Shontz v. Brown

• Citation: 27 Pa. 123
• Parties: Shontz versus Brown.
• Decision Date: 01 January 1857
• Court: Pennsylvania Supreme Court

Page 123

27 Pa. 123

Shontz versus Brown.

Supreme Court of Pennsylvania.

ERROR to the Common Pleas of Crawford county.

COPYRIGHT MATERIAL OMITTED

Farrelly and Finney, for plaintiff in error.—The agreement was a consideration by its terms, and there was evidence of its performance — they were to pay the debts, and support their father

and mother. No creditor was hindered or delayed, because the land was charged with the payment of the debts: United States v. Mertz, 2 Watts 406; Dobbs v. Finley, 2 Barr 397; Patterson v. Stewart, 6 W. & Ser. 72. The agreement was good in favour of the creditors, and they could have maintained an action upon it: Hind v. Holdship, 2 Watts 104, 2 Barr 397; Seitzinger v. Harris, 1 Jones 163; Beers v. Robinson, 9 Barr 229.

A subsequent creditor, even if the deed were voluntary, could not take advantage of it without showing that it was made to evade such future debts: Greenfield's Estate, 2 Harris 489; Mateer v. Hissim, 3 P. R. 160; Sexton v. Wheaton, 8 Wheat. 229; Read v. Livingston, 3 J. Ch. R. 497; 1 Sto. Eq. 359; Hurd v. Longworth, 11 Wheat. 199; Chambers v. Spence, 5 Watts 404.

In order to render a conveyance made for a good and valuable consideration fraudulent in fact, both parties must concur in the fraud: Magniac & Co. v. Thompson, 1 Baldw. 344; Hunison v. The Academy, 12 Mass. 456; Bridge v. Eggleston, 14 Id. 245; Foster v. Hall, 12 Pick. 89.

The acceptance of the deed by Brown was a merger of all previous contracts relative to the land. This bond was therefore no debt: Jones v. Wood, 4 Harris 25; Wilson v. McNeil, 10 Watts 422; Seitzinger v. Weaver, 1 Rawle 377.

The court ought to have instructed the jury, that the agreement to pay the debts and support their father and mother was a valuable consideration: Patterson v. Stewart, 6 W. & Ser. 72; Geiger v. Welsh, 1 Rawle 349. In no sense can this conveyance be said to be a voluntary one, and upon this assumption alone can the plaintiff's case be sustained.

Church and Derrickson, for defendant in error.—The conveyance or contract set up is a mere voluntary one, for there does not appear to have been any valuable consideration paid: Twyne's Case, 3 Coke; 1 Smith's Con. 31. If the conveyance was voluntary, and debts existed at the time, it results as a necessary conclusion that the Orphans' Court sale conveyed the title to the purchaser.

There was evidence of fraud to submit to the jury, from the character of the conveyance, and the secrecy of the contract, and the apparent retention of possession by the grantor, as well as the relation of the parties: Greenl. Cruise, tit. 32, ch. 28, §§ 2, 5, and 8; 1 Sto. Eq. § 353; Reade v. Livingston, 3 J. Ch. R. 500; Ridgway v. Underwood, 4 W. C. C. R. 135-7; Harris v. Sumner, 2 Pick. 153.

Was John Brown, the holder of the title bond, to be considered a creditor? Twyne's Case rules that the statute extends to all persons having cause of action, &c.: 1 Smith L. C. 32. Liability only is a sufficient basis for the legal implication of fraud: 1 P. C. C. R. 464; so is prospective and probable liability: Thompson v. Dougherty, 12 Ser. & R. 448; Hamot v. Dundas, 4 Barr 178; Reichert v. Castator, 5 Binn. 112-14; Osborn v. Churchman, Cro. Jac. 127; Mountford v. Ranie, Keb. 99; Roberts on Fraud. Con. 455; Jackson v. Myers, 18 John. 425; Van Wick v. Seward, 5 Cow. 67; 18 Wend. 375; 8 Cow. 406; 18 Wend. 383; How v. Ward, 4 Green. Rep. 195.

The word "others" in the statute is intended to embrace all interests defrauded, and where prior debts appear, subsequent ones are let in. Where the conveyance is avoided by legal implication, the honesty of the intention is not to enter into the decision: Kepner v. Burkhart, 5 Barr 478; Tarback v. Marberry, 2 Vern. 510; Hungerford v. Earle, Id. 261; Hildreth v. Sands, 2 John. C. R. 35; Lush v. Wilkinson, 5 Ves. 388 n.; Gunn v. Butler, 18 Pick. 252. The personal benefit reserved to the grantor is evidence of fraud: Parkman v. Welch, 19 Pick. 236; Johnson v. Harvey, 2 P. R. 92.

But Huidekoper is more than a subsequent creditor. His claim represents a precedent liability, although changed in form but not in substance. As trustee and administrator, Shontz was liable on the legal covenant of "grant, bargain, and sell," for encumbrances suffered by himself, of which this tax was one: Kauffelt v. Leber, 9 W. & Ser. 97; Gratz v. Ewalt, 2 Binn. 95; Stewart v. Kearney, 6 Watts, 453.

The application of defendant for an order on the administrator to sell real estate, and the subsequent proceedings, estop him in this case: Cook v. Grant, 16 Ser. & R. 210; Martin v. Jones, 17 Id. 366: 5 Harris 351.

The opinion of the court was delivered by WOODWARD, J.

The first question which arose on the trial of this cause was whether the deed of 21st September, 1838, Jacob Shontz and wife to their sons, Jacob and Samuel, was a voluntary conveyance or not. If a voluntary conveyance it was fraudulent and void as to existing creditors, for it was a conveyance of his whole estate real and personal, and such a conveyance an indebted party has no right to make. And if the deed was, in the language of the statute 13 Eliz. cap. 5, "void, frustrate, and of none effect," then old Jacob Shontz died seised, and the Orphans' Court had jurisdiction to sell the land for payment of his debts, and the plaintiff, a purchaser at such a sale, took a good title. But if the deed was for a valuable consideration and not voluntary, it vested the title in the sons; and the father did not die seised unless it was fraudulent in fact. If voluntary, the fraudulent intent resulted as a conclusion of law; if not voluntary, the fraudulent intent was to be established, if at all, as a matter of fact. This is putting the question in the most favourable light for the plaintiff, and perhaps too favourable; for there may be some doubt of the jurisdiction of the Orphans' Court, even if the deed was fraudulent as to creditors.

It is not easy to determine from the record whether the court meant to pronounce the deed of 1838 a voluntary conveyance, or to leave the jury to fix its character. The answer given to the first point of the defendant, a simple affirmative, would seem to indicate that they thought it a good conveyance, and sufficient to vest the title in the sons; but the answers to several of the plaintiff's points, and especially the written charge, lead us to think that they considered the instrument a voluntary conveyance, and meant that the jury should so treat it. They said "unless there be some other proof than the article itself of a valuable consideration, it would be deemed voluntary," — which was a pretty distinct affirmation that there was no valuable consideration expressed in the instrument. The charge, then proceeding on the assumption that the conveyance was voluntary, directed the attention of the jury to the question whether there were existing creditors Was the court right in thus treating this as a voluntary conveyance? What is a voluntary conveyance?

The elementary books tell us it is a conveyance without any valuable consideration. In Seward v. Jackson, 8 Cowen 430, Senator Spencer, commenting on this definition, says, the adequacy of the consideration does not enter into the question, and only becomes material to ascertain a fraudulent intent. But the character of purchase or voluntary is determined by the fact whether anything valuable passed between the parties. The execution of a bond to pay the purchase-money, made in good faith and intended to be paid, is a valuable consideration, and makes the transaction a purchase, as much as the actual payment in money. If it does not, then one-half the titles to lands in this state are invalid; and it is too late to inquire whether a security accepted by the grantor is not equivalent to money.

We have in the deed before us the express covenant of the grantees that they will support and maintain their parents for life, and will "pay all the debts due now and owing by the said Jacob Shontz," and these duties are charged as a lien on the land conveyed. How can it be doubted that this is a valuable consideration? The court seemed to think that where a deed from father to son was contested by creditors, there ought to be other evidence of the consideration than that furnished by the instrument itself. True enough, where the only evidence contained in the instrument is the formal acknowledgment and receipt of the grantor alone; but where, as here, there is a solemn covenant, signed and sealed by the grantees, obliging them not only to pay money, but to perform other onerous stipulations, it is impossible to say the instrument furnishes no evidence of a valuable consideration. Such a covenant is just as truly a valuable consideration as bond and mortgage for the purchase-money. Nay, more, for these obligors were not only liable to all ordinary remedies, but their obligation was in the nature of a condition of tenure, and for breach of it the father might perhaps have entered and dispossessed them. An obligation so onerous and imperative is a valuable consideration. An unrecorded agreement to make future advances was held in Moroney's Appeal, 12 Harris 374, to be not only a valuable consideration for a mortgage, but such as to entitle the mortgagee to a preference over liens attaching before his advances were actually made. This was giving the fullest effect to an executory covenant. An agreement by a son to pay the father's debts was treated as a valuable consideration for a conveyance of real estate in Pattison v. Stewart, 6 W. & Ser. 74.

We are therefore of opinion that the court ought to have instructed the jury in clear and intelligible terms that the deed of 1838 was not voluntary, but was founded on a valuable consideration. This would have reduced the case to the question of actual fraud. To some conveyances, such as are made by a debtor of a large and material part of his estate without any equivalent, or for such as is grossly...