43 N.H. 118 | N.H. | 1861
Various questions arise upon the case, and one of the most important has respect to the instructions given to the jury.
Assuming the instructions prayed for to be substantially correct and applicable to the case, as it stood before the jury, let us see what instructions were actually given, notwithstanding the refusal, in terms, to give what were asked for. The court did instruct the jury, that if the plaintiff’s claim was legal and valid, and a secret trust was reserved, or the purpose was to prevent an attachment upon some claim, whether doubtful or not, then such conveyance was fraudulent and void as to such claim of the plaintiff.
So far, we think, the instructions accord with the prayer of the plaintiff’s counsel, and are not open to objection. As to the further request, in respect to the want of sufficient consideration, the court instructed the j ury that a voluntary conveyance as a gift, or in consideration of blood and affection, the effect of which was to hinder and defraud creditors, would be void as against them ; but when made as a gift or the consideration of blood, by a person not indebted or not in embarrassed circumstances, and when large and ample means were still left in the hands of the grantor, open to be levied upon, known to the creditor, and amply sufficient to satisfy his debt and all other debts of the grantor, the conveyance would not be void, and that the creditor would not be at liberty to pass by the property still retained, and levy upon that so conveyed.
There was no error, we think, in declining to charge‘the jury, in the unqualified form, that the conveyance was void if without sufficient consideration, inasmuch as that naked statement would furnish no guide to the jury without explaining what would be “ a sufficient consideration,” and it would, in fact, be quite likely to mislead them.
The court undertook to explain what would be a sufficient consideration under the circumstances stated, and now the question is, whether there was error in that part of the charge.
The substance of it was that a conveyance of land as a gift, or in consideration of blood, by a person not indebted or not in embarrassed circumstances, but having ample means to pay all the grant- or’s debts, would be good against creditors. If by this it was intended to lay down the broad doctrine that such a conveyance would be good, even if made with the intent to defraud creditors, we think it would be erroneous; because the conveyance must not only be upon good consideration, but bond fide. If not in good faith, but with intent to defeat creditors, it would be void as to subsequent creditors, even though existing creditors had all obtained payment out of property remaining after such conveyance. Was this broad doctrine the one intended ? or was the language likely to be so understood, and so to mislead the jury ? Taken in connection with the preceding part of the charge, to the effect that the conveyance would be void if intended to prevent an attachment, upon some claim doubtful or otherwise, we
The question, then, is, were the instructions correct as applied to a conveyance for the consideration of blood ? To be sure, that consideration is not expressed in the deed, but, under the statement used here of “ $500 and other good causes and considerations,” it is competent to aver and prove the consideration of blood ; and this is not inconsistent with the deed, but stands with it. Such is the doctrine of Mildmay’s Case, 1 Co. 175; Bedell's Case, 7 Co. 40; 1 Phill. Ev. 549; 1 Greenl. Ev., sec. 304; Morse v. Shattuck, 4 N. H. 229; Pritchard v. Brown, 4 N. H. 397; Buffum v. Green, 5 N. H. 71; Graves v. Ticknor, 29 N. H. 144. Here the evidence reported tends to show such a consideration, and it is assumed by the course of the trial to he the defendant’s case. The inquiry then is, whether a conveyance made upon such consideration, by a person not in debt or not in embarrassed circumstances, but leaving in the grantor’s hands large and ample means, open to be levied upon, known to the creditor, and amply sufficient to pay all his debts, is void as against creditors, in a case where no bad faith is shown. In Reade v. Livingstone, 3 Johns. Ch. 481, Mr. Chancellor Kent, upon great consideration, lays down the law to be, that if the party be indebted at the time of the voluntary settlement, it is presumed to be fraudulent in respect to such debts, and no circumstance will permit those debts to be affected by the settlement, or repel the legal presumption of fraud. And he holds further, that this presumption does not depend upon the amount of the debts or the extent of the property in settlement, or the circumstances of the party. To allow any distinction, founded upon such circumstances, would, in his judgment, be embarrassing if not dangerous to the rights of the creditor, and prove an inlet to fraud, and, therefore, no such settlement should be allowed to stand in the way of existing debts.
These views were expressed by Chancellor Kent, as the fair result of the early English decisions ; but it will be observed that most of those cited by him were suits in chancery, where the court had power to determine questions of fact as well as law, and, therefore, might find the fraud from the evidence, when, in a court of law, the finding of a jury would be essential.
It will be observed, also, that in none of these decisions is it held that the fraudulent intent will be conclusively presumed in all cases, however trifling the indebtedness, or inconsiderable the amount of property conveyed; but the presumption is applied to conveyances by parties “ in debt ” or “ indebted ” at the time, in general terms, which, although broad enough to embrace indebtedness of the most trifling amount, by a person of ample means, have hardly the full weight of an authority expressly to the point. See, also, 1 Story’s Eq., sec. 363, n. Indeed, it might be urged very plausibly that these terms were used in the sense of indebtedness to a substantial amount, such as to cause embarrassment, or to such an extent com
On the other hand, the doctrine of Reade v. Livingstone has been discussed very ably by Judge Story (1 Stor. Eq., secs. 358-365, and the authorities cited and examined ); and he is evidently of the opinion that, in the case of a voluntary conveyance, a mere indebtment does "not per se render it void, even as to existing creditors ; and we think that this opinion is sustained by the authorities. And Chancellor Kent (in 2 Com. 442, note a), in referring to this examination of Judge Story and the opinion suggested, says he has no doubt that this is the tendency of the decisions, both in England and America, and that the conclusions of fraud are to be left as matters of fact to a common jury. And he further says that “ the docti’ine in Reade v. Livingstone, and of those English chancellors on whom it rested, is, as I greatly fear, too stern for the present times.”
Upon the whole, we are inclined to the opinion that a voluntary conveyance, for the consideration of natural love and affection, made by a person not embarrassed at the time, but retaining ample means to'pay all his existing creditors, is good, unless it be made to appear that such conveyance was not bond fide. Whether it was bond fide or not is a question of fact depending upon all the circumstances of the case, such as the l'easonableness of the provision, the extent of the indebtedness, the nature and sufficiency of the fund retained to satisfy such debts, and other circumstances bearing upon the motives of the conveyance.
It is true that, under cover of family settlements, fraud may sometimes lie concealed and creditors be greatly embarrassed; but, in the experience of courts of justice, it has not been found so generally true as to cause the establishment of a rule so stringent as to hold such settlements fraudulent in all cases, as a judgment of law, where the grantor was indebted to any amount, however trifling it might be. The case of secret trusts, by which a beneficial use is reserved to the grantor, stands upon a footing entirely different, inasmuch as such trusts are entirely inconsistent with the apparent object of the salé, are rarely resorted to for an honest purpose, and are never necessary. Whereas, provisions of the character under consideration are not only free from all these objections,'but when, not trenching upon> the security of creditors, are in accordance with a high moral duty to provide for the advancement of those to whom the party is bound by the ties of blood and affection. The rule suggested by Chancellor Kent would be in the nature of a lien upon all the property, both real and personal, of a debtor, as against
Among numerous English cases that sustain the views we have expressed, are Russell v. Hammond, 1 Atk. 15; Cadogan v. Kennett, Cowp. 432, where Lord Mansfield holds that a fair voluntary conveyance may be good against creditors; that indebtedness at the time is an argument of fraud ; and that the question is in any case, whether the act was bond fide, or a trick and contrivance to defeat creditors, though he says if it be to a trustee for the benefit of the debtor it is fraudulent. So is Doe v. Routledge, Cowp. 705. To render fraudulent and void a voluntary settlement by reason of indebtedness, it was held, in Lush v. Wilkinson, 5 Ves. (1 Sum. Ed.) 384, that such indebtedness must be to the extent of insolvency ; and the same general doctrine is recognized in Shears v. Rogers, 3 B. & A. 362, where it was held that, if the conveyance left in the debtor’s hands not enough to pay his debts, it was fraudulent and void. Gale v. Williamson, 8 M. & W. 405, is also an authority in point. See, also, 1 Story’s Eq., sec. 363, note 1, and cases cited; James v. Boulter, 1 Cox 288. In Stephens v. Olive, 2 Bro. Ch. 90, it was held that a conveyance to trustees by the husband on separation from the wife, the trustees indemnifying the husband against the future debts of the wife, was for a valuable consideration, and not within the statute of 13 Elizabeth, there being no evidence of any indebtedness of the husband, except one debt of £500, which was secured by a mortgage. This shows that the evidence of fraud may be repelled by proving the indebtedness to have been secured ; and whether such security was specific as by mortgage, or general and founded upon ample means retained by the grantor, would seem, in this respect, to make no difference.* The case of Townshend v. Westacott, 2 Beav. 340, 341, cited in 1 Story’s Eq., sec. 362, a, is strongly in point.
In accordance with our views the American cases are numerous. Among them are Seward v. Jackson, 8 Cow. 406-438, in opinion of Allen, Senator, and cases cited. In Van Wyck v. Seward, 6 Paige Ch. 62, it is held that, when a parent makes an advancement to his child, and honestly and fairly retains sufficient to pay his debts, such child is not bound to refund such advancement, even if it should happen that existing debts were not paid; and other cases in New-York sustain these views. In Salmon v. Bennett, 1 Conn. 525, it is decided by Swift, C. J., that, where there is no actual fraudulent intent, and a voluntary conveyance is made to a child, in consideration of love and affection, if the grantor is in prosperous circumstances, unembarrassed, and not considerably indebted, and the gift is a reasonable provision for the child, according to his State and condition in life, comprehending but a small portion of his
In our own State it is laid down by Richardson, C. J., in Smith v. Lowell, 6 N. H. 69, that a parent may, if not in embarrassed circumstances, make a suitable provision for a child, which will be sustained against creditors. But in Smith v. Smith, 11 N. H. 459, Parker, C. J., leaves the point undecided. In Carlisle v. Rich, 8 N. H. 44, it is laid down in general terms, that a voluntary conveyance by a person in debt is fraudulent, as a conclusion of law, and the court consider but do not pass upon the effect of sufficient means being retained to pay all the existing debts, assuming that, in fact, the debtor was insolvent.
It would seem, then, that the question has not been fully settled in this State; but we are satisfied that the conclusion we have reached is the right one, both on principle and authority.
As part of the res gestee, and as bearing upon the question how said Hannah understood her residence in the plaintiff’s family, and to show waut of good faith in assenting at the time to the account, witnesses were permitted to testify that, when she was about to start for New-York, she said she was going to visit her sister Lucy and friends, and on her return said she had a good visit and an agreeable time. And it appeared that her sister was the mother of the plaintiff’s wife, and resided in his family.
One ground taken by the defendant was, that the plaintiff’s claim was fictitious, and the assent of Hannah Dow collusive and by a fraudulent concert with the plaintiff', for the mere purpose of enabling him to assume the character of a creditor, and take this property from the defendant. Such a proceeding would not, however, place the plaintiff before the court in the character of a creditor, nor does the plaintiff’s counsel claim that it would. It was, therefore, material to show that the assent of said Hannah was collusive, otherwise it might have had great weight in determining whether the plaintiff’s claim was or was not valid.
"We do not think this case stands like Page v. Parker, as to admissions of co-conspirators, but stands like the case of a fraudulent conveyance. In the case of a fraudulent conveyance, it is competent to show that about the same time the vendor made other conveyances of a like character. Whitney v. Varney, 10 N. H. 291; Blake v. White, 13 N. H. 267. In the latter case, to prove the fraudulent intent of the vendor, proof of other fraudulent sales about the same time, and of proposals to make others, together with his statements and declarations showing such intent, were held o be competent, and so were his declarations in respect to the property while in his possession, after the alleged sale. In Bridge v. Eggleston, 14 Mass. 244, it was held that the conduct and declarations of a grantor, tending to show a fraudulent intent, and made before the conveyance, but not after, are admissible; and in this case they were nearly six months before. So is Foster v. Hall, before cited. So where the plaintiff, in replevin against a sheriff who had attached a horse as the property of one who had bought it of the plaintiff, sought to avoid the sale upoii the ground that it was obtained by false pretenses, it was held that proof of other purchases about the same time, under similar pretenses, was admissible, as having some tendency to show a fraudulent intent in the case under consideration. Bradley v. Obear, 10 N. H. 477. These cases show that when the motives and intent of the parties to an act become material, they may be shown by their separate and independent acts and declarations, accompanying or preceding the act in question. How far back such proof may extend, must depend upon the nature and circumstances of the particular case, and no positive rule can be laid down. In the case of fraudulent conveyances and goods obtained by false pretenses, the proof will be limited to similar acts about the same time.
In this case the inquiry is, whether the claim in question was agreed to because it was just, or in pursuance of a fraudulent purpose to take the property from the defendant. The acts and declarations of the parties in respect to the claim, from its origin to the time of the act in question, whether it had been pressed on the one
The plaintiff' also objects to the admission of the testimony of Russell Kimball, to the effect that, after the judgment in favor of the plaintiff against the said Hannah — but whether before or after the extent is uncertain — she told him that she was to have the use of the property in question during her life. If this was after the extent, and while the said Hannah was in possession with the assent of the plaintiff, it would be competent for the purpose of showing the nature of her possession ; and if the jury were satisfied that she continued to possess the land under such a claim of right, it would bear rightfully upon the validity of the debt, as understood by the parties. This accords distinctly with the view of the court in Blake v. White, before cited. For aught that appears, the jury might have found the statement to Kimball to have been after the extent, and we are, in the absence of exceptions, to presume the instruction to the jury to have been correct.
Another question arises upon the testimony of Mrs. Lucy Elliott, whose deposition was read by the plaintiff. On her direct examination by the plaintiff, she testified to the fact of said Hannah being at the plaintiff’s house at the times for which board was charged, and on the cross-examination she stated that, on the death of her husband, Mr. Elliott, in 1839, she went to New-York, staid part of the time in the plaintiff’s family, and then went to Haverhill and stopped with her mother and sister Hannah, until her mother died, and then staid with her sister, and, in all, was there about three years, and was charged nothing for her board. She further stated that, since she went to New-York, she had been a member of the plaintiff's family, and no charges made against her. She also stated that she had United States stocks to the amount of $1250, and about $1500 of other property, and that, on the death of Hannah How, she received her United States stock; and all this she had given to the plaintiff. It appeared from the testimony of the plaintiff and other sources, that, on the death of Mr. Elliott, in 1839, the plaintiff offered Mrs. Elliott his house as her home, as long as she chose to make it so ; but it did not appear that he was under any obligation to support her, beyond what his aforesaid offer to her, his relationship, and receipt of all her property would impose. The plaintiff objected to the aforesaid statements of Mrs. Elliott on the cross-examination, but they were admitted by the court, and, we are inclined to think, rightfully, as showing the sort of connection that existed between his family and the said Hannah, as bearing upon the question whether the parties did or did not understand that the said Hannah was to pay for her board. It stands upon the same footing, in fact, as the proof that the said Hannah was the aunt of the plaintiff’s wife, which the jury might
The testimony that the plaintiff’s wife was the only heir of Mrs. Lucy Elliott, and that the latter was a legatee under the will of the said Hannah, was admissible upon the same grounds as the preceding, namely, to show in what connection the plaintiff and Hannah Dow stood.
The statement by Lucy Elliott, on cross-examination, that she supposed the plaintiff was displeased on account of the deed to Hazeltine, is immaterial, and ought not to disturb the verdict. Beside, it does not appear to have been objected to as an opinion merely, and the language may have been used and understood as if she had said, “ I think .he was displeased.”
The objection to the proof that said Hannah was nervous and excitable and easily wrought upon, does not state upon what ground it was put; but, assuming that the mode of proof was not objectionable, the question is, was the fact itself competent ? When an attempt is made to set aside a deed or other contract, upon the ground that it was obtained by fraud, it is not unusual to grant relief upon the ground of fraud and undue influence practiced upon the weakness and infirmity of others ; and we see no objection, in cases of this sort, to the proof here admitted, especially in connection with thb character of the postcript written by her, indicating an agitated and incoherent state of mind. Chit. Cont. 594, and cases cited; 1 Story’s Eq., sec. 235-238, and notes. So in Brackett v. Waite, 6 Vt. 411, it was held competent to show that a person was in poor health and subject to depression of spirits, to qualify his statements as to bis property.
This disposes of all the exceptions taken, and there must be, therefore,
Judgment on the verdict.