Ingles v. Donaldson, 3 N.C. 57, 2 Hayw. 57 (1798)

April 1798 · North Carolina Superior Court

3 N.C. 57, 2 Hayw. 57

Ingles vs. Donaldson.

'V'ROVER for a Negro named Casar; not guilty, and upon the evidence the case appeared to be thus: That the Negro formerly belonged to Murray, who in the county court of Edg-combe, at November term, in the year 1792, confessed judgment to Garner for the sum of forty pounds or thereabouts, upon which judgment and execution issued, tested 27th November, 1792. — . On the first day of December, in the year 1792, another execu-tlou, but of what date did. not appear, upon a judgment before ft Justice of Peace, at the instance of another plaintiff, was in the funds of Jewell, a constable, who on that day levied on Murray’s household fund aire ; Murray immediately on the same day xp-.plicd to Donalson to discharge this debt for him, being to the a-moant of thirteen pounds five shillings; Donaison did discharge it, and took from Mus ray a bill of sale, dated on that day, purporting to be an absolute bill of sale, and to be in consideration of one hundred and fifty-.two pounds ; The Negro was sent for •and delivered to Donalson, and immediately returned to Murray’s service by Donalson's direction .5 but in a few days after-wards came to Donalson and worked with him; about a week after which he returned .again to Murray, and continued in' his possession till the time of executing a bill of sale to Ingles, -and in that time Murray occasionally hired out the negro as his own, Donalson on two different occasions admitted the bill of sale of him was intended as a security for money, and he now proved that Murray was indebted to him in the two further sums'of forty pounds and twenty-six pounds. On the 31st of Janury, in the year 1793, Ingles purchased the same negro of Murray paying off Garner’s judgment, deducting a debt due to him from Murray, of ñfty-iouv pounds or thereabouts, and assuming other debts which Murray owed, and which he (Ingles) has since discharged, to the amount, in all, of £. 134 1.3 3. Inglesacknow-•ledged, and it v/as now proved that he had first notice of the bill •of sale to Donalson — Ingles registered his bill of sale at Febrn-ary term, 1783; Donalson registered his .at May term, 17-93, and Garner’s execution was returned satisfied to February term, -1793. When the bill of sale to Donalson was executed, Jewell, the attesting witness heard Donalson say it was to secure his money, and he heard them talk o-f no money sa.ve only the £, 13 5 0.

Baker, for the defendant,

insisted, that as Donalson did nof; take and continue tbs possession of the negro, but suffered him to continue in the vender’s possession, that it was an evidence of fraud, and of an intention to .delay and hinder the other creditors of Murray of their just debts, and was therefore void. Second!»/, that the bill of sale to Donalson was in truth but a security foe money, and yet purported on the face of it to bean absolute one and vas not accompanied nor followed by possession 5 that it was void, and he cited to the first part, 3 Re. 80, Tryon’s case, .and to the second, 2 Term 394, and he urged vehemently upon the latter authority, that Donalson’s bill of sale being absolute and not consistent with the vender’s continuing in possession was absolutely void : And thirdly, he insisted that Ingle.-, having advanced the money to satisfy Garner’s execution, which had it not been satisfied would have caused a sale of the negree, Ingles, though he purchased from Murray, way to be considered iffthe-same light as if he had purchased from the sheriff by ?, sale under the execution ; and he cited Bull N, P. 50. S. Rev port- 60.

Davie, e contra,

argued in support of the bill of sale to Don» alson.

Et per Curtain

-Haywood, Justice in the court.

-The first thing tobe observed upon is the execution upon Garaer’s judgment Murray’s goods and. effects were all bound by that frota the time of its-teste,, and he could not after that teste sell or dispose thereofso as to defeat the execution., No sale made, pending the execution unsatisfied, will be good to vets the property la the vendee unless eventually the execution shall become satisfied by some other means. As to what has been said respecting the want- of possession, if it be neceosary.in the present-case to resort to .that circumstance ¡ the want of possession is-a strong badge-of fraud s- The property7, is placed -ia the creditor,..the pes-session continues in the debtor, and by.that means-other creditors perceiving no visible diminution of the debtor’s effects, rest satisfied, and take no measure to secure their debts- until perhaps the whole estate of the debtor is exhausted,, whereas should the creditor.immediately take possession,other creditors-would thereby have notice that the debtor’s' estate was wearing.away and apply for the discharge of their demands in time.. It has this further ill effect, that the debtor still continuing-in possession , and being reputed owner, obtains credit upon a.belief that he. is the owner, and so by fault .of the vendee possesses the means of contracting debts-without.the meansof pay big.them. But in general,, this want of possession is only, evidence, of .fraud, which may he explained.and repelled by contrary evidence ; it is not absolute-, iy conclusive, but is only a strong sign of fraud, which by circumstances equally strong, tending the other way, may be overturned. In the presentíase, she bill of. sale- to Donalsosi, purports-upon the face of it to be absolute, and to vest.the whole property im - mediately in the vendee ; whereas in truth it zs-but a security for moneys. This also is a-mark, of fraud, for it is calculated to raí:;-lead-and deceive creditors, and to make them believe that no part of the negro or his value is .subject to their demand, .when in fact it is otherwise: indeed the cac.e cited at the bat-determines that an absolute bill of sale not accompanied with possession b fraudulent and void though a.bill of sale with a-condition permitting the possession to remain with the vender is-not, because there such possession is* consistent with the deed which upon the face of it discovers the truth to creditors, and cannot be said to intend a. concealment of circumstances in order to deceive them. This doctrine is supported by. a great number of decisions, and is built upon good reason, where creditors are concerned, the transactions of the debtor in relation to the disposition oF his property should exhibit their real situation and circumstance» to the wotld that everyone who is interested in them may know with car unity what has been done, and how to act; if they do not, but on the contrary, are s<> constructed as to conceal circumstances which should he known, and to given different appearance and coloring to the business than it really ought to bear, the presumption of fraud attaches to them in proportion to such concealment. With respect to the purchase made by Ingles from Murray, it has been urged, that is, between Murray and Do-nalson, the property passed out of Munay; though supposing the conveyance fraudtilenC, it did not as to creditors ; and that therefore a sale from Murray afterwards to Ingles could carry no property, however a sale by the sheriff might have done it.— I was at first very forcibly struck with the remark, but the cases cited from Bullers N. P. and from 5. Re. 60, have removed my doubts; these state that a contract which is fraudulent as to creditors, it is fraudulent also as to purchasers; and that the purchaser has notice without registration, his purchase is good ; for if he has notice he knows the contract to be a fraudulent one and void.

The jury .could not agree, and a juror was withdrawn by consent.