Greenbank v. Ferguson

58 F. 18, 1893 U.S. App. LEXIS 2851

• Court: U.S. Circuit Court for the Northern District of Illnois
• Decided: August 24, 1893
• Status: Published

Opinion

WOQDB, Circuit Judge.

T am not able to agree with the master’s view of this case. I am convinced that the conveyance of November 10, 1874-, instead of having been executed in discharge of the debt evidenced by the promissory note of April 10, 1874, was intended as a security additional to that theretofore given for the payment of that note, and perhaps for any other liability of Ferguson to Greenbank which might be incurred; and, this being so, the deed, though absolute in form, was, in equity, only a mortgage, and affords no support for this action. Or, if this is not so, then the deed was made, in fraud of creditors, upon a secret trust for Ferguson, or for his wife and children. The complainant, after receiving the deed, though ‘in straitened circumstances, did not act as if lie considered the land Ms. He retained possession of the note, which, if paid, should have been surrendered. He permitted Ferguson to pay the taxes upon the land, and to receive the rents from it. His testimony is by no means positive to the contrary; and Ms letters, especially that of April 2, .1891, show that he regarded Ferguson as still indebted to h.m; and that if the debt were paid the land ought to he reconveyed. The testimony of Ransom shows that Mrs. Ferguson understood that Greenbank had advanced money, and held the deed as a security. If guided by Ferguson’s testimony alone, the court would be compelled to find that the deed was made with the intent to put the’property beyond the reach of Ferguson’s creditors, and that Grreenbank, having received and held the deed in furtherance of that design, has no standing in equity.

It follows that the conclusions of the master should be set aside, and the bill dismissed, at the complainant’s costs, but without prejudice to his rights as mortgagee. So ordered.