Townsend & Bros. v. Harwell

18 Ala. 301
CourtSupreme Court of Alabama
DecidedJune 15, 1850
StatusPublished
Cited by14 cases

This text of 18 Ala. 301 (Townsend & Bros. v. Harwell) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Townsend & Bros. v. Harwell, 18 Ala. 301 (Ala. 1850).

Opinion

CHILTON, J.

Our opinion must be predicated upon the special verdict of the jury, as set forth in the record, for if they have found the facts wrong, an application should have been made to the primary court to set aside their verdiet. Thus considered, the record presents the sole question, whether the deed of assignment made by a debtor in insolvent circumstances to an honest but insolvent trustee, by which such debtor devotes his property absolutely to the payment of his debts, but which was intended by him to delay, hinder and defraud his creditors, can be upheld as against the plaintiff in attachment, the creditors provided for in said deed never having given their assent to, or claimed any benefit under it. The solution of this question depends upon whether we must presume that the creditors will assent to the deed, and upon the further inquiry whether such assent, either presumed or actual, would make it available as against the plaintiff, who has acquired a lien upon the property, prior to any actual assent.

The doctrine held by this court, in regard to presuming the assent of creditors, is, that such assent will be presumed where the assignment is for their benefit — (Kinnard v. Thompson, 12 Ala. 491; Gazzam v. Points, 4 ib. 374) — but such assignment will not be considered beneficial, unless the deed devotes the property absolutely and under all circumstances to the payment of the debts secured — (Dubose v. Dubose, 7 Ala. 235; Allen v. Montgomery & W. P. R. R. Co. 11 Ala. 437) — nor where it provides for the delay of the creditors secured to be paid.— Lockhart v. Wyatt, 10 Ala. 231; Hodges v. Wyatt, ib. 271. But these principles do not affect the case before us, and we feel confident that no case has been decided by this court where the question here made was involved.

The statute expressly declares all conveyances made to delay, hinder, or defraud creditors, “ to be clearly and utterly void.” — Dig. 254, § 2. The jury have found this conveyance to be of that character, and we must pronounce it void, unless those claiming under it can bring themselves within the exception mentioned in the statute — unless they be bona fide purchasers for valuable consideration. Now we concede, as has often been decided, that a creditor, to whom a debt is justly due, may obtain a conveyance from his debtor for its security, and without parting with the evidence of his debt, or extending the [304]*304time of payment, or paying any equivalent therefor, will be considered a bona fide purchaser for a valuable consideration, if he accept the conveyance in good faith. We further concede the law to be well settled by the decisions of this court, that fraud on the part of the grantor alone is not sufficient to invalidate the deed, as to creditors who have bona fide accepted it. — Stover v. Herrington, 7 Ala. 142; Hooks v. Anderson, 9 ib. 704; Abercrombie v. Bradford, 16 ib. 560. But these were cases where there was an actual acceptance on the part of the cestuis qve trust., or some of them, of the provision made by the deed for their benefit. In the case of Stover v. Herrington, the former, who claimed under the deed, was a bona fide grantee, or rather mortgagee, and he was held protected, although the mortgagor may have contemplated a fraud. In the case of Anderson v. Hooks, the latter had become bound for the grantor in a large sum, and to secure its payment, he, in good faith on his part, took a conveyance in trust, himself being the grantee. In the case of Abercrombie v. Bradford, the point was incidentally noticed, but in that case, Bradford, the grantee and trustee in the deed, who accepted bona fide its provisions, was a party in interest, being bound for a portion of the debts. Besides, by an examination of the record, it will be seen that several of the creditors provided for had accepted the provision made for their benefit. So that these cases are wholly inapplicable to the point before us. In the case of the Governor, use, &c. v. Campbell, 17 Ala. 566, the point now presented was not raised by the charges. In that case the deed was not per se fraudulent, and the court charged that the jury must infer the assent of the prefered creditors, as the deed was beneficial to them. No charge was asked, nor was any given, that if the jury believed the deed was made to delay, hinder, and defraud creditors, and that no creditor had assented in fact to its provisions, or claimed any benefit under it, that then the law would not. presume their assent to validate such fraudulent deed. In the conduct of a, cause, the respective counsel have the right to demand that the court declare the law as applicable to any phase of the case, which the testimony conduces to establish; and if a proper charge is asked, the court is bound to give it in the language in which it is asked. So in the case just cited, various specific charges were asked, and the court responded to each as the [305]*305several hypotheses as to the state of the proof were supposed to warrant; but in none of them was the point here raised presented.

We have been unable to find any case, and the learned counsel has refered us to none, which would warrant us in pronouncing in favor of this deed, unless the case of Brooks v. Marbery, which was twice before the Supreme Court of the United States, (see 7 Wheat. 556; 11 ib. 78,) may be considered an authority in favor of it. I think, however, that that case has been unwarily perverted by those courts, which have applied the principle settled by it to conveyances declared fraudulent under the statute of 13 Eliz. To state that case in the strongest light, the deed was made by the grantor and accepted by the trustee, each of them influenced to execute it by the hope that they would thereby suppress prosecutions against the grantor for forgery, which it was feared the prefered creditors would set on foot. The creditors had, neither directly nor indirectly, concurred in the fraudulent or unlawful intent, which moved the grantor and trustee to its execution; and their acceptance of the deed could have no operation in effectuating the design of the grantor. The deed in such case could be a valid security, and the creditors the bona fide recipients of its provisions, whilst the unlawful purpose of the grantor would fail of its object and remain as innocuous in his bosom as though it had never been conceived. To make that a parallel case with this, let us suppose that the acceptance of the deed effectuated the intention of the grantor, would Chief Justice Marshall have hesitated to declare such conveyance utterly void, and that the creditors’ assent should never be presumed, when the effect of such assent would be to stifle prosecutions for offences against the criminal laws of the country ? In cases arising under the statute relating to fraudulent conveyances, the deed being made to delay, hinder, and defraud creditors, the acceptance which validates the deed gives effect to the fraudulent intent. Not so in the case of Brooks v. Marbery. Now while the law will not deprive a creditor who in good faith, and without notice of the grantor’s fraudulent design, has obtained a security for his debt, of the benefit of that security, it is not so regardless of every principle of sound public policy, and so destitute of morality, as to hold out such fraudulent deed as a premium for the accep[306]*306tance of creditors, who for aught that appears, have never heard of it, or who, if they have heard of it, may never consent to avail themselves of its provisions.

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Bluebook (online)
18 Ala. 301, Counsel Stack Legal Research, https://law.counselstack.com/opinion/townsend-bros-v-harwell-ala-1850.