Miller v. Thompson

3 Port. 196
Supreme Court of Alabama·Decided January 15, 1836·Published·Cited by 16 cases

Opinion

Saffold, C. J.

I will first examine the subject, in reference to the cases, in which the Millers are the claimants, and the other so far, only, as the same principles are equally applicable to it — leaving out of view, for the present, the effect of the mariage, on the latter.

The inquiry is presented, whether it is competent for a father, who is a debtor at the time, to make a, voluntary conveyance of a portion of his property to a child, or children, so as to vest in them a valid title against the claim of his pre-existing creditors; though he retain at the time sufficient other property to pay his debts; or whether such conveyances are, in legal contemplation, fraudulent and void, as against such creditors?

So much of our statute of frauds, as is considered applicable to these questions, is in the following language —that every gift, grant, or conveyance of lands,” &c. or of “goods or chattels,” &c. “by writing or other[200] wise/’ “had, made and contrived, of malice, fraud, covin, collusion, or guile, to the end or purpose to de lay, hinder or defraud creditors of their just and lawful actions, suits, debts,” &c. “shall be from henceforth deemed and taken only as against tjie person oí persons, his, her or their heirs,” &c. “ w\iose debts, suits,” &c., by such means, “shall, or might be, in any wise disturbed, hindered, delayed or defrauded, to be clearly and utterly void,” &c. The import and effect of this statute is understood to be the same as that of the English statute of 13th Elizabeth, as far as they apply to this-principle, and both are considered as declaratory of the common law.

That a voluntary conveyance, i. e. one not founded on a consideration deemed valuable in law, of all a debtor’s property, or of so much as must unavoidably “delay, hinder, or defraud ” his existing creditors, is fraudulent and void as against them, all must admit. The only doubt appears to be, whether such conveyance of the debtors property, and what proportion, will be free from this objection.

We may readily imagine the great difficulty and embarrassment, that must necessarily result from the adoption of the latter principle. One consequence must be, that all trials of the right of property thus conveyed, may involve inquiries, respecting the amount and validity of all claims and demands against the donor; of the amount and value of the property he possesses and claims, and the sufficiency of his title to the same. If, however, it be found,, that such is the settled law, we, as a Court, without power to alter it, have only to acquiesce in the principle, and expound it accordingly.

It is insisted, on the part of the claimants, that [201] the principle has been so settled, on good authority. In support of the position, are cited, various decisions; among others, some made by this Court, under its former organization. The first case relied upon, is that of Toulmin vs. Buchanan's Ex'ors.a

It is true, that, if we are bound to adhere to the principles of that decision, it justifies the position assumed, to its fullest extent.

The gift,„in that case, was from Caller to his son-in-law, several months after his marriage, and at a time when it appeared that the donor was/'much embarrassed by debts — much moré than he was able to pay.” The Court held, that if Caller had made a gift of all bis estate the law would declare it fraudulentperse, and void against the creditors. ' But, as the gift was of part only, it was prima facie, in advancement of the marriage, which is deemed, in law a valuable consideration; and that it was not void or fraudulent per se, but, a circumstance, which, if corroborated by other circumstances, might have authorised the jury to infer fraud.

' The principle declared on that occasion, obviously requires further consideration. Since that, and the other decisions referred to, of this Court, all the members have been changed, except myself. How far I may have concurred in that opinion at the time, is not recollected, or material to my purpose. We should proceed with reluctance, in any case, to overrule a principle of decision, once declared by the highest tribunal of the State, and which may have had its influence on the community : yet, we regard it as a solemn duty, to do so, if we discover it to be manifestly erroneous, and of a highly mischievous tendency. Should [202] it therefore appear, upon examination of the authorities, (as I think it will,) that this decision is opposed to the current doctrine of the highest tribunals, it can have no binding influence upon us.

It is also to be observed, that this Court has long since departed from the principle of that decision, without expressly overruling it. We did so, in the case of Cato vs. Easly,a which has been referred to, on the part of the defendant in error. This latter case, too, has a direct application to these under consideration.

There, a voluntary conveyance was executed by a mother, then a widow, to her children. At the time of the conveyance she owed the debt, for the satisfaction of which, the suit, (which was in Chancery,) was instituted. The property was held subject to the debt, the language of the Court being, that it was a “ legal inference, that a voluntary conveyance, made by one indebted at the time, is, as against such creditors, fraudulent and absolutely void.”

A case equally applicable to these under consideration, and mainly relied on, by the counsel for the defendant in error, is that of Read vs. Livingston.b

In that case, which related to a voluntary family settlement, the Chancellor reviewed numerous authorities, both English and American, with his usual ability. He decreed, that a voluntary settlement, after marriage, by a husband, in favor of his wife, by means of a deed in trust, was fraudulent and void, against all the donor’s antecedent creditors : and that, without regard to the amount of the existing debts, or the extent of the property settled, or the circumstances of the party. But that, with regard to debts, [203] contracted subsequent to the settlement, he intimated, that the presumption of fraud, arising in law, from the party being a debtor at the time, may be repelled, by circumstances: as, that the antecedent debts were provided for, in the settlement, or otherwise secured; that, if the presumption of fraud, were not so repelled, subsequent creditors might impeach the settlement, by shewing antecedent debts, sufficient in amount, to afford reasonable evidence of a ■fraudulent intent; for, as on the one hand, showing -an antecedent debt, however small or trifling, is not sufficient to render the settlement fraudulent and void — so, on the other hand, the subsequent creditor, to impeach it, is not obliged to prove, that the party was insolvent at the time.

The views of the Chancellor, and the authorities he quotes, subject all voluntary settlements or conveyances, whether in favor of the wife or children of the donor, to the same rules; and, the principles he has thus recognised, appear to me, to be as just, reasonable and consistent, as the very difficult and complex nature of the subject, will admit of.

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