Mathiez v. Day

36 N.J. Eq. 88

• Court: New Jersey Court of Chancery
• Decided: October 15, 1882
• Status: Published

Opinion

The Chancellor.

This suit comes before me on a rehearing of the final decree dismissing the bill, made on the advisory opinion of Vice-Chancellor Dodd. The complainant, on the 14th of April, 1879, recovered a judgment for $363.34, including costs, in the city court of Brooklyn, in the state of New York, in a suit brought by her against Mrs. Day. The action appears, from the briefs of counsel, to have been for damages for a tort. On that judgment a suit was brought in the circuit court of Hudson county, in this state, on or about the 7th of January, 1880, and judgment recovered by the plaintiff therein on the 23d of April following, for $415.07, debt and costs. An execution against goods and lands was issued upon that judgment, and returned unsatisfied before the filing of the bill. By deed dated March 28th, 1879 (but not recorded until January 22d, 1880), Mrs. Day, with her husband, conveyed to John C. Spencer, of the city of New York, for the consideration, as expressed in the deed, of $500, a vacant lot of about half an acre, in the township of Union, in Hudson county. At the same time she and her husband conveyed to the same grantee two houses and lots in Brooklyn, and a tract of four acres at New Lots, on Long Island, belonging to her, and also a house and lot, owned’by Mr. Day, adjoining the lot in Union township. This suit is brought to subject the first-mentioned property, the lot of half an acre, to the payment of the complainant’s judgment, on the ground that the conveyance to Spencer, though made before the recovery of either of the judgments, was fraudulent as against the complainant. Spencer was the brother-in-law of Mr. Hay. He swears that the latter had been, for several years before the purchase, trying to sell the properties to him, and had been trying to borrow money on them from him, but he had refused these applications; that Hay came to see him several times during the ten days preceding the sale, and urged him to buy the properties, because the Hays could not keep any of them by reason of the encumbrances (mortgages, taxes and municipal assessments) which were upon them, and were obliged to sell; that he finally told Hay that he would buy them, and he did so, for about $2,000, for all of them together, subject to the encumbrances thereon, and paid the money in cash to Hay; that the lot in question was valued in the transaction at $500, and there were $300 of assessments on it, and that all the properties were in fact encumbered. He swears that the sale was an absolute one, and that he heard nothing of the suit against Mrs. Hay until some time after the conveyance was made to him, and not until he was called to testify in the supplementary proceedings in the suit in this state. He swears, also, that the only reason he knew of for the Hays selling the properties, was their inability to keep them because of the encumbrances upon them, and that he bought the properties with a full intention to keep them for his own benefit. It is a noteworthy fact in this connection that Hay sold the house and lot in which he lived and which adjoined the property in question in this suit, together with the property of his wife. The suit was not against him but her alone. There obviously was no necessity (and as a practicing lawyer he must have known it) for selling his property in view of a judgment against his wife.

It is insisted on the part of the complainant that the fact that Spencer had seen none of the properties and knew nothing about them or their value, or the amount of encumbrances or the condition of the title, except from Hay’s statements, is evidence of the absence of good faith in the transaction. But while it exhibits his confidence in Hay, his brother-in-law, it is not proof of fraud. It is also argued that the price at which the lot was sold to' Spencer is evidence of fraud, inasmuch as it was, as is alleged, worth $1,200. But there is no proof as to what it was worth when the conveyance was made. A single witness, who appears to have been examined in the absence of defendant’s counsel, and was not cross-examined, says it was worth, when he testified, about $1,200, but he does not say what it was worth when it was sold to Spencer, more than three years before that time. And the same criticism is to be made on the testimony of the witness (there is but one) who speaks of the value of,the other properties. It may be added, also, that there is no proof in the cause as to the assessments on the latter properties. The truth seems to be that the Days, finding themselves unable to hold the properties by reason of the encumbrances upon them, pressed Spencer, as they had done often before, to buy them, and he yielded to their urgency and bought them absolutely and wholly on his own account, and with no knowledge or suspicion of the existence of any other reason (if any other reason there was) on their part for disposing of them or any of'them. He may have obtained them at alow price. He undoubtedly, being an unwilling purchaser, thought he was doing so. If he did, and there was no fraud in the matter, he is of course entitled to the benefit of his purchase. The vice-chancellor who heard the cause on the oral testimony of the witnesses was of opinion that there was no proof of fraud in the transaction, and I concur in the opinion.