5 D.C. 319 (C.C.D.C. 1837), 922, Bank of United States v. Lee

Docket Nº:922[1]
Citation:5 D.C. 319, 2 F.Cas. 702
Opinion Judge:CRANCH, Chief Judge.
Attorney:Mr. R. S. Coxe, for the plaintiffs, and Mr. Marbury, for the defendants.
Judge Panel:CRANCH, Chief Judge, (THRUSTON, Circuit Judge, absent,) delivered the opinion of the court:

Page 319

5 D.C. 319 (C.C.D.C. 1837)

2 F.Cas. 702



LEE et al.

No. 922 [1]

Circuit Court, District of Columbia.

November, 1837 [2]

In equity. The bill in this case was filed by the Bank of the United States against Elizabeth Lee, widow of R. B. Lee, deceased, Edmund J. Lee, surviving trustee under a deed of trust for the separate use of Mrs. Lee, and Richard Smith, a trustee under a deed from R. B. Lee, to secure his debt to the Bank of the United States. The object of the bill is to set aside the deed of trust for the separate use of Mrs. Lee as being either a voluntary or a fraudulent deed, as to the plaintiffs, who are creditors of R. B. Lee, and to compel Mrs. Lee to surrender the property to Mr. Smith, so that it may be applied to the payment of the debt due to the plaintiffs. [Bill dismissed. This was afterwards affirmed by the supreme court in Bank of U. S. v. Lee, 13 Pet. (38 U. S.) 107. See note at end of case.]

The bill states that R. B. Lee represented himself, in 1817, to be the sole and lawful owner of the property, after mentioned, which was in his possession, as owner. That the bank lent him $6,000, upon the security of the property, and he gave his note, indorsed by E. J. Lee and W. Jones, and on the 11th of June, 1817, executed a deed of trust to Richard Smith, of twelve negroes, valued at $5,000, and all his household furniture, valued at $2,200, and a claim upon one John Hopkins. That the debt remains unpaid. That R. B. Lee died in 1827, intestate, insolvent, and no administration has been taken out upon his estate. That his widow, the defendant, Elizabeth Lee, has taken possession of all the property conveyed to Mr. Smith by the deed of trust, and refuses to deliver it up to him for the purposes of the trust. That by taking possession of the property she has made herself liable, as executrix in her own wrong. That she claims the property under a pretended deed of trust executed by her husband in January, 1809, which she has exhibited to the plaintiffs. That if any such deed was executed, it was a voluntary and fraudulent deed, and therefore void as against the plaintiffs, and as against W. Jones, the indorser of the note. That the considerations expressed in the deed are false, or, if true, insufficient to give it validity. That at the date of the deed, R. B. Lee was largely indebted, and incompetent, in law, to make the same. That if the deed was made, and upon legal and adequate consideration, it was executed in Virginia; that the trustees never had possession of the property, but suffered the said R. B. Lee to retain possession of the same, and to use, enjoy, and dispose of the same for his own use and benefit, as if he were the unqualified owner thereof. That it was never recorded in the county of Washington, nor any notice of it given to the public, or to the plaintiffs, in the lifetime of the said R. B. Lee, nor for many years subsequent to his death; but he was permitted to obtain credit upon it, and to sell and dispose of parts thereof. That the defendants, Mrs. Lee, and Mr. E. J. Lee, the only surviving trustee, knew that the plaintiffs had lent the $6,000 to the said R. B. Lee, in full faith that he was the real and unqualified owner of the property, and knew that he executed the deed to Mr. Smith, to secure the payment thereof, and never communicated to the plaintiffs, or to Mr. Smith, during the life of the said R. B. Lee, nor until several years after his death, the existence of the deed of the 9th of January, 1809, or any other claim inconsistent with the deed to Mr. Smith. All which actings and doings of the said Elizabeth and Edmund, and their omissions and negligences, as aforesaid, are, as to the plaintiffs, in contemplation of law, fraudulent, and preclude them, the said Elizabeth and Edmund, in law and equity, from asserting any right to any part of the said property against the plaintiffs. That the said deed of the 9th of January, 1809, for the reasons aforesaid, is fraudulent and void; and if it ever had any legal validity, it ought now, by a decree of this court, to be annulled. The bill then prays for a discovery, & c.; and that the deed may be produced and proved, and be decreed fraudulent and void, as against the plaintiffs; and that Mrs. Lee may be decreed to surrender the property to the plaintiffs, and to Mr. Smith, and to account for all that may be deficient, or disposed of; and that she may be personally responsible as executor in her own wrong, for the whole amount of debt, interest, and costs; and that Mr. Smith may be ordered to take possession of the property, and sell the same according to the deed of trust, & c.

Mrs. Lee, in her answer, admits the loan, but not the representations, & c., of Mr. R. B. Lee; admits the deed to Mr. Smith, of the 11th of June, 1817, but avers that she was ignorant of...

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