Den ex dem. of Jones v. Ruffin, 14 N.C. 404, 3 Dev. 404 (1832)

Dec. 1832 · Supreme Court of North Carolina

14 N.C. 404, 3 Dev. 404

Den ex dem. of Martha Jones v. Rebecca Ruffin.

Where A conveyed his estate to a trustee to secure B his surety, who agreed to purchase the estate at a sale by the trustee, and upon a re-sale, after indemnifying himself to hold the surplus for C, another creditor of A: It was held, that a conveyance by B of the surplus to satisfy C was not voluntary, and fraudulent as to his creditors, altho’ there was no written memorandum of the agreement between him and A.

Ejectment, tried before Norwood, Judge, at Halifax, on the last circuit.

A registratiou of a deed of trust madeuponproof of its execution by an attesting witness,who was interested under it, is valid.

A pecuniary consideration mentioned in the first part of a deed of bargain and sale, extends to any land conveyed in the deed to the person who paid that consx deration.

The lessor of the plaintiff claimed under the following deed:

“This indenture, made, &c. between James Grant and “ Eli B. Whitaker, vvitnesseth: that the said J. G. for “ and in consideration of the sum of S12.000, to him in “ hand, paid by the said E. LI W. the receipt, &c. hath “ bargained and sold &c. unto the said E. B. W his “ heirs and assigns forever, all the land which I am “ seised and possessed of (describing other lands not in “ dispute) ; also, the following negro slaves, &c. to have “ and to hold the said property to him the said “ E. B. W. his heirs and assigns forever; and the said “ James Grant doth, &c. (then followed a covenant for “ quiet enjoyment) ; also, I further convey unto him the “ said E. B. LV. his heirs, &c. a certain tract of land “ lying, &c. (describing the land in dispute.) which land “ I purchased at the trust sale of Thomas Bustin, the “ said land to go to satisfy in full, a certain power of at- “ torney by me held, in favor of Martha Jones, and the “ balance, if any, to be applied to another power of at- “ torney in favor of Fanning Jones. The first named “ property in trust for the following purposes then followed a declaration of trust in favor of sundry of Grant’s creditors, and directions to the trustee as to the mode of selling, which are not material.

This deed was proved before his Honor Judge Da-Nibu, by one William Bustin. an attesting witness, and was registered within six months. The defendant objected to the reading of the deed, and offered to prove, that the witness upon whose testimony it was ordered to be registered, was a creditor who was secured by it, but Ms Honor held the probate to be sufficient, and the deed Was read.

The defendant then objected, that the legal title to the land in dispute, (that mentioned in the deed as bought of Thomas Bustin,) did not pass to the trustee, Whitaker, because rio consideration was expressed in the deed upon which a use arose as to it. But his Honor thinking the consideration of gl2,000 extended to all the land mentioned in the deed, overruled the objection. A verdict y.’as then taken for the plaintiff, subject to the opinion of the court, upon the following case:

Thomas Bvslinbeing largely indebted, applied to Grant, -¡jie bargainor in the above deed, to be his surety, who consented, upon condition that Bustin would convey all liis property to a trustee for his security, which was accordingly done. At the time of making this conveyance, Bustin was the executor of his mother, and had wasted the assets, and Martha and Fanning Jones, two of the legatees, had given Grant powers of attorney to collect their legacies. Bustin being insolvent, a sale of his property was advertised for the purpose of indemnifying Grant. Before this sale, Grant knowing Bustin to be insolvent, agreed with him that he. Grant, should purchase all the property, and if, upon a re-sale of it, any thing remained after paying the debts for which Grant was surety, it should be applied to the payment of the debts due Martha and Fanning Jones. In pursuance of this agreement, Grant bought the whole of Bustin's property, and after fully indemnifying himself, the land in dispute remained in his hands unsold. Afterwards, Grant became insolvent, and executed the deed to Whitaker, for the purpose of securing his debts ; at its date, he had collected nothing from Bustin, and was not indebted to cither Martha or Fanning Jones, but conveyed the land in dispute for the purposes mentioned in the deed, in execution of his agreement with Bustin, by w'hich he felt himself morally bound. The defendant claimed under an execution sale of Grant's property. If these facts made Grant’s deed to Whitaker fraudulent, then the verdict was to be set aside, and a nonsuit entered' — otherwise, judgment was to be rendered for the plaintiff His Honor being of opinion for the plaintiff, judgment was entered upon the verdict, and the defendant appealed.

Gaston and Devereux, for the defendant.

Badger, contra.

Ruffin, Judge

The principal question is, whether the deed from Grant is void against his creditors, as being in reference to this tract of land, voluntary ; for if it be gratuitous, it is of course fraudulent. The morality of the case is certainly with the plaintiff, and has been so admitted, for no imputation of actual fraud is made.

I think the deed may be supported upon the ground of a valuable consideration. Bustin had a resulting trust in the estates, after the satisfaction of Grant's claims, which was of value, as is proved by the proceeds of the ultimate sales being more than sufficient to satisfy tiiose claims, Grant and he treat for that interest, and if the former had agreed then to pay Bustin. a certain sum for it, the promise would have bees» obligatory, although it formed part of the agreement that Grant should take his title under a sale by the trustee, and upon that sale, the estates were bought at a sum less than Grant’s demands. After such a contract, Bustin would have no interest to make him look out for purchasers, orto endeavor to raise the money himself, and it would be a complete fraud on him, did it not bind Grant. It is the same tiling as agreeing to pay Bustin a price, for Grant, as the agent of another creditor, to agree that the value of the resulting interest, to bo ascertained by a rc-s<ile, should be applied in discharge of the debt of that creditor, whose agent he was. it seems to me, that the question is a plain one, when viewed in this light, and that it is only embarrassed by considering the conveyance to Grant by the trustee, as the only evidence of the contract of purchase. Whereas, that is only the modo of executing the contract and getting the title into Grant. It might create a diiliculty in proving the real contract, if it were denied upon a bill founded on it ; but if it were admitted by the defendant, I jthin k a court of equity would certainly establish it as a sale of the resulting trust of Bustin; and upon a question of fraud, the objection to receiving parol evidence does not arise, whentheparty bound by the agreement has acted on it in good faith. I conceive that Grant in his own right, agreed to give the true value of the estates for them, though at the sale then to be had, he might bid them off for less ; and as agent, he agreed to receive as payment to the Jones’ the excess of the value above his own claims. It is like a purchase from a defendant in execution at a certain price, with a further agreement, that in order to complete the title, and make it good against other execution creditors, the sheriff’s sale shall take place, and the purchaser buy at it,

Suppose in • this case, that Jones sued Bustin on the original debt, is not the latter entitled to credit for the value of the estate conveyed to Jones? And if so much of Jones’ debt be discharged by the conveyance, how is it voluntary ? The case of Williams v. Howard, (3 Mur. 74,) is much like this, as between Grant and Bustin, and if Grant was bound to Biistin, it is the same, as a consideration for the deed, as if he was bound to Jones ; though I think there was an obligation to both.

The conveyance of all the estates being to the same trustee, from whom the consideration mentioned in the beginning of the deed moved, that consideration extends to the whole, especially, when the words “ also I further convetj” connected with the grant of this tract,are taken in. The objection to the probate has been abandoned in the argument, and therefore, upon the whole case, I think the judgment must be affirmed.

Per Curiam. — Judgment affirmed.