Scholey v. Worcester — 11 N.Y. Sup. Ct. 302

Majority

p. 302

JOHN B. SCHOLEY, Executor, Respondent, v. DAVID F. WORCESTER and FRANCES G., his Wife, Appellants.

Headnote

Creditor — when estopped, by Ms acquiescence therein, from asserting that a transaction of his debtor was fraudulent.

Where money is lent to one, who, with the knowledge and assent of the creditor, uses the same in erecting buildings upon land belonging to his wife, the creditor cannot afterward maintain an action to charge the debt upon the land of the wife, on the ground that such disposition of the money was, as to him, fraudulent.

Appeal from a judgment in favor of the plaintiff, entered upon the trial of this action by the court without a jury.

This action was brought to charge the lands of the defendant Frances G. Worcester with the payment of a debt due from her husband to the estate of Elizabeth G. Scholey, deceased: The

p. 303

premises were, from the time of their purchase, in July, 1867, the property of the said Frances. The debt, attempted to be charged upon these premises, was contracted in 1867, for a loan of United States bonds to David by the deceased, a sister of Frances; the proceeds of the bonds having been used in erecting a house on the land in question.

Geo. F. Danforth,, for the appellants.

F. A. Macomber, for the respondent.

There is evidence which tends to raise an inference that the expenditure of the moneys used by the defendant David Worcester, in building the house upon lands of his wife, was made with the knowledge and approbation of the testatrix, Mrs, Scholey. If it should turn out that such was the case, thé fact would constitute a perfect bar to the relief sought against Mrs. Worcester ; for a party who has been privy, and assented to a transaction which may be treated as fraudulent as to creditors, cannot impeach it on that ground. In Steel v. Brown^[4] Lord Mansfield held a bill of sale, where possession had not been taken under it, good between the parties to it, and, creditors who concurred in the nondelivery of possession. So a transfer will not be held fraudulent against persons who became creditors after they had notice of it, or who were privy and assented to it.^[2] In Olliver v. King, a father, after consultation with his brother, executed a voluntary deed assigning a considerable portion of his property to his two sons, and by his will made the brother and sons executors, and died. The brother never impeached the settlement, but acted under the will, and was a party to several transactions proceeding upon the assumption of the validity of the settlement. At his death his executors Impeached the voluntary deed as void against the brother, he being a creditor of the debtor, on a bond made prior to the deed. The vice-chancellor decided against the validity of the deed,^[3] but the

† † Sagitary v. Hide, 2 Vern., 44; Woodham v. Baldock, 3 J. B. Moore, 11; Bamford v. Baron, 2 T. R., 594; Olliver v. King, 8 De G., Mac. & Gord., 110.

‡ ‡ 1 Jur. (N. S.), 1067.

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lords justices reversed that decision on appeal. Sir G. J. Turner said: “ The deed was executed with his [the creditor’s] full consent and concurrence and he could not be permitted to say (and if he could not have been, his executors could not be) that the deed thus executed with his full consent and concurrence, was a fraud upon him within the meaning of the statute. (13 Eliz., chap. 5.) My opinion is based on this. I consider the true effect of this agreement to be, that John [the creditor], by his conduct, agreed to this alienation of the assets, and must have consented to take satisfaction out of the property which remained.” A similar principle has often been asserted by the courts of this State.^[4] Indeed, the rule is elementary, that parties, who, by their conduct, or even silence, have led others to act in opposition to their rights, cannot afterward set up those rights against them.

Upon the trial, the counsel for Mrs. Worcester offered to prove that her husband, David, was induced to come to Rochester with his family at the request <3f the testatrix, and that at her suggestion and request the premises in this case were purchased, she expressing a desire that the title should be in Mrs. Worcester. The evidence was excluded, and it is not unreasonable to infer that the court supposed that the facts to which the evidence offered related, were to be proved by conversations between the defendant David and the testatrix. The offer, however, was not restricted to that particular mode of proof, but was made in general language, which would embrace other and competent kinds of evidence. The facts offered to be proved were certainly competent and very material, according to the principle to which we have adverted; and for the error in excluding the evidence offered, there must be a new trial.

Judgment reversed and new trial ordered, costs to abide event.

* Pell v. Tredwell, 5 Wend., 697 ; Phillips v. Wooster, 36 N. Y., 414 ; Baker v. Gilman, 52 Barb., 39 .

Footnotes

* 1 Taunt., 381.