
    DEN ON DEMISE OF WILLIAM J. HARDY AND AL. vs. SAMUEL SIMPSON.
    Wlmt constitutes fraud, is a question of law.
    In some cases fraud is self-evident, when it is the province of the Court So to adjudge, olid the Jury has nothing to do with it.
    In other cases, it depends upon a variety of circumstances, aris;ng from tho motivo and intent, and then it must be left, as an' open question of fact, to the Jury, with instructions as to what, in law, nonstitutes fraud.
    And, in other cases, there is a presumption of fraud, which may be rebutted. Then, if there is any evidence tending to rebut it, that must he submitted to the Jury; bul, if there is no such evidence, it 13 tho duty of the Court so to adjudge, and to act upon the presumption.
    The case of Hardy v Skinner, 9 Ired. 191, cited and approved.
    Appeal from the Superior Court of Law of Chowan County, at the Fall Term, 1851, his Honor Judge Settle presiding.
    The case is stated in the opinion delivered in this Court.
    
      Heath, for the plaintiff.
    The case of Hardy v Skinner, has been before this Court at a previous term, 9 Ire. 191: the point there decided was, that the deed could not be pronoun, ced fraudulent, in law, for that any apparent fraud, on the face of the deed, might be submitted to the jury, and explained by evidence. As the case then passed without argument for the plaintiff, and the same case was again presented to the Court, the Counsel has thought it not disrespectful, to present the same point again; not with any expectation that the Court below would be so insubordinate as to overrule the former decision; but with the hope, rather, than the expectation, that this Court might be induced to review the decision, and, if in error, retrace their steps. Is there any such distinction as that contended for ? that is, a deed, fraudulent-on its face, fraudulent in law, explainable by testimony, dehors the deed, as deeds are, supposed to be fraudulent in fact ? Can any evidence be heard to uphold or explain a deed fraudulent on its face ? As this point has once been adjudicated against the plaintiff, in this very case, the Counsel will be content with a reference to a single decision, without troubling the Court, with a multiplicity of cases or comments ; the case of Haven v Lord, 2d New Hampshire Rep. 17. Mr. Justice Woodbury, late of the Supreme Court of the United States, in discussing the question, whether that w?as a case of fraud in Law, to “be decided by the Court, or fraud in fact, to be passed on by the jury, uses the following language : “ The difference between these two positions is highly important, because the first one (fraud in law.) devolves the question of fraud upon the Court; the last one, (fraud in facf,)upon the Jury ; the first one requires an opinion to be formed on a single circumstance, and admits of no explanation ; but the last one looks to the whole transaction, and admits of every honest apology in extenuation.” Many other authorities to the same purpose might be cited; this has been brought to the attention of the Court for its directness and its brevity.
    . On the supposition, however, that the Court adheres to its former decision, have the fraudulent features of the deed, under which the defendant claims, been explained away.? Is not the plaintiff éntitled to a charge responsive to his prayer, that the iraudulent character of the deed has not been explained ? This Court has already said in Hardy v Skin* ner, ut supra, that “ it is a fraud, not to apply a debtor’s property to the satisfaction of his debts, in reasonable time, but reserve it for his own use; and certainly three years is startling, and prima facie, for the debtor’s benefit.” Is this, and are the other, iraudulent provisions of the deed explained away by the-draftsman ? .His opinion, as to the time the Trustee might-indulge, cannot alter the construe-tion to be placed on the transaction; from his evidence, it appears it was thought by the Trustor and Trustee, that it would take three years to close the mercantile transactions of the Trustor ; and the intent of both parties was to. protect the other property, until the business of the store cóuld be closed. This’testimony explains nothing; it only-sho.ws that in the opinion of. the witness the parties might lawfully delay the sale for two years ; the Court has decided. that,.unexplained, it is too long, and is, therefore, fraudulent.
    Does the testimony of the other witness' explain away the objectionable features of the Trust Deed ? There is nothing in James C. Skinner’s testimony to that end ; that of Wm. R. Skinner shows his utter insolvency ; it is true he states, the deed was made for no other purpose than to secure all his creditors ; but he also states, that he and his brother, the Trustee, “ consulted together previous to making the deed: that they knew he could not collect money fast enough to pay his creditors r and that the property would be exposed, to judgments and executions,, and if sold for cash, as it would be,, if sold under execution, it would not sell-for enough to pay the- debts,” &c., &C-; it is submitted that he. gives no-good, reason, why the-property was-left in. the- hands of an. insolvent man for three years;, he intake the profits and the Trustee all this time not to beheld responsible; On the contrary, this testimony discloses tha¡¡ one of the- objects; of the; Trust was to cover the property in favor of the Trustee; who -was the preferred creditor,, until the non preferred creditors should be-paid, if ever, by-the slow process, of collecting-the mercantile-debts, which-James. C. Skinner says.it would take three years to.-dm If is believed the testimony in. explanation does not come tip to the, requisitions of the case, as. declared by the - Court, ■ when, here, on its former trial; then, it was said, “ if this person (the grantor) was not insolvent, but had other property sufficient to cover all his debts, and these creditors wished to keep their money at interest, and the day was deferred at their instance or if the debtor was bestowing his labor and money of his own, or of the second class creditors, in making improvements on the estate, which would gveatly enhance its value, and require three years to complete ; or if the deed was made in this form, with the privity and full concurrence of all the creditors; in these or in other similar instances, which may be supposed, it would be clear, there was no fraud. Neither these nor any similar facts are disclosed by the witnesses to explain away the objectionable provisions of the deed ; and if, as far as the case proceeded on the former trial, it might have authorised a verdict for the plaintiff, then (see Hardy v Skinner, ut supra,) it is submitted, that in the second trial the Judge should have instructed the jury, thát the defendant had not introduced any evidence to explain away the evidence' of fraud against the deed, and that the plaintiff was entitled to their verdict.
    
      W. N. H. Smith, for the defendant.
    In Hardy v Skinner, 9 Ired, 19 L, this Court determined, that this deed iu trust, from Skinner to Skinner, which is now, as it was then, attacked for fraud, was not fraudulent in law, to be so adjudged by the Court, upon any of the provisions which are contained in it; and that the question oí fraud was one pi fact, to be submitted to the Jury.
    Upon the trial below, on the evidence submitted to the Jury, they rendered their verdict sustaining the deed, and declaring that there was no fraud in it. The verdict of the Jury places the case in precisely the same position, in which it stood by the admission of counsel, when, with a change of defendant only, it was formerly before tin's Court.
    In Hardy v Skinner, this Court held that, however.objectionable and suspicious were some of the provisions of the deed, yet they were open to explanation before the Jury. The verdict below declares that’that explanation has been full and satisfactory.
    The issues were left to the Jury, under a charge from the Court, of which the lessors of the plaintiff cannot complain. The instruction asked that the Jury should be told, that the presumptious against the deed, furnished by itself were not explained nor rebutted by the evidence offered. It was to take from the Jury the determination of a fact, after evidence had been submitted to them to enable them to pass upon it. The instruction could not have been given, nor its principle acted on by the Judge, without disregarding the opinion in the former case, and usurping the functions which appropriately belong to the Jury.
    The Court was, consequently, right in refusing to give such instruction, while the Jury, at the same time, were charged, that it devolved on the defendant to explain and remove the imputations and presumptious arising upon the deed itself. Lee v Flannagan, 7 Ire. 471, Young v Booe, 11 Ire. 347.
    There was no estoppel, for the defendant claimed under a title paramount, and prior to the lien of the executions, under which the plaintiffs purchased.
    It is submitted, whether the plaintiffs have 'not assented to the deed, wherein they are secured among the creditors of the second class, from the part which, as the evidence shews, they took in directing a sale, so that they are not now at liberty to impeach it.
   Pcarson, J.

Both parties claim under William Skinner. The lessor deduces title, by a sale and deed of the Sheriff in 1845, under a judgment against Skinner, in August, 1841, and executions regularly issuing thereon up to the sale. The defendant deduces title, by a deed of trust, executed by Skinner to one James Skinner, in April, 1841, and a deed from James C. Skinner to himself in 1846.— The case, therefore, turns upon the validity of the deed of trust. It conveys to James Skinner the land sued for, and several slaves, and all the other visible property of William Skinner, in trust to sell, and out of the proceeds to pay certain debts, which constitute the first class ; and, if there is any surplus, to apply it to the payment of the debts of the seeond class. It provides that the property is not to be sold until after the expiration of three years from the date, and then, if any of the debls of the second class shall remain unpaid, the trustee may be required, by such portion of the creditors, of the second class, as represent the greater interest, to proceed to sell; and he is, thereupon, authorised to sell the property at public auction, on a credit of six months. It further provides, that, until a sale is made, William Skinner shall remain in possession of all the property, and Skinner shall not be held responsible for the same, while it remains in the possession of the said William.

To account for this delay of three years, and the stipulation that, during the time, the debtor was to be allowed to keep possession of the property, and receive the profits, without responsibility on the part of the trustee, — the defendant examined Thomas F. Jones, Esq., James Skinner, and William Skinner. Their testimony was, in substance, that William Skinner was a merchant, and also carried on a small farm. In the Spring of 1841, he found himself very much embarrassed; he was indebted to. James Skinner, who was his brother, in a large amount, chiefly for money borrowed of him, as guardian; he also owed large sums to several of his intimate friends. These creditor's were willing to give him indulgence, provided their debts were secured, and he was anxious to give them the preference, and supposed that his land, negroes, and all of his other chattel property, w ould be about sufficient for that purpose. Besides these debts, he owed several merchants for goods, to quite a large amount, and in taking an estimate of the notes, book debts, &c. due on account of the store, he supposed this fund, if he was successful in making collections, in additioü to the profits of his farm, would enable him, in three or four years, to pay off most of the debts due to merchants, and several small debts due in the jieighbo rhood, which he did not purpose to secure; and he communicated this to his brother, and they called on Mr. Jones, a highly respectable gentleman of the bar, to draw the deed of trust. They stated over the above circumstances to Mr. Jones, and told him their wish was to postpone a sale of the property as long as the law would allow, and suggested four years. He advised them that time was too long, but thought the deed would not be invalidated by a delay of three years, which was inserted, and the deed was executed and registered. William Skinner stated, that he was much mistaken in reference to the amount which he had hoped to realise from the notes and debts, due on account of the store, and, although the nominal amount was some $4,000, his collections fell far short of the amount .of debts secured in the second class, and the result was, he proved to be insolvent to a large amount. He accounted for his want of success in making collections, by the fact, that, in 1842, there was a great pecuniary pressure, and an almost total failure in that section of the State : this fact .was also stated by Mr. Jones.

- The plaintiff’s counsel insisted, that the deed of trust .was fraudulent upon its face, and should be so adjudged by the Court. His Honor was of opinion, that the question of fraud was one of fact, to be submitted to the Jury. For this the plaintiff excepts. The Court then submitted the ease to the Jury, with general instructions as to the question of fraud.

The plaintiff’s counsel then requested the Court to instruct the Jury, that, upon the face of the deed of trust, there was •prima facie evidence of fraud, and that the de-‘ tend ant had offered no evidence to explain or rebut this presumption. The Court declined giving the instruction, and for this the plaintiff excepts.

The first exception is unfounded. The very question is settled by the case of Hardy v Skinner, 9 Ired. 191, when this same deed of trust was submitted to the consideration^ of this Court, and the matter is so elaborately discussed, as to make it unnecessary to add another word.

The second exception is well founded. By fhe case of Hardy v Skinner, it is decided, that, upon the face of this deed of trust, there is a presumption of fraud; and the single point is, was there any evidence to rebut this presumption? The plaintiff had a right to present this point, as upon a demurrer to the evidence; that is, admitting all of the testimony offered by the defendant to be true, and admitting all the inferences that can properly be drawn from it, there is no evidence to rebut the presumption,— and to ask for a direct opinion of the Court upon that question. Consequently, it is error to refuse the opinion; and to leave the case with the Jury, upon a general charge as to the matter of fraud. What constitutes fraud, is a question of law. In some cases, the fraud is self-evident: when it is the province of the Court so to adjudge, and the Jury has nothing to do with it. In other cases, it depends upon a variety of circumstances, arising from the motive and intent; then it must be left as an open question of fact to the Jury, with instructions as to what, in law, constitutes fraud. And, in other cases, there is a presumption of fraud, which may be rebut led. Then, if there is any evidence tending to rebut it, that must be submitted to the Jury; but if there is no such evidence, it is the duty of the Court so to adjudge, arid to act upon the presumption. Fraud is very subtle, and frequently eludes the grasp, both of the Court and J ury. When, therefore, the Court has hold of it, there is no reason for passing it over to the Jury, unless there is some evidence that will justify them in coming to the conclusion that the presumption is rebutted.

In one case, it had been decided, that there was a presumption of fraud against this deed of trust, and it was narrowed down to this question : Is there any evidence to rebut this presumption? The legal effect of-the deed is to delay and hinder the creditors named in the second class, and to hold them at arms length for three years; because, so far as the personal property was concerned, it could not be reached by an execution, and the equity of redemption in the land, only, could be sold, which would impose on the purchaser the necessity of going into equity to redeem, by paying all the debts. Of course, there would be -no purchaser, so that, in fact, the admitted design was to hokPoff the creditors of the second class, for three years, during which time the debtor was to remain in possession, and the receipt of the profits upon his own responsibility. What motive does the evidence assign for this ? The creditor wished to prefer certain creditors ; true, he had a right to do it, but he was bound to make an honest preference.— He could have given them the very same preference, and allowed the sale to be made within a reasonable time ; so, his wish to give the preference furnishes no reason for the delay, and leaves it as a new pretext, under which to provide for a benefit to himself. But again, it is said, the evidence shows, that he expected to be able, within" the three years, to make large collections from his books, which he could do by taking in grain, &c., much better than a trustee; and he left his notes and accounts out of the deed of trust, for the purpose of settling them up himself. Grant it: but does this furnish any reason why his other property should not, in the meantime, have been appropriated to the payment of his debts, so as to stop interest and close up the business ? Upon what principle does this self-constituted agency of his rest ? He, being insolvent, or, at least, greatly embarrassed, and on the verge of insolvency, as it afterwards turned out, assumes the right to defy his creditors, and enjoy the use of his property for three years, • — in other words, to keep his property, and pay his creditors, when he finds it convenient. This assumption shocks all notion of honesty and fair dealing, and cannot be tole, rated. The cases of Lee v Harnagan, 8 Ired. 741, and Young v Booe, 11 Ired. 347, were cited for the defendant. The distinctions are obvious.

Per Curiam. Venire de novo awarded.  