Teague v. Howard Grocery Co.

Hoke, J. Our statute regulating general assignments for creditors, Revisal, secs. 967 et seq., as amended by Laws 1909, cb. 918, 1 Gregory’s Supplement to Pell’s Revisal, 109-110, makes provision, among other things, tbat it shall be tbe duty of trustee in such cases to recover for tbe benefit, of tbe estate property which may have been conveyed by tbe grantor or assignor in fraud of bis creditors or which may have been conveyed or transferred by tbe grantor or assignor for tbe purpose of giving a preference. A preference under this section shall be deemed to have been given wben property has been transferred or conveyed within four months next preceding tbe registration of tbe deed of trust or deed of assignment, in consideration of tbe payment of a. preexisting debt, wben the grantee or transferee of such property knew or bad reasonable ground to believe tbat tbe grantor or assignor was insolvent at tbe time of making such conveyance or transfer. Tbe word “convey” more usually refers to real estate, “comprehending tbe general methods by which title thereto is acquired,” but it may be of even more extended meaning. Tbe word “transfer,” applying to both , kinds of property, may be held to include tbe general methods by which title thereto is passed or interest therein created, including, beyond question, an executed contract of sale. Godwin v. Bank, 145 N. C., 320, approving tbe *198 broad and inclusive definition of the term “transfer” contained in the Bankrutcy Act, U. S. Statutes at Large, vol. 30, ch. 541, sec. 1; Vann v. Edwards, 185 N. C., 661-668. And, on proper consideration of the present statute, its terms and purpose, it is clear that the Legislature intended to prohibit and avoid, as a wrongful preference, any and every disposition of real or personal property, absolute or conditional, by which a creditor, in consideration of an existent or antecedent debt and within four months of a general assignment by his debtor, acquires title to such debtor’s property or any interest therein or lien thereon, when he knew or had reasonable ground to believe that his grantor or assignor was insolvent at the time the transfer or conveyance was made. Wooten v. Taylor, 159 N. C., 604. On the present record, there are facts in evidence tending to show that this transaction was an executed contract of sale, having reference to designated and specific pieces of property, and if these facts should be accepted by the jury, it is well understood that present physical delivery of the property is not necessary to the transfer of the title but that the same passes according to the intent of the parties as expressed in the contract between them, and further, that, in the absence of specific agreement on the question, the presumption is that the title passed at the time of the purchase and without such delivery. Richardson v. Insurance Co., 136 N. C., 314; Jenkins v. Jarret, 70 N. C., 255; Tiffany on Sales, pp. 82-83; Benjamin on Sales, 7th Ed., p. 728. In the citation to Tiffany, the correct position, in both aspects of the matter, is tersely stated as follows: “When there is a contract of sale of specific goods, the property in them is transferred at such time as the parties to the contract intended it to be transferred. (2) When there is a contract for the sale of specific goods, unless a different intention appears, the property in the goods passes to the buyer when the contract is made.” This being true, and with facts in evidence on the part of the defendants tending to show an executed contract of sale was made between these parties two or three weeks, perhaps more, before the assignment, and with delivery of a part some days thereafter, and of the remainder four or five days before the assignment, with additional evidence of insolvency disclosed after the trade, and even evidence tending to show that defendant bought the buggy and harness seven or eight months before, we are of opinion that there was error to defendant’s prejudice in restricting their knowledge of the debtor’s insolvency and their reasonable belief on that subject to the time when the goods were actually received by defendants, for, if they had no such knowledge or belief at *199 tbe time of title acquired, tbe transaction would not constitute a preference witbin tbe meaning and purport of tbe law. Tbe defendants, therefore, are entitled to bave tbis essential fact determined on an appropriate issue and under a proper charge concerning it and to that end a new trial is awarded. New trial.