Heatley v. Finster

2 Johns. Ch. 157

Opinion

The Chancellor.

[ * 161 ]

When Finster took an assignment of Muller’s contract, the consideration had not been paid to Winter. The plea admits that 1,015 dollars were due and paid by the defendant to Winter, in 1814, when a deed was executed. The question is, whether the whole negotiation between the defendant and Winter, and the payment of the money, was not, in judgment of law, a fraud upon the rights of the plaintiffs. I consider the defendant as chargeable, at that time, with notice of the suit then *pending against Winter, for a breach of trust. In explanation of the rule on this point, I can add nothing to what was said in the case of Murray v. Ballou, (1 Johns. Ch. Rep. 566.) The defendant denies notice of the suit, but there is no denial of notice of the character in which Winter dealt; and, indeed, after the proof that we have had in the case of Murray v. Finster,

Footnotes

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† of positive and direct notice given to the defendant, as early as 1812, (and which notice is not even denied in that case,) the denial of actual notice here of the existence of any suit against Winter, when he made the payment in 1814, cannot but excite surprise and concern. The amicable suit instituted between the defendant and Winter in September, 1813, and terminated as soon as it was commenced, by a decree, by consent, adds nothing to the validity of the defendant’s claim. It was nothing more nor less than a private agreement put into the shape of a decree for a more imposing appearance. Muller’s original contract, though good in the first instance, was left inchoate, without delivery of the deed, or payment of the money; and when the party became chargeable with notice of the suit against Winter, he was bound to cease all further dealing with him, on the subject matter of the trust. (See cases cited in 1 Johns. Ch. Rep. 301.) To allow the payment to stand good would be permitting trust property to be fraudulently dissipated in contempt of the authority, and in evasion of the process of this Court.

1 shall, therefore, decree, that the defendant Finster, within 40 days from the service of a copy of this decree, Pay t0 the solicitor of the plaintiffs, or bring into Court, the sum of 1,015 dollars, with interest from the 14th of January, 1814, unless he shall, within that time, elect to convey *n toe, and actually convey by deed, with proper covenants against his own acts, to be approved by a master, the premises in the pleadings mentioned, to Mary Green and Henry Green, to be held by them in trust, &c. • and that in either case, he pay the costs of this suit. ■

Ante, p. 155.