Fuller v. Sears

The opinion of the Court Was pronounced by Baylies, J. The first enquiry is, was it admissible for the plaintiff to prove, “ that the said Clement had no merits in his said action, which he commenced against the said John.” It would have been a novelty to have tried the merits of that action in this suit. It cannot be supposed, that the defendants came to Court with art expectation to go into a trial of that action to ascertain, whether it had merits, or not. The law required no such thing. It was sufficient, if said Clement was a creditor of said John, prima fade, without his showing the amount that was due. The County Court in their charge, told the jury, “ if they found that John Puller wished to leave the State to avoid, or delay his creditors, and the plaintiff knew it, and purchased all his personal property at prices agreed on, and let him have a horse, and thirty dollars in cash to enable him to abscond, it was a fraud in fact, and as it respected John’s creditors, the sale was void, and the oxen, hay, grain, and potatoes Were liable to be taken for John’s debts.” A transaction like this, is clearly within the letter, and spirit of our act, Chap. 32, sec. 7, which says, “ That all fraudulent, and deceitful conveyances of goocjs or chatties, and all bonds, bills, notes, contracts, and agreements, and all suits, judgements and executions, made Or had, to avoid any right, debt, or ditty of others, shall, as against the party or parties, only, whose right, debt, or duty is endeavoured to be avoided, their heirs, executors, administrators, or assigns, be utterly null and void, and any false pretence, or féigned consideration to the contra530 ry notwithstanding.” This act has the substance of 13 Eliz. c. 5, which says “ that no act whatever, done to defraud a creditor dr creditors, shall be of any effect against such creditors.” On this clause of the Statute, in the case of Codogan vs. Kennett, Cowper, 434, Lord Mansfield says, “ If the transactions be not bona fide, the circumstance of its being done for a valuable consideration, will not alone take it out of the statute. I have known several cases, where persons have given a fair and full price for goods, and where the possession was actually changed; yet being done for the purpose of defeating creditors, the transaction has been held fraudulent, and there - fore void.” “ One case was where there had been a decree in the Court of Chancery, and a sequestration. A person with knowledge of the decree, bought the house, and goods belonging to the defendant, and gave a full price for them. The Court said, the purchase being with a manifest view to defeat the creditor, was fraudulent; and therefore, notwithstanding a valuable consideration, was void.”' “ So if a man knows of a judgement, and execution, and, with a view to defeat it, purchases the deb-tor’s goods, it is void, because the purpose is iniquitous. It is assisting one man to cheat another, which the law will never allow.” These observations upon the 13 Eliz. c. 5, justify the County Court in their remarks, upon what would be a fraud in fact, within our statute. So this part of the charge derives support from the case of Edgell vs. Lowell & Bennett, 4 Vt. Rep. 405. The Court also charged the jury, “ if they found the sale of the oxen was bona fide, and the possession did not follow the sale, it was a fraud in law, and the creditors of John might attach the oxen as his.” It may not be easy to understand, how the sale could be bona fide, and at the same time a fraud in law. But I suppose the meaning of the County Court was, that if the vendor, at the time of sale, had no intention to defraud his creditors, and sold his oxen at a fair price, and . received his pay — also, if the vendee did not intend to injure any body by making the purchase, and paying his money for the oxen ; then both vendor and vendee had good inten [531] tions, and acted Iona fide in entering into the contract. — • But as the oxen did not accompany, and follow the sale, it rendered the contract inoperative and void, as to the creditors of the vendor; or in other words, created that state of things, which is denominated a fraud in law. It seems to be settled in this State, that an absolute unconditional sale of goods, under circumstances admitting of immediate delivery of possession, if the possession does not accompany, and follow the sale, the conveyance is fraudulent per se, and void as to creditors: leaving the possession of the goods in the hands of the vendor, operates as a deceit, and fraud upon his creditors, and vitiates the sale. Mott vs. McNiel, 1 Aik. 162; Weeks vs. Wead, 2 Aik. 64. The same principles are recognized as law by the Court of K. B. England, in the case of Edwards vs. Harbin Ex. 2 T. R. 587. Also by the Supreme Court of the United States, in the case of Hamilton vs. Russel, 1 Cranch, 309. Story, for plaintiff. Cooper, for defendant. Fraud in fact, and fraud in law, are often interwoven with each other: When this is the case, it is not necessary to enquire after the fraudulent intent of the parties to the contract; but simply, whether the goods remained in the possession of the vendor after sale. This fact is easily proved, while the fraudulent intent is dexterously concealed. If the vendor remained in possession of the goods after sale, and no good reason can be assigned why it was so; this of itself is sufficient to render the sale inoperative, and void as to creditors. The charge says “ if the sale of the oxen was fraudulent in fact, or in law, it was the duty of the jury to find for the defendants.” This cannot be disputed. So the charge says, “ At any rate the jury would find only nominal damages for the plaintiff, if they found that the plaintiff had sold, and received his pay for the oxen as testified by Enos.” This part of the charge could have no influence upon the minds of the jury, in as much as they had no occasion to assess the damages, but found for the defendants their costs. Judgement is affirmed.