28 Iowa 460 | Iowa | 1870
The plaintiffs offered to prove, by a witness on the stand, that he had a conversation with Walters on the Sunday evening before the mortgage was made, and that Walters then stated it was his purpose to defraud the plaintiffs by executing a mortgage to the bank; and also offered to prove by another witness that Walters, immediately after the mortgage was made, declared he did it for the same purpose. To this evidence the record shows that the defendant objected, generally, and the court sustained the objection ; and the bill of exceptions states that the court so ruled, because the plaintiffs did not propose to carry knowledge thereof home to defendant; and further ruled that plaintiffs might give evidence of any act or declaration of Walters showing such intent, which they proposed to bring home to defendant.
Ordinarily, where a creditor assails a conveyance as fraudulent, he must prove the fraudulent intent on the part of the grantor, and that the grantee participated in, or, at least, had knowledge of, that intent. We should hesitate before holding (as the language of the bill of exceptions seems to show the District Court held), that it was necessary to bring home to the grantee, or offer to do so, knowledge of the particular act or declaration of the grantor, showing the fraudulent intent. It might be sufficient to show the grantee’s knowledge of that intent,
But we rest our affirmance of this ruling of the District Court upon the broad ground, that, where two or more bona fide creditors are engaged in a race for priority, the one securing it cannot have his right defeated, and be postponed to a more tardy or less fortunate one, by showing the fraudulent motive, and knowledge of it by the creditor, which prompted the debtor to give such priority. Fraud, in its legal sense, cannot, without more, be predicated upon such a transaction. The evidence, then, which was excluded was immaterial; and for this reason, if for none other, the court ruled correctly in excluding it.
III. The only other error assigned which it is necessary to notice, arises upon the modification and giving of instructions. The District Court held, and modified and gave instructions accordingly, that to accept a mortgage from a debtor, who gave it with the intent, known to the mortgagee, to delay or defraud another creditor, was not void or fraudulent, if the creditor accepted it for the purpose of securing a bona fide debt due such creditor from the mortgagor. This ruling is in accordance with the views hereinbefore expressed, and is
Affirmed.