Court Opinion

ID: 6233388
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:27:02.572597+00
Date Added: 2024-06-11T08:57:56.208480
License: Public Domain

The opinion of the court was delivered, January 4th 1869, by
Williams, J.
¡An actual and continued change of possession is essential to the validity of a voluntary sale of chattels as against creditors. If the possession is retained by the vendor, or if the delivery is merely formal and constructive, the sale will be regarded as fraudulent in law, without reference to the intent of the parties. But if there has been an actual and continued change of possession, the court cannot pronounce the sale fraudulent in law, but must leave the jury, whose province it is, to determine whether or not it is fraudulent in fact.
What then constitutes such a change of possession as the law requires in order to prevent the sale being declared fraudulent ? Undoubtedly the vendor must deliver to the vendee the possession of the property in order to consummate the sale, and render it valid as against creditors. The delivery must be actual, and such as the nature of the property or thing sold, and the circumstances of the sale will reasonably admit, and such as the vendor is capable of making. A mere symbolical or constructive delivery, where an actual or real one is reasonably practicable, is of no avail. There must be an actual separation of the property from the possession of the vendor at the time of the sale, or within a *467reasonable time afterward, according to the nature of the property: Barr v. Rietz, 3 P. F. Smith 268.
But is it essential to such separation that the property shall be removed from the vendor, or the vendor from the property, so that there shall be an actual and visible separation between them, measurable by space or distance ? Must the vendor absolutely cease to have any connection or contact with the property after its delivery, not as owner, but as the agent or servant of the vendee, on pain of having the sale declared fraudulent ? To hold this would be going beyond the established doctrine of our own decisions, and the reason and requirements of the law. Separation of the property from the possession of the vendor implies nothing more than a change of the vendor’s relation to it as owner, and consists in the surrender and transfer of his power and control over it to the vendee.
But in order to prevent fraud the law requires that this shall be done by such appropriate and significant acts as — if done in good faith — shall clearly show the vendor’s intention to part with the possession of the property and transfer it to the vendee. And these acts must be so open and manifest as to make the change of possession apparent and visible. If there are such palpable tokens and proofs of the vendor’s surrender of his dominion over the property as owner, and of the transfer of his possession to the vendee, the sale will not be declared fraudulent in law, although the vendor may act as the agent or servant of the vendee in the management and disposal of the property, provided that his acts are professedly and apparently done, not as owner, but as the agent or servant of the vendee, and are so understood by those with whom he deals. If the change of possession is otherwise sufficiently shown, the mere fact of such agency is not, and never has been held to be, such a badge of fraud, or evidence of retained possession, as to render the sale invalid.
In the case before us the evidence of the sale and actual delivery of the goods was positive and uncontradicted. The vendors, Billingsley & Patterson, were engaged in mercantile business in Oookstown, and, on the 7th of March 1867, they sold their stock of goods to the plaintiff, and on the 9th of March, after the completion of the invoice, they delivered to him the possession; and at the same time he paid them part of the price in cash, and gave them his note at six months for the residue, which was paid at maturity. The goods were invoiced at Pitts-burg wholesale prices, including cost of carriage.
Notice of sale and change of possession was given by advertisements put up on the door of the store, and in at least two other public places in the town or borough; and personal notice thereof was given to all the creditors of the firm in Pittsburg. Immediately after the sale the plaintiff took possession of the store, and *468began to conduct tbe business in his own name and on bis own account, and continued to carry it on for a period of ten months, when, in January 1868, tbe sheriff seized and sold bis stock of goods upon tbe defendants’ execution as tbe property of Billingsley & Patterson.
There was positive evidence that tbe advertisements giving notice of tbe sale were seen and read, and that it was known that tbe plaintiff was carrying on tbe business. Tbe fair and reasonable inference from all tbe evidence is, that tbe sale was well known in tbe community, and that tbe customers of tbe firm, who dealt with tbe plaintiff after tbe sale, knew that be was carrying on tbe business in bis own name, and apparently on bis own account. There was not a particle of evidence tending to show that either Billingsley or Patterson, after tbe sale to tbe plaintiff, ever bought or sold any goods, or did any other act professedly or apparently in tbe name of tbe firm, or that either of them bad any connection with tbe plaintiff’s business, except as bis agent or employee.
Patterson rented a field and went to farming, but because be sold a few goods in tbe store after tbe sale to tbe plaintiff, and Billingsley acted as plaintiff’s clerk or salesman under a contract of hiring, tbe court declared there was no such evidence of delivery or change of possession as tbe law requires, in order to render tbe sale valid as against creditors. Do these circumstances, then, in connection with tbe other facts of tbe case, constitute such a badge of fraud, or evidence of retained possession, as to render tbe sale fraudulent in law ? They would undoubtedly be sufiicient to avoid tbe sale if they bad tbe effect of rendering the possession of tbe plaintiff doubtful or ambiguous. But if they did not, why should tbe sale be declared fraudulent ? If no one was misled, or deceived by tbe conduct of tbe parties, if their relations to each other and to tbe goods in question were well understood by those who dealt with them after tbe sale, and if their acts and declarations, accompanying and following tbe delivery, furnished such evidences of an apparent and actual change of possession as to satisfy tbe community, why should not these evidences be sufficient to satisfy tbe requirements of tbe law ?
If those who dealt with tbe plaintiff after tbe sale bad no doubt in regard to tbe character of bis possession, why should tbe law regard it as doubtful or ambiguous ? If Billingsley’s acts and declarations as a salesman bad been such as to leave it doubtful whether be was acting as owner or agent, then bis presence and connection with tbe goods would have been such evidence of retained possession as to render tbe sale fraudulent. But if bis acts and declarations were professedly and apparently those of a mere agent, and were so understood by tbe parties with whom be dealt, as all tbe evidence tends to show, then they constituted no *469such badge of fraud or evidence of retained possession as would justify the court in declaring the sale fraudulent.
The facts of this case are wholly unlike those in the case of Milne, Brown & Co. v. Henry, 4 Wright 352, and kindred cases. In the case cited the evidence did not show any change of possession whatever. The vendor carried on the business after the sale precisely as he had done before, with the same clerks and the same books. The purchaser’s name did not appear in the books except in one or two instances, where he was charged with some goods. He was not engaged in the store, nor did he have any direction of its business. It was therefore a clear case of retained possession.
In the case before us all the evidence tends to show that the goods were actually sold and delivered to the plaintiff, and that he remained in possession of them,- conducting the business in his own name for ¿a. period of ten months, without any doubt or question in regard to his ownership or possession. If the sale was not fraudulent in fact, which is a question for the jury, the evidence did not show such a case of retained possession, or a possession so doubtful or ambiguous, as to render the sale fraudulent in law.
Judgment reversed, and a venire facias ■de novo awarded.
Read and Sharswood, JJ., dissented.