Lemay v. Bibeau

By the Gourt I. Atwater, J. The Reply in this case admits the appointment of a Receiver, under the proceedings supplementary to execution, which are set forth in the Answer, and that the Plaintiff in such proceedings received the sum of twenty-five dollars. This sum, as appears from the Answer, was an amount found due by the examination of the Defendant Bibeau, and Yandal, from Bibeau to Vandal, on the purchase of the land specified in the Complaint by Bibeau from Yandal. The amount found due from Bibeau to Yandal on the sale of the land specified in the Complaint, and the conveyance of which the Plaintiff seeks to set aside, was ordered by the Court below to be paid over to the Plaintiff, in part satisfaction of his judment against Yandall, and was received by the Plaintiff for such purpose. The only question which [293] it is necessary to consider in this case is, whether the Plaintiff can he permitted to receive a part of the consideration of the sale from Yandal and Bibeau, and then come into Court and ask to have the sale set aside as fraudulent, and therefore void as to creditors. The defendant claims that the Plaintiff ‘by instituting proceedings supplementary to execution, in effect prosecuted an action against the respondent, representing therein Yandal, for the recovery, and to compel the payment ment of the amount then unpaid by Bibeau to Yandal, on the purchase of the lands in question. It is true that such might have been the object of the Plaintiff in taking these proceedings, but it was not necessarily such. It might have been his object to ascertain not only whether Bibeau was indebted to Yandal, but also all the circumstances attending the sale, in order that he might determine whether the same was bona fide or otherwise. But whatever may have been the object of the Appellant in taking supplementary proceedings against Yandal, it can make no difference in (the consideration of this case. The question is with reference to what he actually did under such proceedings. It appears from the case that the District Court or the Judge thereof found a certain amount due from Bibeau to Yandal, on the purchase of the land by the former from the latter. That thereupon a receiver was appointed, to whom Yandal by order of the Court, was directed to assign this indebtedness. This was done, and the proceeds were paid over by the Deceiver to the Plaintiff and accepted by Jiim, and the [receiver discharged. Upon this state of facts, we think the Plaintiff is estopped from now setting up, that the sale from Yandal to Bibeau was fraudulent and void. There can be no doubt but that a conveyance of real estate in due form, even if made with the intent to defraud creditors is good as between the parties and privies, and can only be avoided by a creditor of the fraudulent grantor. Rev. Stat. p. 269. Sec. 1; 1 Smith’s Lead. Cases, 41; Jackson vs. Malvin 16 Johns, 189; 1 Story Eq. Jur. See 425; Jackson vs. Cadwell, 1 Cow. 622; 22 Pick. 253. And the creditor may have his election either to confirm the conveyance, or attempt to avoid it, but he cannot do both. He cannot receive a benefit under [294] the conveyance, and then turn round and claim that the conveyance is fraudulent and void. And it is held that by receiving a benefit under the conveyance claimed to be fraudulent, he thereby affirms it, so as to be estopped from settingup fraud or other facts in avoidance of it. He cannot hold on to such part of the contract as may be desirable on his part and avoid the residue, ¡but must rescind in toto, if at all, and the party who would disaffirm a fraudulant contract, must return whatever he has received upon it. Such at least is the rule with reference to the parties to a contract claimed to be fraudulent, and it is difficult to see how the creditor can stand in any better position in reference to the codtract, than an innocent vendee. Mason vs. Boret, 1 Denio, 69; Campbell vs. Fleming, 3 Ner. & Man, 834; Chit, on Con. 408, 409, 680; Burton vs. Stewart, 3 Wend. 236; 2 Kent's Com. p. 480; 5 East Rep. 449; Voorhes vs. Earl, 2 Hill, 288; 3 Sand. 174. The cases above cited, are mostly those in which one of the parties to the contract sought to avoid it on the ground of fraud. In the case at bar, the complaint charges that both parties (the vendor and vendee) acted fraudulently in effecting the sale. But it also" admits that the Plaintiff has received a benefit under the sale,‘to wit, apart of the consideration paid by Bibeau for the land. By such act, he so far affirms the sale of the land, as to be estopped from questioning its validity on the ground of fraud. It is claimed by the Counsel for the Appellant, that the respondent having entered into a fraudulent contract, is precluded from objecting to the loss of both the purchase money and the land, in case such should be the result of this suit. But the same reasoning would equally apply in a case where one of the parties sought to avoid the contract on the ground of fraud, and yet, by the authorities referred to, it will be seen that they are not permitted to retain what has been received, and still insist that the contract is wholly void. And when a party claiming to have been defrauded'in the sale of goods, brings assumpsit, instead of trover, to recover the price of the goods, he affirms the contract and cannot set up that the sale. was void on the. ground of fraud. Ferguson vs. Carrington, 9 Barn. & Cres. 59; Brinley vs, Tibbets, 7 Green, 70; 5 Met. 49. [295] In the case at bar it would appear that the Plaintiff must have been aware of the alleged fraud, at the time he accepted, the money under the proceedings supplementary to execution, and if so, it would not avail him to offer to restore the amount received, in bringing an action to set aside the conveyance as fraudulent. The judgment of the Court below must be affirmed.