Holmes v. Bacon

Mr. Justice HaNdy delivered the opinion of the court. The facts of this case are in substance, that the plaintiff’s intestate, Jane Kirkland, was indebted to the defendants in error by a promissory note on which one Ellis was surety or indorser, and which was secured by a deed in trust; and in the month of March, 1848, Ellis applied to the defendants in error, through their agent, to pay the debt, by giving his sight draft on Andrews & Brother of New Orleans, which he assured the agent would be promptly paid; and relying on this assurance the agent took the draft, delivered up the note to Ellis, and had the deed in trust cancelled. It turned out that Ellis had no funds in the hands of Andrews & Brother, and the draft was protested for non-payment. This bill was thereupon filed against Jane Kirkland’s administer and Ellis, who was her son-in-law, alleging that Ellis had procured the cancelment of the deed in trust by fraud, and seeking to have the deed restored and that the property embraced in it should be sold in satisfaction of the debt. The administrator answers simply denying all knowledge of the alleged transaction between Ellis and the agent of the defendants in error, and insisting that no sufficient ground is shown by the bill against Mrs. Kirkland for restoring the deed in trust. Ellis died before answer, and the bill was taken as confessed against his administrator who was made a party. The decree was for the complainants, and this writ of error is prosecuted by Jane Kirkland’s administrator. From the pleadings and proof in the case there can be no doubt but that Ellis practised a fraud upon the agent of the defendants in error in obtaining the discharge of the deed in [610] trust, which would subject him to liability and be good ground for restoring the deed in trust if it had been an instrument made by him. But the question is, whether his fraudulent conduct is a sufficient ground for restoring the deed so as to affect the rights of Jane Kirkland. If she derived a benefit from his deceit, though not a party to it, or if no consideration was paid by her to Ellis in consequence of which he discharged the deed in trust by giving his draft, or if after that time no payment was made by her to him of the note taken up by him, the debt would still remain unpaid by her, and she would be bound to pay it, and could make no just objection to the security given by her being restored. If the note is outstanding in the hands of Ellis, she is still liable to pay it, for aught that appears in the record, and it is but just that it should be paid to the defendants in error and not to Ellis. If it has been paid to Ellis or to any other person, it is not a little strange that Ellis did not show that fact by answer, and that the administrator of Jane Kirkland does not allege any thing of the kind in his answer. If she had actually paid it, it is to be presumed that some evidence of that fact eotdd be found among her papers, or by information in relation to it derived from Ellis by the administrator. In the absence of every thing tending to show that the debt had been paid by her, we think it but just to presume that it remains unpaid. Her administrator, therefore, cannot complain of a decree which simply compels him to pay a debt of his intestate which remains unpaid, and to that end, restores a security of which the creditor had been deprived by fraudulent means. The decree is affirmed.