Middlebrook v. French

Hosmer, Ch. J. The decision of this case depends on that clause of the statute concerning insolvency, which precludes the debtor from the benefits of the act, “who has conveyed any of his estate, with intent to defraud his creditors.” The letter of the act is equivocal, and admits of different constructions. It would be difficult to determine, guided by the popular use of the expression merely, whether the legislature intended to interdict from the benefit of the law, all those, who had attempted to defraud their creditors, or those only whose attempts had proved successful. The object of the provision, though not very clearly expressed, may be apprehended without much difficulty. The clause was not inserted, for the purpose of punishing the debtor, nor to discourage him from making a fraudulent conveyance, lest he should be abandoned to the mercy of his creditors, and at their option, to the horrors of endless imprisonment. An event so enormous, as the consigning a poor debtor, for a single deviation from rectitude, to ruin and oppression, when no disadvantage has accrued to his creditors, and in respect of whom, the recalled act has virtually diminished his offence to an unjustifiable intention only, it is not to be presumed, was with inthe intent of the legislature. Nor can I believe, that the penalty of perpetual imprisonment was enacted, as a preventive against the perpetration of fraud. Without doing violence to the statute, a more benign construction, and one equally beneficial, may be adopted, by considering the object to have been, to deny the benefits of an act of insolvency to those debtors, who had committed a fraud [3] actually injurious to creditors. On a different construction, the imprisoned debtor, who had conveyed away property fraudulently, and afterwards, had repossessed himself of it, and with it paid a part of his honest debts, could never receive the oath; but must expiate the unjustifiable but corrected act, by unlimited confinement. An exposition of the law so severe, and so uncongenial with the better feelings of good men, I should be unwilling to adopt, unless impelled to it, by expressions the most unequivocal. Chapman, Brainard, and Bristol, Js. were of the same opinion. Peters, J. was of opinion, that the making of a fraudulent conveyance was a crime, not only by statute, but malum in se; and though repentance and reformation might purge the offence in foro conscientiœ, they could not enable the offender to escape the penalties of the law, in a tribunal which possessed no pardoning power: That obtaining a reconveyance of property fraudulently transferred, could no more do away the legal effect of the transaction upon the petitioner, than the restoration of a stolen horse, or than making amends to a party injured by robbery, or perjury, after detection and conviction, could restore “a fair character for probity” thereby destroyed: That the statute was made for the relief of honest, industrious, unfortunate debtors; but those who are “justly chargeable with idleness, mismanagement or fraud,” must depend on the mercy of their creditors, or of the legislature. Decree affirmed.