No instrument is to be avoided under § 43-25-34 in favor of a subsequent purchaser or encumbrancer having notice thereof at the time his purchase was made or his lien acquired, unless the person in whose favor the instrument was made was privy to the fraud intended.

Source: CivC 1877, § 677; CL 1887, § 3299; RCivC 1903, § 992; RC 1919, § 598; SDC 1939, § 51.1406.