THOMPSON, Circuit Justice.
The original bill or petition in this case was filed in the superior court for the county of New London, in the state of Connecticut, and was removed into this court under the provisions of an act of congress, on the ground that the defendants were citizens of the state of New York. This circumstance has been urged at the bar on the part of the complainants, as placing the cause, with respect to the effect and operation of the answers as matters of evidence, upon a different footing than if it had been originally commenced in this court. I can perceive no good reason for such a distinction; if it was the right or privilege of the defendants to be sued in this court, it ought not to be in the power of the opposite party to take away that right, or deprive them of any advantage, if any exists, which they may have in this respect. It seems to be admitted that in the state courts in Connecticut, an answer in chancery stands on the same footing as a plea, and is not evidence, unless the complainant seeks a disclosure by an appeal to the conscience of the defendant. This is different from the rule that prevails in chancery proceedings in the courts of the United States; when the answer is responsive to the allegations in the bill, it is considered as evidence, and must be rebutted by something more than simply the testimony of one witness. In this case the answers were filed in this court after the cause was removed here, and were, in point of fact, sworn to in conformity with the practice of this court. The courts of the United States ate not governed or controlled by the practice of the state courts, unless adopted by some law of the United States, or by some rule of court made in pursuance of an act of congress. See Brewster v. Gelston [Case No. 1,853]. The supreme court of the United States has, under authority of an act of congress, adopted certain x-ules of practice for the courts of equity of the United States; one of which is, that in all cases where the rules prescribed by the supreme court or by the circuit court, do not apply, the practice of the circuit courts shall be regulated by the practice of the high court of chancery in England. And it has not been, and cannot, indeed, be denied, that, by the practice of the English chancery, the answer is required to be put in under oath, and is received as evidence-so far as it is responsive to the bill.3
[961] The answers in this case must, therefore, be received and considered according to this rule.
The object of the bill in this case is to set aside, and declare null and void, a certain deed or instrument in writing, given by Charles E. Phelps to D. Forest Manin, one of the defendants in this case, bearing date the sixteenth day of May, in the year one thousand eight hundred and thirty-three, and which is set out in hsec verba in the bill. The allegations in the bill as the grounds upon which the relief is sought, are substantially that Charles E. Phelps, at the time of his death, had a large real and pgr-sonal estate, to the amount of $20,000 and upwards. That he was largely indebted to more than that amount, which, debts, at the time of the execution of the deed in question, were due and payable, and still remain unpaid; and that the property mentioned and described in said deed was liable to, and necessary for the payment of such debts, and the only fund to which the creditors can resort for such payment; and that unless the same shall be so applied, all his creditors must lose their debts. The bill further states that Benjamin F. Phelps, one of the defendants, was the brother of Charles E. Phelps, and was a partner in the mercantile house of Manin, Phelps & Co. That he was the only brother of the whole blood of the said Charles, and his sole heir-at-law. That at the time of the execution of the deed the said Charles had become weak, debilitated and much impaired both in body and mind, and was in daily expectation of dying at the house of his said brother Benjamin, where he was then sick, and under the entire influence and control of his brother, in the absence of all his other near relatives; and that the said Manin and Benjamin combining and conspiring together, secretly and away from the knowledge or observation of his other relatives, or any of the creditors, [962] obtained his signature to the said deed. And the bill charges that the said Manin and Benjamin fraudulently, as it respects all the creditors of said Charles, combined together to obtain and perfect before his death, the instrument of writing aforesaid, thereby to defraud, delay and hinder, and wholly to deprive all the just creditors of the said Charles of all the means of obtaining any part of their debts.
The grounds, therefore, assumed in the bill upon which the deed is sought to be set aside, are to be considered in two aspects: (1) As between grantor and grantee, unconnected with the creditors of the grantor; and (2) as against the creditors of the grantor.
Viewing the case under the first aspect, it is not perceived hów the complainant can have any right to call in question the validity of this deed. Neither he nor those whom he professes to represent, have any interest in the matter. The bill alleges that Benjamin E. Phelps, one of the defendants, was the only brother of the whole blood of Charles E. Phelps, and his sole heir-at-law. He is, accordingly, in the absence of all creditors, the only party interested in the estate, and he admits in his answer, in the most full and unqualified manner, the validity of the deed. The deed is certainly not void on account of any defect appearing on its face. The recital shows a benefit received by the grantor, which, with the pecuniary consideration, although nominal, are abundantly sufficient to sustain it, unless the grantor was incompe-teijt to make any valid instrument to pass his estate.
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THOMPSON, Circuit Justice.
The original bill or petition in this case was filed in the superior court for the county of New London, in the state of Connecticut, and was removed into this court under the provisions of an act of congress, on the ground that the defendants were citizens of the state of New York. This circumstance has been urged at the bar on the part of the complainants, as placing the cause, with respect to the effect and operation of the answers as matters of evidence, upon a different footing than if it had been originally commenced in this court. I can perceive no good reason for such a distinction; if it was the right or privilege of the defendants to be sued in this court, it ought not to be in the power of the opposite party to take away that right, or deprive them of any advantage, if any exists, which they may have in this respect. It seems to be admitted that in the state courts in Connecticut, an answer in chancery stands on the same footing as a plea, and is not evidence, unless the complainant seeks a disclosure by an appeal to the conscience of the defendant. This is different from the rule that prevails in chancery proceedings in the courts of the United States; when the answer is responsive to the allegations in the bill, it is considered as evidence, and must be rebutted by something more than simply the testimony of one witness. In this case the answers were filed in this court after the cause was removed here, and were, in point of fact, sworn to in conformity with the practice of this court. The courts of the United States ate not governed or controlled by the practice of the state courts, unless adopted by some law of the United States, or by some rule of court made in pursuance of an act of congress. See Brewster v. Gelston [Case No. 1,853]. The supreme court of the United States has, under authority of an act of congress, adopted certain x-ules of practice for the courts of equity of the United States; one of which is, that in all cases where the rules prescribed by the supreme court or by the circuit court, do not apply, the practice of the circuit courts shall be regulated by the practice of the high court of chancery in England. And it has not been, and cannot, indeed, be denied, that, by the practice of the English chancery, the answer is required to be put in under oath, and is received as evidence-so far as it is responsive to the bill.3
[961] The answers in this case must, therefore, be received and considered according to this rule.
The object of the bill in this case is to set aside, and declare null and void, a certain deed or instrument in writing, given by Charles E. Phelps to D. Forest Manin, one of the defendants in this case, bearing date the sixteenth day of May, in the year one thousand eight hundred and thirty-three, and which is set out in hsec verba in the bill. The allegations in the bill as the grounds upon which the relief is sought, are substantially that Charles E. Phelps, at the time of his death, had a large real and pgr-sonal estate, to the amount of $20,000 and upwards. That he was largely indebted to more than that amount, which, debts, at the time of the execution of the deed in question, were due and payable, and still remain unpaid; and that the property mentioned and described in said deed was liable to, and necessary for the payment of such debts, and the only fund to which the creditors can resort for such payment; and that unless the same shall be so applied, all his creditors must lose their debts. The bill further states that Benjamin F. Phelps, one of the defendants, was the brother of Charles E. Phelps, and was a partner in the mercantile house of Manin, Phelps & Co. That he was the only brother of the whole blood of the said Charles, and his sole heir-at-law. That at the time of the execution of the deed the said Charles had become weak, debilitated and much impaired both in body and mind, and was in daily expectation of dying at the house of his said brother Benjamin, where he was then sick, and under the entire influence and control of his brother, in the absence of all his other near relatives; and that the said Manin and Benjamin combining and conspiring together, secretly and away from the knowledge or observation of his other relatives, or any of the creditors, [962] obtained his signature to the said deed. And the bill charges that the said Manin and Benjamin fraudulently, as it respects all the creditors of said Charles, combined together to obtain and perfect before his death, the instrument of writing aforesaid, thereby to defraud, delay and hinder, and wholly to deprive all the just creditors of the said Charles of all the means of obtaining any part of their debts.
The grounds, therefore, assumed in the bill upon which the deed is sought to be set aside, are to be considered in two aspects: (1) As between grantor and grantee, unconnected with the creditors of the grantor; and (2) as against the creditors of the grantor.
Viewing the case under the first aspect, it is not perceived hów the complainant can have any right to call in question the validity of this deed. Neither he nor those whom he professes to represent, have any interest in the matter. The bill alleges that Benjamin E. Phelps, one of the defendants, was the only brother of the whole blood of Charles E. Phelps, and his sole heir-at-law. He is, accordingly, in the absence of all creditors, the only party interested in the estate, and he admits in his answer, in the most full and unqualified manner, the validity of the deed. The deed is certainly not void on account of any defect appearing on its face. The recital shows a benefit received by the grantor, which, with the pecuniary consideration, although nominal, are abundantly sufficient to sustain it, unless the grantor was incompe-teijt to make any valid instrument to pass his estate.
Admitting the right of the complainant to call this in question, how stands the case on this ground? The bill does not charge that the grantor was defrauded, deceived or imposed upon, or that the deed executed by him was in any respect different from what he intended. And how stands the case with [963] respect to the allegation, that the grantor had become weak, debilitated, and much impaired both in body and mind, when he executed the deed. The report of the commissioner upon this point is sufficient to remove all objections on this ground; he states that there was no proof of any such mental debility as would render him unable to make a valid contract, or would expose him peculiarly to undue influence or practices, but, on the contrary, his mind was clear and sound; and, indeed, the want of capacity in the grantor to make a valid deed, is entirely unsustained by the proofs in the case. But the contrary is most clearly and satisfactorily established. The answer of Benjamin F. Phelps (the only person, under the present view of the case, who is interested in the question), is sufficient to put this matter at rest. This part of the answer is directly responsive to the allegation in the bill. He admits that the deceased died without any child or other heir except this respondent; and that the deceased, at the time of the execution of the said. instrument, had become weak, debilitated and much impaired in body, and his recovery deemed hopeless; but he expressly denies that the deceased was at that time weak, debilitated, or much, or at all, impaired in mind; but, on the contrary, that he was in the full and vigorous exercise of all his mental faculties, and so continued down to the hour of his death, & a remarkable degree. The allegation in the. bill, that the grantor was under the influence and control of his brother Benjamin, is entirely unsupported by the proofs, and is expressly denied by the answer of Benjamin; so, also, the allegation that the deed was executed in the absence of all the grantor’s relatives, except Benjamin, is not only unsupported by any evidence, but the contrary was expressly proved. The mother of the grantor was present, and had taken an active part in bringing about the arrangement, and procuring the deed to be given. The same remarks may be applied to all the other circumstances that have been urged as affording grounds for concluding that any undue or improper practices had been resorted to in procuring the deed in question. So far as any are specifically set out in the bill, they are denied by the answers, and not sustained by the proofs. It is deemed unnecessary to notice, in detail, the objections which have been urged against this deed, growing out of the time and manner in which it was executed; although the circumstances were a little unusual, and if accompanied by proof of any attempt to impose upon the grantor, would be entitled to great consideration, and might afford reasonable and plausible ground of argument and inference against the fairness of the transaction. But-in the absence of all such proof, and in the face of the report of the commissioner, that the grantor was of sound mind, and not so debilitated as to expose him to undue influence and practices, any conclusion unfavorable to the deed on this account, must rest upon bare suspicion, and would not comport with a fair view of the evidence. This branch of the case is, therefore free from any difficulty, and the deed must be considered valid and operative, unless assailable by the creditors of the grantor on some other ground.
2. The second objection to the deed made in behalf of the creditors of the grantor, has been presented at the bar in two points of view: (1) As a voluntary deed, and void under the statute of frauds; and (2) as being void under the act of Connecticut of 1828 [Laws Conn. 1822-35, p. 182]. The bill, so far as it contains any allegation of fraud in fact, is fully met and denied by the answers, and is not, in any measure, sustained by the proofs, and may be dismissed without further consideration.
The first inquiry then is, whether it is fraudulent in law as a voluntary deed, and void under the statute of frauds. The in-debtment of the grantor at the date of the deed is fully stated in the bill, and not denied by the answers; so that' no question arises here, which has sometimes been made, as to a distinction between creditors antecedent and subsequent to the date of the deed. The consideration upon which the deed is sustained, appears by the recital: “Whereas Benjamin F. Phelps, of the city of New York, (one of the defendants,) is largely indebted unto the said party of the second part, and also to the said party of the second part and Erasmus D. Poote; and said party is under large and considerable responsibilities, together with said Poote, for said Benjamin P. Phelps, which said debts and responsibilities the said party of the first part has agreed to pay, and indemnify the said party of the second part, and said Poote against, as far forth as the property hereinafter conveyed will extend and enable him to do.” The consideration here set out is, therefore, an agreement on the part of the grantor to pay certain debts due from Benjamin P. Phelps to the grantor, and also to the grantee and Erasmus D. Poote, and to indemnify them against responsibilities they were under for Benjamin P. Phelps. What these debts and responsibilities are does not appear upon the face of the deed, and it becomes a question whether parol evidence is admissible to explain it. It is a well-settled rule that parol evidence cannot be admitted, to contradict or vary the terms of a written instrument. Nor can a conveyance be shown by parol to be to another use or intent than that expressed in it. But the evidence in this case does not appear to me to violate these rules. It was introduced to prove a collateral agreement connected with the stipulations in the deed, and in no respect repugnant to it; it was matter extrinsic, and referred to as explanatory of the nature and extent of the consideration. It may be con[964] sidered as partaking of the character of a latent ambiguity, arising from some collateral matter out of the instrument, which may always be explained by parol evidence.
If, then, the inquiry can bo entertained as to the nature and extent of the consideration, does the evidence sustain tlie deed in this respect? How far the answers of the defendants on this branch of the case are to be received, will depend on the allegations in the bill. The bill, in substance, charges the defendants with fraudulently obtaining the deed from Charles E. Phelps, to the injury of his creditors, and to defeat their just debts; and this allegation rests materially, if not solely, upon the ground of want of consideration. The answers, therefore, showing what the consideration was, are responsive to the bill, and to be received as evidence. The commissioner reports, that from the answers, and various other sources of evidence, it appears that Benjamin F. Phelps was one of the firm of Manin, Phelps & Co., and this indeed is so alleged in the bill; and that in the year 1832, and in the early part of 1S33, he was acting as the agent of his brother Charles E. Phelps, in New liork, and constantly furnished him with funds to a large amount, which were extensively drawn from the funds of Manin, Phelps & Co., without the knowledge of either of the other partners, and in many instances grossly fraudulent. The evidence shows very satisfactorily, that the funds of the partnership, used by B. F. Phelps for the benefit of his brother, Charles E. Phelps, were to a greater amount than the value of the property conveyed to Manin by the deed in question. It was, therefore, in reality the debt of Charles E. Phelps himself, which his property went to pay; and, in this view of the case, every consideration of justice and equity, as against C. E. Phelps, calls for the establishment of the deed. This evidence was proper, as explanatory of the agreement of Charles E. Phelps, and to show the consideration upon which that agreement rested. It was in no respect repugnant to the deed, but related to matter collateral to and consistent with it; and, indeed, may well be considered as in direct answer to the allegations in the bill, so far as they rest upon the want of consideration in the deed.
But it is objected, that illegal evidence was admitted to establish this debt; that the books of the partnership could not be received for that purpose. The report of the commissioner shows the purpose for which the books were offered and received in evidence; it was not to show any debt against Charles E. Phelps, but to show how the accounts stood as between the partners themselves. The recital in the deed is that B. P. Phelps was largely indebted to Manin and to Manin & Foote, which debts the grantor, C. E. Phelps, had agreed to pay. The amount of the debts and responsibilities thus assumed by C. E. Phelps, does not appear by the recital, and this was necessary to be shown, at least to the extent of the value of the property conveyed. C. E. Phelps had appropriated his property only to that extent, and if there was any surplus it was reserved for his use, and would have been subject to the claims of his creditors. That the books were sufficiently proved to show how the accounts stood between the partners themselves, cannot be questioned. The books were objected to because all the clerks who made the entries were not produced as witnesses; but the commissioner states that they were admitted because it appeared that the clerks were the agents of the partners for the purpose of keeping the books, and that ffm, H. Plumer, who was sworn as a witness, was the'principal clerk, and had the superintendence of all the books; and had himself made almost all the entries which related to the same charges. These clerks were the agents of all the partners, and their acts were binding upon all the partners. The books were admitted subject to any proof of collusion, fraud or mistake in the entries; but no such proof was offered. This was not evidence showing a different consideration from that expressed in the deed. The consideration in the deed was the assumption of the grantor to pay debts of B. F. Phelps to a large amount, and this. evidence was to show such amount, which, as against the creditors of Charles E. Phelps, was necessary, in order to protect the property against their claim.
The case, then, is resolved into one where an insolvent debtor has appropriated his whole property towards the payment of the debt of a preferred creditor; and if the facts in the case will warrant this view of it, the validity of the deed cannot be questioned, for it is a well-settled and undisputed doctrine, that an insolvent debtor may prefer one creditor to another. This is believed not to be at this day an open question. It is a point too well settled to admit of argument. ‘Whether originally settled upon sound principles of justice and policy, is not considere;! within the province of this court to examine. Had the deed been given to Benjamin F. Phelps, who was the creditor of Charles E. Phelps, its validity would have been clear. The only remaining inquiry is, whether this deed is void under the statute of Connecticut of 1S2S, relative to conveyances in trust for creditors? This act declares, “that all eon-veyances and assignments of any lands, tenements, goods, chattels or choses in action, hereafter made, directly or indirectly, by any person in failing circumstances, with a view to his insolvency, to any person or persons in trust for his creditors or any of them, shall, as against the creditors of the person making such conveyance or assignment, be deemed and adjudged fraudulent, and utterly void, unless the same be made in writing for the benefit of all the creditors in proportion to their respective claims, &c."
[965] It is a sufficient answer to this objection, that this is not, in point of fact, a deed coming within the description contained in the act. It is not a deed given by Charles E. Phelps to any one in trust for his creditors. Manin & Foote are not the creditors of the grantor, they are the creditors of Benjamin F. Phelps. This is explicitly stated in the recital in the' deed, and Benjamin F. Phelps is the creditor of Charles E. Phelps, who has assumed to pay the debt of Benjamin. The assignment being ma de with the assent of Benjamin, the proceeds of the sales of the property, on being received by Manin, would extinguish so much of Benjamin’s debt. But this does not make it a deed in trust for the creditors of Charles; but it may well be questioned whether this can be considered, in any sense, a deed in trust. It is not a conveyance to one for the benefit of another, or for the grantee and another; it is for the benefit of the grantee himself. He may, in a certain sense, be said to hold the surplus, if any, in trust for the grantor; but this could not be considered in trust for the creditors of the grantor, within the statute of Connecticut. It may be considered more properly an indemnity, in the nature of a mortgage, or a power coupled with an interest The grantor appoints the grantee his attorney irrevocably, and authorizes and empowers him to use and take all lawful ways and means to carry into full force and effect the true intent and meaning of the indenture, which was to sell and dispose of the property conveyed, and to retain and pay all such sums of money as are due, owing and payable, by the said Benjamin F. Phelps to Manin individually. or Manin & Foote, and pay over the surplus. if any, to the grantor or his legal representatives. It has been settled, in this state (Bates v. Coe, 10 Conn. 280) that this statute does not break in upon the long-established doctrine of the common law, that a debtor may prefer one creditor to another. Upon the whole, therefore, the complainant’s bill must be dismissed without costs.