Carter v. Grimshaw

| N.H. | Dec 15, 1869

Nesmith, J.

If the question in this case, merely involved the validity of the sale of the goods from the plaintiff to the defendant, under the facts as stated by the master, we would be prepared to declare it fraudulent and void, on the ground that the defendant never intended to pay for the property purchased; and that he used misrepresentation, artifice and false pretences to obtain possession of them.

The deceit, or fraud, which makes void the sale of this property, is found in a series of acts, all tending to show a previously concerted contrivance to obtain of plaintiff, goods without the design to pay for them. In addition to the defendant’s false representations, we have the evidence of an inordinately large quantity of goods purchased, in proportion to the regular wants, or purposes of the defendant’s apparent business. Then the goods are not kept, or dealt with in such place, or manner, as to show a fair acquisition for the purpose of an honest, regular business. Then we have the evidence of forced sales at different times, of separate quantities of goods, at a sacrifice, being such as had been purchased on credit, and other conduct, all tending to show the design to evade payment therefor, to the plaintiff, and unjustly to appropriate the avails thereof to the defendant’s use. Hilliard on sales, 334.

The sale of the goods to the defendant, and the declaration and acts done by the defendent in relation to them immediately follow the conveyance of defendant’s real estate to his minor children. Cases are numerous to show, that when the motives and intent of parties to an act, become material, such may be shown by their separate and independent acts and declarations, accompanying or preceding the main act in question.

Generally, in fraudulent conveyances of property, the proof will be limited to similar acts about the same time. Bradley v. Obear, 10 N. H., 477. Blake v. White, 13 N. H., 267.

The deed of the land in this case is without consideration, and is properly denominated a voluntary conveyance. The plaintiff stands as a creditor subsequent to the conveyance in question, and he is therefore subject to a different rule of proof, than an existing creditor would be. A conveyance is not void as against subsequent creditors, unless it be not only voluntary, but collusive and fraudident and made with a view to future debts. 8 Wheaton, Rep. 228. 4 Wendell, Rep. 390. 6 Paige, Rep. 526. Hilliard on sales, chap. 21, § 10, page 343, also, page 352.

So a conveyance, by one not in debt, to his wife* or other relative, of a portion of his estate, is not fraudulent, unless it was made with the intent of becoming indebted. Haskell v. Bakewell, 10 B. Munroe 206.

Judge Story well remarks, that there is nothing inequitable or unjust in a man making a voluntary conveyance or gift, either to a wife ^* or child, or even to a stranger, if it is not at the time prejudicial to the rights of any other person, nor in meditation of any future fraud, or injury to other persons.

If there is any design of fraud, collusion, or intent to deceive third persons in such conveyances, although the party be not then indebted, the conveyance will be held void for it is not bona fide. 1 Story Equity, § 356, and Atherly on Marriage Settlements, 212, cases in note. Hence, he says, the law has widely disabled the debtor from making any voluntary settlement of his estate, to stand in the way of existing debts, and this is the clear and uniform doctrine of the cases. The doctrine laid down by Story, is sustained by the courts in the state ; more especially in Pomroy v. Bayley, 43 N. H., 122, where conveyances of this character are discussed, and just limitations prescribed. Under the rule established by' the aforesaid cases, we cannot find the deed from Grimshaw to his minor children, valid, or as made in good faith, either as to existing, or subsequent creditors, because from the evidence, it manifestly appears to have been made with a view to future indebtedness, and is, therefore, for this reason, fraudulent as to this plaintiff. Again, Grimshaw remains in actual possession and management of one of the houses, as before the deed; then we have here, evidence of the reservation or creation of a secret trust beneficial to the grantor, indicating merely a ficticious transaction, and gaining for the grant- or a false credit, therefore, fraudulent iii its character. Coburn v. Pickering, 3 N. H., 415. Again, the circumstances of this case, seem to lead to the inevitable or inresistable conclusion that the grantor at the inception or time of the delivery of his deed, intended to hinder, delay, or defraud his creditors. The direct tendency of such a conveyance, is to impair the rights of creditors, generally, evincing bad faith, and is pronounced fraudulent per se, or conclusive evidence of fraud. Coolidge v. Melvin, aud cases cited, 42 N. H., 516. Carlisle v. Rich, 8 N. H., 44. Twyne’s case, 3 Coke, 80.

When it appears manifest, that a fraudulent use is -made of a deed of .settlement, it may be carried back to the time when the fraud -was .commenced. 1 Story Equity, § 364. Jackson v. Town, 4 Cowper, 604. Verplanck v. Steney, 12 Johns, 536. Our opinion is, that-the said deed of settlement from Grimshaw to his minor children be declared null and void, and that the decree of this- court ■issue accordingly; and that the guardian ad litem, execute appropriate releases of all right and title, claimed by any or all of said children, and that said lessees be ordered to pay their rents to and for use of plaintiff, &c. The plaintiff, having according to well settled practice in this state, obtained his legal hold of the equity of redemption of the defendant’s estate conveyed to his minor children, by attachment in one of our courts of law, will in due time proceed to remove the other encumbrances existing in the form of mortgages upon said estate according to the answers made, and the evidence furnished to the court. There does not seem now to be occasion, for any special order in relation to these previous mortgages, as they are admitted to be founded in right, and the amount due Cm each, can be readily ascertained and payment made accordingly.