[Swayze and Wife v. Burke et al.]

The argument of Mr. Fetterman, for the plaintiffs in error, and of Mr. Watts, for the defendants, was submitted to the court in writing, at the close of January term, 1836.

Mr. Fetterman contended, that it is now an admitted maxim at law, that fraud is cognizable at law as well as in equity; and whether that inquiry can be made in an action of ejectment, is the question. This court, in the case of Sayre's Lessee v. Ormsby et al. 8 Peters' S. C. R. 252, says, "it is an admitted principle, that a court of law has concurrent jurisdiction with a court of chancery in case of fraud; but when matters alleged to be fraudulent are investigated in a court of law, it is the province of the jury to find the facts, and determine their character, under the direction of the court." It is worthy of remark, that that was an action of ejectment.

We find, also, that as early as Fermor's case, 3 Rep. 77, A. the principle settled, "that fraud vitiates all transactions;" so in 10 John. 462, Jackson ex dem. Gilbert v. Burgett, which was an action of ejectment; Kent, chief justice, in delivering the opinion of the court, says, "courts of law have concurrent jurisdiction in all cases of fraud. Fraud will invalidate in a court of law as well as in a court of equity, and annul every contract and conveyance connected with it; a frau- ́ dulent estate is as no estate in judgment of law." Lord Mansfield, in the case of Cadogan v. Kennett, Cowp. 434, says, "the principles and intent of the common law, as now universally known and understood, are so strong against fraud in every shape. that the common law could have attained every end effectuated by the statutes of Elizabeth:" and the same judge, in Bright v. Eynon, 1 Burrows, 395, remarks, "fraud or covin may, in judgment of law, avoid every kind of act." Courts of equity and courts of law have a concurrent jurisdiction to suppress and relieve against fraud. So judge Parsons, in Boyden v. Hubbard, 7 Mass. 112, "but when a court of law has regularly the fact of fraud admitted or proved, no good reason can be assigned why relief shall not be obtained there." So in 18 John. 111, which was the case of an ejectment in an alleged fraud in a sheriff's sale, the same principle is expressly reaffirmed; also, in Fleming v. Slocum, same book, 403-4; and in Pennsylvania, in 2 Watt's Rep. 66, Gilbert v. Hoffman, which was an action of ejectment, justice Rogers, in delivering the opinion of the court, reiterates the same principle: "a covinous conveyance of land, is as no conveyance against the interest intended to be defrauded." "It is certainly not the duty of a court

[Swayze and Wife v. Burke et al.]

to protect the interest of a person who has been detected in an attempt at fraud."

"The devisee or heir whom the vendee attempted to defraud, for the attempt affects him as well as creditors, asks the aid of the statute against this fraudulent conveyance, on the ground that his title cannot be affected by a fraudulent sale. His remedy is strictly at law, for fraud is cognizable in a court of common law, as well as in a court of equity. A fraudulent vendee has no equity, and is not entitled to claim the protection of law on that ground." In this case, as well as in the cases of Ridell v. Murphy, 7 Serg. & Rawle, 230; Bownes' Lessee v. Craft, 8 Johnston, 118; Lazarus v. Bryson, 3 Binney, 53, 54; 5 Cowen, 67, 78; Johnston's Ferry v. Harvie, 2 Penn. Rep. 93; were actions of ejectment, in which the question of fraud was considered as proper matter of inquiry.

Unless, according to the opinion of the judge of the district court, Mr. Ross is guilty of fraud, the plaintiffs cannot recover; no matter how fraudulent the intentions and conduct of Oliver Ormsby may have been. The heir of John Ormsby cannot recover from Oliver Ormsby, unless she proves that Mr. Ross was particeps criminis. The debt for which the property was sold, was due at the death of John Ormsby; its existence was known to Oliver Ormsby, his administrator; he promised to pay it in 1820.

In Pennsylvania, lands have always been assets for the payment of debts. Graff v. Smith's Administrators, 1 Dallas, 481; Morris v. Smith, 1 Yeates, 238. Either to an action of debt, as a cause of action, or when resort must be had to a scire facias, after the death of the debtor; it issues not against the heirs, upon whom the law casts the inheritance; but against the executor or administrator, who, so far as relates to the payment of the debts, is the trustee of the real estate. Rogers v. Rogers, 1 Hopkins' Chancery Reports, 526-7, a case very similar to this, and in Brown v. Webb, 1 Watts' Reports,

411.

How does it become material to show that Mr. Ross was guilty of fraud?

It is alleged that Ormsby was guilty of an attempt to defraud his co-heirs out of this property; and if he was guilty of such, how can his situation be either benefited or injured by the fact that Mr. Ross was or was not equally guilty of the fraud? The law abhors all kind of fraud, whether open or by any kind of indirection; and when the action is against the party guilty of the fraud, or his heirs, it is

[Swayze and Wife v. Burke et al.]

not for him or his heirs to shelter themselves from the consequences of his own wicked designs. As early as Tresham's case, 9 Reports, 110, in an action against an administrator, it was resolved by the court, on the 4th point of the case, "That although a general allegation of covin, which, as held in Talboise's case, ought to be between two or more, would be sufficient; yet a fortiori, in case of fraud which may be in the heart of one only; for if one by deed make a fraudulent gift of his goods to divers who knew not of it, it is fraudulent in him who makes it. And so it was adjudged in Turner's case, 8 Reports, 133, A. that fraud may be in one or one party only: and again, in the same case, the court say that fraud may be committed by one alone: and in Turner's case, the court held, that although an administrator may lawfully confess a judgment in favour of one creditor, yet if that creditor afterwards is satisfied, or offers to compromise, and offers to take sixty pounds for one hundred pounds, and the administrators do not do it, to the intent that the judgment may stand in force, so that third persons may be defrauded, and the administrators convert the deceased's goods to their private use, which is altogether against their office and the trust reposed in them; and therefore, be such agreement either precedent, before the recovery, or subsequent after the recovery, it is all one as to the creditor, who is a third person; for he is defrauded as well by the subsequent agreement as by the agreement precedent: and in 2 John Ct. 42-3, it is ruled that a deed, fraudulent on the part of the grantor, may be avoided. though the grantee may be a bona fide purchaser and ignorant of the fraud.

This brings us to the important inquiry in this ease, whether an executor or administrator, or any other individual standing in a fiduciary capacity, can purchase the real estate, either directly or indirectly at a public sale, occasioned by his own neglect and misfeasance, as in this, and hold the same to the exclusion of his coheirs; upon this point the books are full of authority. Courts both of law and equity have reiterated the position that it cannot be done. The law will not thus suffer a man to be led into temptation by taking away from him all inducement to fraud. The general principle is strongly laid down in the able commentaries of Mr. Justice Story on Equity, 318. The principle applies, however inconvenient to purchasers in any given case; it is poisonous in its consequences: and the same principle is advocated by chancellor Kent, in his Commentaries, vol. 4, 438-9.

[Swayze and Wife v. Burke et al.]

On this point there was also cited Wormley v. Wormley, 8 Wheat. 441; 1 Mason's C. C. R. 241, 345; Davone v. Fanning, 2 John. Chan. Rep. 252; Lazarus v. Bryson, 3 Binney, 54; Moody v. Vandyke, 4 Binney, 43; Rham v. North, 2 Yeates, 118; Lambreton v. Smith, 13 Serg. & Rawle, 310; Rogers v. Rogers, Hopkins' Chan, Rep. 527; Downes v. Gray, Trustees, et al. 3 Merivale, 200; Nilthrop v. Pennyman, 14 Ves. 510; Whelpdale v. Cookson, 1 Ves. sen. 9; Ex parte Lacy, 6 Ves. 626; Lester v. Lester, 6 Ves. 630; 1 Powell on Mortgages, 124; Coles v. Trecothrick, 9 Ves. 234; Evertsam v. Tappan, 5 John. Chan. Rep. 439. After referring to these cases, we may appeal to the facts of this case, and confidently ask, where was the necessity of proving that Mr. Ross lent himself to the fraudulent intentions of Oliver Ormsby; before we can recover from trustees the estate he and they held by fraud. It is humbly imagined, in this part of the case, the learned judge was in error. An individual may concert a scheme of fraud, he may employ a hundred different agents, they may each believe his intentions perfectly honest-they, as in this case of Mr. Ross, may not know that there were other lawful heirs to the estate, except Ormsby and his lunatic sister, then partly under his care--they may each believe his intention pure: and yet we must prove them all parties and privies to the fraudulent intentions of the maker of the fraud, before we can defeat the estate so unfairly acquired. How was Mr. Ross to know whether there was personal property to pay the debts? How was he to know that Mrs. Swayze was an heir, residing in Mississippi? How was he to know that Oliver Ormsby had been guilty of falsehood to her; that in 1828, a year after the sheriff sold, before a dollar was paid either by Ross or Ormsby, that Ormsby had written to her, telling her his father had. left no property? Yet Oliver Ormsby knew all these things, and the court say, although he was guilty of fraud, yet the plaintiffs cannot recover, unless Mr. Ross was also guilty of it. In considering that part of the charge of the court connected with this point, we do not wish to scan it nicely, but to give it a fair and liberal construction; and in doing so, must observe, that it neither corresponds with the facts of the case, nor the law of the land; as we understand it. It is all true that Mr. Ross attended at the sheriff's sale, and had the property knocked off to him in the lump, "chilling by his presence the sale," saying, "if Ormsby or any of his family can get able to redeem it, he, or any of his family, might have it on paying the debt and interest:" the very effect of a declaration of this kind, would be VOL. XII.-C

[Swayze and Wife v. Burke et al.]

to prevent the property from bringing its full value. Ross never interfered with Ormsby in the possession of the property-paid no money to the sheriff, and there was no money paid until 1831, when Ormsby paid Ross the amount of the judgment, and receipted to the sheriff, as administrator of his father's estate, for the balance of the bid at the sale. How then could the court take the facts of the case from the jury, and say "that Mr. Ross, who never paid a dollar, was a bona fide legal purchaser-that he bought for himself, not as a trustee for Ormsby or any body else?"

It was relied on, as one of the strong circumstances conducing to prove fraud, that there was no change of possession. It may also be well asked to whom did the property belong, when Ormsby receipted to the sheriff, as administrator of his father's estate? The property is paid for, if paid at all, with the money of the heirs of John Ormsby. Without their consent, no man and no court had a right to convert more of the real estate into money, than was sufficient to pay the debts. We have here the case of an administrator purchasing at sheriff's sale, individually, and paying for the land with the plaintiffs' money. Can plaintiffs resort to the land? In 1 Serg. & Rawle, 144, when real estate was bought by a guardian, with the funds of his wards, the land was treated as theirs; and his making the conveyances to himself exclusively, was held fraudulent of itself: what is this but the ordinary case of a man purchasing with the money of others, and taking the deed in his own name? See 2 Watts' Penn. Rep. 324; Kisler v. Kisler, and Law v. Doighton, Ambler's Rep. 406; Lench v. Lench, 10 Vesey, 506; and Waite v. Whorewood, which was the case of an executor, in 2 Atkyns, 159; Wolf v. Smyser et al. 2 Penn. Rep. 347. So in Hempstead v. Hempstead, 2 Wendel, 199. It is expressly said by the court, that cestui que trusts, who have paid the consideration money of land patented in other names, may maintain ejectment. See opinion of the court, page 134. In Fellows v. Fellows, 4 Cowan's Rep. it was decided that an administrator who buys land on a judgment of his intestate, must account for it to his cestui que trusts; he was an agent and trustee, and could not divest himself of the trust. Cited also, on this point, the case of Hamilton, Guardian, 17 Serg. & Rawle, 144; Rogers v. Nicholson, 2 Yeates, 516; Griffin v. Jones, 6 Wendel, 522; Craig v. Sprague, 12 Wendel, 46; Bowman's Lessee v. Craft, 18 John. 110; Jackson v. Newlin, 18 John. 362; Woods v. Monell, 1 John. Chan. 502; Shad v. Course, 4 Cranch, 403; Sampson v. Sampson, 4 Serg. & Rawle, 320; Greenleaf v, Burk, 9 Peters, 292; 2 Watts' Penn.