Robinson v. Woodmansee

Simmons, Justice. The complainants, Woodmansee et al., filed their bill in Fulton superior court against the defendants, Robinson et al., alleging that Robinson was indebted to them in a large sum of money, and that he had made a fraudulent sale to his brother, R. Y. Robinson, and had given fraudulent mortgages to Conley et al. Upon the trial of the case, the jury returned a verdict in favor of the complainants, and the defendants moved for a new trial upon the grounds set out in the motion, which was overruled by the court below, and the defendants excepted, and assign error upon the refusal of the judge to grant a new trial. 1. The second ground of the motion is, that the court erred in admitting as evidence, over defendants’ objection, the petition of complainants, and the answer of defendants in the proceedings against W. G. Robinson, Jr. and [253] R. V. Robinson, praying for an order for contempt against the defendants in violating the injunction. We. see no error in admitting these papers as evidence against W. G. Robinson, Jr., one of the questions in the case being that he had made a fraudulent sale, and these documents tending to show that he persisted in trying to give effect to said sale. 2. We see no error in the court’s admitting the testimony of Leonard and Forbes, complained of in the third, and fourth grounds of the motion. The matter testified to by them was a circumstance which might or might not throw light upon the bona fides of the mortgagees, and it was proper to admit it to the jury for their consideration. 3. We see no error in admitting the testimony of Well-house, as complained of in the fifth ground. It was a circumstance going to show the want of bona fides of the trade between W. G. Robinson and his brother, R. Y. Robinson. The jury might infer as against W. G. Robinson, from these circumstances, that W. G. Robinson knew that his brother was insolvent at the time He made the purchase of the goods in the store. 4. There was no error in the court’s admitting the testimony as to the failure of Shuttles, taken in connection with other testimony given by the same witness. It is often difficult to prove actual fraud. In the investigation of cases in which it is alleged, it is necessary that all facts and circumstances throwing any light upon the transaction, or the motives of the parties, be allowed to go to the jury. 5. There was no error in the court’s allowing counsel to comment on erasures and changes of entries in the cashbook, as complained of in the 7th ground. That part of the book was introduced in evidence, and was in for all purposes. The erasures could have been seen by the defendants as well as the plaintiffs, and if they wished to explain them, they could .have done so while the witness was on the stand. It appears that he was notified that [254] the comments would be made before the argument for the defendant was concluded, and the concluding argument of the plaintiffs begun. 6. The eighth ground is as follows: “ Because the court erred in the following charge to the jury: ‘ When a debtor makes a mortgage to a creditor, and makes an agreement with him, at the time the mortgage is executed, that it shall be kept off the record beyond the time allowed by the law for recording, that this shall be done to protect his commercial standing (that is, the commercial standing of the debtor), such a mortgage as that would be fraudulent as against persons who, after that time, extended credit to such debtor. To apply that rule to this case, if you should believe that W. G. Robinson, Jr. made these mortgages, and that at the time he made them he had an understanding with the persons receiving them, that they should be kept off of the record for the purpose of protecting his financial credit, then these mortgages would be fraudulent as to such persons as extended credit to Robinson after this date.’ ” Complaint is made by the plaintiffs in error of this part of the charge, because the court instructed the jury as a matter of law, that, “ if they believed that Robinson made these mortgages, and there was an understanding with the persons receiving them, that they should be kept off the record for the purpose of protecting his financial credit, then the mortgages would be fraudulent as to all persons extending credit to Robinson after this date.” We think this part of the charge erroneous. Under the facts of the case, it was not, as a matter of law, fraudulent to agree not to record the mortgages. It is not necessarily a fraud to agree not to record a mortgage. The agreement or understanding may have been made with the most honest intention. It is for the jury to say what the intention was; whether the mortgages were given by the debtor for the purpose of hindering, delaying or defrauding his creditors. If they should find that that was the intention of the debtor, [255] still it would not affect the mortgagee, unless “ such intention was known to him, or without notice or grounds for reasonable suspicion.” “ Secrecy or concealment is not fraudulent per se, but a badge of fraud, to be considered by the jury with the other facts of the case.” It has been held “ that an arrangement or understanding in regard .to witholding mortgages from record until the the mortgagors should have trouble, did not render the mortgages void, but was a matter for the consideration of the jury, in passing upon the question of fraud.” “ An agreement to conceal the fact of a purchase is not per se fraudulent, but is merely matter of evidence in favor of avoiding the sale, which, although perhaps very strong, is still capable of explanation.” Wait on Fraudulent Conveyances, p. 323, and authorities cited. See also Bump on Fraudulent Conveyances, p. 82. 7. We see no error in the matters complained of in the 9th, 10th and 11th grounds of the motion, but we reverse the judgment on the error in the charge complained of in the 8th ground. Judgment reversed.