Cunningham v. Dwyer

Fkatjdtoent Conveyance : Pboof of Considekation: Pakoi, Evidence. • A debtor having made a deed to his mother, which was assailed for fraud, and the consideration stated in the deed being five dollars, evidence-was offered to show an adequate pecuniary consideration. On exception to this evidence as inadmissible, — Held: 1st. That considered merely as a fact, the amount of the consideration stated in the deed would be evidence of fraud, but considered as a pecuniary consideration, it established the character of the deed as belonging to a class which would be preferred to volunteers, and the amount not being conclusive on the grantee, or those claiming under her, it was competent to prove a larger consideration of the same kind. 2nd. That the evidence proposed to be offered was adduced to rebut any idea of fraud, by showing — not a different consideration, but the same kind of consideration, differing only in amount. 3rd. That it was competent, under a deed of this sort, to prove the actual amount received by the grantor from the grantee, in advances of money which he had agreed to secure by deed, and to secure which the deed was executed, in pursuance of the previous agreement to that effect. ¡Executor: Competency oe Witnesses. — Where a witness offered to sustain a deed of leasehold estate impeached for fraud, is the executor of the grantee, he is interested in sustaining the deed, because if the deed'is sustained, the property conveyed by it will be assets in his hands, on which he will be entitled to commissions. Peactice in Couet of Appeals: Code, 2nd Supplement, Art. 37, sec. 1: Competency of Witnesses. — Where the testimony of a witness is rejected by the Court below, because of his interest in the cause, and subsequently his incompetency is remoyed by law, whether the Court, on appeal, will raerse and remand the cause for the purpose of admitting his evidence — future ?

AppbaIj from the Circuit Court of Baltimore city. A hill in equity was filed by the appellee on the 29th of May 1358, against the appellants and Thomas J. Cunningham, in his own right, and. as executor of- Abigail Cunningham, and also against certain persons, creditors of said Thomas A, Cunningham, who had caused executions issued by them on judgments against said Thomas A, Cunningham, to be levied on certain property, and which. property they were about to cause to be sold thereunder. One object of the bill was to prevent such sale, on the ground that, in the doubt then existing as to the title, there would be a great sacrifice of the property if such sale were made, and therefore an injunction was prayed for and granted. No question, however, arises on this appeal as to this part of the case. Another object was to set aside certain deeds which said Thomas A Cunningham had made to his mother, Abigail Cunningham, in her lifetime, and which were assailed on the ground that the same had been executed fraudulently and without consideration, and for the purpose of hindering, delaying and defrauding the complainant and other creditors of the said Thomas A. Cunningham. The bill further shows that the said Abigail Cunningham departed this life in the summer or autumn of 1857, and that by her will, dated the 9th of July 1855, she gave the residue of her estate to the appellant, Susan E. Cunningham, and the appellant, Abbie E. Wright, (wife of the appellant, John W. Wright,) and.appointed the said Thomas A. Cunningham the executor of her said will, and that he duly qualified as .such. The said appellants, therefore, were made defendants in these capacities as the devisees and legatees of the said Abigail Cunningham, the grantee in said deeds. The two deeds assailed are both dated the 14th of September 1855. In eaeh the expressed consideration is five dollars. The first is an assignment of leasehold'interest; the second is a conveyance of the reversion of fourteen lots. The complainant insisted that both the deeds were without valuable consideration, and merely voluntary. The appellants, in their answer, insisted that both deeds were made for valuable and full consideration, to wit, $7,000, part of a larger amount due from said Thomas A. Cunningham to said Abigail Cunningham. Thomas A. Cunningham, in his answer, stated that the deeds were made Iona fide,, and that the property was sold for $7,000, and which amount he insisted was considerably more than its actual value. And he averred, in his answer, that when, upon hearing the deeds read, he found that five dollars was stated in each of said deeds as the expressed consideration thereof, he called the attention of the scrivener to the fact, and was assured by him that it made no difference whether the consideration was stated in the deeds at five or at five thousand dollars, and that he was thereupon satisfied that the deeds were correct in point of form. Under the commission, Thomas A. Cunningham was examined as a witness on behalf of the appellants, by leave of the Court. He testified that he was indebted to his mother, on the day of the date of these deeds, for borrowed money and for rents due, in the sum of $8,000, and that his mother agreed to accept said conveyances in payment of that indebtedness. He also testified that at that time he had other assets fully adequate, as he then believed, to pay all his debts. He ascribes his subsequent inability to pay all his debts, to losses and bad health. John R. D. Bedford, the.person who prepared the deeds, was also examined, and he testified that Mr. Cunningham desired the actual consideration to be expressed, but that he, the witness, had already inserted the consideration of five dollars in each of the deeds, and that he had done so to prevent the possibility of the execution of the deeds by inadvertence, without any consideration expressed, as had been done in a particular case, and that he had assured the said Cunningham, before .the execution of the deed, that any consideration expressed in the deeds, however small, would be sufficient. Exception was taken by the complainant to the evidénce of Bedford and the evidence of Cunningham. The testimony of Bedford was excepted to, because its object was to add 'to, vary and contradict the deeds offered in evidence by parol, and to substitute a consideration for them different from that expressed in them. The testimony of Thomas A. Cunningham was also excepted to, because he is a party to the "suit, and executor of the deceased Abigail Cunningham, and if the deeds should be sustained, the leasehold property would vest in him as executor; his testimony is also excepted to for the same reasons as that of Bedford. The Court (KREBS, J.) decided, that as the expressed consideration was nominal, the deeds were to be considered as merely voluntary deeds, and that it was not competent to show by parol testimony an adequate pecuniary consideration, because, as he said, this would be allowing the introduction of evidence to vary the consideration set forth in the deeds. He also said that the evidence of Cunningham, even if he was a competent witness, was not sufficient to sustain the deeds, and he decided also that Cunningham was not a competent witness. A decree was passed in conformity to this opinion, vacating both deeds, and directing the property to be sold for the benefit of the creditors of the grantors. Prom said decree this appeal was taken. The counsel for the appellants will maintain, in argument, the following points: • 1st. Apart from the evidence of Thomas A. Cunningham, there is no competent legal evidence that the complainant or any other of the judgment creditors, or any person whatever, other than his mother, held any claims against the grantor at the time of the factmn of these deeds, namely, on the 14th of September 1855. The transcript, undoubtedly, as against all persons, is evidence of the facts that suit was brought and that judgment was recovered at the respective times, as shown by the record, and, as between the parties and privies, is’ conclusive evidence of all that is thereby imported. But as respects strangers, the suit is res inter olios, and the fact that suit was instituted, by Sjexton for example, on the 14th of April 1855, before the factum of the deeds, and the further fact that judgment was rendered in that suit on the 21st of October 1856, after the factum of the deeds, are not evidence, as against Mrs. Cunningham, the grantee in said deeds, nor against those claiming under her, that the indebtedness existed prior to the factum of said deeds ; nor does the fact, that in the transcript it is shown that notes were filed, to which the name of Thomas A. Cunningham appears as maker, give any greater efficacy to the record, so as to make the same evidence in this case for said purpose. The complainant, therefore, did not show any right to impeach the deeds upon the alleged ground that they were intended to defraud creditors, even if they were voluntary in fact. Unless the evidence of Thomas A. Cunningham be received, there is no competent evidence, as against the appellants, to show such prior indebtedness. Gaunt vs. Wainman, 3 Bing. N. C,, 69, (32 Eng. O. L. Rep., 42.) jDoe, dem. Foster vs. Derby, 1 Ad. &EU., *¡90; Litxledale, J. (28 Eng. O. L. Rep., 213.) Broom’s Legal Maxims, 435, (50 Law Lib., 269,) In a proceeding' against the heir, a judgment Against the personal representative is not any evidence. Gaither & Warfield, vs. Welch, 3 G. & J., 263. The general rule is 'laid down in McClellan & Wife, vs. Kennedy, 8 Md. Rep., 252. See, also, Dorsey vs. Gassaway, 2 H. <& J"., 402; Wood vs. Grundy, 3 H. & J., 13. 2nd. If the evidence of Thomas A, Cunningham he received, then two material facts are proved by him, and they are not disproved by any evidence in the cause. He proves that the deeds were made bona fide, for payment of a debt of about $8,000, due to his mother for borrowed money and rent, and that the property estimated as being worth $1,000, was agreed to be received by her in satisfaction of the indebtedness. And he proves, also, that he had other property which he considered as sufficient for payment of all his other debts in full, and that his subsequent inability to pay those debts arose, as he testifies, from bad health, and from the various losses subsequently incurred, as stated in his evidence. His evidence is not contradicted, nor his credibility impeached. The only objection to his testimony was on the ground of alleged incompetency.. 3rd. Thomas A, Cunningham was a competent witness in support of the deeds. He was examined under an order of Court. No objection, therefore, can be taken on the ground that he is a party to the suit. He- was not incompetent on the score of interest; he had no certain legal interest in the event' of the suit. It was suggested that he is liable to costs, but costs in Chancery are always in the discretion of the Court. 3 Daniels’ Oh. Pr., 15, 16, and note there. Linthicum vs. Linthicum,- 2 Md. Ch. Dec., 21. As executor, he had no possible interest, he was in that capacity a merely formal party. In his individual capacity, his interest was altogether on’ the side of his creditors. No decree could possibly have been made against him, nor for him, in that suit individually, or iri his representative capacity. 4th. The evidence of Bedford, and that of Cunningham, were admissible for the purpose’ of showing' that the deeds (although prima facie voluntary, from the apparently nominal consideration) were, in fact, for valuable and full pecuniary consideration.- The evidence was not offered to show a-consideration different from the expressed consideration. It is allowable to shotr a full pecuniary consideration, where the' deed purports to be made for a small pecuniary consideration. By extrinsic evidence the' real value of the' property was shown, and thus the' expressed consideration was shown' to' be merely nominal, and hence the presumption' arose that the deeds were voluntary. But, like other presumptions' raised by extrinsic evidence, it is rebuttable by the production of extrinsic' evidence, provided such evidence be legal and competent. The expressed consideration of five dollars,made the deeds a bargain and sale between the parties, and’ they -were undoubtedly good as such between grantor and grantee. By proof, however, it was shown that the interest passing under the deeds was Worth Several thousand dollars, and hence the fact was grima facie established, that the expressed consideration was merely nominal, áhd thus,presumptively, that the deeds were fraudulent. But if the further fact be permitted to be shown that the consideration’ was a substantial and full pecuniary consideration, then the presumption would be repelled. None of the cases' go to the extent of saying, that rvhere the consideration is pecuniary, you cannot show a further pecuniary consideration in support of the deed. It is entirely consistent with the consideration expressed in the deed. It would be otherwise if the effort was to convert a mere covenant to stand seised, into a deed of bargain and sale, or e conversa. But there is no statute or rule of law which requires the exact consideration to be stated in a deed. 2 Shephard’s Touchstone, 511, (31 Law' Lib., 398.) Watkins on Con., 28*7, (20 Law Lib., 80.) Harvey vs. Alexander, 1 Band., 219,.-233. Powell^vs. Mon. & B. Man. Go., 3 Mason, 341. ’Hickman vs. McOurdy, 1 J. J. Marshall, 555. The admissibility of such evidence is entirely consistent with the cases of Glenn vs. Grover & McGolm, 3 Md. Bep., 212, and Baxter vs. Sewell, 3 Md.- Bep., 334, and same case in 2 Md. Gh. Dec., 441, Indeed the last case is a strong authority for the appellant. It expressly adopts the rule ■laid down in Gdle vs. Albers & Bunge, 1 Gill, 422, that “evidence of the same Mnd of consideration, varying only in amount, may be received.” See, also, Anderson vs. Tydings, 3 Md. Gh. Dec., 111. 5th. The evidence of Bedford, in relation to the declaration of the grantor, as to the consideration upon which the deeds were really made, was admissible as part of the res gestee of the transaction. It was good rebutting evidence to repel the presumption of fraud arising from the nominal amount expressed in the deeds as the consideration.. Garner vs. Smith, 1 Gill, 3. Smith vs. Morgan, 8 Gill, 138. Powles vs. Dilly, 9 Gill, 234'. Miller & Mayhew, vs. Williamson, 5 Md. Bep., 219. 'Hcmdy & Tull vs. Johnson, 5 Md. Bep., 450. McDowell vs. Goldsmith, 2 Md. Gh. Dec., 310. Same case, 6 Md. Bep., 319. The following points are submitted on the part of the ap-pellee : 1st. The two deeds sought to be set aside are voluntary on their face. The consideration being nominal, is virtually a consideration for love and affection. Sewall’vs. Baxter & Wife, 2 Md. Oh. Dec., 454. Same case, 3 Md. Bep., 340. McOrea vs. Purmost, 16 Wend., 463. 2nd. The consideration so set out in these deeds, cannot be contradicted, nor can any other consideration be proved. They are impeached for fraud, and cannot be sustained by proof of a different consideration from that stated in them. The deeds, if sustained at all, must be sustained as voluntary instruments. See cases above cited, and Birdy & Holt, vs. Staley, 5 G. & J., 455; Olagett vs. Hall, 9 G. & J., 90. Betts vs. 'Union Bank, 1 H. & G., 202. 3rd. In order to sustain these deeds as voluntary instruments, the burden of proof is upon the grantees, to show that at the time they were executed, the grantor was in “prosperous circumstances, possessed of abundant means to discharge his engagements and pay his debts.” If there be a reasonable doubt of this, the deeds must fail. Baxter vs. Sewell, 2 Md, Oh. Dec., 454. Same case, 3 Md. Bep., 340. Worthington dt Anderson, vs. Shipley, 5 Gill, 460. 4th. There is no evidence, except that of the grantor himself, as to his circumstances, and his testimony is excepted to, as before stated. But conceding Lis testimony to be admissible, it proves that his circumstances were not such as that these deeds can be sustained as voluntary instruments. See oases above. 5th. Even if it were competent to prove, by parol, a different consideration for these deeds, there is no evidence before the Court in regard to that subject, except the testimony of Bedford and Thomas A. Cunningham. That of the first, if admissible, proves nothing; it is indefinite. That of Cunningham is not admissible, because he is interested ; and even if admissible, could not be relied on by the Court sufficiently to establish the fact. Batoliffe vs. Sangs-ton, 18 Md. Bep., 390. Hat. Fire Ins. Go. vs. Grane, 16 Md. Bep., 260. McHlderry vs. Shipley, et al., 2 Md, Bep., 35.