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dition precedent, the vendor's continuing possession does not avoid it, because, by the terras of the conveyance, the vendee is not to have the possession until he has performed the condition, and it is sufficient if possession follow the deed, though it be not immediate (u).
It has been stated, that the motives and intention wi.ere the of the parties must always be taken into considera- „ot oaudu tion (a?); therefore, where the obvious intention of the party transferring is not fraudulent, continuance of possession by him will not vitiate the sale. An assignment of all his effects by defendant to trustees, for the benefit of his creditors, was held not to be fraudulent, though made pending a suit, and for the purpose of delaying the plaintiff of his execution: because the motive was honest; the defendant felt that he had not sufficient to satisfy all his debts, and wished to make an equal distribution (?/). A debtor, as well as an executor, may
(«) 2 T. R. 596. See Cadogan (Lord) v. Kennett, Cawp. 432; Haslington v. Gill, 3 T. R. 620, n.; Stone v. Grubham, 2 Bulstr. 225; Bucknalv. Roiston, Free. Chan. 287. [So, it was decided, on the Bankruptcy Act, that the property in the goods did not pass to the assignees, though the bankrupt remained in possession for several months after the sale; the vendee having resumed possession a few days before the bankruptcy, Jones v. Dwyer, 15 East, 21.]
(r) Supra, p. 99.
(j) Pickstock v. Lyster, 3 M. & S. 371. And see Meux v. Howell, 4 East, 1 ; Bowen v. Bmmidge, 6 C. & P. 140; Estvsick v. Caillaud, 5 T. R. 420.
give preference to a particular creditor (2), by assignment or otherwise; provided he does so in payment of just demands, and not as a mere cloak Notoriety for securing the property to himself (a). It is tion, always an important consideration, whether the
transaction have been secret or open. If it is a fact well known, that the party retaining possession is not the real owner, such possession cannot mislead, and the mischief will not arise. The notoriety, therefore, of the transaction is always strongly insisted upon, to rebut the presumption of fraud (£); as, in the cases cited, where the circumstance of the execution was well known (c). So, where the sale was notorious and public, being made by the sheriff (c?); or, by the landlord under a distress for rent (e); or, by public auction (/). On the same principle, a bill of sale is good against a creditor, with whose knowledge and assent it has
(«) 2 Stark. Ev. p. 361; Holbird v. Anderson, 5 T. R. 235; Tolputt v. Weill, 1 M. & S. 395; Estwick v. CaiUaud, 5 T. R. 424.
(a) Goss v. Neale, 5 B. Moore, 19,21.
(6) Whether the sale was notorious and bond fide, or fraudulent, is frequently a question for the jury, Armstrong v. Baldock, Gow, 33; Martin v. Podger, 2 Bl. Rep. 702. A secret transfer was a strong badge of fraud at common law, see Mace v. Cammell, LofTt, 783.
(c) Latimer v. Batson, 4 B. & C. 652; Jezeph v. Ingram, 8 Taunt. 838; S. C. 1 B. Moore, 189. Supra, p. 100.
((/) Kidd v. Raxolinson, 2 B. & P. 59.
(e Guthrie v. Wood, 1 Stark. N. P. C. 867.
(/) Woodham v. Baldock, 3 B. Moore, 11; S. C. Gow, 35, n.
been given, though possession may not have gone under it (g).
It is said in Buller's Nisi Prius (/*), that no con- Fraud veyance is fraudulent within the statute, unless it future can be proved that the person was indebted at the time, or very near; though there have been determinations to the contrary (i). And it seems, that if a conveyance could be proved to have been made with a view to defraud a future creditor, it would be void under the statute (k).
Of Sales Affected By The Statute Of Bankruptcy.
The effect of bankruptcy, upon sales of chattels, Effect of may be considered under the following heads :— onsaies. y
First, Where the bankrupt is in the situation of vendor. If the transfer took place before his bankruptcy, the transaction will not in general be affected by such subsequent event, unless the vendor had his bankruptcy in contemplation at the time,
(g) Steel v. Brown, 1 Taunt. 381; see Leonard v. Baker, 1 M. &S. 251.
(h) Page 257 a, (7th ed.) Cases there cited, Walter v. Burrows, Chan. 1745; Taylor v. Jones, 2 Atk. 600. And see Lush v. Wilkinson, 5 Ves. Jun. 384; per Lord Tenterden, C. J., 3 B. & Ad. 869.
(0 By Sir J. Jekyll and Fortescue, M. R., Bull. N. P. 257 a.
(A) 2 Stark. Ev. p. 861; see Evans's Statutes, Vol. I. p. 365, notes (3rd ed.).
and intended to give the vendee (being a creditor) a fraudulent preference. If the transfer took place after an act of bankruptcy, though in strictness the bankrupt has no longer any power of disposition over his goods, the statute provides that bon&jide transactions shall be protected (unless a commission shall be sued out within two tnonths), in order that the fair dealer may not be prejudiced by secret acts, of which he can have no notice.
Secondly, Where the bankrupt is in the situation of vendee, the statute extends a similar protection to bondfide dealings; and the payment of money, or delivery of goods, which belong to the bankrupt, would be good at any time before the issuing of the commission.
Thirdly, Where the bankrupt is in the situation either of vendor or vendee, an important class of cases relates to that enactment of the statute, which provides, that he shall be deemed to be the owner of property continuing in his possession, order, or disposition, at the time of his bankruptcy, and that such property shall pass to the assignees. This provision is, perhaps, not so much for the purpose of guarding against fraud, as for the purpose of preventing credit being given to false appearances, and of marking with certainty the ownership of goods, by making the property in general accompany the possession (a). The question, therefore,
(a) See 9 East, 238, 242.
usually is, not whether there has been fraud, but whether the bankrupt actually had, or had not, the control and disposition of the property, within the meaning of the statute.
Section l.—Of Transfer of Goods by a Trader immediately before an act of Bankruptcy.
The Bankruptcy Act (b) enacts that, if any trader Transfer beshall make a fraudulent grant or conveyance, or a rupetcy.n" fraudulent gift, delivery, or transfer of his goods or chattels, he shall be deemed to have committed an act of bankruptcy (c). Such transfer, therefore, though under colour of a sale, will be void, as being a fraud upon the bankrupt laws. In the former statutes of bankruptcy, "fraudulent grant or conveyance" only were mentioned, and it was accordingly held, that no transfer of property, though made fraudulently, and to give preference to a particular creditor, would amount to an act of bankruptcy, unless the transfer was by deed(d)> The fraud, however, would have avoided the transaction (e); and now by the words of the new Act,
(b) 6 Geo. IV. c. 16, (which repeals all former statute* Of bankruptcy).
(c) section 3.
(d) Cooke, B. L. p. 102.
(e) Martin v. Pewtress, 4 Burr. 2478,