Clough v. Glines & Stevens Co.

Walker, J. According to the decisions in Kenefick v. Perry, 61 N. H. 362, and Hosmer v. Farley, 67 N. H. 590, the transfer of the insolvent debtor’s property to the trustees was an absolute sale. It was not attended with a secret trust for the benefit of the vendors, which might in a proper proceeding by a creditor be held to invalidate the transfer; and the fact is found that no actual fraud upon a. creditor was attempted or contemplated. The controlling purpose was to protect all the creditors without creating or attempting to-create unjust or inequitable preferences. As the sale was upon a sufficient consideration and evidently fair to all parties, it was legal and effective as against the plaintiffs in this action at law. Moreover, it is well established in this state that in the absence-of a fraudulent intent on the part of the vendee he cannot be charged as a trustee of the vendor, for the value of property honestly bought and paid for, in the equitable action of trustee process. In such a case, if the creditor believes the transfer was fraudulent as a matter of law, he must proceed by an attachment of the property, obtain judgment in his action at law, and then seek in equity to have the transfer set aside upon that ground.. He must proceed as a judgment creditor having an attachment lien upon the property.. Thompson v. Esty, 69 N. H. 55; Corning v. Records, 69 N. H. 390; Dole v. Farwell, 72 N. H. 183; McGreenery v. Murphy, 76 N. H. 338. The order must be. Trustees discharged. All concurred.