Edwards v. Dickson

• Decision Date: 29 October 1886
• Citation: 2 S.W. 718
• Parties: EDWARDS <I>v.</I> DICKSON and others.
• Court: Texas Supreme Court

Page 718

2 S.W. 718

EDWARDSv.

DICKSON and others.

Supreme Court of Texas.

October 29, 1886.

Appeal from Titus county.

Action to recover against a sheriff and his sureties for the seizure of property claimed by plaintiff on execution against another. Judgment for defendants below. Plaintiff appeals.

Todd & Hudgins, for appellant.

GAINES, J.

This suit was brought by appellant to recover of appellee Dickson, as sheriff, and the other appellees, as sureties on his official bond, damages for the seizure of a stock of drugs by Dickson under an execution against one W. H. Blythe. Appellees pleaded a general denial, and for special answers set up that the sale of the goods from Blythe to appellant was fraudulent and void, as to creditors of Blythe, and also that, by reason of certain representations made by appellant, he is estopped to assert his claim to the property.

The first error assigned by appellant is as follows: The court erred in its charge to the jury in this: "The court instructs the jury, in substance and effect, that the sale from Blythe to Edwards would be fraudulent and void if Blythe intended to defraud his creditors, and Edwards knew, or ought to have known, of such intent, even though he (Edwards) took the goods in payment of a bona fide debt due to him from Blythe, and took no more goods than enough to pay such debt." The right of a creditor to purchase of a debtor in failing circumstances a sufficient amount of property to pay his debt is well recognized by authority, although the necessary consequence of the transaction is to hinder and delay other creditors in the collection of their debts. Greenleve v. Blum, 59 Tex. 126; Iglehart v. Willis, 58 Tex. 306; Schneider v. Sansom, 62 Tex. 201; Frazer v. Thatcher, 49 Tex. 26; Edrington v. Rogers, 15 Tex. 195; Hancock v. Horan, Id. 511. This principle follows a deduction from the right of an insolvent debtor to prefer one creditor to another, and is subject to the qualification that no more property must be transferred than is essential to pay the debt, at a fair valuation, and that the transaction must be open and bona fide; and, in saying that the transaction must be made in good faith, we understand it is meant that the sale must be absolute, — that is, not attended with any secret trust for the benefit of the debtor, — and must be a real, and not a mere colorable, transaction. See Greenleve v. Blum, above cited. If it be a real transfer of the property, unaccompanied with any secret understanding or trust on behalf of the debtor, and with intent to satisfy the debt, and no more property be sold than is necessary for that purpose, then it matters not whether or not the debtor intended to hinder or delay his creditors, or whether the creditor knew, or ought to have known, of such intent if it existed.

Let us apply these principles to the instruction complained of. In the preceding paragraphs of the charge the court gives a clear exposition of the law upon this question, and applies it to appellant's phase of the case. Then follows the following instructions: "(7) If you believe from the evidence that Blythe sold his goods," etc., "described in plaintiff's petition, to plaintiff, for the purpose of hindering, delaying, or preventing Blythe's creditors from the collection of their debts, and that plaintiff, Edwards, knew of Blythe's intent, or ought to have known, by the exercise of proper diligence, of said intent, at the time said sale from Blythe to Edwards was consummated, you will find for defendant. (8) If Blythe's intent was fraudulent, (of which you are the judges,) and was or ought to have been known to plaintiff at the time of said sale, Edwards could acquire no right to said stock of drugs," etc., "to the prejudice of Blythe's other bona fide creditors, (if he had any such,) even though Edwards took no more goods than satisfied a debt Edwards may have held against Blythe."

Plaintiff's case, as developed by his testimony, is that he had bought the goods of the defendant in execution before the levy, in payment of a debt due him by the latter, and that the value of the goods was not more than sufficient to pay the debt; that delivery had been made; and that he was in possession at the time of the levy. As applied to such a case, the charge is erroneous. It instructs the jury, in the first paragraph quoted, to find for defendant if they believed that Blythe sold the goods for the purpose of hindering, delaying, or preventing Blythe's creditors from the collection of their debt, and that plaintiff knew, or ought to have known, of the intent, etc. This is in conflict with a previous paragraph of the charge; and however one learned in the law might construe the several paragraphs upon this branch of the case, when taken together, it is clear that the particular instruction under discussion was calculated to mislead the jury to appellant's prejudice, and is reversible error. See Railroad Co. v. Le Gierse, 51 Tex. 189; Bailey v. Mills, 27 Tex. 434; Willis v. McNeill, 57 Tex. 465; Chandler v. Fulton, 10 Tex. 2.

The second assignment of error is "that the court erred in its charge to the jury in this: it instructs the jury that the law would presume fraud from the unexplained possession by the seller, Blythe." The rule laid down in this state is that possession on part of the seller after the sale is not fraud per se, but is prima facie evidence of fraud, subject to be rebutted by other evidence explanatory of the possession, showing that it is consistent with a fair transaction. Bryant v. Kelton, 1 Tex. 415; Converse v. McKee, 14 Tex. 20; McQuinnay v. Hitchcock, 8 Tex. 33; Hancock v. Horan, 15 Tex. 507; Mills v. Walton, 19 Tex. 271; Van Hook v. Walton, 28 Tex. 59; Gibson v. Hill, 21 Tex. 225. In the case last cited the judgment was reversed because of the failure of the court below, at the request of appellant, to give a charge substantially the same as that complained of in the assignment of error under consideration. It may be that the instruction before us was too general, and, under the facts of the case, should have told the jury what the law considered possession on part of the seller, and what evidence explanatory of such possession would rebut the presumption of fraud raised by such possession. If so, the remedy of appellant was to ask an additional charge upon the point. Not having done so, he cannot now complain.

Appellees,...