Court Opinion

ID: 6235524
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:31:38.116343+00
Date Added: 2024-06-11T08:58:02.320856
License: Public Domain

Mr. Justice Woodward
delivered the opinion of the court,
It is not apparent how any hazard of mistake or injury was incurred by the permission given to recall Frank P. Day for cross-examination. He was the subscribing witness to the agreement between Reynolds, Brinks and Baldwin, and the question put to him was, whether or not payment of part of the consideration for the agreement was made at the time of its execution. In regular order, the cross-examination should have been closed before the paper was read, but its admission or rejection could have been in no manner controlled by the new evidence. Offered at any stage of the trial, the effect of the paper would not be changed. The whole subject was within the discretion of the court.
■ At the very foundation of the case of the plaintiffs, in their attempt to fasten a fraud upon Reynolds and Baldwin, was the allegation that the sum of $2888 had never been advanced by Baldwin, and that the claim for it was fabricated and baseless. Surely it was competent to show by Brinks that the fact of such an advance had not been made known to him up to the time when he bound himself conditionally to pay it in the agreement that was executed on the 29th of October 1873. It was a fact illustrating the relations and conduct of the parties, and was relevant and competent, if there was any relevant and competent testimony throughout the causp, to sustain the charge of fraud.
Nor are the objections better founded that have been made to the portions of the charge set out in the fifth, sixth and seventh assignments of error. The jury were instructed in substance that an alleged fraud must be established either by direct proof or by facts to warrant a presumption of its existence clearly and conclusively proved. They were instructed also that if the assignment to Baldwin was made for the purpose of hindering and delaying the creditors of Reynolds, that fact, as against the plaintiffs, who were contesting creditors, would be fatal to its validity. This was in accordance with recognised authority. Lord Mansfield said, in discharging a rule for a new trial in Cadogan v. Kennett, 2 Cowper 432 : “ If the transaction be not bona fide, the circumstance of its being done for a valuable consideration will not alone take it out of the statute. I hav'e known several cases where persons have given a fair and full price for goods, and where the possession was actually changed, yet being done for the purpose of defeating creditors, the transaction has been held fraudulent, and therefore void.” And it was ruled in Ashmead v. Hean & Moulfair, 1 Harris 584, *252that a conveyance of real estate, made with the intent on the part of the vendor, known to the vendee, to delay, defeat and hinder a particular creditor from obtaining his debt, though made for a valuable and full consideration, is, as against such creditor, fraudulent and void.
In reality, there is but a single significant question in this cause. Was there any evidence of the existence of a fraudulent combination legitimately entitled to the consideration of the jury ? On the 2d of October 1872, A. H. Brinks, the garnishee and defendant below, entered into a written contract to grade sections 6 and 7 of the track of the Columbia and Port Deposit Railroad Company. One-sixth of the money earned was to be retained until the completion-of the contract. On the 9th of January 1873, J. B. Reynolds entered into a sub-contract with Brinks to grade part of section 7. Brinks was to receive as his profit on the sub-let section one-half of the one-sixth of the estimates retained. Although the contract was executed in January, Reynolds did not begin his work until May 1873, and until that time, and indeed until the 1st of July following, remained in the service of the Union Railroad Company in Baltimore at a salary of $100 a month. The work was carried on by him until October 1873, when his funds were exhausted, and he had fallen into debt, Heise & Kauffman, the plaintiffs below, who had furnished him with powder, fuse and other materials, being among his creditors. In that month Reynolds, Brinks and Baldwin met in Philadelphia. In the course of a conversation between them, Reynolds told Brinks that if he had $1000 he could pay off all his debts and go on with the work without any trouble. Brinks replied that.he “should not stick for $1000.” And Baldwin then remarked: “ If you haven’t got the money, I have got money in bank, and I will lend it if you will endorse or stand good for it.” Reynolds and Baldwin went to Baltimore, and a few days afterwards Reynolds returned with a note for $3888 instead of $1000. This note Brinks refused to sign. Then the agreement of the 29th of October 1873 was executed, by which Brinks bound himself to pay Baldwin $1000 absolutely, and $2888 (recited as “ having been borrowed at previous dates”), provided that amount should be due to Reynolds on the final estimate for his work under the contract. The plaintiffs obtained their judgment against Reynolds on the 8th of December 1873, and issued an attachment against him making Brinks garnishee on the 6th of February 1874. A new arrangement, of which the plaintiffs were informed and to which they agreed, was the consequence of this attachment. Reynolds was to continue working, and Brinks was to receive the .estimates and pay the wages of the men, the necessary charges for materials and Reynolds’s personal expenses. At the completion of the contract, the balance due Reynolds, if any, was, according to the testimony of Brinks, “to go to, or for the *253benefit of the creditors, whoever were entitled to it.” The balance found due in the end was $2978.96.
In the course of the trial it was ascertained that no notes or receipts had been given for any of- the sums of money which, it was alleged, Reynolds had received from Baldwin. The dates and amounts were obtained from a small memorandum-book, on one page of Avhich they had been entered in pencil, and it Avas contended that their appearance indicated that all the entiles had been made at one time. Tayo sums of $500 each were charged before Reynolds’s work under the contract was begun. Advances to the amount of $2500 were charged before he relinquished his position as superintendent of the Union Railroad Company. Nothing was said of these advances in Philadelphia, when Reynolds’s need of $1000 to pay his debts and complete his contract was explained. Brinks knew nothing of Baldivin’s claim until Reynolds brought the note from Baltimore. And no notice Avas given to the plaintiffs of the existence of that claim Avhen they were informed of the modification of the contract betAveen Reynolds and Brinks. They AYere encouraged to, suspend proceedings on their attachment by the assurance that any balance that should eventually be found due to Reynolds should “go for the benefit of his creditors.” To say the least, the acts of the parties' in this transaction were, in a good many respects, exceptional and peculiar. It is not in the usual course of business to make loans at intervals during a period of six months, amounting to a sum so significant as $2888, without providing some more authentic evidence of indebtedness than a pencil memorandum made by the lender, and remaining undisclosed throughout a protracted negotiation 'for a fresh loan, for which a third person was to be security. What ought to be the effect of the evidence in relation to Reynolds’s statements in Philadelphia ? Was the knowledge of Baldwin’s claim fraudulently withheld from the plaintiffs? Was the Avhole arrangement, which was consummated by the agreement of the 29th of October 1873, a fraudulent contrivance to AYithdraw any balance due Reynolds on his contract from the grasp of his creditors ? These were questions which only a jury could answer. They Avere to weigh the evidence in each detail and as a whole, and adjust its value. It has not been shown that they did not weigh it justly.
Judgment affirmed.