Hudgins v. White, 37 N.C. 575, 2 Ired. Eq. 575 (1843)

June 1843 · Supreme Court of North Carolina

37 N.C. 575, 2 Ired. Eq. 575

THOMAS W. HUDGINS, AD’OR. &c vs. BENJAMIN WHITE.

Where the bill is for the execution of a trust, and circumstances are disclosed which tend to shew that the trust was created for the purpose of defeating creditors, yet if such fraud is not directly alleged cither in the hill or answer, the Court will take no notice of it, hut will proceed to decree an execution of the trust, if properly established by proofs.

This cause having been set for hearing, was transmitted by' consent from the Court of Equity of Chowan County, at Spring Term 1843, to the Supreme Court. ' The followiug case was presented by the pleadings and proofs:

In December 1829, there were judgments against Jesse Hudgins, then of Gates county, to much more than the value of all his property, and sales were appointed to be made on the executions on the 21st day of that month. A few days before the sale, the wife of Hudgins wrote to the defendant, (who was her brother and resident in an adjoining county,) giving him information thereof, and requesting him to attend the sale and purchase some necessary articles for the support of the family. She also mentioned to him that her husband had sold a negro for $250, “ of which,” says the letter, “ I never saw one cent. But I want you to come- and see if you cant get him to make something over to you for my support, for if he does not I shall'have nothing to support my children. I depend on you as a friend.” The defendant being confined by sickness could not go, but authorized another person to make such purchases as his sister-should direct. Hudgins was a farmer in moderate circumstances and every thing he had was sold, and the defendant’s-agent purchased, at very low prices, articles to the amount of ¡$228 33, consisting of indispensable house-hold furni-tin'e) provisions, a horse, cow and calf, some plantation utensils, including also a negro woman at the price of $55 01, and a negro boy named Wilson, about -19 years of age, at the price of $41 01. The bill charges, that it was agreed between Hudgins and White, that the property should be bid off in the name of the latter and held in his name, but for the use of Hudgins and his- family, and that Hudgins should then furnish as much money as he could towards paying for it, and the residue of the money be advanced by White, for which the property was to stand as a security.— In a short time after the sale, Hudgins paid White $70, on account of the purchase, and-delivered to him some articles to the the value of $26 more, and, in August succeeding, White gave a receipt therefor to Mrs. Hudgins, as having been-received of her “in part payment of the chattel property” bought at the sale. The possession of all the property was retained by Hudgins until his death in 1835, and af-terwards by his family until 1837. At this latter period the defendant was called on for payment of some medical bills for attending on the negroes, which Mrs. Hudgins was unable to pay, and the defendant then took the negro Wilson into his possession, and has retained'him or hired him out ever since ; still, however, not removing or interfering with the other property. The bill then states, that the plaintiff had a judgment against Jesse Hudgins for a large debt due before December 1829; which remains unsatisfied, and that there are no effects of Hudgins out of which it can be satisfied, save only those purchased as aforesaid by the defendant.— In May 1839, administration of the estate of Hudgins was granted to the plaintiff, and afterwards he filed this bill, in which he prays that the defendant may be decreed to surrender to the plaintiff the negro Wilson and pay over to him all his hires, and also release the other property bought by him.

The answer states, that the defendant did not expect his agent to purchase the slaves at the sale, but only such things as were absolutely necessary for his sister and her children, bat that as he had not restricted the agent, he felt obliged to take and pay for the slaves as well as the other things. It denies that any communication passed between Hudgins and himself on the subject before the sale, or any other member of the family, except Mrs. Hudgins, as before mentioned. And it states, that as to the furniture, provisions and other necessaries for living, he intended them as a provision for his sister and her children from himself, as far as they might not be able to pay for them, and that he gave the receipt for the sum of §96,"paid to him, for the purpose of satisfying her, that she should have those articles.

The defendant says, he did not understand her as wishing to have the negroes, and that he did not intend to give her to understand that he would surrender them, and hence he expressed that the money was in part payment for the “ chattel property,” meaning thereby the other articles, besides the slaves. But the defendant admits that he did not take away the negroes until 1837, being willing that Hudgins and his family should have the benefit of their services, and that he then took away Wilson alone for the reasons before mentioned, and has since hired him out for §75 per annum.

There was a replication to the answer.

The depositions introduced by the plaintiff supported the allegations contained in the bill. There was other testimony, but it related principally to matters of account, should the Court declare the trust established and order an account.

Iredell for the plaintiff.

A. Moore & Kinney for the defendant.

Ruffin, C. J.

Upon the circumstances as disclosed by the pleadings, there could be little hesitation in decreeing a redemption of the slaves, as well as the other things, purchased by the defendant. But if it were possible to doubt upon the case, as made in the bill and answer, the proofs make the plaintiff’s right manifest. It is stated by the defendant’s agent, that, at the time of the purchase, money was placed in his hands, about $70, belonging to Hudgins, towards paying for the purchases, and that, at the instance of Mrs. Hudgins, he bought the negroes for the benefit of Hud-gins’ family, as he did the other articles, and that he bought all very low in consequence of making it known, that he was bidding ior the defendant for the benefit of the family. The witness states, that Hudgins u sed that money, the $70, in payment for his purchases. If to these circumstances be added the subsequent use and dominion over the negroes, •there cannot be a doubt, that the defendant meant the whole as a donation from himself, or at the most to hold the property as a security for his advances, with liberty to his brother-in-law to redeem. Indeed, the counsel for the defendant did not contest the right to redeem, so much upon the ■ground, .that his purchase was absolute, as because the bill shews, that it was a fraudulent contrivance to protect the property from the creditors of Hudgins, under the cover of a purchase by the defendant, really though.secretly, in trust for Hudgins. If such were the case, the court could give no relief to either party to the dishonest agreement, and it struck us at the opening of the case, that the bill was drawn with that view, as no other motive for stating the plaintiff to be a creditor could be imagined. Upon a more careful reading of the bill, however, it would seem that the pleader was cautious not to make the needful allegation, that the purchases were made upon the imputed trust with the intent to hinder or defraud creditors.

The acts themselves may be evidence of such an intent* ■but they may likewise have been innocent and truly and openly to constitute a security for the defendant’s advances, with an open and honest trust beyond that, for Hudgins ; and without a direct averment of the covinous purpose, it cannot .be assumed or acted on by the court. The bill, therefore, does not state a case of fraud against creditors, and it is not necessary to consider the effect on the right to redeem, if the bill had so stated. Nor does the answer place the defence on that ground, but solely on that of the defendant’s purchases being absolute and for his own use, without any trust for Hudgins, or use in the property to him or his family, except as the defendant might gratuitously allow,. To that defence the receipt of the money of Hudgins, as a payment for the articles purchased, is a complete answer, in connexion with the other facts before spoken of. Therefore the plaintiff, as the administrator of Hudgins, must be declared to be entitled to redeem on the usual terms, and there must be a reference to take the accounts.

Per Curiam. . Decree accordingly.