
    Richmond.
    Beale v. Digges & als.
    
    1850. January Term.
    
    1. A debtor remaining in possession of slaves for five years, under a parol loan, they are liable to satisfy his creditors, though the possession is resumed by the lender before executions are levied upon them.
    2. Under the circumstances, an issue directed for the purpose of ascertaining whether the claim of the creditor for which' he claimed to subject the slaves, was fair and bona fide, or fictitious and fraudulent.
    In July 1840, John G. Beale applied to the Judge of the Circuit court of Fauquier for an injunction. In his bill he alleged, that John H. Digges and Charles W. Digges, late merchants and partners, executed a deed, which was duly admitted to record, whereby they conveyed. to their brother Thomas E. Digges, the books of the said firm, and all accounts and debts due to them, in trust to pay certain debts to creditors mentioned therein. That after the execution of the deed, and the acknowledgment thereon by Thomas E. Digges that he was in the possession of the books of the firm, a suit was brought in the Circuit court of Fauquier, in the name of the said John H. & C. W. Digges against the said Thomas E. for a large amount claimed to be due by open account: That at the October term of the Court in 1839, the said Thomas E., by a collusive and private arrangement with the members of said firm, confessed a judgment in the case for the sum of 1763 dollars 27 cents, with interest on 1373 dollars 51 cents, from the 15th of October 1839 till paid, and the costs. He charged that this claim was utterly without foundation in law or equity, having neither a valuable nor a bona fide consideration on which to rest. That this confession of judgment was made but a short time before some slaves, the property of the complainant, but then in the possession of the said Thomas E. Digges, were to be returned to him, in order, no doubt, to anticipate and prevent that event, and render them liable to the execution which might issue on said judgment.
    He further stated that an execution had been issued on the judgment aforesaid, and placed in the hands of the sheriff, who either had levied or was endeavouring to levy it on the said negroes, which were then in the possession of the complainant; though they had been formerly lent to Thomas E. Digges. That they were not the property of Thomas E. Digges ; and that the circumstances under which they were allowed to remain in his possession were not calculated, as complainant believed, to subject them to this debt, or to mislead the plaintiffs or any other of the creditors of Thomas E. Digges, as it was known to John H. & C. W. Digges, that he admitted the negroes were not his property, and expressed his intention to return them to the complainant, long before the confession of the judgment aforesaid.
    
      He further stated that on the death of his daughter, who was the wife of Thomas E. Digges, complainant demanded the slaves. That said Thomas E. admitted complainant’s right to them, but prevailed on comPeinan* to let them remain with him the remainder of that year and the following, for the purpose and with a private understanding, as complainant believed, with said creditors, of giving colour, if not validity, to their claims to subject them to the debt aforesaid.
    The three Digges and the cestuis que trust in the deed, were made parties defendants, and the former were called upon to answer fully each and every allegation of the bill, to discover the consideration of the debt aforesaid, and what part thereof was bona fide due, how and by what means it became due, and to exhibit the books containing their mutual accounts, debts and credits, and dealings. '
    The prayer of the bill was, that the said John H., Charles W. and Thomas E. Digges might be restrained from further proceedings under the said judgment as far as the said slaves, viz: Charles, Jarred, Phil and Jane were concerned; and for general relief. The injunction was granted; and in October 1840, the Digges filed their answers. John PI. and Charles W. Digges, admit the execution of the deed of trust. They say that subsequent to the execution of that deed, a settlement of accounts between the firm of J. H. & C. W. Digges and Thomas E. Digges took place under the inspection and superintendence of Col. Edward Digges, which resulted in a balance being found due from said Thomas E. to said firm, for the sum mentioned in the bill, for which sum said Thomas E. confessed a judgment, and said claim was put under the control of the attorney of said firm, Samuel Chilton, to be by him collected and applied in discharge of certain debts due from the firm, which were provided for in the said deed of trust.
    
      They further say, that Thomas E. Digges married the daughter of the plaintiff, a man of fortune, in December 1832, at which time said Thomas E. was a merchant in the town of Warrenton, and that he quit the business in 1833, and settled on a farm in the country. That in 1834, the plaintiff put the slaves in question into the possession of Thomas E. Digges; and that all of them, except Jane, remained in the possession of said Thomas E. until the 1st of January 1840. That Jane was returned to the plaintiff soon after the death of the wife of Thomas E. Digges; which occurred in July 1838. They charge that the slaves were put into the possession of Thomas E. Digges as an advancement to him ; but if they were intended as a loan, no record of it was made, and that the slaves having continued in the uninterrupted possession of Thomas E. Digges for more than five years, they were subject to the execution of the defendants. That they regarded the slaves as the property of Thomas E. Digges, and credited him on the faith of them. They deny all knowledge of any arrangement between the plaintiff and Thomas E. Digges, whereby the slaves were to be returned to the plaintiff on any contingency whatever. They deny that their judgment is not founded on a bona fide, valid and valuable consideration, and affirm that it is founded on such a consideration. They deny all fraudulent combination to procure said judgment, or to deprive the plaintiff of any legal or equitable right whatsoever, whether in connexion with said slaves or otherwise. They say that their execution was placed in the hands of the sheriff, who meeting with Thomas E. Digges, he gave him a levy upon said slaves, except Jane, the sheriff not having seen them. That at the request of Thomas E., the sheriff, with the consent of the attorney in the execution, permitted the said Thomas E. to retain the possession of the slaves until the day of sale, upon which day, the 1st of January 1840, they were brought to Warrenton for the purpose of being sold, when they were by the plaintiff, or his agent John G. Beale jr., secretly and fraudulently carried off, and concealed, so that the sheriff could not reach them, until one of them, Charles, was taken ; and then the plaintiff obtained his injunction.
    The answer of Thomas E. Digges states that he married the plaintiff’s daughter in December 1832; that the plaintiff put the slaves in question into his possession between the 1st of January 1834 and the following August. That when the plaintiff put the slaves into his possession nothing passed between them, but the slaves were simply sent to him. That in the month of August 1838, the wife of Thomas E. died, leaving no children ; and it was his intention to restore "to her father all he had received by her, so far as he could do so consistently with the rights of his creditors. That he was largely in debt to several persons, whom he names, and prior to his wife’s death, these creditors, or some of them, had claimed to hold said slaves responsible for their debts. That at the time of the death of his wife, he supposed the other slaves, without Jane, would be sufficient to pay his debts. That he informed the plaintiff of his wish to return said slaves, and of the difficulty interposed by his creditors. The plaintiff said he did not think they were bound, and proposed to the defendant to keep a portion of them, and restore to him the residue. That the defendant declined taking any of them, and told the plaintiff, that were they freed from his creditors, he would return them all. Several conversations of the same import passed between them; but prior to the death of the defendant’s wife, no conversation touching said slaves, or the terms on which the defendant held them, ever passed between the plaintiff and the defendant. Nor was there any agreement other than might he implied from the aforesaid conversations, subsequent to her death.
    He further stated, that after the execution of the deed referred to in the bill, he came to a settlement with J. H. & C. W. Digges, under the supervision and control of Col. Edward Digges, who had the settlement of the affairs of said firm: upon which settlement he was found indebted to said firm in the sum specified in the bill, for which he confessed a judgment in the Circuit court of Fauquier ; as also in favour of several other persons, whom he named. That executions were issued on these judgments and placed in the hands of the sheriff, who meeting with the defendant, demanded a levy, and the defendant gave him up the slaves in controversy, except Jane. The slaves, however, except Jarred were not seen by the sheriff. That defendant requested the slaves might remain in his possession until the day of sale, to which the sheriff, with the assent of the plaintiffs, or their counsel, agreed. That on the 1st of January 1840, the day appointed for the sale, he produced the slaves at Warrenton, and they were, as he understood and charges, persuaded to leave Warrenton, by John Gr. Beale jr., acting as agent for the plaintiff, and go into the plaintiff’s possession, where, as he has understood, they have since continued concealed, or so disposed of, that executions since issued could only be levied on Charles, which levy has resulted in the injunction of the plaintiff. He denies that the debt of J. H. & C. W. Digges, or any of the other debts mentioned, rest or are founded upon any other than a bona fide, fair and valuable consideration. He denies all fraudulent combination in regard to the judgment of J. H. & C. W. Digges aforesaid. And he denies all fraudulent combination, device or intention, to defeat, embarrass or affect in any manner whatever, the rights, legal or equitable, of the plaintiff touching the slaves aforesaid, or any of them, or touching any other matter or thing whatsoever.
    The plaintiff at the October term of the Court for 1840, excepted to the answers of these defendants, because they were not responsive to the allegations of the bill, and because they did not discover the consideration of the debt in the bill mentioned, as called for, and did not submit the books which were called for to the inspection of the Court and parties.
    At the same term of the Court, the defendants moved the Court to dissolve the injunction; but the motion was overruled, and the Court sustained the exceptions to the answers, and ordered the defendants to answer the plaintiff’s bill more fully and sufficiently. And it was further decreed, that one of the commissioners of the Court should state, settle and adjust the accounts between the late firm of J. H. & C. W. Digges and Thomas E. Digges, and between the late firm of Digges & Hart and Thomas E. Digges, shewing by said settlements each item in the said accounts on both sides of the same. And the members of these late firms were directed to exhibit to the commissioner their books; and that they and Thomas E. Digges should submit to be examined on oath before the commissioner touching the said accounts.
    The commissioner returned his report on the 1st of September 1842. He says : “ Upon the subject of the accounts between the late firm of J. H. & C. W. Digges, and Thomas E. Digges, no proof or evidence has been laid before me except the accounts marked No. 1, 2, 3 and 4, herewith filed, and the books of the late firm of J. H. & C. W. Digges, and the books of J. H. & T. E. Digges, which books were exhibited before me by the defendants. These accounts and books, as they now stand, shew a balance of 1662 dollars 29 cents, due by Thomas E. Digges to J. H. & C. W. Digges.”
    
      “I am required by the counsel for the plaintiff to report that the ledgers of J. H. & T. E. Digges and of J. H. & C. W. Digges, upon the pages where the said accounts were kept, are much scratched, and in some places appear to have been altered, and the day books in some places are scratched, and appear to have been altered. In examining the books, I kept a memorandum of the particular places scratched, and which appear to have been altered, which memorandum is herewith filed, marked A, and prayed to be taken as a part of this report.” This paper A, referred to numerous instances both in the ledgers and day books, in which the entries were scratched and altered; and also entries of payments in the ledger which did not appear in the cash account.
    It appeared from the evidence that the slaves in controversy, except Jane, had remained more than five years in the possession of Thomas E. Digges. And there was evidence of his declarations, that he never considered the slaves his property, and also of his promise in September 1839, to the agent of the plaintiff, that he would send them to the plaintiff at the next Christmas.
    In October 1842, the defendants filed their amended answers, in which they state that upon a settlement in the fall of 1839, of the accounts between the firms of J. H. & C. W. Digges and J. H. & T. E. Digges, and between the latter firm and John H. Digges, one of the partners, Thomas E. Digges was found indebted to the first named firm, in the sum of 997 dollars 67 cents, and to J. H. Digges in the sum of 664 dollars 62 cents, as would appear by the accounts filed with the commissioner, marked No. 2 and No. 4, which accounts they say, were taken from the books of the firms; and they tender the books for the inspection of the plaintiff and the Court.
    
      That after the settlement of the accounts, to avoid multiplicity of suits, with the assent of Thomas E., the balance found due from him to John H. Digges, was transferred to J. H. & C. W. Digges, and a judgment was intended to be confessed for the aggregate of the two balances, amounting to 1662 dollars 29 cents, but by mistake in taking off the balances from the books they suppose, it was made 1763 dollars 27 cents, and to the extent of the difference between these two sums, they admit the judgment is erroneous.
    The cause came on to be heard in May 1844, when the Court below dissolved the injunction and dismissed the bill with costs. Whereupon the plaintiff applied to this Court for an appeal, which was allowed.
    
      Cooke, for the appellant.
    
      Morson and Robert E. Scott, for the appellees.
   Baldwin, J.

delivered the opinion of the Court.

It appears to the Court, that the slaves in the proceedings mentioned, with the exception of the woman Jane, remained by the space of five years in the possession of the appellee Thomas E. Digges under a pretended parol loan thereof from the appellant Beale, without demand made and pursued by due process of law on the part of the said pretended lender; and therefore that according to the terms, true intent and meaning of the act to prevent frauds and perjuries, 1 Rev. Code, ch. 101, § 2, p. 373, as held by this Court in Taylor v. Beale, 4 Gratt. 93, and other cases, became liable to the demands of the creditors of the said Thomas E. Digges, though the possession thereof was resumed by the said Beale after the expiration of the said period of five years. But that the said woman Jane, not having so remained in the possession of the said Thomas E. Digges, but the possession of her having been resumed by the said Beale within such period of five years, she continued the property of the said Beale, and did not become liable to the demands of the creditors of the said Thomas E. Digges.

And the Court is further of opinion, that under the circumstances disclosed by the record, the Circuit court erred in dissolving the appellant’s injunction and dismissing his bill, instead of causing an issue to be tried before a jury for the purpose of ascertaining whether the claim of the appellees John H. Digges & Charles W. Digges, in the character of creditors of the said Thomas E. Digges, was fair and bona fide, or fictitious and fraudulent. And that whatever might be the result of such an issue, the Circuit court erred in dissolving instead of perpetuating said injunction so far as it restrained proceedings at law in regard to the said woman Jane, and in regard to the amount of the error admitted in the answers of the defendants, as to the sum for which the judgment at law was confessed by the said Thomas E. Digges.

Decree of the Circuit court reversed, with costs, injunction reinstated, and cause remanded, to be proceeded in according to the principles above declared.  