Court Opinion

ID: 6683453
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:31:05.348161+00
Date Added: 2024-06-11T16:00:52.485602
License: Public Domain

The Chancellor :
The object of the bill filed in this cause, is to set aside two conveyances, the one from the defendant Grover and others, to the defendant McColm, dated the 20th of April; and the other dated the 18th of July, 1839, from Grover alone, upon the ground, as to the first deed, that it was made without consideration, and fraudulently to delay, hinder and defraud the creditors of the grantor, Grover, and as to the other, that it was fraudulently made, to delay, hinder, and defraud the creditors of said Grover.
The answer of McColm, with which alone we are to deal, for that of Grover, even if inconsistent with his, could not be read against him, denies the allegations of the bill, and the simple question is, whether the proof offered by the plaintiff, is sufficient, according to the well and long established law of this court, to overcome the answer ?
Some discussion was had at the bar, with reference to the character of that part of the answer, which states how, and in what manner, the consideration set forth in the instruments, was paid. It being insisted upon the one hand, and denied on the other, that the answer, in this respect, is responsive to the bill. The bill alleges, that the deed of the real estate, was vmade without consideration, and fraudulently, to hinder and delay creditors. The answer denies that it was made without consideration, and fraudulently, and then proceeds to state what the consideration was. Now although so much of the answer as states what the consideration was, may not be strictly responsive (a point not intended to be decided) yet the denial of the allegation of the bill, that there was no consideration, is confessedly responsive, and must be overborne by the requisite evidence or must stand for true.
That a consideration was paid for these conveyances, is most clearly established by the evidence; but still it is said, and such appears to be the established law upon the subject, that though made upon a good or valuable consideration, they will not be permitted to avail, if made mala fide. A conveyance, even if for a valuable consideration, is not, under the statute of 13th of *35Elizabeth, valid in point of law, from that circumstance alone. It must also be bona fide ; for if it be with intent to defraud or defeat creditors it will be void, though there may be a valuable consideration. This doctrine was laid down in Twyne’s case, 3 Co. Rep., 81, and as Mr. Justice Story says, has been since steadily adhered to. 1st Story’s Rq. Jurisprudence, section 369. But though a deed made upon a valuable consideration may be successfully impeached, if shown to be made to defraud, or defeat creditors, it is of course indispensably necessary that the fraudulent intent should be shown. It is not a thing to be presumed, but must be proved, and by evidence sufficient for the purpose.
Now, in this case I am not satisfied of the existence of the fraudulent intent. The statement of Grover upon his application for the benefit of the insolvent laws, being excepted to, is clearly inadmissible as evidence against his co-defendant, Mc-Colm, and even if admissible, could not, for the purpose for which it was offered, avail the plaintiff, against the direct and positive evidence of Mr. Mayer, who proves conclusively, that the said defendant could not have had any connection with, or knowledge thereof.
Circumstances here are relied upon, and those circumstances, when ingeniously and skillfully combined, may be made to wear the appearance of suspicion, but I do not find in them, that degree of conclusiveness, which, in my opinion, should induce a court of equity, to take from a purchaser property for which he paid a valuable consideration. The agreement for a reconveyance, upon receiving from the grantor the amount advanced for, and duo by him to, the defendant, McColm, is denied, and not proved, and, therefore, it is not necessary to consider what would be the effect of such an agreement if proved, or admitted. I cannot, upon this record, bring myself to think, that McColm, in taking these conveyances, was influenced by a desire to defraud or defeat the creditors of Grover. He had a perfect right, upon common law principles, and apart from our insolvent laws, to secure himself, and with respect to the real estate, there appears in the case, reasons of special weight, entitling
S. T. WALLIS, J. Mason Campbell, for Complainant,
John Nelson, Charles F. Mayer. for Defendants.
him to that security. The bill, I am of opinion, must be dismissed, but inasmuch as I think it was not brought without some plausible grounds, and perhaps it was the duty of the plaintiff in his character of trustee, to file it, costs will not be allowed.