Reed v. Woodman

The opinion of the court was read at the ensuing September term in this county, as drawn up by Weston J. The greater part of the debt, which was the foundation of the judgment rendered in favor of the demandant, accrued subsequent to the deed given by Aaron Woodman to the [405] Oxnards. The levy was entire, and cannot be so apportioned ov divided as to constitute a satisfaction for that part of liis debt, which was due prior to that deed. The demandant, having take» judgment for his whole demand, is to be regarded as a creditor subsequent to the conveyance of the land in question, by his debt- or. He cannot therefore impeach that conveyance,but by showing actual fraud. This the jury have negatived ; although by the conduct of .dawn Woodman and of the Oxnards, who lent themselves as his instruments in his attempt subsequently to put the property out of the reach of his creditors, there was some reason to infer that this course was originally meditated by him, and intended to be aided by them, to defeat the claims of such as then were, or afterwards might be, his creditors ; and if the jury had been satisfied that such was their intention, the deed might have been defeated. But this does not clearly appear. The security of the Oxnards might have been the only ground of the conveyance at the time, and the fraudulent purpose conceived after-wards. And this is rendered the more probable from the fact, which the jury have found under the direction of the judge, that at the time of the conveyance, Woodman was possessed of property sufficient to pay his debts. It does not appear that the value of the land did much, if at all, exceed the amount due to the Oxnards ; so that fraud was not to be inferred from inadequacy of consideration. Although, by the agreement of the parties, the conveyance, which was in form absolute, was regarded as collateral security for their debts, which were not therefore discharged ; yet if they took the land, and held it to their own use, if of sufficient value, the debts, which it was conveyed to secure, would be considered as paid ; as when a mortgagee takes possession for condition broken, he can no longer recover the debt, except so far as the value of the property mortgaged may fall short of the debt due. We are of opinion that the judge was correct, in declining to instruct the jury, as requested by the counsel for the demand»»!:, that the verbal agreement between Woodman and the Oxnards, when they received their deed, by which the former was to have the privilege of redeeming the land, by other’ wise paying their demands, was conclusive evidence of fraud. [406] The case of Goodwin v. Hubbard 15 Mass. 210, has been cited for the demandant. We have examined it with attention. Some of the principles there stated, and deductions drawn by the learned chief justice, by whom the judgment of the court was delivered, do not appear to us to have been illustrated with the clearness, which generally marks his opinions. The facts presented a case of gross fraud upon creditors ; and could not fail to excite the desire, manifested by the court, to defeat the accomplishment of the designs of the fraudulent party. The case is viewed in various aspects ; and several suggestions are made as to the ground upon which this might be done without violating legal principles, .the correctness of some of which, if we have understood them, may, we think, admit of doubt. Some special legislation upon this subject has, it appears, been deemed necessary in New-York. A statute of that State is referred to in the opinion cited, which provides that whenever real estate is held in trust, it may be levied upon by a creditor as the property of the cestui que trust; and that parol evidence of such trust should, in such cases, be admissible. This latter provision seems to have been introduced,with a view to give additional facilities to creditors, in defeating the fraudulent arrangements of their debtors. It may, however, well deserve consideration whether, by thus relaxing the spirit and policy of the statute of frauds, more frauds may not be occasioned than defeated. The ground, upon which the opinion of the court is distinctly predicated in that case, at the close, is, that the demandant,having shewn no title but what originated in fraud, could not prevail. We are called upon to determine, not whether the tenant who holds, as it is insisted, under a fraudulent conveyance, has title, but whether the demandant has ; and however defective may be that of the tenant, yet if the demandant has shewn no title, he must fail in his action. With every desire to aid the latter in defeating the fraudulent practices of his debtor, we find ourselves constrained to determine, that having failed to satisfy the jury that the conveyance to the Oxnards was fraudulent, he has exhibited no title which can avail him. [407] The opinion of the court is that the case was presented to the jury, by the judge who presided at the trial, as favorably as the facts would warrant. There must therefore be Judgment on the verdict.