditors.” 1st, because, as Beddo acquiesced in the verdict, this court did not, and could not, adjudicate on it; and 2d, because, had he complained, the court could not have avoided it for fraud, as that money was not paid Uunder (or in consideration of) the fraudulent arrangement.” He is equally mistaken when he places Shirley in the attitude of a witness introduced by Baylor “to prove the alleged fraud.” He was introduced by Smither’s heirs to prove that there was no fraud ; and the court having decided that he was competent for that purpose — also decided that, on cross-examination, he should be required to answer questions conducing to discredit him, by showing fraud.'
None of the Kentucky cases therefore, tend, in any way, to show that Myers is a competent witness for the plaintiffs to prove that his sale of the boat was fraudulent. And the foreign cases referred to for that purpose by Mr. Stevenson, go on the false and exploded idea that, if that contract should be set aside for the imputed fraud, Williamson could recover on Myers’ warranty, or for the money advanced by him for the beat, which principle, policy and conclusive' authority all disprove. It is, we think, clear on all these grounds, that a vendor, who has received anything under the sale, is incompetent, as a witness for his creditor, to prove that the sale was a fraud on that creditor. Wherefore, Myers was incompetent, and consequently his wife, who, if competent, proves nothing.
Without Myers’ deposition there is no plausible pretence for urging a reversal of the decree. And even, if it were admitted as evidence, the case would, as we would insist, be for our client — for not only did the peculiar temptation to falsify destroy the credibility of Myers, but he is also shaken by the improbability and inconsistencies of his whole story, and is overwhelmed by the testimony of S. Williamson, Hawley, Isham, and others.
Is it credible that Williamson, comfortable at home, in his own house and with his own family, and receiving a salary of $1,000 a year for the light service' of a clerk, would have surrendered all this domestic peace and security, and encountered the perils, privations and toils of the steamboat, on a promise indefinitely to pay him a better salary ? And is it not very incredible that, on such terms, he would also have undertaken to pay a heavy and unascertained debt which was then due, and which bound the boat, and moreover to finish her necessary repairs, and provide the means of equipping and supplying her for service? And the more especially, when all this was to be done and, his engagement cease in about six months ? And when, too, the boat seems to have made but little or no profit during the three preceding seasons of running, and her owner (and his employer) was insolvent? Yet all this Myers tries to prove. Falsehood is stamped on the face of his deposition, especially when his motives are considered. Besides, is it not strange (if he tells the truth,) that Williamson, after paying all the debts, had no evidence to show what he was entitled to, while Myers is entitled to the boat, and the excess of profits over the amount of those debts ? And especially when, had the boat been lost, by collision or otherwise, or had she made no profits, Myers might, and doubtless would, have claimed the §15,000, and no other contract than that shown by the written memorial could have been proved by witnesses, or would have been admitted by Myers, even under oath.
But there is abundant testimony in corroboration of the written contract. S. Williamson testifies that both parties, more than once, recited their contract to him substantially as stated in the bill of sale; and that, though one of them was his brother, and the other his friend and employer, neither of them ever intimated anything else ; but, on the contrary, Myers told him, “that he had nothing to do with the boat, but that he had parted with all his interest in her to O. C. Williamson, who was, therefore, responsible for the debts.” And so he would have continued, even yet, to say, if the boat had not, under skillful management, been very lucky. Hawley testifies that,yw.?f before the sale to Williamson, Myers proposed to sell her to him (the witness) for §20,000; that, on his telling Myers that the price was extravagant, Myers asked what he thought it was worth, and what he would give him for it — to which he replied that he did not want it; but that, if he did, he would not give more than §15,000 for it; that, two or three days afterwards, “Williamson asked him (Hawley) if he would go in with him and have half the Yorktown and barge at §15,000;” that he replied he would not, but told him that, if he (Williamson) should buy, “he would step in and help him, to moneythat after this conversation, Myers told him that he had sold the boat to Williamson; and again, “that it was a bona fide sede.’’'’ Isham testifies that Dickson had a mortgage on the boat for secui'ing the performance of a promise, on the advance of $1,000, to freight molasses from New Orleans at $1 25 a barrel, (which was greatly below the customary price,) and that Dugan :& Co., for the like advance, held a similar lien ; and these contracts had not been performed by Myers when he sold the boat to Williamson. He also testifies that, when Myers sold the boat, he owed his firm more than $6,000 for stores and money advanced for the preceding three years ; that Myers, on being urged to pay, offered to sell, and did sell the boat to Williamson for $15,000, as stated in the bill of sale; that Williamson was to pay all the debts then due on the boat, which were estimated at $10,000; and that the note for the $15,000 was deposited with him for the purpose of his endorsing on it the payments of debts by Williamson as he should make them; and that, in May, 1854, Williamson exhibited to him vouchers showing that he had paid debts and made advances to Myers exceeding $13,000, and that he endorsed them on the note on the 18th of May, 1854, in pursuance of a written order from Myers; that Williamson hesitated to buy the boats until he and his partner promised to indulge him, for their debt against it, and to furnish supplies, on credit, for finishing its repairs, and “help him start the boat out.” Pie also testifies that the sale, as assumed by both parties, was bona fide — that Williamson was asked by Myers “if he would start the boat and agree to give her back, which he most particularly refused to do, since he did not like to assume all the risk of accidents, and doing a prosperous business, without a prospect of the profits arising out of the same”
The foregoing facts, if not fortified, as they are, by many minuter circumstances, ought to be deemed sufficient, especially when combined with the written memorial, to repel the imputation of fraud, even if the inconsistent, and interested, and discredited, deposition of Myers could be read as evidence. But without that deposition, it is difficult to imagine how the written contract and the corroborating facts proved by our witnesses, can be adjudged as so far overruled as to justify a reversal, and authorize a nullification of the contract as fraudulent, and thus, probably, ruin Williamson. The appellants, however, try that forlorn hope, and array, for that purpose, several little circumstances, the most material of which we will briefly notice, by condensing, into one, such of them as, in different forms, present only the same idea in substance.
1. Myers’condition. This, in fact, shows a strong motive for selling. He was insolvent, without credit ■ — could not even pay for the repairs of the boat— owed heavy debts which operated as a lien — could not hope to start her into service — knew that she must soon be attached, and probably sacrificed without the possibility of his getting, for his own use, any portion of the proceeds — and he had failed to sell, though he tried, to any other person on better terms • — -under these circumstances, was not the ■ sale, as made, prudent? — was it not the best he could probably have done ?
2. The price was inadequate and the credit too long. Considering the age and condition of the boat, and the testimony of Hawley, Isham, and the two Pierces,- — -valuing the boat in November, 1853, after she was sold and repaired, at $10,000, — -Withenburgh, and others, the court will conclude that $15,000 was, at least, a fair and reasonable price; and Mr. Stevenson is altogether mistaken in assuming that the sale was on a credit of two years; for more than $12,000 were, at the time of the sale, due on the boat, and Williamson was bound to pay all of it at once, or, by his credit, to procure partial indulgence, and pay interest on it. More than two-thirds of the price was, therefore, cash in hand; and in fact nearly $14,000, of the $15,000, were paid within less than 7 months. Who else would have given $15,000, and have paid nearly all of it, as he did, down ?
3. Myers went with the boat and attended to her interests after the sale. These facts are both exaggerated and distorted in the printed brief. Myers lived in Orleans, and on the first trip of the boat he went home on her, and never went on her hack again.— As S. Williamson proves, Myers took no sort of control of the boat, but, as was natural to any former owner and who was interested in immediate profits for paying his debts, he occasionally suggested advice, and may have manifested concern about her safety and her freight. This is all — and properly considered, it does not weigh as much as a feather as a badge of fraud.
4. The transaction was secret — no security taken —Williamson was poor, and Isham kept the note. This is all explicable without a vestige of collusion. The contract was in writing, and disinterested witnesses were privy to it, and both parties publicly and repeatedly stated it just as it was, and the possession and control were forthwith changed. No security, better than the existing liens, was necessary— what better could have been given ? If Williamson failed to pay any debt to which she was subject, the creditor could sell the boat! This was the best possible assurance to Myers for all except a small balance of the $15,000, and for that little balance, Williamson himself, the boat, and Myers’ vigilant anticipation of advances, as illustrated by the account, afforded ample security.
5. Myers contemplated a fraud. That he might have made, if he could, with the proper man, a collusive arrangement, we shall not deny. But failing in this, and, at last, compelled to act without longer delay, he sold, and on advantageous terms under all the circumstances. And the testimony of Hawley and Isham would, alone, be sufficient to show that he intended and understood the contract to be as written. There is no proof, therefore, that in that contract, he contemplated a fraud; or that, if he did, Williamson fraudulently participated in that purpose, or was even aware of it.
There is much more ground for charging the plaintiffs with fraud. Under our law they might have attached the boat as soon as the transfer was made, if, as they charge, it was a fraud on them as creditors of Myers. But they cunningly seemed asleep and acquiescent in the sale, until Williamson had, by paying the debts of the boat, relieved her of all incumbrance, and as soon as that was done, they attach her, and endeavor to make him pay their debt. Had they attached her before these debts had been paid, then, even had he established the imputed fraud, the sale of her would not have done more than satisfy liens and priorities, and the plaintiffs could have made nothing but the fun of paying costs. Why did they thus lie by ? Why did they not proceed before Williamson had made any payment, and thereby relieve him from the loss of nearly $14,000, and also his boat, which they are striving to take from him? There can be but one reason, and that shows a rapacious and fraudulent design in the plaintiffs in the prosecution of this suit. And to consummate their fraudulent purpose, they have conspired with Myers, at whose instance and for whose benefit this suit was probably brought, and, though he is made a defendant, and in his answer, as a cross bill, prays for a vacation of the bill of sale and restoration of the boat, they try to make him a witness in his own case, and the only direct and important witness in this case.
The fact that Myers is such a party would, alone, render him incompetent as a witness against his bill of sale.
We conclude by repeating, that even with Myers’ deposition, the decree ought to be affirmed ; and that, without it, the court can surely have no serious difficulty.
J. Harlan, on the same side—
The depositions of Myers and wife, and of Walker and Haldeman, were taken b.y the plaintiffs, and. whether they are competent witnesses for them presents the first question for the decision of the court.
1. And first as to Walker and Haldeman.
The object of the present suit is to subject the boat and barge to sale, and apply the .proceeds to the payment of the judgments rendered in favor of the plaintiffs against Myers, Haldeman, and Walker.— If the plaintiffs succeed, by the swearing of Haldeman and Walker, their own property will be relieved to the extent of the net proceeds of the sale of the boat and barge. The interest of the witnesses is direct, and consequently they are incompetent to testify.
2. As respects the competency of Myers and his wife.
The first objection I shall urge against the competency of Jonathan Myers as a witness is, he is a party to the record.
Greenleaf (volume 1,page 829,) says: “First in regard to parties, the general rule of the common law is that a party to the record, in a civil suit, cannot be it witness, either for himself or for a co-suitor in the oause. This rule of the common law is founded not solely in the consideration of interest but partly also in general expediency of avoiding the multiplication of temptations to perjury.” (Lampton vs. Lamp-ion's ex'ors, 6 Monroe, 617; Higdon's hews vs. Higdon's devisees, 6 J. J. Marshall, 53.)
In chancery a party to a suit rimy be a witness for or against other parties in the same suit, if he have no interest in the question to which he deposes.— '(jWarren vs. Sproule, 2 Marshall, 339; Sharp vs. Morrow, 6 Monroe, 304; Oldham vs. Jones, 5 B. Monroe, 460; Craddock vs. Thornton, 11 B. Monroe, 100.)
The second objection against the competency of Myers as a witness is, he is directly interested in the matter about which he deposes.
In Phillips on Evidence, vol. 1, page 64-, it is said, “in- an- action of trespass against a sheriff, when the question was whether goods which had been taken by him in execution in a suit against A B, belonging to A B or to the plaintiff, A B was not allowed to be a witness for the defendant to1- prove the goods his property, for the effect of his evidence would be to pay his own debt with the plaintiff’s goods-.” (See. 2d volume Comen Hill’s notes Phillips on Evidence, p. 120, notes 111.)
The question presents a case of palpable interest, but it will be argued that the interest of the witness may be equalized by showing that as vendor of the property he would be liable to bis vendee for its value. The answer to that position is, the vendee could not recover on the warranty, because in order to succeed, the record of the recovery would have to he produced, and that would show that the sale was fraudulent, which would be tantamount to a defeat, for it is an established principle that courts will not enforce an executory contract, founded in fraud, on-the rights of others, or a breach of public policy, but leave the parties where they are. {Bolt vs. Rogers, 3 Paige, 154; Herrick vs. Grow, 5 Wendell, 579; Sur - lot vs. Beddo, 3 Monroe, 109.)
The effect in this case shows the impolicy of permitting a man situated as Myers to be a witness. In 1853 he was indebted to the plaintiffs about $20,-000, and to sundry other persons, who were creditors of the boats, amounting, as he admits, to about $8,000. He sold and delivered the boat and barge-to Williamson, who paid about $13,000 of debts-against Myers, contracted whilst he was in charge of them, and against which the creditors held special-liens. Myers then- caused a suit to be instituted in this state, against the boat and barge, to have them sold to pay the debts of the plaintiffs, and he is introduced as a witness to sustain their claim, and on his examination he swears he made a fictitious sale of the boat and barge to Williamson for the purpose of hindering and delaying his creditors — and such as the law denounces fraudulent. If he were a competent witness his conduct throughout divests him of any credit. He shows he is a swift and uilling witness on the side of the plaintiffs. There is nothing which shows fairness and impartiality.
The rejection of the deposition of Jonathan Myers carries with it that of his wife.
The evidence of Myers and wife, and of Haldeman and Walker, being out of the record, is there any evidence left upon which a court could base a reasonable ground for suspicion of fraud, and subject the proceeds of the boat and barge to the payment of plaintiffs’ judgments ?
One of the alleged evidences of fraud is the price Williamson agreed to pay for the boat and barge.— The proof taken by Williamson upon the question of value is as follows :
John G. Isham {page 201,) says, “I think $15,000 a fair price for the steamer Yorktown, No. 2, and barge No. 2, at the time she was sold.”
Joseph Pierce {page 222,) estimated the Yorktown at $10,000, and the barge at $1,500, in November, 1853.
William H. Pierce {page 224,) valued the Yorktown 2d, in November, 1853, at $10,000; reported unseaworthy in June, 1854, and valued her in July, 1854, at $8,000.
W. W. Withenburg {page 228,) is a steamboat captain; went on board in October, 1853, to examine the boat with the view of purchasing it, and came to the conclusion it was worth $12,000; would not have been willing to have purchased the boat at $15,000 with an overhanging debt of $11,000 on it.
James T. Fisher {page 230,) estimates the boat at from $12,000 to $15,000.
Henry E. Spencer, President of the Fireman’s Insurance Company, {page 226,) says the Yorktown was valued in November, 1852, for insurance pur poses, at $12,000; and Myers sanctioned the transfer of the policy to Williamson in October, 1853.
A. M. Searls, President of the Merchant’s and Manufacturer’s Insurance Company, estimated the boat to be worth in November, 1852, $12,000. Myers transferred the policy to Williamson in October, 1853.
The average estimate of all the witnesses would not, I apprehend, exceed $15,000. So far, therefore, as the price agreed to be given by Williamson, it affords no evidence of fraud; it is true that the boat and barge sold for $14,500 at the sale by the sheriff, but it must be recollected that steamboat stock increased in value after the purchase by Williamson • — see Haldeman’s deposition.
Whatever motive may have operated on Myers in making sale of his boat and barge Williamson did not participate in his wishes and intentions, if they were, as plaintiffs alledge, to defraud his creditors. There was no inducement held out to Williamson to aid Myers in smuggling his property to prevent his creditors from taking it to satisfy their claims.
The only evidence contained in this record, of the negotiations between Myers and Williamson, and what was said by each, is contained in the deposition of John G. Isham. His testimony is corroborated by other witnesses, and by many of the circumstances that surround the transaction.
A careful reading of the deposition of Isham will satisfy any unprejudiced mind that the sale by Myers to Williamson was made in good faith, certainly so far as Williamson was concerned; that the condition of Myers’ affairs was such as required him to make sale of the boat, and the sale to Williamson, under the circumstances, was as advantageous as could have been made at the time.
A few extracts from Isham’s deposition will be given : “He (Myers) proposed to O. C. Williamson to ‘ buy the boat, and said Williamson, after ascertain- ‘ ing the indebtedness of the boat, which was, I think, £ over $10,000, agreed to buy the Yorktown 2d, and ‘ barge Yorktown 2d, for $15,000, giving a note pay- ‘ ably two years after date from October 19, 1853, in ‘ which was stated all the debts of the boat and barge ‘ were to be paid, and the balance of the purchase * money was to be paid to said J. Myers; and further, ‘ that the note was to be left in my hands, and not ‘ given up to Myers until all the amounts paid to My- ‘ ers, and for debts of the steamer Yorktown 2d and ‘ barge Yorktown 2d, were indorsed thereon. Will- ‘ iamson hesitated to take the responsibility of the £ purchase until we promised that we would not push ‘ our claim unless it was necessary for our own safe- ‘ ty, and would sell him what goods he might. want ‘ for the finishing the repairs of the boat, and would ‘ help him to start the boat out, which we agreed to, 1 and did fulfill, upon he (Williamson) getting the ‘ boat insured for our own benefit; also, the first trip ‘ the boat went out to insure the freight list of same, ‘ which was done. The total indebtedness of the ‘ Yo'rktown 2d to us was, when she started from Cincinnati in November, 1853, over $6,000 for stores ‘ and supplies furnished and money advanced, and 6 our liabilities — $750—as indorsers on the insurance * notes, and $600 indorsed- on a draft payable in New ‘ Orleans, on which money was obtained by O. C. £ Williamson to start the boat out on.” (Page 199.)
In answer to a question the witness says: “The ‘’sale was assured by both parties, Myers and Will- ‘ iamson, and was a real bona fide sale, as William- £ son was asked by Myers if he would take the boat ‘ and agree to give her back, which Williamson most ‘ positively refused to do, as he did not like undertak- ‘ ing all the responsibility of accidents to the boat, £ and not doing a prosperous business, without a pros-1 pect of the profits arising out of the same. Will- ‘ iamson handed me a list of debts, showing me the £ vouchers for same. $13,654 34 was indorsed on the £ note of Williamson by me May 18, 1854.” “Will£.iamson showed me the vouchers for these separate ‘ amounts he had paid, and which he now holds in ‘his possession.” {Page2Ú0.)
The witness being interrogated as to the value of the boat answered, “I think $15,000 a fair price for ‘ the steamer Yorktown No. 2, and barge Yorktown ‘ 2d, at the time she was sold.” {Page 201.)
I contend therefore—
1. That Haldeman and Walker are not competent witnesses because of their direct interest in the result of-the case.
2. That Myers is not a competent witness because he is a party to the record, and interested directly in the result of the judgment to be rendered.
3. Excluding these witnesses there is nothing on which to base a decree in'favor of the plaintiffs.
4. But if Myers is a competent witness the evidence is insufficient to outweigh the denial in the answer of Williamson, and the direct evidence in corroboration of his answer.
And upon the whole record the judgment of the-circuit court should be affirmed.
January 10.

Opinion:
Chief Justice Marshall
delivered the opinion of the Court.
On the 19th of October, 1853, Jonathan Myers executed to O. C. Williamson a bill of sale, transferring to him, for the consideration- of $15,000, acknowledged to be received for the steamer Yorktown, No. 2, and the barge Yorktown, No. 2. The bill of sale was regularly recorded in the Custom House at Cincinnati. But the consideration, instead of having been paid, was secured or evidenced by the note of Williamson of even date with the deed, and by which he promised, two years after date, to pay to the order of J. Myers the sum of $15,000, with the following additional words in the note: "But it is ' understood that the amounts due by. the steamer ' Yorktown, No. 2 and barge is to be deducted from 'the amount above named — $15,000; this, note be- ' ing for the purchase of said boat and barge, and * when said boat's debts are paid then the balance of ' the purchase money, secured above, to be paid 'byO. C. Williamson to Jonathan Myers or his or- ' der." This note was deposited with J. G. Isham, not to be delivered to Myers until the payments made by Williamson, of the previous debts of the boat, were credited on it by Isham, which debts were then supposed to amount to $ 10,000 or more. In November, 1853, the boat entered upon the business of the season, which was prosecuted with great profit, O. C. Williamson acting generally as clerk, and his brothei, Snmuel Williamson, who was received on board after the boat reached the Mississippi on the first downward trip, acting from that time as captain.
On the 3d day of June, 1854, the boat having returned from her last trip to New Orleans fort-hat season, and being in the county of Kenton, opposite to Cincinnati, she was attached by Smead, Collard & Hughes, who set up, in their petition for that purpose, four judgments against Myers, &c., rendered in Hamilton county, Ohio, and bearing ten per cent-um interest, and alledging that the transfer by Myers to Williamson was but colorable, and was made with the intent to defraud the creditors of the former, and especially themselves. Myers answered, admitting that the sale was not a real one, and alledging, in substance, that being embarrassed with debts, and unable to raise funds necessary for finishing the repairs of the boat, and for putting her in condition for entering upon the business of the season of 1853-4, from which he anticipated great profits, and being desirous to realize those profits for the purpose of paying his debts, and fearful that the boat, then in Licking river in Kentucky, would be attached if taken over to Cincinnati, he made the transfer to O. C. Williamson, then a clerk in the store of Isham & Fisher, (the principal creditors of the boat,) and who had formerly been a clerk on his boat, under an arrangement that his brother, Samuel Williamson, should be captain or master, and O. C-. Williamson clerk, at a salary better than he was then receiving, and that the net profits were to be appropriated to the payment of debts of the boat, and other debts of Myers, and that at the end of the season the boat was to be restored to him, Myers. O. C. Williamson answered, denying fraud, insisting'on the fairness and validity of the sale, and claiming the boat as his. In each of these answers particulars are stated which it is not necessary now to detail. Many depositions were taken by the parties respectively, and among them the plaintiffs took those of Myers and his wife, and also of Walker and Haide man , each of whom was bound for one of the debts of Myers set up in the petition.
Soon after the commencement of the suit, to-wit, in August, 1854, the boat was publicly sold under an order of court, and brought $ 14,500, on a credit of six months. And on that hearing, the four depositions above mentioned having been rejected, on the ground of incompetency of the witnesses, and the court being of the opinion that although, without their testimony, the intention of Myers in making the transfer was sufficiently established, there was no satisfactory evidence of Williamson's participation in it, the petition was dismissed with costs; and from that judgment the plaintiffs have appealed.
The first question arising in the case, as presented in this court, is whether the circuit court erred in rejecting the depositions above referred to, or either of them. The interest of Walker and Haldeman in subjecting the boat or its proceeds to the satisfaction of debts, for which they are themselves bound, for a principal probably insolvent, is obvious; and their competency is scarcely insisted on. But a serious question is made upon the rejection of the deposition of Myers, who, it is contended, has an interest on both sides, equally balanced, inasmuch as if the boat is subjected he looses his claim upon the note, which he will have if the boat is determined to' be the property of Williamson, under his purchase; and if the deterioration of the boat be considered it is1 contended that the balance of interest is against the plaintiffs, who offer the witness. But it appears that credits have already been indorsed on the note by Isham, with whom it was deposited, for about $13,000, for payments made by Williamson, on debts existing against the boat before the transfer ; and although it be conceded that this indorsement does not satisfactorily prove the amount of such payments actually made, still, if the precise amount may be uncertain, it is certain that a large portion of the debt due to Isham & Fisher, of several thousand dollars, has been paid by Williamson, And if it were conceded that in case nothing had been paid upon the contract of purchase, the loss of the price to be paid on that contract would be equivalent to the gain by subjecting the boat to the demands of the plaintiffs, still as there have been large payments on the note, greatly exceeding the deterioration of the boat, and by which Myers has been, to some extent, finally relieved from his debts, he will, if the boat be now subjected to other debts due by him, be the gainer by the entire difference between the price which Williamson was to have paid and the proceeds of the boat as sold under the attachment, with the addition of the sums already paid by Williamson in discharge of debts of the boat due before bis purchase. To the extent of this difference, certainly amounting to a large sum, and perhaps equal to or exceeding four-fifths of the price to have been paid by Williamson, Myers would, by subjecting the boat in this case, realize- a double payment or a double price on it, except so far as the costs of the present proceeding may affect this result.
If the subjection of the boat, in this case, would authorize a recovery against Myers for the breach of his warranty, or his covenant against incumbrances,, this liability, consequent upon a termination of the suit in favor of the party calling him, might be deemed equivalent to the advantage gained by that event. And, as such a liability would be avoided by a differ ent termination of this suit, his interest might be regarded as balanced, and he would be a competent witness against his vendee, even to impeach the sale on the ground of fraud. The same consequence would follow if the subjection of the boat would render him liable to re-pay to Williamson the full amount that he had paid to, and for Myers under the contract of purchase. But, although, in such case Williamson would lose the boat, or rather would lose the benefit of his purchase, it would not be on the ground of any defect in the title of Myers but on the ground of a fraud, in which Williamson participated, so as to render his purchase void as against the creditors of Myers; and as this result would not disprove or defeat but affirm the title of Myers, and would only defeat the title of Williamson, on account of his own wrong, it could not establish or amount to a breach either of the warranty of title or of the covenant against incumbrances; nor, as we suppose, would the law imply a promise or impose a liability to repay to Williamson the sums which he had paid to or for Myers, in pursuance of a contract made with intent to injure and defraud third persons, and which the law itself makes void as to them. It is true the statute declares such a contract void only as to the creditors and purchasers intended to be defrauded; but even this declaration is equivalent to prohibition, and would have made the contract illegal if it haa not been so before the enactmant of the statute. It is a contract in violation of good morals, inconsistent with honest purposes, and therefore against public policy, and not countenanced by the law nor by the tribunals which administer the law. To such a transaction the maxim applies, ex turpi causa non oritur actio. From such a foundation no cause of action can arise; and this is true not only as to any action for the enforcement, or for a breach of the vicious contract itself, but also as to any action by which either party may attempt to regain from the other what, by reason of the invalidity of the trans action as to third persons, he may have lost for the benefit of the other party, and he could not sustain an action either on the contract or for its breach, or on any implied liability to refund what he had paid on it. The law regarding both parties as equally implicated in an illegal transaction, will not interpose in behalf of one of them, either to enforce the illegal contract or to relieve him from the consequences of either a partial or a full performance of it. And this is the only effect which, without defeating the object of the statute, and the certain policy of the law, can be given to the implied declaration that the contract, though void as to creditors, &c., is valid as between the parties to it. The law leaves the parties where they place themselves. If the vicious contract is wholly or partially unexecuted, it will not coerce its execution, and neither party gains by it farther than it is executed by themselves. If it is to any extent executed by the parties themselves, the law will not replace them in statu quo, though one of the parties be a loser by the avoidance of the contract. This inability of each party to recover what he may have lost by the illegal transaction, and the liability which even the fraudulent vendee may incur to third persons by his participation in it, are the penalties by which the law intends to prevent fraud, and to enforce the observance of honesty and good faith.
It is said, in argument, that according to the principle settled in the case of the Planters' Bank of Tennessee vs. Baker, decided at the last term, Williamson, in the event of the loss of the boat, in this suit might, to the extent of his payments, be substituted to the rights of the creditors of Myers, and to their liens on the boat; and that Myers would therefore gain nothing by the subjection of the boat. But the principle of the case referred to is not understood to admit of the application contended for. If the plaintiffs here were attempting to make Williamson liable for the profits of the boat made while he controlled her under his purchase, it would be just that he should have credit for the debts of Myers which he had paid out of those profits, and especially for such as had liens upon the boat. And as he would be entitled to these credits upon general principles of equity, even if the payments had not been made under the fraudulent contract, the fact that they were made in pursuance of it ought not to prevent him from receiving them. The most that the attaching creditors could claim, in such a case, would be that the profits should be regarded as belonging to Myers, and subject to his debts ; and so regarded the fund would be subject to diminution by the amount of all disbursements fairly made in payment of his debts, and the creditors claiming afterwards, by attachment, would be entitled only to the ba'ance, because nothing more could be regarded as his. But this allowance to Williamson would not imply any further liability to him on the part of Mjrers, and it would not diminish his interest in having the boat subjected to his debts not yet paid, because it would not admit a right in Williamson to participate in the proceeds of the sale under the attachment, nor in fact to any interest in the boat itself, although, if he was an actual creditor of Myers, beyond and independent of the fraudulent contract, the chancellor might not wrest from him the possession of the boat without providing for his just claims.' And this measure of favor, which is not involved in the present case, because Williamson's payments were made from the profits of the boat, is, as we apprehend, the utmost which could be justified by the principles of the case referred to.
1. One having an interest both for plaintiff and defendant, but whose interest prep onderates on one side, is not a competent witness for that party on whose side his interest is greatest; nor is his wife. The rule is general, almost without exception, that a vendor is a competent witness for his vendee, but incompetent for a cred itor of such vendor, who levies upon property, to prove fraud in the transfer.
Upon the whole, therefore, we are of opinion that Myers had a preponderating if not an exclusive interest in the event of this suit, and in favor of the plaintiffs, and that he, and consequently his wife, were incompetent witnesses on that side; although if offered by Williamson, they would have been competent to sustain the sale to him, because their interest as the case stands, would have been on the other side. This distinction and the conclusion at which we have arrived upon the question, are'sustained by the cases of Raglan vs. Wickware, 4 J. J. Marsh., 530; Paul vs. Rogers, Admr's, 5 Mon. 164, and other cases in this court, and by an elaborate citation of authorities in note 111, page 120, of the 2d volume of Phillips on Evidence, by Cowen and Hill, which conclude with stating as "a rule almost unincumbered by exception, that the vender is a competent witness for his vendee, but not for his levying creditor, who offers him on the assumed ground of fraud." There was therefore no error in rejecting the depositions of the four witnesses above designated, and we put them out of view in our consideration of the case. But independently of those depositions, and giving due weight to the testimony of Isham, who had a nearer connection with the actual transaction between the parties, and might have known more of their motives than any other competent witness, we are of opinion that however fair and honest the parties may at the time have supposed their motives and the transaction itself to be, the established facts and circumstances of the case and of the parties, repel the conclusion that the sale was in fact a real one, and establish as the only admissible deduction, the fact that the form of a sale was resorted to as a means of at once avoiding the attachments which were feared, and satisfying Isham that the boat would be so managed as to furnish a prospect of the debt to his firm being paid out of the profits, and at the same time of providing for the payment of other debts of the boat out of the profits; and that the transfer was made with the understanding between the parties that the boat was still the property of Myers, and to be finally restored to him, or disposed of for his use.
2. Where there lias been a fraudulent Bale made with the intent of securing to the vendor a future interest in the property, and the sale is for less than the value of the pro perty, the chancellor will set aside such sale, and subject the property to the payment of debts due tojudg ment creditors.
What particular inducements may have been held out to Williamson, or why the transfer was made to him, the evidence does not fully disclose. But while the circumstances disclosed enable us to account for the selection of him to take the title and management of the boat under a sham sale, and to control her earnings for the benefit of others, with the right and power of securing to himself a fair and liberal compensation, there is nothing which explains why if the sale was intended to be a real one it was made to him; and there is no single circumstance outside of the formal transfer to him, which accords with the supposition that the sale was intended to be an absolute and irrevocable transfer of the boat. He was clerk in the store of Isham and Fisher, in Cincinnati, engaged at a salary of $1,000 ayear, and possessed of no property but his residence in Covington, worth at most $3000. He had been a clerk on steamboats, and was at some period acting in that capacity for Myers. He had no means to purchase a valuable boat. He could no more have thought seriously of purchasing such a boat as a real transaction, upon his own means and responsibility, than the owner (unless he was ready to give it away), would have thought of selling it to him without security. And yet the boat was transferred to him without security, at a recited consideration, less by one-fourth than the lowest estimate which Myers had ever placed upon her; less by $3,000 than he could have obtained for her in prompt payments, in the summer of 1853, before she had received the repairs which were nearly completed at the date of this transfer; and she was transferred upon terms of payment, which as to the time given, as well as the absence of security, were entirely out of the usual course of similar transactions; being such a sale as no witness had ever heard of; and on looking to the mode in which the payment might be made, we see that it was optional with Williamson whether he would discharge the debts of the boat, and that as he had no other means but from the profits, ether of doing this, or of otherwise paying the price, or so much as might not be paid in this wray, Myers in transferring the boat and her anticipated profits to him, not only gave up him self, and placed in the hands of Williamson the very means by which he was to make payment, and the the only means by which he would be enabled to do so, but left himself without recourse, in case the boat should be lost without making profits, or should be sold by Williamson for money.
The boat must have been worth considerably more on the 19th of October, 1853, when nearly fitted for commencing the business of the season, than she was in August, 1854, when after being in service for six or seven months, she brought on a credit of six months, nearly as much, well secured, as Williamson was to give out of her profits in the course of two years. The lowest estimate of her vendible value, made before the sale in Octobor, is $15,-.000, by a witness who says Myers about that time offered to sell her to him for $20,000; an offer considerably below his usual estimate of her value, and which if made, is to be attributed to the urgency of Isham in pressing for payment or security for the demand of his firm, then amounting to near $5,000, against the boat.
It is proved thatMyers had high expectations with respect to the profits of the approaching season; that he had apprehended attachments upon the boat, by which he might be prevented from reaping those profits; that he was unwilling to sell the boat, but wanted to place her in the hands of a friend who would keep her for him, so that he might be thereby enabled to pay his debts. Isham who advised a sale, and insisted on the boat being placed in other hands for management, as the only means that would secure or satisfy his firm, knew that Myers was unwilling to sell, but that he desired to make a sham sale. His clerk, without means, is the person to whom the transfer is made, upon the terms which have been stated, and after his hesitation, as Isham says, had been removed bylsham's promise of forbearance and assistance. But Isham took good care to have not only the boat, but also the freight of the first trip in sured for his benefit; while Myers with a greater interest at stake, required no security; took no indemnity; and so far as appears, left the entire arrangement in the hands of Isham and Williamson. And although Isham says Myers proposed to Williamson to buy, it does not appear that he named the price, or the terms; and he certainly exacted no stipulation for his own safety, except for the payment in two years, of a sum which reduced to its value at a discount accordant with the rate of interest on the judgmet against him, was equal only to about $12,000. The arrangement was made to avoid all attachments, and to secure Isham. It was evidently stimulated by his charges of bad management, and his urgency to put the boat in other hands. It was obviously an arrangement for securing through Williamson's management of the finances of the boat, the debts due to the firm of Isham and Fisher; and from which, Myers, if he was not to retain his right to the boat, derived no advantage, unless in saving the boat from attachments against her in his own hands, and in enabling Williamson to appropriate the profits to paying the debts to Isham and Fisher, and such other debts of the boat as he might choose to pay, and in this way to discharge the price to be given for her. And as Williamson in taking charge of the boat was to protect the interest of Isham, so Isham in taking charge of the note for the price, was to protect the interest of Williamson. And he has done so by crediting the note with more than $13,500, under a date preceding by a few days the commencement of this suit; but which from his own statement, was probably not in fact done until after the suit was brought, and upon such evidences of payment, though satisfactory to himself, he did not retain, and does not produce in giving his deposition. That the credits were to be made up between him and Williamson, is of a piece with other features of the transaction, which go to show that this was a case of confidence, and not a real bargain in which adversary interests are asserted, and to be protected or guarded against. And it is to be observed that even Williamson, coy as he was about assuming the responsibility until encouraged by Isham, never visited the boat for the purpose of inspection, nor even enquired into her precise condition or suitableness for being put into the business of the season. Is it to be presumed that a poor man about to incur a real responsibility to the amount of five times the value of his whole estate, would make no enquiry into the condition and value of that which was to be the consideration of this responsibility? If it is to be presumed that he knew the condition and value of the boat, may it not with equal reason be presumed that he knew the condition and purposes of the owner, who was proposing a transfer; and that he knew the objects of his own employer, who took so prominent apart in cuasing it and carrying it into effect? If, as may be assumed, he knew with reasonable certainty the value of the boat, he knew that the price which he agreed to pay, and in the mode fixed on, was greatly below the real value; and in fact scarcely more than nominal in comparrison with it. Did he suppose that such a bargain was proposed or agreed to by Myers, merely out of kindness to him? Did he not know that the proposed transfer, was intended to evade the remedy of the creditors of Myers, to satisfy and secure Isham and Fisher, his own employers, and to aid Myers by applying the profits of the boat to the payment of his debts? That it was so intended by Myers, and that Isham knew it, is absolutely certain. Isham does not even say that the transfer was intended to be real, or that he himself considered it to be so. And if it could be doubted whether Myers disclosed his purpose to the person chosen to effectuate it, or whether Isham, who also had an object to be effected by the same instrument, did not put him in possession of what he knew on the subject, still, the conduct of these parties, and the nature and circumstances of the transaction itself, were such as must have apprized him of its real character and objects. Res ipse loquitur. And to suppose that he really did not know that the sale to him, whether originally conceived of and proposed by Myers or not, was to be but a sham, intended to effectuate the objects above mentioned, or at any rate the two first, is to suppose that he wilfully closed his eyes and mind to circumstances fully within view, and to their palpable and certain indication. We cannot suppose this. But assume that he did know that the sale was intended to be a sham, and an obstruction and hindrance to creditors; and that as he became a party to it without necessity, the presumption is that he concurred in it. But whether he intended it to be a sham sale, or whether knowing it was so intended by Myers, his own intention from the first was to take advantage of its form for his own benefit, and to the injury of Myers, is immaterial. Having without necessity or excuse, aided Myers in a disposition of his property, fraudulent as to his creditors, they have the right if he has not, to go behind the form and expose, and take advantage of the real character of the transaction: which, if it had really been intended by both parties to be an absolute sale, was such a one as Myers in justice, to his creditors had no right to make.
The evidence discloses many particulars, bearing for or against the conclusion which we have stated, but preponderating decidedly, as we think, in favor of it. We need not encumber this opinion with a detail of them, but merely add, that if this sale is to be sustained, it would evidently have been much better for Myers to have permitted his boat to be attached and sold when she was newly repaired, and would, as the subsequent sale and other facts prove, have brought a much better price, payable in a short time and well secured; and it is not to be forgotten in considering the intent of the transfer, that while the absolute bill of sale acknowledging payment of a price which though low, might not, if actually paid, have been evidence of fraud-, no part of the price was in fact paid, and the real terms of the transfer, so grossly misstated, were not only not made public, but in fact kept private and concealed.
Wherefore, the judgment dismissing the petition is reversed, and the cause remanded for a judgment giving to the plaintiffs the proceeds of the sale of the boat.