Opinion
(August Term, 1847.)
1. Under the statute of Elizabeth voluntary conveyances to children, as such, are not absolutely void as to creditors. To make them void it must be shown that the maker of the deed was indebted at the time or so soon afterwards as to connect the purpose of making the deed with that of contracting the debt and defeating it.
2. By indebtedness in such a case is not meant a debt of a trifling amount, in comparison to the donor's estate, but he must be "greatly indebted," or at least he must owe some debt that remains unpaid and will be unpaid if the conveyance be sustained.
3. If a father, who conveys land to a son, be indebted at the time, that does not avoid the deed, provided the father pay that debt, or if he retain property sufficient to pay the debt and out of which the creditor can raise the money when he seizes the land conveyed to the child.
4. This deed was made before the act of 1840-1, ch. 28.
APPEAL from BUNCOMBE Spring Term, 1846; Pearson, J.
The premises in dispute belonged to Thomas Reavis in June, 1838, and he then conveyed them to his son Robert Reavis, the defendant, by a deed expressed to be made in consideration of $1 and of natural love and affection. At the same time Thomas Reavis made similar deeds for other land to each of his sixteen other children, but he retained (342) a tract of land, on which he still lives, and a considerable amount of personal property. In October, 1838, Thomas Reavis contracted a debt of $100 to the State, and confessed a judgment therefor, and a fieri facias was issued thereon, under which the premises were sold by the sheriff to the lessor of the plaintiff in April, 1839. On the trial the plaintiff proved that in April, 1838, an indictment was found against Thomas Reavis, which was pending when he made the deeds to his children, and on which he was convicted in April, 1839, and fined $150; but it was admitted that he paid the fine and the costs forthwith. The counsel for the plaintiff moved the court to instruct the jury that the pendency of the indictment against Thomas Reavis at the time he conveyed the land to the defendant and his other children, created such an existing demand against him as made those deeds fraudulent and void in law. But the court refused the motion, and directed the jury that the deed to the defendant was to be regarded as voluntary, and that the indictment, though it did not create a debt which existed when the defendant's deed was made, was sufficient evidence of a debt in contemplation; and that it was for the jury to consider whether the deed, under the circumstances, was made with the intent to hinder or delay that contingent or contemplated debt. A verdict was found for the defendant, and from the judgment the plaintiff appealed.
Edney and Francis for plaintiff.
N.W. Woodfin for defendant.
The refusal to give the instructions asked on the part of the plaintiff was, we think, correct. The act of 1840, ch. 28, makes the question of fraud in such a case one for the jury, under proper advice from the court. Therefore, it was right to decline pronouncing the deed fraudulent as a matter of law. But independent of that act, and under any construction of the Stat. 13 Eliz. that has ever prevailed, this deed could not be deemed convinous. As Lord (343) Hardwicke observed in Walker v. Burrows, 1 Ark. 93, there was always a distinction between the two statutes of 13 and 27 Elizabeth; and it would be attended with bad consequences if, as to creditors, voluntary conveyances were, as such, absolutely void, as the statute extends to goods as well as land, and that construction would defeat every provision for children, though the father were not indebted at the time. Hence, under 13 Eliz. it has always been held necessary to show that the maker of the deed was indebted at the time, or so soon afterwards as to connect the purpose of making the deed with that of contracting the debt, and defeating it. At least, that has always been the rule where the deed was not made to a stranger, so as to be purely voluntary, but was made to a child, as a reasonable provision, and thus founded on a meritorious and the "good consideration" mentioned in the statute. And when the donor's indebtedness at the time is spoken of, it is not intended that the deed is void if he owed a dollar or other trifling sum in comparison to his estate; for then no man could make a deed that would stand. But it is meant that he should be "greatly indebted," as Lord Coke says in Twyne's case, 3 Rep., 81, or, at the least, that he should owe some debt that remains unpaid and will be unpaid if the conveyance to the child be sustained. Lush v. Wilkinson, 5 Ves., 384; O'Daniel v. Crawford, 15 N.C. 197. But if a father, who conveys to a son, be indebted at the same time, that does not avoid the deed, provided the father pay the debt, or if he retain property sufficient to pay the debt, and out of which the creditor can raise the money when he seizes the land conveyed to the child; for the idea of an intention to defeat the debt is completely repelled, in the one case, by the actual payment by the father, and, in the other, by the existing and continuing ability to pay it. It is only when the donor is unable to (344) pay his debts when he makes a gift, or becoming so, and a debt remains unpaid, that the creditor finds the deed an obstacle to his satisfaction, and has the right to impute fraud to it. Now, in this case, if it be supposed that the fine and costs that might result from the indictment constitute a debt, yet that debt was actually paid by the father out of his reserved property, which rebuts the imputation of fraud. So of the debt for which the land was sold. That was contracted after the deed to the defendant, but, it may be admitted, so soon as to give it, for this purpose, the character of an existing debt. If so, it cannot, nevertheless, affect this deed with covin, because the father kept property much more than sufficient to discharge it, not only when he made the deed, but he had it when he contracted the debt and confessed the judgment, and when his son's land was sold, and, as far as it appears, still has it, amenable to the process of execution.
PER CURIAM. Affirmed.
Cited: Houston v. Bogle, 32 N.C. 505.