Court Opinion

ID: 7275628
Source: CourtListenerOpinion
Date Created: 2022-07-25 19:59:04.97923+00
Date Added: 2024-06-11T16:18:50.887199
License: Public Domain

Mr. Justice Shepabd,
dissenting:
I regret my inability to concur in the disposition made of this appeal. I cannot escape the conclusion that the decree should be reversed instead of affirmed, and deem it proper to give some of the reasons which have influenced my judgment.
Joseph W. Parish had no visible property subject to execution for debt. His only means seem to have consisted of claims against the Government, dependent upon favorable action by Congress. He was certainly in debt and insolvent early in 1876, and I think it fairly presumable that he was so at an earlier period. He had an invalid wife, two sons whose ages are not given, and a daughter, the defendant Emily E. Parish, who was born in September, 1857. What business the said Parish was engaged in, or by what means he maintained his family from 1875 to 1886 nowhere appears in the record. In May, 1886, under an appropriation made by Congress, he received from the Treasury something over $56,000; in May, 1889, he received about $18,500. It is evident that large amounts of these payments went to associates and attorneys. How much Parish retained is unknown, as two of his attorneys, on objection made by defendant, declined to answer concerning the transactions and he himself did not appear as a witness. Prior to May, 1886, several judgments had been recovered against him in the courts of the District, upon which executions had been returned unsatisfied. Some"of these judgment creditors, suspecting that the house and lot in controversy had been purchased with the money of Parish and for his benefit, filed the original bill in this cause on May 12, 1892, to subject it to their demands. The lot with the house upon it was conveyed by Gist and wife to Jonas H. McGowan, October 25,1887, and stood in his name *224upon the records until after the bill was filed. In June, 1886, Parish delivered to his daughter $5,000 of the collection made from the Government, of which she gave $4,500 to McGowan to make the cash payment on the purchase of the property. The remainder of the consideration, $2,000 with interest, was paid in 1889, out of the $18,500 coilection referred to above. McGowan conveyed the property to Emily E. Parish in 1889, but the deed had not been recorded at the time the bill was filed. These facts made a prima facie case of fraud as to creditors, which said Emily E. Parish, in my opinion, was called upon to overcome. A voluntary gift or advancement to her under such circumstances would not be sufficient; consequently it became her duty to show that the transaction was upon a good and valuable consideration. As regards the making of the contract itself, she occupies the situation of one who buys from a fraudulent debtor, or contracts with him for property which might otherwise be subjected to the demands of his creditors. In this relation she ought to show not only that the contract was made upon a valuable consideration, but also that it was without notice of the fraudulent intent on his part. To this extent, in my opinion, the burden of proof was clearly upon her. 1 Bigelow on Frauds, 130-2; 2 Id. 487; Brown v. Cactus Hedge Co., 64 Tex. 396 ; Hough v. Dickinson, 58 Mich. 89.
It will be remembered that for more than ten years this contract remained in force without an accounting under it. Not one dollar had ever been demanded or received upon it.
Under all the circumstances of the case, I am of the opinion, that in claiming to have received the money in part discharge of the debt attempted to be created by this contract, she is charged with the burden of proving the fairness of the transaction by which she alone of all the creditors obtained payment from the insolvent. In other words, having received the money in the payment of a debt, it became her duty to prove, with reasonable satisfaction, that *225she did so in the attempt to collect dues under a contract the continuing validity and obligation of which she maintained, and the collection of which she made as a bona fide creditor merely, and not to assist she debtor in an attempt to defraud other creditors. Klein v. Hoffheimer, 132 U. S. 367, 376 ; Clements v. Moore, 6 Wall. 299, 315. I think the defendant has wholly failed to make out a defense.
Joseph W. Parish answered the original bill under oath, though the same had been expressly waived, and made the following statement concerning the purchase of the property : “ The purchase money and consideration for said real estate was the private means of the said Emily E. Parish, said money being by her earned as the result of her own labor after she became of age, and your respondent had no interest therein whatever and no claim therefor.”
In her answer to the amended bill, Emily E. Parish said: “She did receive a certain sum of money from her father, being the fund or part of the fund with which said property was purchased, but she says said money was due her by virtue of a certain contract or agreement set out in the answer of said J. W. Parish.” It will be observed that the nature, terms and conditions of this contract wrere not stated. These were only elicited by the examination of the said Emily E. Parish. She said that in September, 1875, her father promised to support her and pay her $50 per month for remaining with him and caring for her mother, who was afflicted with some heart trouble. She was then eighteen years of age, and was of the impression, and so remained, it would appear, until her examination, that she was then “of age,” in the legal sense of the word. Subsequently she was recalled on her own behalf, and gave the origin of this contract as follows: “ I wanted to obtain employment in one of the departments, and wrote an application and gave it to my father. Through his influence I thought he could secure me a place; and he told me that he would rather I would not do anything of the kind, but *226stay at home, and attend to my mother and the house, and he would give me $50 per month and my support. I then decided to accept his agreement, and gave up all intention of ever trying to obtain employment in the departments, and I devoted myself to my mother and my home duties.”
In my opinion, the foundation for this contract does not strengthen defendant's case. Here was a daughter, lacking three years of the attainment of her majority, whose natural duty it was, especially under the circumstances, to remain with her family. Yet she proposed giving up the care of her mother, and the management of the household for employment in a Government office, and was only induced to remain by the promise of no inconsiderable pecuniary reward. The contract was apparently made as between strangers; no sentiment seems to have entered into it. Notwithstanding this, no arrangement seems to have been made to secure the payment for the services either by month or year. She performed her part of the contract faithfully for more than ten years before one dollar was ever paid her. No accounting was ever had, and no attempt seems ever to have been made to collect even a portion of her dues during this period. The business part of the transaction was confined exclusively to the making of the-contract. In June, 1886, her father turned over to her $5,000 out of funds collected from the Government. At this time, counting the three years of her minority, the salary due her amounted to about $6,400. Excluding these years, it would amount to about $4,600. I concur, without question, in the proposition that á father, though insolvent, may emancipate his minor child, and that his creditors would have no right to subject her earnings to the payment of their demands. Any other doctrine would savor of human slavery. But I do not agree that he can first emancipate a child from the performance of a proper and necessary service to himself, and then immediately contract with the same child for the same service at an arbitrary price, and *227devote to its payment money that ought to go to his creditors. Dick v. Grissom, 1 Freeman, (Miss.) 428. If he could contract to pay $50 per month, why not $100 or more?
There is no proof with respect to the reasonableness of this contract. Viewed as a contract for personal services between party and party, the compensation would seem to be very liberal, still it is not so great as to shock the conscience at a glance. The possibility of such contracts with children, either before or after majority, is enough to suggest that they cannot be left to the will of the makers thereof, but must be matters of inquiry and revision by courts of equity, in the interest of justice and fair dealing.
I pass now to the consideration of some other features of the case. Four thousand five hundred dollars of the money so disposed of was invested in the house and lot. The vendors, Gist and wife, conveyed the property to Jonas H. McGowan, October 25, 1887, for $4,500 in cash furnished by defendant, and $2,000 in notes secured by trust deed thereon. In her statement of this purchase, Miss Parish testified that McGowan purchased the property before she purchased it of him, and that he did not purchase it for her. She further said that he bought on condition that she might have the property if she liked it; if not, he would keep it. That she looked at the house, liked it, and then bought it of McGowan, giving him $4,500 in cash and notes for $2,000. Ilis contract with her for sale at this price bears date November 18, 1887. She further stated that McGowan bought for himself; that she had no conversation with him before he did so; and explained that when she had said that he bought upon condition that she might have the property if she liked it, she had used the wrong word.
McGowan, however, testified, that Miss Parish came to him, told him she had $4,500, and wanted to buy a house at from $6,000 to $7,000, if she could arrange for the difference. He said to her: “ Find some place that you think will be satisfactory to you, then see me again, and I will do *228what I can to help you.” The reason he gave for the purchase in his own name for her is: “ Because Miss Parish, said: ‘ I have not money enough to pay for this; I will want more money than I have, and do not know how to take care of this margin.’ She said to me: ‘ I do not want to get into any scrape with my father’s creditors; he is always getting into scrapes, and unless I have a clear title to this home of mine, I may be entrapped by some of father’s creditors in some way.’ ” McGowan was her father’s attorney in some of his claims, and furnished him desk room in his office.
I can readily appreciate the motive for keeping the transaction concealed from these troublesome creditors. It is consistent with that which I conceive tó be the purpose of the whole transaction. But I am unable to perceive why her inability to pay all the purchase money in cash would be any reason for using the name of McGowan instead of her own, for it does not appear that the personal liability of McGowan was any part of the consideration to the vendors, or that they were not perfectly content with their lien after receiving $4,500 in cash. In this connection it may be remarked, too, that neither the contract with McGowan, nor his deed to her when she completed the payment, was recorded. The entire Parish family moved into the house, lout there was nothing to indicate that they were not tenants of McGowan, instead of owners of the property. The failure to record the deed may have been through carelessness as claimed, but the omission to do so was very much in the line of the wish to “ avoid scrapes ” with creditors.
Shortly after the purchase of the house it was repaired, at the request and upon the order of Parish, by the consent and in the name of McGowan. The cost of repairs seems to have been from $600 to $700, and was paid by Parish himself. Miss Parish had nothing to do with it, and could not tell the cost. The father also kept the taxes paid up. How much he thus paid she could not tell, for it appears that *229there had still been no accounting whatever between them. McGowan testified that he collected, as attorney for J. W. Parish, in May, 1889, $18,500 from the Government; but upon suggestion of defendant’s counsel, refused to disclose what amount of this he paid over to Parish. He explains the payment of the lien on the house out of this fund as follows: “ I called Mr. Parish’s attention to the matter, and said to him: 1 Now, you admit that you owe this girl money, and this money is in my hands; you had better authorize me to pay these notes from the money in my hands now,’ and he said, ‘ Go ahead and do it.’ ”
Altogether, defendant received from her father $7,000 in cash, about $600 or $700 in repairs upon the house, and the taxes for a number of years. By leasing the house to him for a residence at a liberal sum, she could, with her continuing salary, make- a safe depository for other large collections which he might make at subsequent periods.
In arriving at my conclusion, I do not find it necessary to say that this extraordinary contract was not made in September, 1875, as alleged, or that it was concocted as late as 1886 or 1887, when the purchase of the house was contemplated. What I do maintain is — granting it was actually made as claimed — that it was not conceived in good faith, but was devised by an insolvent debtor, in anticipation of the receipt of the money from the Government, as the best means through which it could be kept from the grasp of his numerous creditors.