Fults v. Paul — 45 N.Y. St. Rep. 408

Majority

p. 408

Henry H. Fults, App’lt, v. Wilbur Paul, Adm’r of Erwin Paul, Impl’d, Resp’t.

(Supreme Court, General Term, Fifth Department,

Filed April 13, 1892.)

Headnote

Fraudulent conveyance—Knowledge of grantee—Evidence.

In an action by a creditor to reach real estate conveyed by defendant G. to the defendant-F., his son, and by the latter to E., brother of G., the referee found that the deed from G. to F. was given and accepted with intent to defraud plaintiff, and was void as to him. Defendant E. testified on his direct examination that there were forty-two acres in the farm, and that it was worth $20 per acre, and that he paid F. “ so much” and was to take care of his father till he came back. On his cross-examination he testified that the farm was worth no more than $20 an acre, that he was informed there were forty acres in it when ho took the deed; that he agreed to pay F. $1,000 and to pay G. the rest; that no time was specified in which he was to care for G.; that that was the consideration of the deed; that he did not agree to give $20 an acre; that he did not agree to give $1,800, but $1,200 or $1,300 in all. And on his re-direct examination he testified that F. owed him $500, and he gave F. a note for $500. On his examination in supplementary proceedings he testified that he paid about $3,000 for the farm; that he paid F. $1,000, all in cash except what F. owed him; that he did not remember how much F. owed him; that he was to pay the balance to G. as he wanted it. Held, that the evidence did not-support the finding that defendant E. purchased in good faith.

Appeal by the plaintiff from that portion of a judgment, entered In Steuben county, on the report of a referee, which dis- ' missed the complaint as to the defendant, Wilbur Paul, as administrator, etc., with costs.

J. F. Dorihy, for app’lt; J. W. Dininny, for resp’t.

The action was a creditor’s bill to reach real estate, consisting of a small farm, conveyed by. the defendant , George Paul to the defendant Frank Paul, his son, and by the latter to Erwin Paul, the brother of George. Erwin Paul was made a defendant in the action, and answered as such, but died after the. evidence was taken and pending the decision- of the referee, and Wilbur Paul, as his administrator, was substituted for him as defendant. The referee found that the deed from George to Frank was given and accepted with intent to hinder, delay and defraud the creditors of the former, particularly the plaintiff, and was void as to the plaintiff; but that the deed from Frank to Erwin Paul was accepted by the latter in good faith and for a valuable consideration paid by him, and without any intent to hinder, delay or defraud the plaintiff or any creditor of

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George Paul, and without any notice or knowledge of any fraudulent intent on the part of Frank or George Paul, or of any fraud rendering the title of Frank Paul void. Judgment was directed and entered accordingly, adjudging the deed from George to Frank fraudulent and void as to the plaintiff, but dismissing the complaint as to the defendant Wilbur Paul, as administrator, etc.

We are not satisfied with the findings, nor with the disposition of the case, in the respect last mentioned. The deed from George to Frank being fraudulent and void, it'became necessary for Erwin, in order to maintain his title as the grantee of Frank, to show affirmatively, and by satisfactory evidence, that he was himself not only a purchaser in good faith, without fraudulent intent on his own part and without notice of the fraudulent character of the title of his grantor, but also for a valuable and sufficient consideration actually paid or parted with by him, on the faith of the apparent title of his grantor, and before he had notice of the fraudulent character of that title. An examination of the record before us leads to the conclusion that the findings of the referee in the respect last mentioned are not supported by the evidence, and that the exceptions of the plaintiff to those findings, and to the refusal of the referee to find in that respect as requested by the plaintiff, were well taken.

The case on the part of Erwin Paul rests upon his own testimony, a part of which was given on the trial of the action and a part in proceedings supplementary to execution taken by the plaintiff. The testimony thus presented is full of inconsistencies, ■contradictions and evasions, and is very unsatisfactory, especially on the question of consideration for the deed to him. On his direct examination in the trial of the action, he testified that there were forty-two acres in the farm, and that it was worth twenty dollars per acre, and that he paid Frank “ so much ” and was to take care of his father till he came back. On his cross-examinatian, he testified that the farm was worth no more than twenty dollars an acre; that he was informed there were forty acres in it when he took the deed ; that he agreed to pay Frank $1,000 .and to pay George the rest; that he was to take care of George till Frank came back, no time specified; that that was the consideration of the deed; that he thought the price was fixed at twenty dollars per acre; that he had not figured up how much the farm would come to at twenty dollars an acre; that he did not agree to give twenty dollars an acre when he bought it he considered it worth twenty dollars an acre; that he was to pay Frank $1,000 and take care of his father until he came back; that he did not agree to give $1,800, but $1,200 to $1,800 in all. And on his redirect examination he testified that Frank owed him $500 and he gave Frank a note of $500.

On his examination in supplementary proceedings he testified that he never saw Frank’s deed and knew nothing about his having a deed except what Frank told him. That he paid in the neighborhood of $2,000 for the farm; that he paid Frank $1,000,

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all in cash except what Frank owed him; that he did not remember exactly how much Frank owed him, that it was about $300' and he paid $700. in cash; that he paid Frank that sum before he went off; that he was to pay the balance to George and he wanted it along ; that he agreed to pay $1,800 for the farm provided he should pay George as he needed ; that he considered the farm worth $1,800, what he gave for it; that he gave Frank a note when he bought the place, for about $500, due in five years, and $200 in money; that the $500 note had not been paid; that he heard before he took the deed that Frank bad given a life lease to his father and mother; that he furnished provisions and support for George Paul and his family, in this way; he rented the farm on shares and George was to have his (Erwin’s) share to live on. He also testified that he had heard that George was indebted to the plaintiff before he bought the farm; that be heard that George endorsed the note to Fults about the time he took the deed; that he knew they got a horse from Fults and turned out the McTamery note for it. This was the note on which the plaintiff recovered a judgment which is the basis of this action.

There is but little more of the testimony of Erwin Paul which is at all material to this action, and none which relieves it, as a whole, from the effect of the apparent contradiction and prevarication which characterizes that recited above. It is unnecessary to argue that testimony of- this character does not support the affirmative of the issue of good faith and full consideration, which was laid upon Erwin Paul as the grantee of a title which was. void in the hands of his grantor.

The judgment must be reversed and a new trial granted.

So ordered, with costs to abide the final award of costs.

Macomber and Lewis, JJ., concur.