Court Opinion

ID: 8055879
Source: CourtListenerOpinion
Date Created: 2022-09-09 04:32:38.000118+00
Date Added: 2024-06-11T16:37:50.588830
License: Public Domain

The opinion of the court was delivered at this term by
Kinsey, 0. J.
(After stating the circumstances of the case.)
On the trial of this cause at Nisi Prius, the court charged the jury, that the deed upon which the title of the lessor of the plaintiff rested wTas not fraudulent, from the single circumstance of its being voluntary; but that if the jury should believe that it was executed with a design to defraud honest creditors, or if its operation was to defeat fair claims which might exist against the estate, it was fraudulent.
2. Thai to authorize a recovery against a possession, of at least upwards of twenty years, the plaintiff ought to shew a clear title.
3. That the confession, by an executor, of a judgment by cognovit actionem was an admission of assets, whether real or personal, sufficient to satisfy the judgment.
With regard to the two latter questions, upon which considerable ingenuity has been displayed in the argument, I shall only observe, that in the case of Wright v. Hartshorne, decided in this court as early as 1756, it was settled on *558demurrer, that real estate was assets in the hands of an administrator, for the payment of debts; this doctrine has been uniformly recognized and practiced.under since.
The principal question, then, which remains to be considered, is, whether the deed from Little, to his daughter and grandchildren, was fraudulent and void, as against creditors under the statute of 13 Elizabeth, from the circumstance, that the grantor was indebted at the time of its execution ? If this question be decided in the affirmative, the verdict in favor of the defendant must stand.
Fraud, under our law, is either express or a legal inference from circumstances. The true doctrine which is now recognized in our courts, so far as it bears upon the present question, may be gathered from two cases decided in the Court of Chancery, by Lord Hardwicke.
In the case of Russel v. Hammond, 1 Atk. 13, that enlightened judge holds the following explicit language, “ there are many opinions, that every voluntary settlement is not fraudulent; what the judges mean, is, that a settlement being voluntary, is not for that reason fraudulent, but an evidence of fraud only. Though I have hardly known one case in which the person conveying, is indebted at the time of the conveyance, that has not been deemed fraudulent ; there are, to be sure, cases of voluntary settlements that are not fraudulent, and those are, where the person making is not indebted at the time, in which case subsequent debts will not shake such settlement.”
In Townshend v. Windham, (2 Vesey. 10, 11,) after a lapse of several years had allowed him time to examine and weigh his former determinations, and to measure with precision the doctrines which he had promulgated, he holds language of, if possible, a still more decided character. “ There is no case where a person indebted, makes a voluntary conveyance of a real or chattel interest for benefit of a child, without the consideration of marriage or other valuable consideration, and dying indebted afterwards, that *559that shall take place.” “ I know no case on the 13 Elizabeth, where a man indebted at the time, makes a mere voluntary conveyance to a child without consideration, and dies indebted, but that it shall be considered as part of his estate for the benefit of his creditors.” “ A man actually indebted, and conveying voluntarily, always means to be in fraud of creditors, as I take it.” (See Den ex dem. Chews v. Sparks, ante, vol. I. 56.) In Twine’s case, Rep. 80, in which the leading doctrines upon this point are laid down, it is held, that natural affection is not a sufficient consideration to give validity to a grant as against creditors; the consideration must be a valuable one.
These cases fully establish the point, that a conveyance may be legally fraudulent and void, though there is no dishonesty in the mind of the grantor; and although a deed is not deemed fraudulent, from the single circumstance of its being founded solely on consideration of natural affection, yet the principle, that a voluntary deed, made when the grantor is indebted, is invalid as against such creditors, is recognized by numerous authorities, sanctioned by the ablest judges, and questioned by none. This I consider as the settled law, and it is built upon this ground, that no man shall bo permitted to create an estate in his own family, and among his own kindred, at the expense of his creditors.
The case of Cadogan v. Kennet, reported in Cowper, does not appear to me, when carefully examined, to controvert this doctrine. Lord Mansfield’s language, when taken together, is not at variance with that of Lord Iiardwicke, and if it was I should feel no inclination to give it the preference. He says in that case, “ the circumstances of a man being indebted at the time of his making a voluntary conveyance, is an argument of fraud.” Compare this language with that held by the same eminent judge in page 711 of the same book, in the case of Doe v. Routledge, where he *560says, “ one great- circumstance, which should always be attended to in these transactions, is whether he was indebted at- the time ? If he was, it is- a strong badge of fraud.”
I agree with Lord Hardwicke to the full extent of his language, that to give away an estate without making provision for the payment of debts, is a fraud, which it is the duty of all courts to suppress : I will go further, and declare it to be my opinion, that "whenever an attempt of. this kind is made; whenever a creditor can discover property which has been conveyed under such circumstances, it is unreasonable to require of him, nor can he be called upon to make any examination or inquiry in order to ascertain whether •other property has descended to the heir which might be sufficient to satisfy his claim. S.uch a deed is not only voidable, upon proof that there is no other, or not sufficient property, but it is absolutely void.
Viewing the case, therefore, in this light, I consider the charge of the court at the trial as even more favorable to the plaintiff than the law warranted, and therefore he has no right to complain. I should have felt myself constrained to have told the jury, that as the grantor ■ conveyed the estate while a claim existed against it, and died without satisfying the'demand, .the-deed was'absolutely void; not that these were circumstances from which they might infer fraud:
I have omitted-every'observation upon the question of actual fraud. This rests altogether upon circumstances, which, whether -they furnish conclusive or probable proof of a dishonest intention or not, depends so much upon the • characters of the parties, and is so completely a question of fact for. the decision of the jury, that I will not venture to intimate an opinion.
On the other grounds,, however, I am of opinion that a new trial ought not to be granted.
Rule discharged.
*561Note.—Lord Tlmrlow in the case of Stephens v. Olive, 2 Br. C. C. 90, recognized the doctrine of Lord Hardwicke, and it has since been confirmed in Glaister v. Hewer, 8 Ves. jun. 99. Kidney v. Coussmaker, 12 Ves. jun. 136. Some of the difficulties in the way have been removed by the judicious restrictions stated in Lush v. Wilkinson, 5 Ves. jun. 384, where it is said that it is not sufficient that the grantor is indebted at the time of the conveyance; a single or an inconsiderable debt is not enough; every man must be indebted for the common bills of his house, though he pays them every week. It must depend upon this, whether he ■was in insolvent circumstances at the time. If, however, the limitations introduced by this ease are necessary and equitable, so is the extension which has been given to it in another direction, in the ease of Montague v. Lord Sandwich, cited 12 Ves. jun. 148. 156, note, in which it was held that if the conveyance is void against creditors whose claims existed at the time of the grant, and has been set aside as to them, subsequent creditors are let in. 1 Schoale & Lefroy 156. See Osborne v. Moss, 7 John. 161.*
With regard to another question which was argued by the counsel, though not expressly noticed by the court, viz : whether á confession of judgment by an executor is conclusive against the heir of the real estate, it is one which can derive little illustration from English cases. In the case of Masons devisees v. Peters’ administrators, 1 Munf. 437, in the state of Virginia, it was held that a judgment against the executors only, is no proof against the devisees of land; for there is no privity between an executor and the heir or devisee of land, however it may be between an executor and a legatee of personals. On this last point, Anderson v. Fox, 2 Hen. Munf. 245; Atwell's administrators v. Milton, 4 Hen. & Munf. 253.
*562That- the claim on the estate was, in this case, for unliquidated damages, furnished no ground of objection to-applying the stat-ute of Elizabeth, which ha.s been held to extend not only to the creditors, but to all others who- have, any cause of action or suit, or any penalty or forfeiture, either to the king or subject. Gil. JSq. 29.

 See 2 John. Ch. 48. 2 Ib. 500, 501. Wharton’s Dig. 291. Lessee of Ridgeway v. Underwood,