Hall v. Parsons

The opinion of the court was delivered by Hebard, J. The questions in this case grow out of the opinion of the county court in relation to the character, and effect, of the testimony given on trial before that court. The doctrine has become well settled, in this state, that possession must accompany the sale, or it will be fraudulent in law, as to creditors. In relation to what amounts to a change of possession, it has been a subject of discussion, and has, in a number of cases, been considered by the court, with reference to the particular circumstances of the particular cases. It has been considered a matter of policy, that, for the prevention of actual frauds, this rule should not be relaxed ; and the important inquiry in this case is, whether what the plaintiff contends for, would tend to relax the rule. The case does not find that the defendant put himself upon the showing that this sale or assignment was fraudulent in fact, but merely void for want of such an open and visible change of possession as the law requires. The policy of this rule is to [364] guard and protect the public against sales which are fraudulent in fact. The rule, requiring this change of possession, institutes the inquiry, in the case upon trial, in whom was the possession ? The application of this rule as to possession, admits that the possession may be, in fact, in a third person, as agent for the vendee. The point to be determined in this case, in the first place, was — in whom was the possession, in fact, at the time of the attachment ? If the possession was in Merrit Hall, then whose agent was Merrit Hall ? These two inquiries rest entirely in proof, and should have been settled by the jury, with proper instructions from the court, in relation to what constitutes possession and agency. The court told the plaintiff that they should instruct the jury that, if they found certain facts proved, the sale would be fraudulent in law. Those facts might very properly have been submitted to the jury for them to find, from the facts, whether the assignment was fraudulent, in fact. For it is true, under this rule, that, although the sale might have been formal, and exact in all the outward requirements, still, in fact, it might have been fraudulent and void. And, on the other hand, although the sale might have been made bona fide, being no way fraudulent in fact, still if it lacked this outward badge, a change of possession, it would be frandulent in law, and void as to creditors. It then became important for the jury to find in whom was the possession at the time of the attachment ; for, although possession may not accompany the sale, still, if possession is taken before the attachment, that is sufficient. The law, applicable to the case, admits of no discussion. The only question is, whether the case comes within the law; for, in this case, as in all others, the case must bend to the rule, and not the rule to the case. The court informed the counsel, that they should charge the jury that if they found certain facts, the sale would be fraudulent and inoperative, in law. Although those facts might be sufficient to incline the mind to that conclusion, still the conclusion should have resulted from the operation of the facts upon the minds of the jury, rather than upon the minds of the court. The jury should have been directed to the inquiry whether Merrit Hall was the servant of the [365] plaintiff. If he was, his possession was the plaintiff’s possession. They should, also, have been directed to inquire, whether the possession of the plaintiff was exclusive, or whether it was concurrent with the said Caleb B. What may constitute an exclusive possession, is well considered in the case of Allen v. Edgerton, 3 Vt. R. 442. That was a case of assignment of personal property, a part of which consisted of cloth, yarn, &c. in an unfinished state, and a quantity of wool in a factory ; and it was a part of the agreement, that the assignor was to assist, or have a voice, in the sale and manufacture of the same — and that, in point of fact, the assignor was advising in relation to their manufacture. The defendant insisted, in that case, that those facts constituted a joint possession, and that the assignment was, therefore, void. The court held that a joint possession in the vendor and vendee, would be a fraud in law, and render the sale void as to creditors; but that if the sale was bona fide, in order to render it void, the possession and use of the vendor must be of the same description as that of a joint owner, in using, occupying and disposing of the property. In that case, as in this, the important inquiry is, who was-at the head, controlling the business? And if a careful observer would be at a loss to determine, it would be deemed a joint possession. And this is a fact for the jury to find from all the facts proved in the case. The facts in this case might with propriety have been submitted to the jury, with proper instructions, for them to find in whom was the possession, and whether it was a joint, or exclusive possession. And in determining the point, it would be proper for them to consider the fact that the plaintiff owned the store and land — that the sign had been taken down — that a new set of books had been procured, and used, and whatever other outward change there was in the circumstances, and in the persons who were in attendance upon the business of the store. In determining in relation to fraud, in law, it made no difference where the clerk boarded, or by whom he was first informed of the change. If the question was in relation to fraud, in fact, it would be different. The case of Farnsworth v. Shepard ,6 Vt.R. 521, recognizes [366] the doctrine that the vendor may have some occasional and temporary possession of the property, without affecting the "validity of the sale. In the case of Wilson v. Hooper, 12 Vt. R. 653, the court attach very much importance to the fact that the vendee had a deed of the premises on which the property was kept; and the question of concurrent possession was, very properly, submitted to the jury. The case of Judd & Harris v. Langdon, 5 Vt. R. 231, is relied upon by the defendant. But that case is distinguished from the one at bar, in a number of important particulars. In that case the property sold was two colts. They were on a farm owned by the vendor. The plaintiffs took a deed of the farm, but did not put it on record till after the attachment. They never had the colts in their possession, nor did they employ any one to keep them ; nor did they furnish any keeping for them ; but they were left on the premises where the vendor had kept them, in the beeping of the same man, and foddered in the same manner as before. The present case is different in all these particulars. The plaintiff owned the store and land. On taking the assignment of the goods, the sign was taken down. A new set of books was opened. The same clerk was in the store, but he received his instructions from the plaintiff, and was in his employ, and kept the key, and had the sole care of the store. And all these facts were notorious as to the public, and actually known to the defendant. In the case of Wilson v. Hooper, the vendor and vendee were, in fact, in possession of the property, but the jury were left to find whether they had equal control and direction of it. Judgment that the rule become absolute, and a new trial granted.