Streeper v. Eckart

Kennedy, J. delivered the opinion of the Court, as follows:— Several errors have been assigned, consisting of exceptions to the charge delivered by the District Court to the jury; but it is considered unnecessary to notice them in detail, as we are of opinion that the charge is perfectly unexceptionable throughout. It is not only in accordance with the principles laid down and resolved in Twyne’s Case, (3 Co. 80,) which may be considered the leading one in relation to covinous transfers of property, made by debtors, to hinder, delay or defraud their creditors, but is supported by a train of decisions made by this court, which, it appears to me, ought to leave no doubt upon the mind of any one, as to,what the law is in this state, on this subject. See Wilt v. Franklin, (1 Binn. 521.) Dawes v. Cope, (4 Binn. 258.) Wager v. Miller, (4 Serg. & Rawle, 123.) Clow v. Woods, (5 Serg. & Rawle, 278.) Cunningham v. Neville, (10 Serg. & Rawle, 201.) Babb v. Clemson, (Id. 419.) Martin v. Mathiot, (14 Serg. & Rawle, 214.) If there be any principle established by these cases, it is, that a transfer of personal property, unaccompanied by a corresponding transmutation of the possession, is void as against creditors. This is a general rule, clearly settled by them, which cannot be dispensed with, where it is practicable to make the change. The reason of the rule is, that the possession of personal property is prima facie evidence of ownership ; and the person, therefore, who has once become the owner of such property, and obtained the possession of it, may well be con [307] sidered by every one the real owner, as long as he shall remain in the actual possession, and continue to exercise daily acts of ownership over it. He thereby necessarily' acquires a credit on account of it, which, from the very nature of things, must continue to be the case while he retains the possession; and continues to use it. Under such appearances of ownership, every man is justified in regarding him as still being the owner; and in giving him credit, or having become his creditor, in extending indulgence to him on account of it. This being the case, it is obvious that the purchaser of property, who leaves the seller in the possession and use of it afterwards, as before, thereby gives the latter a. deceptive credit in the world, which would operate very unjustly, if he were permitted under such circumstances, to withdraw the property from the creditors of the seller, when it becomes the only means of paying their claims, and may fairly be supposed to have influenced them in giving the seller credit, or otherwise indulgence, or possibly both. To prevent every one, therefore, from being deceived by the appearance of ownership, when it has ceased after having oncjs existed, the party to whom the right of ownership has been transferred, if he wishes to make-himself secure against the creditors of his vendor, must take the property into his exclusive possession, so that the change of possession, which is an index of the transfer of the right of property, may be visible, and by this means become known to all whom -it may concern. Seeing then this is the objectfof the law, in requiring that a change of the possession shall accompany a transfer of the right. of property, how is it possible that a change, merely for a single night or day', can answer the purpose, and advertise the public of the change of ownership in the property. - It is perfectly manifest, that it can have no such effect, and therefore cannot be regarded as meeting the requisition of the law in this respect. A sale made, however, by a sheriff, of property taken in execution, forms an. exception to the general rule on this subject; or not being a sale by the act of the owner himself, but by operation oflaw. it may, perhaps, more properly be said not to come within the rule. It is made under the authority (of judicial process by a sworn officer of fhe law, and upon public notice thereof previously given; so that it is presumed to be fair, and free from fraud, until the contrary is made to appear; and if fair, every one is bound to take notice of it. The vendee, therefore, of the sheriff, in such case, may bail the goods or property to the defendant named in the execution, as a loan, or otherwise, ^s he pleases, without rendering it liable to be taken in execution again for the debts of the same defendant. See Myers v. Harvey, (2 Penn. Rep. 481.) But suppose that Streeper, in this casé, upon the property’s being transferred to him by Jefferies, for a full consideration paid, had taken it into his own exclusive possession, and kept it; the circumstance of its having been done but a few days after Eckart, one of [308] the defendants here, had obtained a judgment against Jefferies; and when it was no doubt expected, that an execution would be sued out thereon shortly, was certainly calculated to awake suspicion, if not strongly indicative of the transfer having been made collusively, and with a fraudulent intent, and therefore .not bona fide. In Twyne’s case, it was resolved to be a mark of fraud, and is so laid down by this court in Babb v. Clemson, (10 Serg. & Rawle, 424,) as also in other cases. And according to the statute of 13 Eliz. the transfer must not only be made on a valuable consideration, but likewise bona fide; and hence, if the sale and transfer of the property were -made between the parties, with intent to defeat Eckart in obtaining execution of his judgment, it was mala fide and void’as against him. Mr. Arundel and Mr. Meredith were for the plaintiff in error; Mr. Jack and Mr. Cohen for the defendants in error. That this case, judging'from the evidence, was beset with pretty strong indications of fraud in fad is very apparent; and it would, therefore, have been the very height of error in his Honour, the Judge of the District Court, to have charged the jury as the plaintiff’s counsel required, to wit, “ that from the evidence, there was a full consideration paid for the horses and carts, and possession taken of them under a bona fide sale ; and that the plaintiff was entitled to a verdict.” But there was certainly great propriety, as well as strong reason for his instructing the jury as he did, that “ a party claiming against the creditors, would be bound to remove all doubt of the fairness of the transaction, even if possession had accompanied the transfer.” Being perfectly satisfied with the instruction of the court to the jury, we therefore affirm the judgment. Judgment affirmed.