Court Opinion

ID: 7208383
Source: CourtListenerOpinion
Date Created: 2022-07-24 17:18:20.740486+00
Date Added: 2024-06-11T16:16:44.870469
License: Public Domain

Martin, J.
The defendants Barber and Kerrison, are appellants from a judgment which sets aside, as far as it concerns the plaintiff, a transfer of property made to them by Stephens, their co-defendant, on the ground that it was a dation en payement, which the insolvency of Stephens prevents from taking effect to the injury of his creditors. They urge that the District Court erred, as the petition does not complain of the apparent sale as a dation enpaiement, and alleges only a simulation and fraud for the purpose of covering the vendor’s property; that the court pronounces in favor of the defendants on the allegation of fraud, but annuls the transfer as a giving in payment, which was erroneously done, as the defendants were not called upon by the petition to establish the solvency of the transferor, and, in regard to his insolvency, the onus probandi was on the plaintiff. They further allege that the solvency was proved, and if the in solvency had been, the transfer ought not to have been set aside in tato, and the sale should have been supported for that part of the price which was actually paid in cash and notes.
They complain that the court erroneously struck out from their answer a plea in compensation, grounded on a claim of Stephens against the plaintiff, which was disregarded, because urged by the claimant after judgment against him, these appellants contending that they are entitled to avail themselves of this claim in order to increase the assetts of Stephens, and repel the charge of his insolvency, especially as the amount of Stephens’ claim entitled him to a balance by reconvention. Lastly, interest is complained of as allowed on the plaintiff’s claim, which was unliquidated.
On the first point, that of simulation, we are of opinion that its existence may be shown by proving that a dation en paiement was the object which the parties had in view, and which they conceived by carrying their intentions iuto effect under the ap*494pearance and form of a contract of a sale. There are two sorts of simulation: one, when a contract is simulated while the parties intend that no engagement should take place ; as when a debtor makes a pretended sale of his property with the sole purpose of preventing its seizure by the sheriff, to defeat one of his creditors. Another, is one of those in which a real contract or engagement, which the law prohibits, is intended, but to defeat the ends of justice, the form and appearance of another contract is resorted to ; as where an insolvent debtor, with a view to favor one of his creditors, gives him part or the whole of his property in payment, and a contract of sale in which the payment and numeration of the price at the time of the contract, in the presence of the notary and witnesses, is stated, even when it is so actually but fraudulently made, as when the creditor pays with money or bills furnished by the debtor, which are immediately after restored. In the latter case, we have no hesitation to say that, under an allegation of simulation, the dation enpayement can be proved. The insolvency was specially alleged, as it was stated to be in the knowledge of the defendants Barber and Kerri-son. The transfer was an entire contract, which could not be partially set aside, as the court had no means to ascertain that portion of the property attempted to be transferred, to which the alleged payments, if allowed, could be applied. As the insolvency was proved, it matters not on what party the onus probandi rested. The appellants offered a sum alleged to be due by the plaintiff to their co-defendant Stephens, and by him pleaded in compensation, alleging that they had a right to avail themselves of it, notwithstanding Stephens had neglected to urge it in time. The court refused to permit them to avail themselves of it. They had, in our opinion, a right to do so, and could not be prejudiced by the neglect of their co-defendant. If they can show a credit, justly claimable by him, the demand of the plaintiff’ must be proportionably reduced, and they are entitled to have the case remanded, that they may have the opportunity of establishing the amount, for which Stephens had a right to compensation, if the plea had been filed in proper time. The view which we have taken of this case, renders it useless that we should act on the part of the judgment which relates to interest.
*495It is, therefore, ordered and decreed, that the judgment be annulled, and the case remanded for a new trial, with directions to the court to permit the appellants to offer evidence of the nature and amount of the sum, by which they pretend the plaintiff’s claim ought to be reduced; the plaintiff and appellee paying the costs of the appeal.