Johnston v. Malcom, 59 N.C. 120, 6 Jones Eq. 120 (1860)

Dec. 1860 · Supreme Court of North Carolina

59 N.C. 120, 6 Jones Eq. 120

SAMUEL JOHNSTON against H. C. MALCOM AND WIFE AND ANOTHER.

A deed combining the two characters of a deed of trust to secure creditors, and a deed of settlement in trust for a wife and children, may operate and have effect in both characters, provided it has been duly proved and registered.

A deed of settlement, in trust for a wife and children, proved and registered three years after the date of its execution, was held to be valid as against creditors, whose debts were contracted after such registration.

Cause removed from the Court of Equity of Cabarrus county.

Samuel N. Black, on the 12th of December, 1849, conveyed, by deed, to Hugh McAulay and his heirs, two tracts of land and twelve slaves, in trust, to secure all his creditors, (naming them and the amount of their debts); the deed then proceeds : “ and whereas, the said S. N. Black has, unfortunately, contracted the habit of intemperance, so much so, that he is frequently unqualified, properly to discharge and manage his affairs, and being desirous to secure a good and respectable living for his wife and children, as he received a large share of his property by his wife, it is, therefore, understood, stipulated and agreed,” &c., and then gives her the sole and separate use in all the said property, not required in the payment of the trustor’s debts, and then limits the remainder' to his son, the defendant, Calvin, and any other child he might have by their marriage, with certain contingent, limitations, in the case of her death, and that of Calvin.

This deed was first proved before the clerk of Cabarrus county court, on 2nd day of January, 1850, and was shortly afterwards registered.

Afterwards, at April Term, 1853, of Cabarrus county court, it was proved in open court by the subscribing witness, and was ordered to be registered, and was registered, on the 8th of June, 1853. Previous to this time, all the debts, owing by Samuel N. Black, had been paid off. On the 28th of August, Black bought of the plaintiff, Samuel Johnston, a negro woman slave and two small children, at $775, and the said Samuel N. Black, his wife, the said Judith E., both signed a note for the price of the slaves, she negotiating and conducting the whole trade. Suit was afterwards brought against Black on this note, and he dying in 1853, it was continued against his executrix, the said Judith, anda verdict and judgment taken against her on the pleas then in issue. After-wards, on a soi. fa. against her, to show cause why she should not pay this judgment out of the assets of Samuel N. Black’s estate, in her hands, she pleaded fully administered and no assets, which pleas were found in her favor. Judith Black lias since married the defendant, Malcom, and this bill is brought against them, and against her, as executrix, and against the trustee, McAnlay, and Calvin M. Black, the only child and tenant in remainder, under the said deed, seeking to set aside the deed of trust as to the settlement to the feme defendant and her son, on the ground, it could not operate in the double aspect of a deed, in trust, for creditors, and a deed of settlement for the sole and separate use of the wife and her children; and insisting furthermore, that, not having been registered within six months after it was made, it was null and void as to creditors, according to the 24th section, 3Jth chapter of Bevised Code. The bill also prays a discovery of assets in the hands of the said Judith, which it is alleged she fraudulently conceals, &c., and seeks to subject certain property to the payment of his debt, on the further ground, that acting under a power of attorney from her trustee, she sold property, conveyed in trust, and gave the proceeds to her husband, with which he bought other property, which she now claims as trust property, but which is, in fact the property of her late husband, Samuel N. Black. The answer of the defendants is full as to the state and condition of the property, now held by the said Judith and her husband, but is not ger-main to the questions treated of in this Court.

Fowle, for the plaintiff.

JBoyden, for the defendants.

PeaesoN, C. J.

The opinion of the Court is with the defendants on both points, made on the argument.

1st. The deed, executed by Samuel Black to McAnlay, 12th December, 1849, combines the character of two instruments— a deed of trust to secure creditors, and a deed of settlement in trust for a wife and children, and there is no reason why it may not operate and have force and effect in both characters, provided the ceremony, which the law requires in respect to attestation, probate and registration is duly complied with.

An analogy may be found in the case of a will, where, most usually, the same instrument contains a will of personalty, according to the common law, and a will land, according,to the statute, and no objection was ever made, although, originally, the mode of attestation wuis different, and the probate of one was required to be in the courts of law, and of the other, in the ecclesiastical courts. The probate of the instrument, in one character, had no effect upon its validity in the other.

In respect to the probate and registration of the instrument,, now under consideration, in its character of a deed of trust to secure creditors, no question is presented. This Court is of opinion, that in its character of a deed of settlement, in trust for a wife and children, the probate, in open court, at April Term, 1853, and its registration on the 8th of June, 1853, made it valid, not only between the parties, but as against cred-tors, whose debts were contracted afterwards, and that it was void only as against creditors, whose debts were in existence, or in contemplation, at the date of such registration. This, we believe, has been the universally received construction of Rev. Statutes, chap. 3T, sec. 29, and Revised Code, chap. 37, sec. 21, and we are satisfied, upon a consideration of the purposes of these enactments, that this is the proper construction. A mere voluntary deed to a stranger, without any meritorious consideration whatever, is allowed to have this effect.

2nd. As the bill of sale for the slaves, which was executed by the plaintiff, passed the title to Black, and his estate has had the benefit of the purchase, the signature of Mrs. Black must be treated as having been done in the mere character of her husband’s security, and can derive no aid from the fact, that McAulay, the trustee, had given her a power of attorney to act as his agent, in respect to the trust property. So, the case is that of a feme covert executing a bond without making it a specific charge on her separate estate, and without the concurrence of the trustee, and falls under the doctrine announced by this Court; Knox v. Jordan, 5 Jones’ Eq. 177.

There will be a decree declaring the opinion of the Court on these points and subject thereto, the plaintiff may take an order of reference for an account.

Per Curiam, Decree accordingly.