Nugent v. . Jacobs

| NY | Oct 5, 1886

This action was brought to vacate and annul, a conveyance of land made by defendant Grace, to the defendant Jacobs, upon the ground that it was executed and delivered for the purpose of hindering, delaying and defrauding creditors, and particularly the plaintiff in the collection of a debt, owing to him by Grace. The findings of the court below, show that Jacobs paid Grace the full value of the land upon the transfer, but it is claimed by the respondent and was found by the court that the conveyance was nevertheless made and received with the intent to hinder, delay and defraud the plaintiff. The evidence upon which this finding was based was not conclusive or even strongly preponderating upon the fact found, and the erroneous admission or exclusion of evidence was likely to have affected materially the conclusions reached by the trial court.

The payment by the purchaser of a fair consideration upon a sale of property affords strong evidence of the good faith of the transaction, and while not conclusive upon that question requires clear evidence of the existence of a fraudulent intent to overcome the presumption of honest motives, arising from that fact. (Billings v. Russell, 101 N.Y. 226" court="NY" date_filed="1886-01-19" href="https://app.midpage.ai/document/billings-v--russell-3592214?utm_source=webapp" opinion_id="3592214">101 N.Y. 226.) One of the most prominent circumstances from which a fraudulent intent was sought to be deduced, was the execution by Grace, on the same day, but after the delivery of the deed in question, of a chattel mortgage to his wife, conveying such property as he had remaining, after the transfer of his land. This fact was proved upon the oral examination of the alleged fraudulent grantor, produced as a witness for the plaintiff, and although the defendant objected that such evidence was not competent and that the mortgage should be produced, it was allowed by the court. The defendant, upon cross-examination of the same witness, attempted to show what was done with the mortgage after its execution, and the circumstances under which it was given, but upon the objection of the respondent the evidence was excluded by the court, and the appellant excepted to the ruling. We see no ground upon which this ruling can be supported.

The mere giving of the mortgage under the circumstances did not afford conclusive evidence of a fraudulent intent on the part of the mortgagor, and the circumstances under which it was executed, the existence of a valuable consideration therefor, the fact that it was promptly filed in the town clerk's office, and the publicity attending its execution, were all competent and material facts bearing upon the question of intent, and should have been received by the court.

In a case where the evidence is not preponderating on either side, such circumstances should be heard and considered, and we cannot say that injustice may not have been done by the exclusion of the proposed testimony.

For this reason, therefore, the judgments of the General and Special Terms should be reversed and a new trial ordered, with costs to abide the event.

All concur.

Judgment reversed.