Vance v. Boynton

Burnett, T., delivered the opinion of the Court—Terry, C. J., concurring.

This is a case between two purchasers of the same property, from the same fraudulent vendor,- and the only question regards the person who must sustain the loss. If both purchasers were equally in fault, or equally innocent, then the first purchaser was entitled to the property. It is a case arising under our Statute of Frauds. Com. L., 199.

The first section of the act relates solely to fraudulent conveyances of, or charges upon, lands, or the rents and profits thereof, made or created with intent to defraud purchasers, prior or subsequent The twentieth section relates to conveyances, and assignments of any estate in lands, or goods, with intent to defraud creditors or others, of their lawful suits, damages, forfeitures, debts, or demands. The first section only relates to purchasers, and the twentieth to creditors and others, sustaining substantially the same relation to the vendor, and not to purchasers.

From the provisions of these sections, a sale of Zanámade with intent to defraud purchasers or creditors, would be void. But there is nothing- in these 'provisions that would make a sale of personal property, with intent to defraud subsequent purchasers, void as to them.

We must then look to the fifteenth section, as the only provision in the act applicable to this case. By that section, unless the sale “ be accompanied by an immediate delivery, and be followed by an actual and continued change of possession,” it will be void, as against subsequent purchasers in good faith.

If; then, a sale of chattels be made with the intent, both on the part of the vendor and vendee, to defraud subsequent bona fide purchasers, the same would not be void under the statute, as against such purchaser, unless the sale was not accompanied with the delivery, and continued change of possession required by the fifteenth section. Where the sale is accompanied with such delivery and change of possession, it is difficult to see how a subsequent purchaser could be injured without carelessness or fault on his part. When the delivery and change of possession exist, the subsequent purchaser has notice, and if he purchase of the original vendor, then out of possession, there is nothing in the statute to give him relief.

*561 It would then seem clear, that the question of intention can have nothing to do with sales made void by the fifteenth section. That section makes certain facts conclusive evidence of fraud. These facts are not made up of intention, in whole or in part. The intention of the vendor and vendee, or either of them, constitute no part of this “ conclusive evidence of fraud.” The simple fact, and that fact alone, that the vendor remains in possession of the thing sold, makes the sale void.

In this case, there was no question of intention for the jury to determine. A question of intention, in the nature of the case, must be a question of fact, and if so, must be determined, in all cases, by the jury. But this question of intention arises under sections first and twentieth, but not under section fifteen.

The question of delivery and change of possession, under the fifteenth section, is a mixed question of law and fact. What are the circumstances existing in the particular case, is a question of fact for the jury. But, conceding their existence, whether they constitute the immediate delivery, and the actual and continued change of possession required by the statute, is solely a question of law for the Court. When the _ facts are conceded, or clearly proved, there is nothing for the jury to determine.

In this case, there is no conflict of testimony, and the main substantial facts are clearly established.

W.e have already held, that a vendor having possession of the property as clerk, or as warehouseman of the vendee, rendered the sale fraudulent. 4 Cal. Rep., 289 3 Stewart v. Scannell, July T., 1857.

The mere change of the capacity in which the vendor acts while in possession of the goods, will not save the sale from the provisions of the statute.

The object of the fifteenth section of the act was to adopt a plain, simple, and conclusive test. If the parties be held strictly to change the possession of the property sold, it is the greatest possible check upon fraud. The fraudulent vendor cannot enjoy the benefit of his fraud, if the statute be rigidly enforced. There can exist no motive for fraud, when nothing can be gained by it.

The possession of property is necessary to its beneficial use; and when the fraudulent vendor must deprive himself of its possession and use, to comply with the statute, there can be no adequate motive for the sale.

In this case, the apparent ownership of the property was left in¡i Haggett by the act of the plaintiff. The barley was left where it would have been had it not been sold. The mere change from one part of the corral to another, did not destroy this apparent ownership, so long as the corral itself remained in the- possession of Haggett. ETo one, not acquainted with the trade, would have been able to know the real owner. The agent *562 of plaintiff looked after the property at.intervals, but never changed its position, and suffered Haggett to remove and store it as his own.

This case differs very much from some former cases, where the property was found, and left in the possession of a warehouseman. The delivery of possession was sufficient, and the change of possession would have been good, if the property had been on storage at the time of sale. In such case, the warehouseman becomes the agent of the purchaser, and the property is, in no sense, in the possession of the vendor.

We think, in this case, the change of possession was not actual and continued. The rule is well laid down in Chitty on Contracts, seventh Am. Ed., 414:

“ It seems that the change of possession necessary to rebut the inference of an intention to defraud creditors, must be substantial, bona fide, and exclusive ; and consequently, that the sale or assignment will be considered fraudulent and void, and the assignor’s possession colorable, if the goods be left upon the premises of the assignor, and in his apparent disposal or order, although the vendee or his servant enter upon the premises, and also be in possession of the goods.”

The instructions of the Court below, in submitting the question of intention to the jury, were erroneous.

Judgment reversed, new trial granted, and cause remanded.