Holden v. Burnham — 63 N.Y. 74

Majority

p. 74

James C. Holden et al., Appellants, v. John W. Burnham et al., Respondents.

(Argued September 38, 1875;

decided November 9, 1875.)

Headnote

A voluntary conveyance by a husband through a third person to his wife is not necessarily or presumptively fraudulent as against creditors; the want of consideration is simply a circumstance bearing upon the question of fraud, which is a question of fact for the jury.

In an action to set aside sucha conveyance as fraudulent against creditors, the referee found that there was a consideration therefor. There was no finding or request to find upon the question of fraud. Held, that even if the finding of consideration was wholly without evidence, the judgment could not be reversed in this court, as the absence of consideration would not alone authorize a judgment for plaintiff, and the court in the absence of findings or requests to find could not look into the evidence to see if other facts were proved, which, if found, would subvert the judgment.

Appeal from judgment of the General Term of the Supreme Court in the second judicial department, affirming a judgment in favor of defendant entered upon a verdict. (Mem. of decision below, 2 Hun, 678 ; 5 T. & 0., 195.)

This action was brought by plaintiffs as judgment creditors of defendant John W. Burnham, to set aside two deeds of certain real estate, one from said Burnham to defendant Lewis; the other from said Lewis to defendant Anna, wife of said John W. Burnham, upon the ground that said conveyances were without consideration and fraudulent as against creditors. The referee found a recovery of judgment by plaintiffs against Burnham, January 2, 1872, and a return of execution thereon unsatisfied; that on the 1st of July, 1870, said Burnham conveyed the premises in question to Lewis, who on the same day conveyed to Mrs. Burnham; that said conveyances were made after plaintiffs’ action against Burn-ham was commenced, and while it was pending, and each of them for a nominal consideration. He also found, in substance, that said premises were in fact purchased and paid for by Mrs. Burnham; that they were conveyed to Burn-

p. 75

ham with her consent, he promising that he would convey to her when requested, and in fulfillment of such promise and in compliance with her request he did so convey with the purpose of vesting in her the legal title. To these findings plaintiffs’ counsel duly excepted. As conclusions of law the referee found that in equity Mrs. Burnham was 'the legal owner, and that the conveyances were valid, and vested in her the legal'title, free from the claims of creditors.

S. H. Thayer for the appellants.

The conveyance was fraudulent as against plaintiffs. (2 R. S., 15, § 64 [3d ed.] ; id., 197, § 1; Savage v. Murphy, 34 N. Y., 508 ; Case v. Phillips, 39 id., 164; Carpenter v. Roe, 10 id., 227.) There was no moral obligation which could justify the conveyance or make it good as against creditors. (Garfield v. Hatmaker, 15 N. Y., 475 ; Lounsbury v. Purdy, 18 id., 515 ; Siemon v. Schurck, 29 id., 398; 2 R. S., 13, § 13 [3d ed.]; Revisers’ Notes, 3 R. S., 585 [2d ed.].)

Edward H. Hobbs for the respondents.

The conveyance by Burnham to his wife vested the title in her free from any claim of plaintiffs. (Davis v. Graves, 29 Barb., 480 ; Foot v. Bryant, 47 N. Y., 544 ; McCartney v. Welsh, 51 id., 626 ; Siemon v. Schurck, 29 id., 598 ; Moore v. Livingston, 14 How., 1 .) The equities of the case are entirely with defendants. (Buchan v. Sumner, 2 Barb. Ch., 207 ; White v. Carpenter, id., 217 .)

Conceding the claim of the counsel for the plaintiff, that the finding of the referee that the conveyance to Mrs. Burnham was founded upon a valuable consideration in equity was erroneous, yet this does not entitle the plaintiff to a reversal of the judgment. Although the conveyance from the husband was voluntary, it was not, for that reason, necessarily or presumptively fraudulent, as against his creditors. This I understand to be the necessary inference from the statute, which declares that no “ conveyance or charge shall be adjudged fraudulent as against creditors or

p. 76

purchasers solely on the ground that it was not founded on a valuable consideration. ” (2 R. S., 137, § 4.) It is a circumstance bearing upon the question of fraud, and, in connection with other circumstances, may establish it. It was settled in this State before the statute, contrary to some earlier decisions, that a voluntary conveyance, by a person indebted at the time, was not by intendment of law fraudulent as to existing creditors. (Seward v. Jackson, 8 Cow., 406 .) The statute then declared the rule in the language which has been quoted, with the additional provision that the question of fraudulent intent should be deemed a question of fact and not of law. (See Babcock v. Eckler, 24 N. Y., 632 ; Dygert v. Remerschnider, 32 id., 636 .)

The action is founded upon the allegation that the conveyance by Mr. Burnham was made with intent to hinder, delay and defraud his creditors. There is no finding upon this question, or any request to find upon it.

We are asked to reverse the judgment for the reason that the finding of a consideration for the conveyance was not warranted by the proof, and for the further reason that on looking into the evidence it will appear that the conveyance was, in fact, fraudulent. The absence of a consideration, as has been shown, does not alone authorize a judgment for the plaintiff, and it is the settled doctrine in this court, which has frequently been declared, that the party who seeks to reverse a judgment rendered upon the report of a referee, upon the ground that it was not warranted by the facts proved, must procure a finding of facts upon the questions upon which he relies, and the court, when there are no findings upon the question presented, will not look into the evidence to see whether facts were proved which, if found, would subvert the judgment. (Fabbri v. Kalbfleisch, 52 N. Y., 28 ; Pratt v. N. Y. Cent. Ins. Co., 55 id., 505, and cases cited.)

We are therefore of the opinion that the judgment should be affirmed.

All concur; Miller, J., concurring in result.

Judgment affirmed.