Church v. Chapin

Peck, J. The question in this case is which of these parties acquired the better title from Fortin Church. The plaintiff shows title by deed from Fortin Church, dated October 29th, 1855. The defendant shows title by levy of an execution in favor of Deborah Church against Fortin Church, in 1858, for — 227 — between $500 and $600, issued on a judgment recovered in 1858, in a suit commenced in 1856, aud by deed from Deborah Church to the defendant, dated April 4th, 1859. Nothing appears invalidating the deed to the plaintiff as against Fortin Church. The question is whether it is good against his creditors, or rather against the creditor under whose levy the defendant claims. The case finds that in the execution of the deed to the plaintiff there was no fraud in fact, or actual intent to defraud creditors generally, or to defraud this particular creditor. Assuming for the present that Deborah Church was a creditor of Fortin Church in respect of the debt or claim for which she levied, at the date of Fortin Church’s deed to the plaintiff, the question arises whether upon the facts stated in the exceptions, the amount, nature and character of the consideration of that deed was such as to render it valid against Deborah Church as such creditor, or whether as to her and the defendant who has her title, it is to be treated, as the county court treated it, as a voluntary conveyance and inoperative against her levy. On reference to the judge’s minutes of the testimony referred to, and the deed and bill of sale, it appears that the amount of property conveyed to the plaintiff by Fortin Church on that occasion was, in round numbers, from $7,000 to $10,000. The consideration for this property is all expressed in the mortgage deed from the plaintiff to Fortin Church, from which it appears that the plaintiff was to pay certain specified debts of his grantor, amounting to about $850, and pay to the children of certain persons named $100 each, as they should respectively arrive at the age of twenty-one years, and also support Fortin Church during his natural life. It appears there were twenty-eight of these children, who were the nephews and nieces of the plaintiff’s grantor. If the $850 and the $2800 constituted the whole consideration for this property, it would be regarded as so far below the real value of the property as to render the conveyance void as against existing creditors, on the ground of inadequacy of consideration. A debtor can not give away his property, and thereby deprive his creditors of all means of collecting their debts. He must be just before he is generous ; or in other words, he must not be generous at the expense of justice to his — 228 — creditors. If such is the effect the gift is void as to creditors. Nor can this principle be avoided by having a partial consideration. In such case the gift is equally void, at least to the extent of the want of consideration. But in this case there is a further consideration, the agreement of the plaintiff to support the grantor during life. The amount or value of this part of the consideration is in its nature so uncertain, depending so much on future contingencies, the duration of life and the future wants and requirements of the grantor, that it can not be assumed that the consideration was inadequate in amount. The question must turn upon the character of the consideration. The $850 which the plaintiff agreed to pay to the two creditors named in the mortgage deed can not be objected to as to its character; and although the grantor in this disposition of his property made no provision for the payment of the debt to Deborah Church, she can not set aside that deed on the ground that the grantor gave preference to other creditors. Whether the $2800 the plaintiff agreed to pay to the collateral relatives of the grantor should also be so considered,- is not so clear. On the one hand it may be said that although it was a gift as between such relatives and the grantor, yet as between him and the plaintiff it was to be a payment, and that the want of consideration as between the plaintiff’s grantor and the persons to whom the grantor required the plaintiff to make the payment, can not affect the deed. On the other hand it may be said that as the plaintiff was a party to this arrangement by which this grantor was giving away this portion of the consideration of the deed, and not having paid or legally bound himself to the donees to- pay to them, he ought not to be allowed to stand upon this agreement with the grantor, and thus perfect the gift to the detriment of creditors, a gift which the grantor, as to creditors, had no right to make. But we do not find it necessary to decide whether this agreement to pay the $2800 in the manner stipulated, is a good consideration to that amount as against creditors or not, because the remaining portion of the consideration, the agreement for support for life, is not of such a character as will sustain the deed if the creditors are thereby deprived of the means of collecting their debts, It is true that as between the parties to the — 229 — deed it is a valuable consideration, and in this respect a deed founded on it differs from a gift; but as to creditors it is not different from a deed of gift, It has long been settled that a party can not either by gift or in consideration of an agreement for support for life, convey his property without reserving what is amply sufficient for the payment of his then existing debts. If we allow the plaintiff the benefit of the $850 and the $2800, as a good consideration to that extent, there is still, at the lowest ■estimate of the property, between $3,000 and $4,000 of the consideration accounted for in no other way than by the agreement for support. Where there is a partial, but not a full consideration good against creditors, whether the deed is voidable in toto, or only to the extent of the want of consideration, is a question not material in this case, as 'the amount of the consideration resting on the agreement for support exceeds the amount of the levy in question. The levy must prevail over the deed, unless the property of the grantor not conveyed is sufficient to prevent that result. A creditor has no right to impeach a conveyance of his debtor on the ground that it was voluntary, or without sufficient consideration, unless it would operate, if allowed to stand, to his detriment in the collection of his debt. The debtor is bound to reserve property ample for the payment of his debts. Whether the property reserved is what will be deemed ample for this purpose does not depend entirely on the amount and value, as the real end to be accomplished is, that the deed or conveyance shall not deprive creditors of the means of collecting their debts. Hence the nature and situation of the property is to be regarded as well as the amount and value, in view of the facilities the creditors have left for the collection of their debts. In this case the debtor conveyed all his property except $100 cash on hand, and débts due him. These debts amounted nominally to $2,075, due from various individuals. The debt of $400 against Sawtell may be thrown out, as Sawtell had failed and become insolvent. This leaves the amount due the grantor $1,675. In relation to the Phillips debt of $1,100 and the Bardwell debt of $200, the debtors resided out of this state, so that they could not be reached by process in this state ; as debts due from persons residing out — 230 — of the- state are not attachable by trustee process, except in some-particular cases. The cash on hand was in point of law liable to attachment if so situated that an officer could obtain possession of it without committing a trespass on the person of the owner;, but it is not probable that it would he accessible for the purposes-of attachment so as to he available to a creditor, especially as-the amount was so small. Deducting the $400 debt as worthless, there was but $375 of the debts reserved by the grantor that was attachable, and that only by trustee process. The-grantor owed about $200 besides this debt for which the levy was made and the debts the plaintiff agreed to pay. This $200-the plaintiff paid, and it was repaid to him out of the debts the grantor reserved. There is another fact stated worthy of consideration ; that is, at the time Fortin Church made the conveyance in question, it was his purpose to give the $1,100 debt to-certain collateral relations in the state of New York, where the debtor resided, and it Was soon after so disposed of. The bill of sale to the plaintiff also professed to transfer all the personal-property that Fortin Church might own at his decease, and the parties so understood its legal effect. The rule that a party who-conveys his property without sufficient consideration, such as will be valid against creditors, must reserve property ample for the payment of his existing debts, is from- its nature somewhat general' and indefinite ; and whether sufficient is reserved- in a given case to answer this purpose, depends, as already stated, on the amount and nature, in connection with the character and situation', of the property in reference to the facilities it affords the creditors for collecting their debts. We think upon all the facts appearing in this case the conveyance must be regarded as invalid as against the levying creditor, if she was a creditor at the time of this conveyance, in respect of th-is debt. This conclusion is the more just since it appears that the grantee-knew at the time he took the conveyance, that this creditor had rendered services for the grantor, and that she claimed he was indebted to her for such services, and yet he took the deed and bill of sale without any provision for the payment of this debt„ The only remaining question is whether the county court erred in excluding certain evidence offered by the plaintiff. The case — 231 — states that “ the plaintiff offered evidence to prove that at the ■time of said conveyance to him, no actual indebtedness to said Deborah Church from said Fortin Church existed ” which was excluded by the court. If this offer is to be construed as an ■offer merely to show the time when the debt accrued, and that it accrued subsequent to the conveyance, the decision was erroneous, as the evidence would not Necessarily tend to impeach the judgment. A judgment, even between the same parties, is con-i ■elusive only of such facts as must have been found to warrant ( 'the judgment. This judgment may be correct, and yet the debt not have existed till after the conveyance. But we do not so understand the offer. The offer evidently was to show that no ■debt ever existed on which the recovery was had, for the exceptions state that it appeared that the judgment was recovered for •the services of Deborah Church (Fortin Church’s sister) as his house-beeper from 1850 to the spring of 1855. The deed was not executed till October 1855. The offer therefore must be understood as an offer to show that the judgment was founded on no actual indebtedness, and not an offer to prove that the debt accrued after the conveyance. The evidence offered tended' directly to impeach the judgment. The judgment is clearly conclusive on this point upon Fortin Church. But in order to entitle a creditor to impeach a conveyance of his debtor for want • ■of sufficient consideration where there is no fraud, it must appear that he was a creditor, and a judgment in his favor against the grantor is not conclusive against the grantee who is no party to it. He may, as a general rule, show that the judgment was collusive, and not founded on an actual indebtedness or liability. But in this case the plaintiff can not be regarded as a stranger to the judgment, as it appears that the suit was defended by this plaintiff not only as agent of Fortin Church, but also in his own behalf to protect the property conveyed to him by the defendant in that suit. Under such circumstances the plaintiff can not be permitted again to try the question of indebtedness. He is bound by the result of that suit. The judgment'of the county court is affirmed.