Opinion
11-24-1909
HALL v. HALL.
Beeckman & Spencer, for complainant. Joseph Strieker and Adrian Lyon, for defendant.
Bill by Samuel Hall against Roy S. Hall to set aside a conveyance of land. Heard on pleadings and proofs. Bill dismissed.
Beeckman & Spencer, for complainant. Joseph Strieker and Adrian Lyon, for defendant.
HOWELL, V. C. The controversy in this case is between father and son. The father in 1906 conveyed to the son a dock property in Perth Amboy, and the bill seeks to set aside that conveyance on the ground that it was improvidently made, that the complainant did not have independent advice, and that the defendant obtained and now holds the title by fraud, in that it is alleged that he promised the complainant that he would reconvey to him the property whenever the complainant called upon him to do so, and that the defendant, although he made this agreement, did not at the time intend to comply with it, and that the fraud thereforeamounts to a common-law deceit, and may be used as the basis of this suit. The facts are that the complainant for many years owned the property in question, and conducted a business thereon of large extent until a short time before the conveyance in question. The conveyance was dated May 20, 1906, this day being the 21st anniversary of the birthday of the defendant, was acknowledged as the certificate shows on May 21, 1904, an evident mistake as to the year, and was recorded November 23, 1906. Both the father and the son say that the deed was delivered to the son on the day on which it was recorded. The deed conveys a tract of land on which the complainant had conducted a large business for many years. Apparently his business had declined somewhat prior to the date of the conveyance, because at that time he owed a bank in Perth Amboy $6,500, upon which he was being pressed, and upon which the bank shortly after the conveyance brought suit and recovered judgment. The judgment is not yet wholly paid. The circumstances under which the conveyance was made are peculiar. The complainant had contemplated a transfer of the premises to a real estate dealer in Perth Amboy named Kennedy, but afterwards changed his mind, and directed Kennedy to draw a deed to the son. It is quite apparent that at this time the father was in embarrassed circumstances, his business had run down, and he was being pressed by his creditors. When asked the reason why he intended to make the conveyance to Kennedy and why he actually did make the conveyance to his son, he replied that he did not know, and could not explain it. The conveyance was wholly without consideration, and his son by his answer claims that it was a gift to him.
The transaction cannot stand as a gift inter vivos. The circumstances preclude the idea. The father says that, when he made the conveyance to the son, he insisted that the son should promise to reconvey it to him whenever he wanted that done. The son denies this statement, but says that he agreed with his father that he would not touch the premises, to use his own expression, during the lifetime of the father, and that in the meantime the father should pay the interest on the mortgages on the premises, and should likewise pay the taxes. This is equivalent to an agreement that the father should remain in possession during his life. The fact likewise is that the father has always had actual possession of the premises and has used the same for the purpose of carrying on a small business there, and that the son has never had possession, and so far as the case shows has never attempted to obtain possession. These facts negative the idea of a gift. In order to make a gift inter vivos effective, two things must concur. The donor must be proved to have had the donative intention; and he must not only divest himself of the title to the thing given, but renounce all possession of it and all control over it. This is a doctrine that has found a late expression in Taylor v. Coriell, 66 N. J. Eq. 262, 57 Atl. 810. If this were the only ground of the proper decision of this cause, the complainant might possibly have a decree, but there is an obstacle in his way which is fairly and squarely presented by the testimony and in which the testimony on both sides practically concur, and that is that the conveyance was made by the father to the son with the intent and for the purpose of hindering, delaying, defeating, and defrauding his creditors. The case is governed by a long line of decisions in this state, the last of which is Geroso v. De Maio, 72 Atl. 432. Conveyances made in fraud of creditors are always good as between the parties. Being conceived and executed in fraud, the court will leave the parties where it finds them, and will not aid either wrongdoer as against the other. Objection was made at the hearing that the answer did not interpose this defense, but it was held by Vice Chancellor Learning in the case lastly above cited that it was unnecessary that the objection should have been taken in the answer to enable the court as the representative of the public to refuse to grant relief upon such a transaction, that the courts were so strict in adhering to the principle of not aiding the enforcement of an illegal agreement that even though the agreement as stated in the pleading does not appear to be illegal, but circumstances come out in the evidence that show that it is in fact tainted with illegality, the court will on its own motion proceed to investigate the matter and decide it according to the rules which could have been invoked if properly pleaded.
My conclusion therefore is that the bill must be dismissed.