President & Directors of Manhattan Co. v. Osgood

15 Johns. 162

• Court: New York Supreme Court
• Decided: January 15, 1818
• Status: Published

Opinion

Yates, J.

delivered the opinion of the court. The executors, as the legal representatives of the deceased, had exhibited the statement under oath, and filed it, with the petition, in the surrogate’s office, with an intention of obtaining an order to sell the real estate, but which was afterwards, abandoned. It appears to me that the executors, of all others, were the best informed on the subject, and were competent to make admissions sanctioned by their oaths; particularly as to a collateral fact. Those documents were, therefore, properly admitted in evidence,

(b) as stated in the case, for the purpose of showing the testator’s indebtedness, on the 31st of August, ,1814; and unless a mistake had been made in the statement, which might have been shown on the trial, it must be entitled to great weight. (1 Phillips' Ev. 192. 15 East, 34, 35. 4 Johns. Rep. 461.) The executors were certainly competent to know the fact, and the evidence appears to me to be the highest of which the nature of the case is susceptible It goes to show, most decidedly, the fact of insolvency at the date of those deeds ; nor would the result be different, if the estate of the husband, and the bonds alleged to be executed fey him, were excluded. It is evident, then, that phe situation of Mrs. Osgood, at the date of those conveyances, rendered them void, as regards the plaintiffs in this cause; and the law is well settled, that if a party executes a voluntary conveyance, indebtedness, at the time, is evidence of fraud; and where such indebtedness is to the extent shown in this case, it is sufficient to render the conveyances inoperative and void, as to creditors.

That part of those debts had originated in consequence of endorsements by Mrs. Osgood, for her son, does not alter the case, in construction of law; and the testimony clearly shows that she could not have been solvent at that period; and that long before the date of the conveyances, she was, from time to time, wholly dependent on her credit for funds. It was, then, illegal for her, while those embarrassments; continued, to convey to her daughters. (3 Coke, 81. b. Twine's Case, 1 Atk. 15. 94. 2 Atk. 600.)

If, then, those conveyances were fraudulent and void, the fee remained in Mrs. Osgood, and, as to her creditors, it was the same as if she had never conveyed. (3 Rep. 78. b. Dyer, 295. pl. 16.) The title to the estate must, consequently, be governed by her last will and testament, by which, after sundry bequests and legacies, she devises to her children, parties to this issue, all the rest of her estate, both real and personal. The lots for which the void conveyances were given constitute a part of that residue, and, of course, must be held by them'J under this devise, and be equally liable for the payment of the debts of the deceased, with the other real estate of which she died seized, and are as~ sets by devise.

There is no ground for the allegation that the notes aré usurious, for it cannot be questioned that it has been the uniform practice of all banking institutions, since their establishment, to exact the payment of interest in' advance; and it would be an alarming principle to introduce, that all paper thus held should be usurious and void. The law, however, does not require such a decision. It supports a different and more salutary principle, and more conducive to mercantile convenience, by allowing bankers to receive the interest in advance. (2 Bl. Rep. 792. 1 Bos. & Pull. 144. 2 Term Rep. 52.) The court are, therefore, of opinion, that the plaintiffs are entitled to judgment.

Judgment for the plaintiffs.

Vide Johnson v. Beardske and others, ante, p. 3.