text:
    Patterson vs. Fowler’s exr.
    Without attempting to deduce, from the authorities, any general and fixed rule, to he applied in all cases, as to what delay of the execution creditor to sue outpi’ocess to enforce a levy upon land by a sale, will displace the lien, and let in intervening incumbrances, it is sufficient to decide, upon the facts of this case — the judgment lien being lost by lapse of time — that, by a delay of nearly four years between the return of the execution, under which the lands were levied on, and suing out the execution under which the lands were sold, during all which time no step was taken to enforce the levy, and no excuse given for the delay, the lien of the levy is displaced, as against the intervening rights of a more diligent creditor.
    To allow a new case to be made by an amended bill — setting up a mew and distinct title from that alleged and relied on in the original bill-r-after the parties had been litigating for more than eight years upon another title, and after the cause was at issue and set for hearing, would be extending the privilege of amendments beyond what is warranted by the established rules of pleading and ‘ practice, and setting a precedent that might result in much mischief.

      Appeal from, Independence Circuit Court m Chancery.

    Hon. William C. Sevens, Circuit Judge.
    Fairchild, for appellant.
    Whether Fowler’s or Patterson’s purchase shall hold the property, is a question of mere legal priority. Any right that Fowler acquired at the marshal’s sale of 25th January, 1847, was a legal right, and the same remark is to be made of the sheriff’s sale to Patterson. Not Fowler, nor his assignee, Bertrand, has any equity that can make his title any stronger in this court, than it would be in a court at law, in an action of ejectment.
    The judgment in the federal court upon which the bill relies, was rendered the 10th August,- 1840, an execution issued upon the 26th of the same month; another execution issued upon the 4th of February, 1848, under which the levy was made 20th of March ensuing; then a venditioni exponas was run upon the 7th of December, 1846, under which the sale of 26th January, 1847, was made.
    That is the whole case made by the original bill.
    The judgment, not being alleged to have been revived by scire facias, was a lien upon the lands in controversy, for three years and no more. Trapnall vs. Richardson, 13 Ark., 543; Pettit vs. Johnson, 15 Ark., 59; Slocomb vs. Blackburn, 18 Ark., 315. And although the levy was made within three years from the time judgment was given, the judgment lien was not thereby prolonged beyond its statutory term of three years. Trapnall vs. Richardson, 13 Ark., 552-557; Pettit vs. Johnson, 15 Ark., 59; Lawson vs. Jordan, 19 Ark., 303. The levy was made upon the 20th of March, 1843, and then a specific lien, but an execution lien, attached to the lands in controversy, and the question here to be decided is, how long shall that lien be held superior to the other after accruing liens, and without any attempt to enforce it by subsequent process ? Here, then, arises the precise question with regard to an execution lien that this court put in Trapnall vs. Richardson, 13 Ark., 553, respecting a judgment lien, where it says, “ though the enquiry would arise, if the levy on “land has the same effect thus to continue the lien, how long will “ the plaintiff have, after the expiration of his judgment lien, to “ enforce a dormant levy by sale under execution, and make it “ relate back to and connect with the lien.”
    This court, in the State Bank vs. Etter, 15 Ark., 274, held that, our statute being silent with regard to the continuance of execution liens, “the court must necessarily determine, from delay “ and other circumstances, whether the lien has been waived or “ abandoned.” And in that case a delay of two years and a half after the levy, with the other circumstances of the case, was adjudged to displace the lien, as against rights that were afterwards acquired. See Slocomb vs. Blackburn, 18 Ark., 315.
    An execution is not more potent to bind property, than the judgment on which it is founded, except it be made so by law; no good reason can be adduced to maintain that the lien of a levy should have longer life than a judgment lien. In the last reported decision of this court upon this subject, it is expressly decided, that a sale that is not upheld by a lion, so as to carry the title back to the judgment, only gives title from the date of the execution coming to the hands of the officer, notwithstanding a previous levy. And it provides exactly for Patterson, in saying, that “in such case, a junior judgment with the lien would have priority over one without, but of older date.” Lawson vs. Johnson, 19 Arló. 303.
    Prom authority, and from reason, the necessary conclusion is, that before the issuance of the venditioni exponas of 7th December, 1816, the lien of the levy of 20th March, 1813, had been discharged, so as to let in intervening liens.
    The amended bill cannot be sustained, because it presents a new, a different case from that presented in the original bill. Such is not the office of an amendment. It may correct imperfect statements in the original bill, by stating its allegations in another form, so as better to meet the case that is to be established by testimony, or to obtain discovery from a defendant more satisfactorily; may withdraw admissions ; perhaps may contradict what are alleged as facts in the original bill; may make new allegations tending to support the claim already made; may prefer a case, so that counting it and the original bill as one, that one may have a double aspect, the alternative relief, to be consistent with and founded upon the whole case so made up, and not inconsistent with the object and scope of the original bill; may make new parties; and generally may allege whatever is necessary for a full enquiry into the facts pertaining to. the support of the plantiff’s claim, and into those relied upon to defend against it; but all amendments must result, or must aim .to result, in maintaining or modifying the very case of the original bill, and cannot be the foundation on which to build an entirely different case. Story’s Eg. 'PI. 881; Lube’s Eg. PI. 87, note; Dodd vs. Astor, 2 Barb. Oh. JR. 395 ;
      Orery vs. Heaven, 13 Sim. 354 ; Walford vs. Pemburton, ib. 76; Lyon vs. Talmadge, 1 John ch. 188.

      Bnb if the subjeet matter of the amendment was proper for an amended bill at a proper stage of the case, this amended bill should not have been filed after the case was at issue and set for hearing, and therefore was illegally filed.
    In the English , practice, and so it was in New York, an amended bill may be filed until witnesses have been examined or proofs taken. But in that practice evidence is taken and publication of it passed, before the case is for hearing. Pan. Ch. Pr. Oh. XXI, Eng. Ed. ¶. 602,603. This is after the issues are formed ; and generally, the proper time for amendment is before replication. Story Eg. PI. see. 886; 1 Hoff. Ch. Pr. 284; Lubeds Eg. PI 189.
    Under our practice the cause stands for trial at the next term after it is at issue, that is after replication is filed; and the proper rule is, without regard to witnesses having been examined, that an amended bill can be filed, only before the case is at issue.
    I have not been able to find in the books of practice, or in the reports, an instance of amendments being alio wed to be made to a bill after replication,- without 'the replication being withdrawn. And to obtain the leave, the party should also show good¡reason why the amendment was not made before replication was filed, or issue formed. Story Eg. PI. see. 887; 1 Hof. Ch. Pr. 274, 286; Coldouyh vs. Evcms, 4 Simons, 76; Thorn vs. Gervnond, 4 Jhs. Ch. 363; Lube Eg. PI. 89.
    Stillwell & Woodruff, for appellee.
    The fi. fa., under which Fowler acquired the title set up in the original bill, issued and was levied while the lien of the judgment was alive : and the sale was on the 25th January, 1847, under a ven. ex. issued in December, 1846; hence there was a continuous lien upon the land from the date of the judgment till the date of the sale; and the title was, doubtless, good against Stone, and also against Patterson, unless the delay to sue out the ven. ex. displaced the lien of the levy, and let in the lien of Miller’s judgment, rendered in 1845.
    As to what will amount to a waiver or abandonment of a levy, there is a conflict of authority; but it will not be presumed from mere delay to sue out process to enforce the lien. 15 Ark. It. 90, 273. In State Bank vs. Etter, (15 Ark. 274), the circumstances from which an abandonment might be inferred, were very strong; and the decision was not based upon the neglect of the plaintiff to sue out his ven. ex.; but upon other circumstances, such as the failure to revive the judgment after the death of the defendant, etc. The delay to enforce the lien on chattels, where they are permitted to remain in the debtor’s hands, is treated as a fraud upon the rights of other creditors; but a levy on land is a different thing — the existence of the lien is evidenced by the record. Here the delay is the only circumstance, and from it alone an abandonment of the levy cannot be presumed in favor of the junior judgment creditor, or one claiming under him,-when he had full notice of the lien.
    The levy of the fi. fa. was a specific lien on the land, and the ven. ex. was a mere continuation and completion of the fi.fa. 13 Sm. ds Mar. 140 ; 13 Flow. U. S. Ft. 290; Bald. G. G. It. 276, in note; 1 Watts 42 ; 15 Ark. 59. And it can only be displaced by gross negligence. 1 Watts 301; 2 McMullcm li&p. 351. And being [specific and not general, the residue of Stone’s estate was subject to Miller’s judgment.
    But it is not at all requisite that we should argue in support of this title. The title set up in the amended bill is undoubtedly superior to Patterson’s. But it is objected that the amended bill sets up a new title — makes a distinct and different case from the original bill. Now, if the amended bill had alleged that the title to the land in controversy was not as supposed in the original bill, at the time of Powler’s purchase in January, 1847, but was in some other person, and Bertrand had acquired that title, there would be a new title and different case from that made by the original bill. But such is not the fact. The title of Stone is the only one before the court, and the question is, which of the parties acquired that title. Both sales to Fowler wore under the same judgment — the inception of Fowler’s rights under both deeds was the same, and together they formed one title.
    In general, a supplemental bill will not bo permitted to be filed except upon new matter; and if brought for matter arising before the filing of the original bill, a demurrer will lie. {Story’s E<i. PI., secs. 614,616). An amended bill is proper for “ enquiry into additional facts, {sec. 884); or where he has omitted to state any matter which ought to have been stated in the original bill,” {sec. 885).
    Here the sale and purchase, set up in the amended bill, occurred before the filing of the original bill, and nothing remained to be done but the mere formality of procuring a deed. The marshal’s deed when executed, related back to the sale, and the title is regarded as commencing then. 13 J. G. li. 316 ; 9 Sm. <& Mar. 392; 1 Gil. P&p. 218.
   Mr. Chief Justice English

delivered the opinion of the Court.

Taking up the questions deemed material to a disposal of the cause, in the order in which they have been discussed by counsel, we shall first determine whether the title of Absalom Fowler, to the lands in controversy, as set up in the original bill, is superior to that of James II. Patterson, as made out in his answer and cross-bill, he being the only party who appealed from the decree of the court below in favor of Fowler.

The substance of the case made by the original bill, is, that Hufus Stone was the owner of an undivided half of certain lands situated in J ackson county, which are described. That on the 10th of August, 1840, Hiram Stewart obtained a judgment against Stone in the Circuit Court of the United States for the District of Arkansas; and on the 26th of the same month a fi.fa. was issued upon the judgment, and afterwards returned unsatisfied.

That on the 4th of February, 1843, another execution was issued, directed to the Marshal of the District, returnable on the second day of the March term following; which, on the 6th of February, 1843, came to the hands of Thomas W. Newton) the marshal, and was by him levied upon the interest of Stone in the lands in controversy, on the 20th of the ensuing March, but returned without sale, for want of time to advertise and sell before the return day of the writ.

That on the 7th of December, 1846, the judgment and execution remaining unsatisfied, and the land unsold, to compel a sale thereof, a venditioni exponas was issued: which, on the same day, came to the hands of Elias Rector, then marshal, etc., who, on the 25th of January, 1847, after due advertisement, offered the lands for sale, at the court-house, in the county of Jackson, and Fowler purchased the interest of Stone therein at $ 1 per tract; and, on the 7th of May following, the marshal executed to him a deed therefor; which, upon the 17th of the same month, was duly recorded, etc.

It was alleged that Patterson claimed title to the same interest in the lands purchased by Fowler, and he was made defendant. Stone and others were, also, made defendants, but none of them appealed, and the pleadings relating to them, and to their claims to the lands, need not be stated here.

The bill prayed for partition of the lands, and for confirmation of Fowler’s title.

Patterson, in his answer and cross-bill, alleges irregularities in the sale to Fowler, and sets up his own title, in substance, as follows:

On the 18th November, 1845, Henry Miller obtained a judgment against Rufus Stond, in the Circuit Court of Jackson county; on which a Ji. fa. was issued 23d November, Í846, and on the same day placed in the hands of the sheriff of the county; who, on the 1st of December following, levied on the lands in controversy, and after due advertisement, offered them for sale, at the court-house door of said county, on the 17th May, 1847, and Patterson purchased them, and on the next day-received the sheriff’s deed therefor, conveying to him the interest of Stone in the lands, etc.; which deed was duly acknowledgedand recorded 17th May, 1849. Prayer that Fowler’s title be canceled, and Patterson’s confirmed, etc.

The lien of the judgment under which Fowler purchased, commenced on the 10th of August, 1840, (the date of the judgment), and expired with the 10th of August, 1843, the duration of the lien being limited by the statute to three years from the date of the judgment.

The alias fi. fa. of 4th February, 1843, was issued, placed in the hands of the marshal and levied upon the lands before the lien of the judgment expired, but the lien was not thereby prolonged. Trapnall vs. Richardson et al., 13 Ark. 549; Pettit et al. vs. Johnson et al., 15 Ib. 59.

The execution became a general lien upon all the lands of Stone, within the territorial district of the dourt from which it issued, at the time it came to the hands of the marshal (8th February, 1843,) — Trapnall vs. Richardson et al., ubi. sup.— and became a specific lien upon the lands in controversy at the time it was levied upon them (20th March, 1843). The lien of the execution must be considered as disconnected with the judgment lien, w’hich was lost to Fowler by lapse of time. (Pettit et al. vs. Johnson et al., 15 Ark. 59.) If. his title is superior to Patterson’s, it must be because the lien of the execution was not only prior to the lien of the judgment under which Patterson purchased the lands, but continued unbroken to the time of the sale to Fowler, under the vend, ex., on the 25th January, 1847.

The execution under which the levy was made, was returned, with the levy endorsed, without sale of the lands, for want of time, etc., to the March term, 1843. The vend, ex., under which Fowler purchased, was issued and placed in the hands of the marshal on the 7th of December, 1846, a period of three years and about eight months from the time the execution was returned, during all which period it does not appear, from the allegations of the original bill, that the plaintiff in the execution (or Fowler, who was his attorney,) caused any intermediate process to be issued, to keep up the continuity of the levy, or enforce the lien. Did the execution lien continue in full force during all this period, or did it expire by reason of the laches of the plaintiff, so as to let in the lien of the judgment recovered by Miller against Stone in the meantime, under which Patterson purchased the lands?

It has been decided that the lien of a judgment is continued by the statute for three years, and that mere delay of the plaintiff to sue out process to enforce the lien, does not displace it, and let in junior incumbrances. Trapnall vs. Richardson et al., 13 Ark. 551; Watkins vs. Wassell, 15 Ib. 90; Shall ad. et al. vs. Biscoe et al., 18 Ib. 156.

The statute fixes the time when the execution lien shall commence, but does not declare how long it shall continue. Dig., chap. 68, sec. 35.

In State Bank vs. Etter, 15 Ark. 273, the court said: “Judgment liens are by statute limited to three years, and we have held that mere delay to sue out process for satisfaction within that time, will not displace the lien; but here, where there is no limitation by statute, unless a different rule be applied to execution liens, they might remain an incumbrance upon the estate until the right to satisfaction of the judgment is barred by limitation.”

In Trapnall vs. Richardson et al., 13 Ark. 555, the court said: “ It is obviously the policy of our system of laws to make the title to land depend upon matter of record, and not upon any act in pais, or resting in parol. The registry system is almost universal. Deeds, mortgages, mechanics’ liens, settlements of separate estate in the wife, and all incumbrances affecting the title to the land, are required to be recorded in the county where the land lies, else they will not avail as against innocent purchasers. So, judgments and decrees are required to be condensed into a judgment docket, to facilitate the examination of incumbrances, and open to the inspection of all persons interested in the title to land. The only exceptions are, where the execution is levied on land to which the lien of the judgment does not extend, i. e., where the execution is sent to another county, or where the lien has been determined, i. e., expired without revival, and, in such case, the execution is’* the lien from the time it comes to the officer’s hands, just as it is on personal property, which is never barred by the lien of the judgment (Rev. Slat., title Execution, sec. 27), and would proba_ bly have to be governed by the same rules as apply to. personal properly: and clearly that the sale of land so situated would not be upheld by the lien of the judgment.”

In Slocomb et al. vs. Blackburn et al., 18 Ark. 315, the execution was levied on slaves, a delivery bond given, returned forfeited, and no process sued out for more than five years, and the question being whether the lien of the levy was lost by delay, etc., the court said:

“ The act of 20th March, 1839, (Dig. ch. 67, sec. 38,) provides that ‘ if the property be not delivered according to the condition of the bond, the levy shall remain a lien upon the property taken, for the satisfaction of the judgment into whose possession soever the same may have passed.’ And section 39 of the same act, declares that the officer may seize the same property wherever it may be found, etc., and sell the same,’ etc. But how long the levy shall remain a lien upon the property, the act does not provide. The statute being silent as to this, the duration of the lien must be determined by reference to such analogous principles of law as may be applicable. Our law does not favor the continuation of such liens for an unreasonable time. The lien-of a judgment upon real estate is. limited to three years. In State Bank vs. Etter, 15 Ark. 269, an execution issued from Pulaski to the sheriff of Hempstead, was levied on land, and returned without sale, by order of the plaintiff. The defendant died, and his administrator afterwards sold the land. The plaintiff afterwards attempted to enforce the lien of the levy by ven. ex., and this court held, that the plaintiff, having directed the return of the execution without sale after the levy, and taken no steps to revive the judgment, against the administrator, and sued out no process for the satisfaction of the judgment for two years and a half after the levy, and near fifteen months after the land had been sold by the administrator, the lien of the levy was lost. The court remarked that as to judgments, ‘the statute has limited the continuance of the lien, but with regard to execution liens, the statute is silent, and the court must necessarily determine, from delay and other circumstances, whether the lien has been waived or abandoned! Where personal property is levied upon, and, by direction of the plaintiff', the sheriff permits it to remain in possession of the defendant, and returns the levy without a sale, the levy will not continue to be a lien as against intervening rights of other persons, etc. Such lien is regarded as dormant and fraudulent as against other creditors. Perhaps, upon principle, where goods are levied on, and delivery bond taken, and returned forfeited'at the return term, and the plaintiff permits the next ensuing term of the court to pass without taking out process to enforce the lien of the levy upon the goods, he might, by such neglect, lose his lien as against any intervening rights of other creditors or purchasers. But, be this as it may, in this case, the appellants sued out no process for more than five years after the return of the bond forfeited, and then they caused fi. fas. to be issued, taking no notice of the levies previously returned.”

The result was, that the court held that the lien of the levy upon the slaves was abandoned and lost by the laches of the appellants.

These decisions point to the conclusion, which we think inevitable, that the duration of the lien of a levy upon land, and what interference, neglect and delay of the plaintiff in the enforcement of the lien, will displace it, and let in intervening rights of other creditors, etc., must be determined by common law principles applicable to liens «f levies upon goods, with such modifications of the principles as must necessarily be made on account of the difference in the nature of the two species of property.

It is not necessary, in this case, for us to attempt to deduce, from the authorities which we have examined, any general and fixed rule, to be applied in all cases, as to what delay of the execution creditor to sue out process to. enforce a levy upon land by a sale, will displace the lien, and let in intervening incumbrances. It is sufficient to decide upon the facts of the ease before us, whether the continuity of the lien was broken by the laches of the plaintiff in the execution.

Here, as above shown, three years and about eight months elapsed between the return of the execution under which the lands were levied on, and the suing out and placing in the hands of the marshal the vend. ex. under which they were sold to Fowler, during all which time no step was taken to enforce the levy, which was lying dormant in the clerk:s office, and no excuse is given in the original bill for such dela}u In the meantime, the judgment, under which Patterson purchased, was recovered, a fi. fa. issued, and levied on the lands.

We have found no adjudication, and know of no elementary principle of the common law, to support the lien of a dormant levy for so long a period, as against the intervening rights of a more diligent creditor. On the contrary, the authorities sustain the conclusion that the lien is displaced by such delay. Hood et al. vs. Winsatt, 1 B. Mon. 210; Owens vs. Patterson, 6 Ib. 490; Eldridge vs. Chambers, 8 Ib. 413; Wood vs. Gray et al., 5 Ala. 47; Riggin vs. Milligan, 4 Gilman 50; Presnell vs. Lander, 5 Ire. Eq. 255; Harding vs. Spivey, 8 Ire. L. 66; Spencer vs. Hawkins, 4 Ire. Eq. 291.

To uphold the lien of a dormant levy, for so long a time, as against intervening liens, would be to give it greater duration and tenacity than the legislature have deemed expedient, on grounds of public policy, to give the lien of solemn judgments of the courts, which is expressly limited to three years.

The conclusion is that the title of Fowler, as set up in the original bill, is inferior to that of Patterson.

2. We are next to decide whether the court below erred in permitting Fowler to file an amendment to the original bill, after the cause was at issue and set for hearing, setting up another and distinct title, to the lands in controversy, than that relied on, and sought to be confirmed by the original bill?

The original bill was filed on the 15th June, 1848. The cause, after various and extended pleadings, which need not be particularly noticed, was finally brought to issue, on the original and cross-bills, at the December term 1855, and set down for hearing at the next term. At the next term no step appears to have been taken in the cause. At the ensuing term (on the 12th December, 1856) the following order was made:

Comes the said complainant, and, on leave of the court, filed his amended bill in this cause, and certain exhibits accompanying the same. And on motion of said complainant, it is ordered that such of said defendants as have appeared to this suit, have leave to answer the matter set up in the amended bill, within two months from this date, and if they, or any of thenc^ should fail to file such answer, within such time, the amended bill shall stand as confessed, and, at the next term, shall be formally taken and entered as confessed against such of said defendants as so fail to answer, within said period of two months; and it is agreed by the complainant, that such answers may be filed without 'being sworn to, and on any of said answers being filed within such period, then, at the end of said period of two months, the cause, as to said amended bill, shall be considered as standing at issue, and the clerk of the court is now directed, on motion of complainant, as soon as said term of two months shall expire, to enter in his name on the records, as by consent, a general replication to each or all of the answers that may be so filed, and on motion of said complainant, this cause is now set down for hearing at the next term, waiving any and all errors or irregularities in the setting down the same before issues are made, or answers in, to said amended bill, cross-bill, answers, exhibits and replications. And it is ordered that each of said parties have leave to take the depositions of witnesses, to be read as evidence on such final hearing. Ordered that this case stands continued until next term.”

The amended bill, after reciting the previous pleadings and proceedings in the cause, alleges, in substance, as follows:

That on the 8th of May, 1843, after the return of the ji. fa.., of 4tn February, 1843, which was levied on the lands in controversy, as stated in the original bill, Stewart sued out another ji. fa. upon the judgment against Stone, returnable to the October term following, upon which the clerk endorsed the levy upon the lands made, under and returned upon the ji. fa. of 4th February, 1843, and which was placed in the hands of Thomas W. Newton, marshal, 9th May, 1843, who levied it on the lands in controversy, and other lands; that Stone claimed the benefit of the appraisement act, the lands were offered for sale, and failing to bring two thirds of their appraised value, the marshal returned the fi. fa. without sale.

That on the 24th October, 1844, and after the expiration of the twelve months stay allowed by the appraisement act, a ven. ex. was sued out, reciting’ the previous levy, appraisement, etc., and commanding the marshal to sell the lands, etc., returnable first Monday of May, 1845, which was returned 10th March, 1845, without sale, etc. 1

That on the 10th March, 1845, another vend. ex. was sued out, for the sale of the lands levied on and appraised as aforesaid, returnable first Monday of August, 1845, which, on the 19th June, 1845, was returned without sale.

That on the 24th June, 1845, or about that time, another writ oí vend. ex. was sued out, reciting the levy made and returned upon the fi. fa. of 4tth February, 1843, as stated in the original bill, and other matters proper for such a writ to recite, which, on the next day, was delivered to Henry M. Rector, marshal, etc., who, on the 5th July, 1845, duly advertised said lands for sale, and pursuant thereto, at the court-house door of Jackson county, on the 16th of August, 1845, sold said lands to Absalom Fowler; that the amounts bid by Fowler were paid to the marshal, and by him applied to the payment of said ven. ex• and judgment; all which was to be made apparent by exhibit H, a copy of said execution and return, when it could be found, the original having been lost or mislaid, or if not found, the amended bill prayed to supply its loss by the best evidence obtainable.

And that the greater part of the facts relative to such last mentioned ven. ex., advertisement, sale^ and application of sale’s proceeds, would appear by certificate of the deputy who made the sale, which was to authorize a deed, and while the deputy was officially holding the execution, and before the appointment of a successor to Henry M. Rector, marshal, which certificate was brought into court, and a copy filed as exhibit I.

And that said Rector, not long after said certificate was given, and before Fowler wms able to obtain a deed to said lands, was finally removed from the office of marshal, and Fowler had no deed, but when he could obtain one, would bring it into court and file a copy as exhibit K.

He claims the benefit of the sale, and title thus purchased, and prays as in the original bill. ■

No excuse is made in the amendment for not setting up this title in the original bill, or for ^offering the amendment at so late a period in the progress of the cause.

A copy of the ven. ex. under which the sale set up in the amended bill is alleged to have been made, was not filed, or produced at the hearing.

The deed of John Quindley, marshal, bearing date 5th May’ 1857, executed under an order of the circuit court of the United States, for the Eastern District of Arkansas, made upon the petition of Fowler, was filed as exhibit K, at the June term 1857.

Patterson did not answer the amended bill within two months after the making of the order copied above, as therein required; but at the June term, 1857, the court gave him leave to file an answer by the next term. He accordingly answered, and in in his answer, objected, by way of demurrer, to the matter of the amended bill.

It will be observed that the amended bill was filed not only after the cause was at issue, but after the parties had been litigating the title set up in the original bill for more than eight years; a ml it is manifest that the matter set up in the amended bill was within the knowledge of Fowler, at the time the original bill was filed, for he was the purchaser at both of the alleged sales.

There is some confusion in the English books in regard to the rule as to the time of allowing amendments, and the extent to which they may go, etc.

In Shields vs. Barrow, 17 Bow. U. S. R. 144, the court said: “ The complainant is not at liberty to abandon the entire case made by his bill, and make a new and different case by way of amendment. We apprehend that the true rule on this subject is laid down by the Vice Chancellor, in Verplank vs. The Mercantile Ins. Co., 1 Edwards Ch. R. 46. Under the privilege of amending, a party is not to be permitted to make a new bill. Amendments can only be allowed when the bill is found defective in parties, in its prayer for relief, or in the omission or mistake of some fact or circumstance connected wiih the substance of the case, but not forming the substance itself, or for putting in issue new' matter to meet allegations in the answer. See, also, the authorities there referred to, and Story's Eq. Pl. 884.

“ We think sound reason can be given for not allowing the rules for the practice of the circuit courts, respecting amendments, to be extended beyond this; though doubtless much liberality should be shown in acting within it, taking care alwmys to protect the opposite party. See Mavor vs. Dry, 2 Sim. & Stu. 113.

“ To strike out the entire substance and prayer of a bill, and insert a new case by way of amendment, leaves the record unnecessarily encumbered with the original pleadings, increases expenses, and complicates the suit; it is far better to require the complainant to begin anew.

“ To insert a wholly different case is not, properly, an amendment, and should not be considered within the rules on that subject.

See, also, the remarks of the Lord Chancellor Cottenham, in Watts vs. Hyde, 22 Eng. Ch. R. 407, on the tubject of amendments.

In Vernon vs. Vernon, 14 Eng. Ch. R. 172, it was held that a statement in the bill that complainant was tenant in tail by way of purchase, and also, that he was heir apparent in tail, were such inconsistencies as could not stand together in one bill, and leave to amend by striking out was granted, only because the Lord Chancellor was led to believe that some of the allegations had crept into the bill by accident.

In Fenno vs. Coulter, 14 Ark. R. 45, after reversing the decree, on the case made by the bill, the court said: “In remanding the cause, a question of practice arises in regard to, instructions to be given to the court below, etc. Shall we allow the complainant to amend his bill, etc., or shall we direct that the suit be dismissed without prejudice, etc. Vfe have, in several instances, pursued the latter course, and as the facts of the case are materially different from those heretofore presented, we have again looked into the authorities, and upon examination of the cases, which we have heretofore decided, we find, in each of them, an amendment would, in effect, have been the institution of a new suit, upon a distinct and independent claim or right. For instance, in Cook vs. Bronaugh, 8 Eng. R. 188, the bill was for specific execution of a contract, but it appeared that he (Cook) might have asserted a claim for the professional services, which were the consideration on which the special contract was based. The court refused to send the case back to the court below, with leave to amend, because it would have been no amendment of a cause of action defectively stated, but the substitution of a new and different cause of action. And so, also, in the case of Moulding vs. Scott et al. 8 Eng. 93. The bill set up title in the complainants to slaves, as heirs of the mother, who, it appeared upon the trial, had no title, but that the complainants had title as heirs of the father. The court refused to direct an amendment, because it would not be an amendment of a case defectively stated, but the statement of a new and independent title.”

In the case now before us, the title set up in the amended bill was not only new and distinct from that alleged and relied on in the original bill, but the titles were contradictory, and both could not stand, or be upheld by a decree. Because the-title set up in the amended bill was a sale of the lands by the marshal, under process issued against Stone, on the 16th of August, 1845, while the title set up in the original bill was a sale of the same lands, under process upon the same judgment, against the same person, on the 25th January, 1847, and of course, if the prior sale was valid, and vested Stone’s title in Fowler, he acquired no title whatever by the subsequent sale.

That both titles might have been set up in the original bill, with an alternative prayer for the confirmation of the one or the other, according to the judgment of the court as to their regularity, and validity, we do not doubt. Nor would we say that the title set up by the amended bill might not have been brought into the case by amendment, if the amendment had been offered at a proper, and within a reasonable time in the progress of the cause. But to allow a new case to be made by an amended bill after the parties had been litigating for more than eight years, upon another title, and after the cause was at issue, and set for hearing, would be extending the privilege of amendments beyond what is warranted by the established rules of pleading and practice, and setting a precedent that might result in much mischief. Story’s Eq. Pl. sec. 886.

The objection to the matter set up in the amended bill, was well taken by the demurrer contained in the answer. Wray vs. Hutchinson, 7 Eng. Ch. R. 237.

The conclusion which we have reached, renders it unnecessary to pass upon the regularity and validity of the execution sale, etc., set up in the amended bill, or to decide other questions discussed by counsel.

The decree of the court below in favor of Fowler, must be reversed, and the cause remanded with instructions to dismiss the bill without prejudice to the right of his representatives (he having died pending this appeal,) to lile a hew bill, if they think proper to do so.

Mr. Justice Fairchild did not sit in this case.


source: Caselaw Access Project

author: Mr. Justice Compton

license: Public Domain

text:
    Aiken vs. Gill.
    Where upon a sale of real estate the purchaser gi res a note for the purchase money, and the vendor executes a covenant to convey the legal title on payment thereof, and afterwards assigns the note, he is a necessary party to a bill by the assignee to enforce the vendor’s lien.

      Appeal from Pulaski Chancery Court.

    Hon. H. F. Fairchild, Chancellor.
    Garland & Randolph, for the appellant.
    Mrs. Beebe should have been made a party to the suit. She had an interest in the suit, and in the decree to be rehdered in it. And the general rule is that persons materially interested, either legally or beneficially, in the subject matter of the suit, are to be made parties, either as plaintiffs or defendants. Story Eq. PL sec. 72; 73, 74, 138; Brodie vs. Skelton, 6 Eng. 120; Bailey vs. Inglee, 3 Paige Ch. R. 278.
    Jordan for appellee.
   Mr. Justice Compton

delivered the opinion of the Court.

The bill was brought by William Gill against Christopher C. and Thomas Aiken, to enforce the vendor’s lien for the purchase money of two lots of land, lying in the city of Little Rock, and charges that Mrs. Beebe sold the lots to Thomas Aiken for $300 he making his note to her in that sum, and she executing to him her covenant to make title upon payment of the purchase money; that, afterwards, Thomas Aiken conveyed the lots, by deed in foe simple, to Christopher C. Aiken, and that Mrs. Beebe assigned the note of Thomas Aiken to Francis Drew, who assigned it to the complainant. •

A demurrer to the bill was overruled, and on appeal from the decision of the court below, the only question raised on demurrer, necessary to be noticed, is, whether the Hill is defective in not making Mrs. Beebe a party to the suitv

It is a general rule in equity (subject to certain exceptions, which do not arise in this case) that all persons materially interested, either legally or beneficially, in the subject matter of a suit, must be made parties to it, either as plaintifFs or defendants. The object of the rule is to enable the court to do complete justice by rendering such decree as shall settle the rights of all persons interested in the subject matter of the controversy, thereby preventing future litigation, and making the performance of the decree perfectly safe to those who are compelled to obey it. Story Eq. Pl. sec. 22. An application of this rule leads to the conclusion that Mrs. Beebe was a necessary party. The legal title is in her, which should not, and all know, cannot be divested, without having her before the court. Furthermore, the purchaser is interested in having her made a party, in order that, upon payment of the note, if payment should be decreed, the court may be enabled to vest in him the legal title. According to Mrs. Beebe’s covenant, she was to make title upon payment of the purchase money. A decree, therefore, which would exact the purchase money without vesting the purchaser with title, so far from settling the rights of the parties, would leave the purchaser exposed to future litigation. The performance of such a decree, instead of being perfectly sale, would be hazardous, and to require the purchaser to perform it would be unjust. Edwards vs. Bohannon, 2 Dana (Ky. Rep.) 98, 99, is a case in point; it is there held that to a bill brought to enforce the vendor’s lien for the purchase money, the holder of the legal litle is a necessary party; and the reason assigned is, that “ a sale should not be decreed unless the chancellor, by having the holder of the legal title before him, can be able to confer on the purchaser a perfect right.” The same principle was decided in Johnson vs. Rankin, 2 Bibb, 184. And Mr. Justice Story, in his work on equity pleading, lays.it down as a general rule, that the person having the legal title in the subject matter of the bill must be a party, and this, even though “ he has no beneficial interest therein; so that the legal right may be bound by the decree of the court.” Eq. Pl. sec. 198.

Let the decree be reversed, and the cause remanded with leave to make Mrs. Beebe a party.

Mr. Justice Fairchild did not sit in this case.


text:
    Anthony vs. Anthony.
    Where it 13 agreed between two parties that one should acquire, by means of s purchase and sale of real estate, an unencumbered legal title, to be held as security for money advanced to the other, the transaction, though in form an absolute sale of the property, is essentially a mortgage; And on a bill to set aside the legal title thus acquired, and have the transaction declared to be a mortgage, the court will consider all the circumstances of the case to ascertain the real intention of the parties at the time of the agreement.
    If a mortgagor goes into equity to redeem, he will not be permitted to do so but upon payment, not only of the mortgage debt, but of all other debts due from him to the mortgagee; and so, where he seeks a recovery of rents and profits. But if the mortgagee seeks a foreclosure in chancery, the mortgagor is permitted to redeem upon payment of the mortgage debt alone.

      Appeal from Pulaski Chancery Court.

    Hon. H. F. Fairchild, Chancellor.
    Williams &, Williams, for the appellant.
    We shall confine ourselves, principally, to the discussion of the two main leading questions involved. First, was Mrs. Anthony a trustee. Second, if she was, did the court, in the reference to the master for account, make the basis too narrow in excluding matters of personal dealing, and in afterwards refusing to correct the master’s report on exceptions by a re-reference. As to the first proposition. Trusts are of two kinds, express, or implied: express trusts can only exist by contract; implied trusts are created or raised by operation of law, from the relation of parties or the circumstances of the case. While it is true that the bill in this case is drawn upon the basis of an express trust, and it might be questionable whether he would not be bound by the aspect of his bill, yet as the court might be of opinion, that appellee would be entitled to relief under his general prayer, if the state of facts alleged authorized relief, we will first enquire whether from relation oí parties, or the circumstances of the case, either, or both, the law will imply a trust.
    The only legal relation that existed between the parties to this suit prior to the purchase of the Bank mortgage, and sale and purchase under it, by Mrs. Anthony, was that oí mortgagor and mortgagee. That is, Mrs. Anthony claimed an interest under the mortgage of 10th January, 1843, and also was made a beneficiary under the deed of trust to Pike. We submit that the fact of Mrs. Anthony being a mortgagee of the property, or beneficiary of a trust under it, did not preclude her from purchasing and acquiring a permanent lien, and title thereunder, even though that paramount lien and title should have emanated from the mortgagor, (appellee.)
    A mortgagee has equal rights with third persons to purchase mortgaged premises, and the lowness of price at which, he purchased, is no ground to set aside a sale. Mott vs. Walsh, 3 Edwards Oh. Rep. 590. And a sale under a power as in this case divests the equity of redemption. See Einsley vs. Ames, 2 Met. R. 29; Blair vs. Ross, 4 Blackford, 540 ; 11 Vermont, 9.
    A mortgagee may buy under his own mortgage and bar the equity of redemption, if he does not use his position to. influence the mortgagor to part with the estate for less than its full value, (which is not pretended in this case.) Micks vs. Hicks, 5 Gill & Johnson, 753 -4.
    The owner of the equity of redemption is not entitled to redeem the mortgaged premises after the same have been put up and sold; although the mortgagee became the purchaser at such sale. Brown vs. Front et al., 10 Paige, 243. See, also, 9 E. H. Rep. 404Hilton vs. Hilton, 3 Dama, 388.
    There is no question made about Mrs. Anthony’s right to sell under the power of sale, and her right to sell and buy is clearly sustained by authority; besides being provided for by the express stipulations of the mortgage. See 1 Paige 48, 78, 68, 69, 70; 2 Cowen, 202; 1Ó Johnson, 195.
    We suppose that the appellee will not seriously insist upon an implied trust, as he has not alleged or relied upon it heretofore, in the court below, either by allegation, or argument, relying solely upon an express trust, and to that point we now pass.
    Does the proof sustain the allegation?'
    The bill charges the existence of such a trust, in parol. Mrs. Anthony, in her answer, denies the trust and all the allegations. and charges in the bill, in reference thereto, in the most emphatic manner. This answer, by the rules of chancery, being directly responsive to the gravamen of the bill, is testimony, and establishes fully the allegations of the answer in this respect, as fully as though proven by one witness. Such being the legal' effect of her answer; and to overthrow her answer in this respect, it requires the testimony of two witnesses, or one witness with strong corroborating circumstances. We look in vain for any testimony coming up to this standard in the transcript, to overthrow the answer. For, aside from the statements, loose and unsatisfactory as they are, of pretended admission of Mrs. Anthony, which we gather from the testimony of the Oldhams and the two Thorntons, which is indefinite and unsatisfactory, not only as to the time when made,, i. e., whether before or after the purchase under the Bank mortgage in August, 1848, which is the period at which Mrs. Anthony commenced claiming an absolute title, but also in the character of the admission. And even giving it its full weight as an admission, it is the weakest and most unreliable testimony that can be introduced into a court of justice, not only because the witness may, and in most cases does, misunderstand what is said; but, also, because he may not correctly remember what was said after such lapse of time, and the party making the admission, may not enter into explanations, which very materially weaken the force of the admission, or changes its character altogether. Besides a false statement as to an admission, is easily fabricated and hard to disprove. Prater adm. vs. Frazier and wife, 6 Png. 249; Phillips on Ev., Gowen dé IIUVs notes, 211.
    And we submit that taking these pretended admissions in their strongest light against Mrs. Anthony, they are not entitled to the weight of a single witness, and would not satisfy the minds of a court or jury as well of the truth of the facts which the admission was adduced to prove.
    To enforce a specific trust upon reali estate from loose and equivocal expressions made by one of the parties in mere social conversations held at different times, would be inequitable and contrary to the spirit and policy of the statute of frauds. Mercer adrrJr vs. Stark, 1 Smede & Marshall Chan. Rep. 479 ; Steere vs. Steers et ad., 5 J. C. Rep. 220; Botford vs. Burt, 2 J. C.. Rep. 409.
    Even if an express contract in parol was clearly proven, the statute of frauds would render it void: for it cannot be contended for a moment that there is the semblance of a memorandum in writing signed by Mrs. Anthony, binding herself to hold for Philip’s benefit.
    ■ Where the declaration of trust was made by the grantor at the- time of making conveyance, a parol trust, so declared, was good, but where .the declaration of trust was made by the grantee (Mrs. Anthony,) she paying the money, then, it is a mere contract to make a conveyance hereafter, and is prohibited by the statute of frauds. Freeman vs. Freeman, 2 Select Fguity Cases, (by Parsons,) 89.
    Even if the decree of the court below is correct in holding Mrs. Anthony a trustee as to the property, yet the basis of reference, upon which ■ the master took the accounts between the parties, was too narrow, and by its operation Mrs. Anthony was deprived of her right of set-off, as to matter of “ mere personal dealing, not in some way connected with the Anthony House property.”
    We think that this action was erroneous: 1st. Because it is a principle as old as equity jurisprudence, that he that seeks equity, must do it independent of the rules and principles of equity, which clearly gives Mrs. Anthony the right to set-off, and that toq without the necessity of a cross-bill; yét we are not. left to this alone, for we have an express statutory provision, giving the right of set-off in this case, and making it a matter of defence. See Dig., chap. 28, see. 26, which provides expressly for the right of set-off in chancery suits, upon money demands, to the same extent as at law. Set-off is matter of defence, and entitles defendants to withhold money due them. Higgs vs. Warner, 14 Ark. 192.
    Set-off was a matter of peculiar equity jurisdiction before the statute of set-off, and none but a court of equity could relieve. Menifee admr. vs. Ball et ad., 1 Eng. 520; Hempstead and Conway vs. Watkins, 1 Eng. 318.
    This is not a bill to redeem, but simply a money demand, to which the law of set-off applies, yet even upon a bill to redeem, Mrs. Anthony would 'be entitled to her advances between her and Philip. See Coate on Mortgages 395; lb. 408
    An executor (a trustee) may set-off a debt due his testator from a legatee. Ward on Legacies 318.
    If a mortgagor comes in to redeem, he must pay up not only the mortgaged money, but also subsequent advances made by the mortgagee. Ogle vs. Shipp, 1 A. K. Marshall, 287.
    Hempstead and Bertrand, for appellee.
    The mortgage on the 10th of January, 1843, was not only effectual to secure the advances then made, but likewise to cover future advances. Hendricks vs. Robinson, 2 J. C. R. 309.
    We take it to be clear, that a mortgage will stand to secure the real equitable claims of the mortgagee; whether they existed at the date of the mortgage, or arose afterwards. A mortgage may be held as security lor future advances. Brinkerhoff vs. Ma/rvin, 5 J. C. R. 326, 327; James vs. Johnson, 6 J. C. R. 429; Livingston vs. Mclnlay, 16 J. C. R. 165; Shirras vs. Craig, 7 Cranch, 34.
    Courts oí equity do not regard the forms of instruments, but look to the intention, and give to the- acts of the parties the construction which that intention justifies and requires. Flagg vs. Mann, 2 Sumner 530.
    In a letter, addressed by Mary S. Anthony to James C. Anthony, dated Little Bock, September 1,1848, she says: lil only took the Anthony House to save the money William and myself have advanced, otherwise it would have been totally sacrificed, and no one paid! Again, in a letter, written by her to Philip, dated December 24, 1848, attached to the master’s report— stricken from the files, but -preserved on the record by bill of exceptions — she says she heartily regrets she did not give up all after the sale by the Bank to Brown, and emphatically states what her expectation had been, in the following strong language: “ All I want or ever expected to get iswhat you owe me a/nd William."

    Aside from this documentary evidence, the oral testimony clearly demonstrates that Mrs. Anthony, in reference to this property, ’ occupied the position of a mortgagee, or a trustee with an interest. '
    The law is, that the mortgagee can take no adyantage of the mortgagor, or derive a profit, or make a speculation, directly or indirectly, out of the mortgage. All the mortgagee is entitled to is the principal and interest. Chambers vs. Gold/wi/n, 9 Vesey, 271; Langstaffe vs. Fenwick 10 Vesey 405.
    Now as to what constitutes a mortgage, there is no difficulty whatever in courts of equity. No particular form or words of conveyance are necessary, and indeed whenever a conveyance, assignment or other instrument, transferring or charging an estate is originally intended between the parties as a security for money or any- other incumbrance; whether this intention appears from the same instrument or from any other, or by parol evidence, it is always considered in equity as a mortgage. And also parol evidence is admissable to show that a conveyance, absolute on its face, was intended as a mere mortgage or security for money. 2 Story's Fg., sec. 1018; Morris vs. Nixon, 1 How. S. C. E. 118; Marks vs. Pell, 1 Johns. Ch. Eep. 594 Flagg vs. Marni, 2 Summer, 540.
    Now certainly the pleadings show — the answer of Mrs. Anthony expressly admits, and’ the testimony undeniably proves, that the intention and agreement between herself and Philip L. Anthony, were that she was to take and hold the Anthony House property for advances made by her to disincumber it, for the benefit of Philip L. Anthony, and as security for moneys advanced, and to be loaned by her to him; and to that end and for that purpose she proceeded to acquire and did obtain the legal title to the Anthony House property — and admitted at various times, and to various persons, as we have seen, that she held it for the benefit of Philip L. Anthony to secure her for moneys, and when they were discharged, the balance was to belong to Philip L. Anthony.
    ■Mortgages may not only be created by the express deeds and contracts of the parties; but they may be implied in equity from the nature of the transactions between the parties. 2 Story’s Eq. 1020.
    There can be no serious doubt but that Mrs. Anthony must be held as a trustee coupled with an interest, of the Anthony House property. Eoldridge vs. Gillespie, 2 J. O' li. 33; Trap-nail vs. Brown, 19 Ark. 39, 50.
    An attempt to convert into an absolute conveyance an instrument which was intended to be in the nature of a mortgage, or to set up as absolute and conclusive, a deed which is conditional, is a fraud upon the law, which a court of equity will rebuke and defeat. Bogan vs. Walker, 1 Wis. 527.

      Gordon vs. Lewis, (2 Sumner, 144,) was a bill to redeem by an assignee of a mortgagor, brought against the defendant as assignee of the mortgagee. The mortgage was admitted, but the defendants insisted that ¿ by entry and foreclosure and visible and exclusive possession, they had acquired an absolute title, and were owners, and therefore denied any liability to account to the mortgagor. Story, J., said, “ the defendants could not now be permitted to set up an adverse title against the mortgagor, or his assignees, to protect themselves from accountability,” 146. “ Mo principle,” said he, “is better established than that a mortgagee shall not get any advantage out of the mortgage fund beyond his principal and interest. Between mortgagor and mortgagee, the latter, when in possession, must account for the actual rents and profits received or made by him, if these rents and profits can be actually ascertained. Where they cannot be ; there must be a resort to a fair occupation rent.” Wilson vs. Metcalf, 1 Buss. 530; Gubbins vs. Beid, 2 Sch. dh Lef. 218; 4 Kent 166 ; 3 Powell on Mort. 499, note E, 2.

      There is a strong analogy between that case and the one in hand, and we invite attention to it.
    Mrs. Anthony was in fact a mortgagee in possession, and had a right to sell with, or without Philip’s consent to pay her debt; but was accountable for the proceeds, and for rents'and profits. The consent is given either expressly or impliedly in mortgages themselves; and it is new law, and startling law, too, if by consenting to a sale, the mortgagor loses all right to hold the mortgagee accountable, and thereby renounces all claim to the proceeds after the payment of the mortgage debt!
    In view of the relation of the parties, and the facts and circumstances of the whole case, and of principles of equity jurisprudence as ancient as commendable, no alternative was left to the chancellor but to hold and declare, as he did, that Mrs. Anthony was not in equity, the absolute owner of the Anthony House property, but that she had charged it with a trust, in favor of Philip L. Anthony, the appellee.
    The chancellor, following the law of mortgages and the manifest propriety of things, directed an account to be taken by the master as to the dealings between these parties, in reference to the Anthony House property alone; and specially directed that no mere personal dealings between them should come into the account.
    This was done, because it appeared to him, as the record in fact shows, that there were other suits between these same parties in other courts, involving those dealings, and having no reference to this property at all. And, besides, it would have opened up stale accounts and demands, and brought before the court transactions of twenty and twenty-five years standing— barred by limitation and lapse of time.
    Obviously there was a propriety in confining the account to the mortgage debt and property — excluding other transactions, not therewith connected. That was the case made by the bill, and that alone was the matter in issue between the parties. And if Mrs. Anthony desired, or could have had, all past dealing and transactions of every kind investigated and reinvestigated and overhauled in this suit, she ought to have filed a cross-bill, or made her answer a cross-bill against Philip L. Anthony, for that purpose, and praying for a full and regular account. And then a distinct issue could have been made between the parties on that head; and Philip could have had an opportunity of meeting stale accounts and demands, by proof, showing them to be false, or paid or discharged, or released.
    The case of Troup vs. Haight, HopJ&ms Oh. JR. 239, 270, is a direct authority on the point that demands, distinct from the mortgage debt, cannot be set-off in a suit to foreclose; and, in any event, that such counter demands can only be presented by a cross-bill. Kershaw vs. Thompson, 4 J. G. li. 616; Preston vs. Btrulton, 1 Anst. 50.
   Mr. Justice Compton

delivered the opinion of the court.

On the 25th January, 1842, James C. Anthony made his promissory note to the Bank of the State of Arkansas, for $15,264 93, due at six months, and renewable according to the rules and regulations of the Bank, to secure the payment of which, he executed his mortgage, dated 22d March, 1842, on certain real estate in the city of Little Pock, known as the Anthony House property. The mortgage contained á .power of sale, in case of default, and provided for possession by the mortgagor until sale under the power.

On the 1st July, 1842, James C. Anthony conveyed the Anthony House property, by deed in fee simple, to Philip L. Anthony, who engaged to pay off the note of J ames C. Anthony to the Bank, as part of the consideration agreed to be given by him for the property. The note remained unpaid, however, and being in arrear, the officers of the Bank, on the 30th December, 1847, assigned it and the mortgage to John Brown, who. assumed the debt to the Bank.

On the 2d May, 1848, Brown assigned the note and mortgage to Mrs. Mary S. Anthony, in consideration of which she assumed the Bank debt, then amounting to $16,244 91, and gave her note to the Bank in that sum. She went into possession, and, under the power of sale contained in the mortgage, sold the premises at public sale, on the 4th August, 1848, and William A. Anthony became the purchaser, to whom she made a deed.’ No money, however, was paid by him. He purchased for the benefit of Mrs. Anthony, it being her object to vest in herself, by means of the sale, the legal title to the property, which she afterwards sold for the sum of $18,000.

The object of the bill is to have the purchase by Mrs. Anthony of the mortgage executed to the Bank, and subsequent sale of the Anthony House property under the power contained in it, declared a mortgage for the security of money loaned by her to Philip L. Anthony, and to recover any surplus of the rents and proceeds of the sale of the mortgaged premises, that may be ascertained after deducting the money thus secured.

Whether the transaction between the parties is to be regarded as an absolute divestiture of the title of Philip H Anthony, the complainant, or as a mere security for the payment of money, and, therefore, a mortgage, is a question which must depend upon the evidence adduced.

After his purchase, in 1842, the complainant took possession of the Anthony House property — which was a hotel — and being pressed for the means to carry on the business of the establishment, and to pay the incumbrance the Bank held upon the property, obtained directly, and indirectly, divers logns and advances from Mrs. Anthony, who was his mother, for those purposes; to secure which he executed to her a mortgage on the Anthony House and other property, dated 10th January, 1843. On the 11th October, 1845, the complainant obtained a further loan of $1500 from Mrs. Anthony, then residing in Tennessee, aud besides delivering to her the, note of James Lawson for $1500, as collateral security, executed and delivered, at the same time, the following paper writing:

“ I Philip L. Anthony hereby obligate myself, for and in consideration that my mother, Mrs. Mary S. Anthony, now makes me an advance of fifteen hundred dollars, that I will have the property known as the Anthony House, situated in the city of Little Bock, and State of Arkansas, sold at sheriff’s sale at the coming term of the Circuit Court of Pulaski County, if practicable, and if not practicable, then at the term of said Court next following, and to procure and record for her a deed from the said sheriff, conveying to her a full legal title to said property, subject, however, to the claim of the Bank of the State of Arkansas, which claim amounts to the sum of twelve thousand nine hundred dollars; and I hereby obligate myself to pay off all the executions against the property older than the one under which the property may be sold, and to apply the rents of the property, deducting repairs, first to the extinguishment of the debt due the State Bank, and lastly, those due the said Mary S. Anthony, and certain other debts due to William A. Anthony, James G-. Anthony,- and Thomas A. Anthony: and, after the payment of the above debts, then the said Mary S. is to re-convey to the said Philip the right she holds in said property ; but it is herein expressly stipulated that the said Philip does not part with his equitable right in said property, but procures to the said Mary the legal right for the security of the debt due her, and in the event a sale can be effected, of the property, for the payment of the debts due, the said Philip obligates himself to make such sale, and pass all the interest he herein reserves. In witness whereof, I have hereunto subscribed my name, this 11th day of October, 1845.
PHILIP L. ANTHON5T.”

The property, however, was not sold as provided for in this instrument, but remained encumbered until the 4th August, 1848, when, as we have .seen, it was sold by Mrs. Anthony under the power of sale in the mortgage she had purchased from the Bank.- The assignment of the mortgage was procured and the sale under it effected at the suggestion of the complainant, who participated actively in the entire transaction, and represented Mrs. Anthony in conducting the sale.

Samuel Oldham, a witness, testifies, that in a conversation with Mrs. Anthony, she said she had been induced to enter into the Anthony House transaction, solely with the view to her son’s interest, and to use her own language, “ to save something tor Philip, poor fellow.” ■ This conversation, the witness says, occurred shortly after the transaction, “ probably after the lapse of some three or four weeks.”

James Oldham testifies that Mrs. Anthony declared to him that her object was to secure the property, known as the Anthony House, to her son Philip.

Mrs. Susan U. Thornton states that she understood from Mrs. Anthony that she had, and was to make "advances to save the Anthony House property, and that she was acting as a “ trustee ” — that she was to pay off the debts and receive what was due her, and that the balance would belong to Philip. On cross-examination, she says, Mrs. Anthony “was to disencumber the property for Philip’s benefit, remunerate herself and return the balance to Philip.” The witness could not state the precise time she learned these facts from Mrs. Anthony.

John S. Thornton states that Philip L. Anthony was the owner of the Anthony House property, and had become involved, and that Mrs. Anthony left Tennessee to go to Arkansas to pay his debts, and after paying them, the surplus of the property was to go to Philip. The witness derived this information from conversations in Mrs. Anthony’s family, but could not positively assert that he heard her say anything on the subject.

Although the answer of Mrs. Anthony is unsatisfactory, in that it is argumentative, and, in some particulars, evasive, still, her admissions, as proven by the witnesses, would not be sufficient, if standing alone, to overturn the denial of the answer. Considering these admissions, however, in connection with the corroborating circumstances above mentioned, and others more minute, apparent in the record, the court is satisfied that there was a contract prior to the purchase of the mortgage of the Bank and the sale under it, by which it was agreed that Mrs. Anthony should acquire, by means of such purchase and sale, the unencumbered legal title to the Anthony House property, to be held by her as security for the money she had;;#dype.ed to the complainant. Consequently, the transaction between the parties, though in form an absolute sale of the property, was essentially a mortgage. The mode by which the complainant’s title was conveyed, was immaterial; for, although he divested himself of the legal title when he executed the mortgage to the Bank, the equitable title remained in him, and the sale under the mortgage, after it had been assigned to Mrs. Anthony, was as effectual to divest that equitable title as a deed voluntarily executed by himself would have been to divest the legal title had there been no mortgage; and, in either case, if an agreement be phown, though in parol — as was done here — that the conveyance was to operate as a security for the loan of money, such conveyance is a mortgage. Loyd vs. Currin, 3 Hump. 462; Overton vs. Bigelow, 3 Yerg. 513; Russell vs. Southard, 12 How. (S. C.) 139; Whettick vs. Kane, 1 Paige 202; Flagg vs. Mann, 2 Sumn. 538; Wright vs. Bates, 13 Verm. 341.

The court below took this view of the case, and ordered an account, directing the master that no matters of dealing between the parties, except those which related to the Anthony House property, should be allowed to come into the account. Under this order, Mrs. Anthony was not permitted to establish several items of indebtedness against the complainant, other than the debts secured by the conveyance of the property, which she claimed and proposed to prove. In the direction to the master, we think the court erred. If a mortgagor goes into equity to redeem, he will not be permitted to do so, but upon payment, not only of the mortgage debt, but of all other debts due from him to the mortgagee. It was so expressly held in Lee et al., vs. Stone et al., 5 Gill & John. 1. And in Walling vs. Aiken, 1 McMull. Eg. Rep. 1, which was a bill by the mortgagor to redeem, the court, upon an examination of the earlier English cases, held, that the complainant was not at liberty to redeem until he had paid, not only the amount intended to be secured by the instrument, which — in. that case as in this — was declared to be a mortgage, but also all other sums due from him to the mortgagee. Similar decisions were made in Scripture vs. Johnson, 3 Con., 211; and Ogle vs. Ship, 1 A. K. Marsh. 287. These cases rest upon the principle “ that he who seeks equity must do equity,” and this principle may be forcibly applied to the case before us. The complainant was deprived of his real estate, and was without remedy at law, and though the bill is not strictly to redeem, it nevertheless seeks a recovery of the rents and proceeds of the sale of the mortgaged premises, and these a court of equity will not decree, except upon condition that the complainant will discharge his entire indebtedness to the mortgagee, as well that which is not, as that which is secured by the mortgage. This equitable principle has no application, however, where the mortgagee seeks a foreclosure in chancery, and hence, in such case, the mortgagor is permitted to l’edeem upon payment of the mortgage debt alone, no matter to what amount, on other accounts, he stands indebted to the mortgagee. And so where a subsequent mortgagee, or judgment creditor files a bill to redeem, he will be allowed to do so upon payment of the mortgage debt only. Lee et al. vs. Stone et al., supra. Nor does this principle apply to a case like Nolly vs. Rogers, 22 Ark., 227, where, on a bill by the beneficiary in a trust deed against the grantor, this court held, that nothing but the demands provided for in the trust deed, ought to be, or could be charged upon the trust property,” and that if the beneficiary had other demands, he should be required to prosecute them at law, or wherever an appropriate remedy could be administered. But if the grantor had brought his bill to redeem or disencumber his property, then, in that case as in this, the principle, that he who seeks equity must do equity, would have applied, and he would have been required to pay, not only the demands provided for in the trust deed, but all others due from him to the beneficiary.

So much of the decree as declares the conveyance.of the Anthony House property a mortgage, will be affirmed, and the decree in all other respects, will be reversed and the cause i’emanded, with instructions to the court below to order an account between the parties, as herein above indicated.

Mr. Justice Fairchild did not sit in this case.


author: Mr. Justice CohptoN

text:
    Bertrand vs. Elder et al.
    The voluntary conveyance of a party to his wife or child, though he be indebted at the time, is prima facie only, and not conalusively fraudulent in respect to the claim of an existing creditor, and the presumption thus raised may be met and repelled by proof on the other side. The question of fraud must depend on all the circumstances of the case, looking to the state and condition of the granto^ the extent of the property conveyed, and the direct tendency of the conveyance respecting the claims of creditors.
    And so, where at the time of a gift to the wife, the husband was largely indebted, was embarrassed, and though not insolvent, his circumstances were doubtful, and his solvency dependent, in a great degree, upon the skilful management of embarrassed mercantile operations, the gift is fraudulent and void as against the prior creditors of the husband.

      Appeal from Pulaski GJumcery Cov/rt.

    Hon. H. F. Fairchild, Chancellor.
    Hempstead, for the appellant.
    It seems to us that the statute, itself, settles the question, that a voluntary conveyance in favor of a wife cannot be held good against a subsisting debt. Gould’s Pig., 765, 767.

      What Bender desired to do — to secure these lots against the .pressure of creditors — to provide a home for himself and family that could not be touched or molested by Creditors — was precisely what the law did not allow him to do. And confessedly the conveyance- to the wife having been made with that intent; it became in the language of the law, a conveyance “ contrived with the intent to hinder, delay or defraud creditors,” and, as such, void against all creditors and purchasers prior and subsequent. Gould’s Digest, 547.
    For if a conveyance thus designed, and having that object in view, is not fairly characterized as made with intent to delay or hinder creditors, within the meaning of the statute of frauds, then it would be almost impossible to prove that intent in any case; and so the statute would become ineffectual, and never reach the mischief intended to be remedied. Godell vs. Taylor, Wright, 82.
    An existing indebtedness is sufficient to avoid the conveyance. And here the debt was large. In Reade vs. Liwingston, 3 Johns. Ch. Rep., 500, the doctrine was distinctly announced by Chancellor Kent, that a voluntary settlement or conveyance by a person indebted at the time, is presumed fraudulent as against all existing debts, without regard to their amount or the extent of the property settled, or to the circumstances of the party. He held that fraud in the voluntary settlement was an inference of law, and ought to be so, so far as it concerned existing debts; but that as to subsequent debts, there was no such necessary legal presumption, and there must be proof of fraud 'in fact'. And Chancellor Kent refers to various cases of high and undisputed authority to sustain him. Shaw vs. Standysh, 2 Vernon 326; Si. Amand vs. Barbara, Comyn’s Rep., 255; Jones vs. Marsh, Gas. Temp'. Talbot, 63; Russell vs. Hammond, 1 Aik. 15; Stileman vs. Ashdown, 2 Aik., 477; Brown vs. Jones, 1 Aik. 190; Wheeler vs. Garyl, Amb., 121; Hylton vs. Biscoe, 2 Vesey, sr., 304. Haim vs. Drowse, 6 Vesey, jr., 759 ; Gompion vs. Cotton, 17 Vesey, jr., 271, 272; George vs. Milbanke, 9 Vesey, 193; Ward vs. Shallet, 2 Vesey, 18; Meddlecome vs. Marlow, 2 Aik. 519;
      2aylor vs. Jones, 2 Atk., 600 ; Walker vs. Burrows, 1 Atk., 93; 1 Madd. Oh. B. 420 ; White vs. Sansom, 3 Atk., 410 ; Beaumont vs. Thorp, 1 Vesey, 27; Townsend vs. Windham, 2 Yesey, 1; Fitzer vs. Fitzer, 2 Atk., 511; Stephen vs. Olive, 2 Bro. Oh. B. 90; Doe vs. Boutledge, Oowp., 705; Kidney vs. Gonssmaker,Y¿ Yesey,jr., 136, 156 ; Montague vs. Lord Sandwich, Lb., 148; Holloway vs. Mellurd, 1 Madd. Gh. Bep., 414; Bermett vs. Bedford Bank, 11 Mass., 421. See, also, 2 Kent's Oom., 441, 442, and notes; Sexton vs. Wheaton, 8 Wheat, 242; JacJcson vs. Stewart, 5 Gow., 67; Yam Wych vs. Seward, 18 Wend., 392,399; 4 Dev., 197.
    Garland & Bandolm-i, for appellee.
    It appeared in this case that Bender’s obligation to St., Johns’ College, upon which the judgment under which Bertrand purchased was rendered, was a voluntary gift. If this be so, even assuming the deed from Watkins to Mrs. Bender to have been a voluntary conveyance by Bender.to her, Bertrand cannot defeat it. We take the position that Bertrand occupies the place of St. Johns’ College, and that the college, being a subsequent creditor — her debt, or the subscription, not being due until after the conveyance — if a creditor at all, could not question the conveyance to Mrs. Bender, unless she showed it was made with intent to defraud her: and refer to the following cases, as establishing the broad doctrine that a deed fraudulent as to creditors can only be impeached by them, and is good as to all others. Oushwa vs. Cushwa, 5 Md. B., 44; Thompson vs. Moore. 36 Mame, 47; Whitland vs. Freeland, 26 Miss., 481; Ourtis vs. Price, 1 Yesey, jr., 103; Malm vs. Garnsey, 16 John., 189; 4 Binn. 109; 7 J. B., 161; 19 Ark. B., 650; 25 Barb. (W. Y.) Bep., 428; 18 111, 511.
    ■But if the court should consider Bertrand in the attitude only of a subsequent purchaser with notice, then' it is equally clear that he cannot set aside the conveyance to Mrs. Bender. Jackson vs. Town, 4 Oowen, 600 ; Bide vs. Ham, 14 Mass. B., 139; Cathcart vs. Bobimson, 5 Peters' IF. 8. 8. O. B., 280; 4 Kent's

      Com. 463, 464, 1 Story's Eg. J. sec. 371; Ilulclnal vs. Wilder, 4 MeOord 294.
    It is well settled that if a husband purchase 'land, pay the purchase money, and cause a deed, on a consideration of affection merely, to be made to his wife, she has a valid title as against him, and all subsequent creditors and purchasers with notice. Ki/ngdon vs. Bridges, 2 Vernon 67; Ducas vs. Lucas, 1 Atkins 270 ; Walker vs. Burr otos, Ih. 93; Liosh vs. WilJdnson, 5 Vesey, jr. 384; Olaister vs. Hewer, 8 Vesey, Jr., 195; Rider vs. Kidder, 10 Vesey, Jr. 460; Sexton vs. Wheaton, 8 Wheaton R. 229 ; 1 Roper's Hush, and Wife, 54; 2 Story's Eg. J., sec. 1375 ; 1 Bright's Hush, a/nd Wife 29, 33; Smith vs. Yell, 4 Ark. R. 293; Dyer vs. Bemi, 15 Ih. 519.
    ' To avoid the operation of the principle last stated, Bertrand has set up in his bill the facts, that Bender, at the making of the deed, was engaged in the mercantile business, that he then was considerably embarrassed by debt, and owed the obligation to St. Johns’ College, and he relies upon the case of Reads vs. Livmgston, 3 Johns. Oh. R. 481, to prove that the deed to Mrs. Bender was fraudulent as against the college.
    We will observe, that it is not shown that Bender owed cmy debt at the time of the execution of the deed from Watkins. Even the College debt was not due till more than eleven months after that time. So supposing the doctrine of Read vs. Idvi/ngston to be correct, it will not help Bertrand. But the authority of this case has been completely overturned, and the learned chancellor who decided it, at a subsequent time, admitted his doctrine to be too stern for the present times. 2 Kent's Com., p. 422, note a. And the doctrine now recognized, both in the English Courts and the American, is that the mere fact of a man being indebted,-is not sufficient to invalidate a voluntary conveyance, if he was solvent at the time. Lush vs. Wilkmson, swpra\ Shears vs. Rodgers, 4 Brown <& Adolphus 362; United States Bcmk vs. Housman, 6 Paige Oh. R. 226; Van Wyck vs. Seward, lb. 62; Jackson vs. Peck, 4 Wend. 300; Hmde vs. Long-worth, 11 Wheat. R. 199; Ilowa/rd vs. Williams, 1 Bailey Eg.
      575, 585, and note ; MeElwel vs. Sutton, 2 lb. 128 ; Seward vs. Jackson, 8 Coimn, 406; 2 Creenleafs Cruise, Boole 4, Ch. 28, see. lo, and note (1), sees. 17, 18, .19; Bárdenme vs. Hardwick, 4 Eng, 482; Dodd vs. MoCraw, 3 Eng. 83; Smith vs. Yell, 8 Arks. (3 Eng.) 470; Burkey vs. Self, 4 Sneed, (Tenn.) 121.
    If tbe intention to defraud bis creditors is not established by the fact of the deed having been made to his wife, Bender, is not shown to have had any such intention when he procured it to be made to her.
    The testimony shows clearly that he has always, up to the present time, been solvent. The fact is not denied in Bertrand’s bill, or in any of the pleadings. It is not pretended that the conveyance to Mrs. Bender was actually made to hinder, delay, or defraud his creditors, or that it has had that effect. Bertrand contends that the law presumes such to have been the case. In fact it is not shown that he had any creditors at the date of the deed. This fact it was incumbent on Bertrand to prove, if it existed. See above authorises. As to subsequent debts, their existence can afford no.evidence of fraud in the conveyance; and fraud must be proved, the law will not presume it. Dardenne vs. Ilardwiek, suegra ; Irons vs. Beyburn, 11 Ark.. 378; Hempstead vs. Johnson, 18 Ark. 123. But if a presumption of fraud had arisen it is repelled by the facts disclosed in the case, such, for instance, as Bender’s solvency and his payment of his debts. 1 American Leading Cases, p. 56, ete., 1 Bobinson's Va. B. 500, 536; 4 McCord, 295; 1 Bailey's Eg. B. 220.
   Mr. Justice CohptoN

delivered the opinion of the court.

On the 23d of November, 1848, George O. Watkins, who was then the owner of lots 8 and 9 in block 35, of the city of Little Bock, sold them to David Bender for $2500 00, and executed to him a bond for title. The purchase money having been paid, Watkins and wife, by deed dated the 15th of April, 1852, conveyed the lots to Mrs. Charlotte Bender, the wife of David Bender. The deed was thus made at the request of the husband, and though it recites the payment of the purchase money as having been made by Mrs. Bender, the testimony abundantly shows that it was in fact paid by the husband, and that the conveyance to the wife was voluntary.

At the time the deed was made, Bender was indebted to St. Johns’ College, in the sum of $500 00, by bond dated the 24th of March, 1852, due twelve months after that- date, and on which judgment was recovered against him on the 14th of July, 1857, for $659 50, with cost of suit. Under an execution issued on this judgment, the lots were sold by the sheriff at public sale, on the 3d of May, 1858, and Charles P. Bertrand became the purchaser.

Mrs. Bender died on the 30th of November, 1857, without children by Bender, but having Marcus M. Elder, a son and only heir hy a former husband, her surviving, who claimed the lots as her sole heir, and who, soon afterward, instituted an action of ejectment for their recovery, and obtained judgment by default.

Bertrand then exhibited the bill in this case to have the title set up by Bender declared invalid, and his own established and quieted; and the question submitted to us, on appeal to this court, is, whether, under the circumstances developed in the record, the voluntary conveyance to the wife can be sustained against Bertrand, he having purchased the premises at execution sale under a judgment against the husband at the suit of an existing creditor.

There is some diversity of judicial opinion touching the rights of creditors, where a voluntary disposition of property has been made by the debtor. The counsel for Bertrand relies on Reade vs. Livingston, 3 Johns. Ch. Rep. 479, which was a voluntary settlement by the husband of property upon the wife, and in which Chancellor Kent held, that the voluntary conveyance of a party indebted at the time of its execution is presumed to be fraudulent with reference to the claim of an existing creditor, and that such presumption is an inference of law, not open to explanation, and which rto circumstances will be permitted to repel. He says : “The conclusion to be drawn from the cases is, that if the party be indebted at the time oí the voluntary-settlement, it is presumed to be fraudulent in respect to such debts, and no circumstances will permit those debts to be affected by the settlement, or repel the legal -presumption of fraud. The presumption of law in this case does not depend upon the amount of the debts, or the extent of the property in settlement, or the circumstances of the party. There is no such lino of distinction set up or traced in any of the cases. The attempt would be embarassing, if not dangerous to the rights of creditors, and prove an inlet to fraud. The law has, therefore, wisely disabled the debtor from* making any voluntary settlement of his estate, to stand m the way of existing debts.” Though the decision in this case is not unsupported, the decided preponderance of authority, both in this country, and in England, is against it, and establishes a rule less rigid, and, in our opinion, more consistent with a sound interpretation of the statute of frauds.

In Hinds's Lessee vs. Longworth, 11 Whea. 213, the voluntary conveyance of certain real estate by Thomas Doyle, to his son, was sought to be set aside by persons claiming as judgment creditors upon antecedent debts; and the rule, as now firmly established in the Supreme Court of the United States, was laid down in the following language : “A deed from a parent to a child, for the consideration of love and affection, is not absolutely void as against creditors. It may be so under certain circumstances; but the mere fact of being in debt to a small amount, would not make the deed fraudulent, if it could be shown that the grantor was in prosperous circumstances and unembarrassed, and that the gift to the child was a reasonable provision according to his state and condition in life, and leaving enough for the payment of the debts of the grantor. The want of a valuable consideration may be a badge of fraud, but it is only presumptive,' and not .conclusive evidence of it, and may be met and rebutted by evidence on the other side.” Chief Justice Maeshall, in Hopkirk vs. Randolph et al., 2 Brock. refused to set aside tlie voluntary conveyance of a father to his daughter, as fraudulent, though the father was indebted at the time of the conveyance, it appearing that his fortune was ample, and the gift to the daughter comparatively trivial. Commenting on the statute against fraudulent conveyances, he said : “Hut as this intent” (to hinder and delay creditors) “ is concealed within the bosom of the actors, it would be the duty of the court to infer it from the character of the transaction and as the equity of the creditors is generally stronger than that of mere volunteers, the court ought to lean to the side of the creditor, and to consider every gift or voluntary conveyance as coming within the statute, the fairness of which was not conclusively proved. Even independent of the statute, gifts or voluntary conveyances, which obviously defeated the claim of a creditor, would be considered as fraudulent, so far as regarded him. The donee, therefore, would always be required to prove the fairness of his title. If he be not a purchaser for a valuable consideration, it would be incumbent on him to show a case, not only without taint, but free'from suspicion. If the circumstances of the gift be such that, accord ingto any reasonable probability, it might originate-in any impure motive, or might, in fact, prove injurious to creditors, by withdrawing a subject to which they had just pretensions, the fair construction of the act would comprehend it. But a construction which should, under all circumstances, comprehend every gift, merely because it was voluntary, might derange the ordinary course of society, and produce much greater injustice than it would prevent.” And in another'part of the opinion, referring to Sexton vs. Wheaton, 8 Wheat. 229, a case in which the chief justice himself delivered the opinion of the court, he remarked: “ The Supreme Court of the United States has said ‘ that in construing the statute of the 13th Eliz., courts have con sidered every conveyance, not made on consideration deemed valuable in law, as void against previous creditors.’ This is a general proposition concerning the extent of the English decisions, not a decision of the court itself declaring that every gift, however trivial, is at any distance of time, and under any circumstances to be avoided by a creditor. ■* * The general proposition was all which could be in the mind of the court, since the case was one of a subsequent purchaser, and did not lead to any minute investigation of the distinctions which might possibly exist in cases of gifts made by persons indebted at the time.” But whatever doubt might have been entertained as to the doctrine in that court, growing out of the expression of the chief justice in Sexton vs. Wheaton, none lias existed since the subsequent decision in Hendés Lessee vs. Longworth, from which we have above quoted.

In Salmon vs. Bennett, 1 Con. 525, a conveyance to a child in consideration of natural love and affection, made without fraudulent intent, at a time when the grantor was free from embarrassment, the gift constituting but a small part of his estate, and being a reasonable provision for the child, was held valid against an existing creditor. In this case, it was said by Swift, Oh. J.: “Where there is no actual fraudulent intent, and a voluntary conveyance is made to a child in consideration of love and affection, if the grantor is in prosperous circumstances, unencumbered, and not considerably indebted, and the gift is a reasonable provision for the child according to his state and condition in life, comprehending but a small portion of his estate, leaving ample funds unencumbered for the payment of the grantor’s debts, then such conveyance will be valid against creditors existing at the time. But though there be no fraudulent intent, yet if the grantor was considerably indebted and embarrassed at the time, and on the eve of bankruptcy; or if the value of the gift be unreasonable, considering the condition in life of the grantor disproportioned to his property, and leaving a scanty provision for the payment of his debts, then such conveyance will be void as to creditors.” Anri per Gould, J.: “Evidence of indebtedness at the time at least, and, as I conceive, of indebtedness amounting, or approximating to embarrassment, must be shown. For, if any degree of indebtedness, however small, would defeat such conveyance ; they would, virtually, b&per se fraudulent; since no individnl, perhaps, or, at least, hardly any one, in the community, is at any time absolutely free from debt.”

The decision in Reads vs. Livingston; has not been followed in New York. O.n the contrary, by a series of subsequent adjudications in the highest courts of that State, the rule that a conveyance, or settlement, in consideration of blood and affection, by one indebted at the time, is prima facie only, and not conclusively fraudulei t, is now well settled. Seward vs. Jackson, 8 Cow. 406; Jackson vs. Town, 4 Cow. 599; Van Wyck vs. Seward, 6 Paige, 62 ; Bank of the United States vs. Housman, Ib. 526. The same doctrine prevails in Maryland, Kentucky, Tennessee and South Carolina. Williams et al. vs. Banks, 11 Mary. Rep. 198; Atkins vs. Phillips, 1 Mary. Ch. Rep. 507; Worthington et al vs. Shipley, 5 Gill 449; Taylor vs. Eubank, 3 A. K. Marsh. 239, 241; Burkey vs. Self et al., 4 Sneed, 121; Jacks vs. Tanno, 3 Dessaus. 1. It was also decided in the High Court of Chancery, and in the Supreme Court of Maryland, that when the indebtedness of the grantor, and the voluntary character of the deed are established — the deed being then deemed prima facie fraudulent — the onus is on the party claiming under the deed to show, affirmatively, the circumstances which shall repel the presumption of fraud thus raised. Sewell vs. Baxter and wife, 2 Mary. Ch. Dec. 447; Bullet vs. Worthington, 3 Ib. 99; Williams et al. vs. Banks, 11 Mary. Rep. 198. In Bullett vs. Worthington, supra, Chancellor Johnson said “ The party who sets up a voluntary conveyance in opposition to the claims oí pre-existing creditors, is required to show, by evidence which leaves no reasonable doubt upon the subject, that the means of the grantor, independent of the property conveyed, are abundantly ample to satisfy them all. If there be a reasonable doubt of the adequacy of his means, or if his property be so circumstanced, that delays, difficulties and expense must be encountered before it can be made available to his creditors, then, as I conceive, the voluntary conveyance must fall, because then it has the effect to hinder and delay his creditors.” These remarks of the chancellor wore quoted with approbation by the Supreme Court in Williams et al., vs. Banks, supra, and the principles asserted, re-affirmed.

In Dodd vs. McCraw, 3 Eng. 83, JohnsoN, C. J., said: ‘‘The mere fact of an existing indebtedness, does not render, a voluntary conveyance absolutely fraudulent or void in law, as against the creditors whose debts were previously contracted, if‘there was no intention on the part of the- grantor to delay or defraud liis creditors.” Though the deed in that case was assailed by a subsequent creditor, Van Wyole vs. Seward and Salmon vs. Bennett were relied on as authority, and the case may be fairly regarded as, at least, indicating the opinion of the Chief Justice upon the point now before the court.

It may be remarked, without attempting a review of the conflicting cases in England, that the latest decisions there do not sanction the rigorous doctrine of Chancellor Kent, in lieade vs. Livmgston. In a case precisely in point, it was said: “ There has been a little exaggeration in the arguments on both sides, as to the principle on which the court acts in such cases as these : on one side it has been assumed that the existence of any debts at the time of the execution of the deed, would be such evidence of a fraudulent intention as to induce the court to set aside a voluntary conveyance, and oblige the -court to do so under the statute of Elizabeth. I cannot think the real and just construction of the statute warrants that proposition, because there is scarcely any man who can avoid being indebted to some amount: he 'may intend to pay every debt as soon as it is contracted, and constantly use his best endeavors, and have ample means to do so, and yet may be frequently, if not always, indebted in some small sum. There may be a withholding of claims, contrary to his intention, by which he is kept indebted in spite of himself: it would be idle to allege this as the least foundation for assuming fraud or any bad intention. On the other hand, it is said that something amounting to insolvency must be proved to set aside a voluntary conveyance: this, too, is inconsistent with the principle of the act, and with the judgments of tbe most eminent judges” — Per Lord LaNgkdale, in Townsend vs. Westacott, 2 Beavan, 345. In tbe subsequent case of Gale vs. Williamson, 8 Mees. &. Wels. 409, determined in tbe Exchequer, tbe same principle was decided. Rolfe, BaRON, at page 410, says: It is a mistake to suppose tbat tbe statute makes void, as against creditors, all voluntary deeds. All tbat it says is, tbat tbe practice, of making covinous and fraudulent deeds bad prevailed, and, therefore, all feoffments, gifts, etc., of any lands or goods and chattels, as against tbe persons whose actions, debts, etc., by such covinous and fraudulent devices and practices, shall be disturbed, hindered, delayed or defrauded, shall be void. . Tbe courts, in construing tbe statute, have held it to include deeds made without consideration, as being prima faeie fraudulent, because necessarily tending to delay creditors. But tbe question in oach case is, whether tbe deed is fraudulent or not; and to rebut tire presumption of fraud, the party is surely at liberty to give in evidence all tbe circumstances of the transaction.”

Tbe principle, as we apprehend, to be extracted from the decisions in England and America, is, tbat tbe voluntary comveyance of a party to bis wife or child, though be be indebted at tbe time, is prima faeie only, and not conclusively fraudulent, in respect to tbe claim of an existing creditor, and that tbe presumption thus raised may be met and repelled by proof on tbe other side. The question of fraud must depend on all tbe circumstances of .the case, looking to tbe state and condition of tbe grantor, tbe extent of tbe property conveyed, and the direct tendency of the conveyance respecting the claims of creditors.

This we understand to be tbe conclusion reached by Mr. Justice Story, as indicated in bis work on Equity jurisprudence, where tbe cases on tbe question are fully and critically reviewed, (Story’s Eg., vol. 1, sec. 305;) and such Chancellor Emm? concedes to be tbe tendency of tbe English and American decisions, and expresses tbe fear tbat tbe doctrine in Reade vs. Livingston, and of those English Chancellors on whom it rested, is too stern for the present times. 2 Kent Com., marg., p. 442, (in note,) 8th edition.

In the case before the court, it appears that David Bender, at the date of the deed sought to be impeached, was engaged in the mercantile business in the city of Little Kock; and, besides the real estate conveyed to his wife, seems to have had no property other than his capital in trade. In his answer, he admits that he was then “ embarrassed somewhat on account of his indebtedness, and to provide a home for himself and family, in the event of further embarrassment,” or “ too great pressure by his creditors,” he caused the conveyance to be executed to his wife'; but states that “he had, at all times, sufficient means, if he could make the same available, (which he hoped to do,) to meet all his liabilities.” The answer of Elder admits that Bender “was much invplved in debt:” denies that the conveyance was • made to defraud creditors, and insists that Bender, though “ he owed much money,” was not insolvent, but had ample means for the payment, of his debts. These are certainly strong admissions, and upon them alone, it is not easy to perceive how the conveyance to Mrs. Bender could be sustained. Testimony was taken however, and we will proceed briefly to notice it

One of the witnesses testified “ that he acted as clerk and book-keeper in Bender’s mercantile establishment, from April, 1849, to August, 1854, and that at all times during that period, Bender had sufficient means to pay his debts, if properly managed.” ITow much he owed, the witness' could not state, though he knew him to be much indebted at the time he left the establishment, in August, 1854. Other witnesses, whose means of information were less favorable, testified, in general terms, that he was regai’ded as solvent, though slow to pay, and at times embarrassed. The precise amount of Bender’s debts, and the exact extent of the means left for their payment, after the conveyance in question, do not appear.. The conclusion may be fairly drawn, however, from all the evidence in the record, that, at the time of the conveyance, Bender was largely indebted, was embarrassed, and thongli not insolvent, his circumstances were doubtful, and his solvency dependent, in a great degree, upon the skillful management of embarrassed mercantile operations. Under such circumstances, even though the admission of Bender indicating an actual fraudulent intent be left out of view, the law requires us to declare the conveyance to Mrs. Bender fraudulent and void, as against the prior creditors of her husband, and we so hold.

So much of the decree as dismisses the cross-bill of Elder is affirmed, and so much thereof as dismisses the original bill must be reversed, and a decree entered here in accordance with the prayer of the original bill, and certified to the court below.

Mr. Justice Faibohild did not sit in this case.