R.B.L., in 1809, then residing in Virginia, for a valuable
consideration made a conveyance in trust for the benefit of his
wife of certain personal property, and slaves, which deed was duly
recorded according to the provisions of the act of the Legislature
of Virginia. The property thus conveyed remained in the possession
of the husband and wife while they resided in Virginia, and in
1814, R.B.L. removed to the District of Columbia with his wife and
family and brought with him the slaves and property conveyed in
trust for his wife. In 1817, R.B.L. borrowed a sum of money of the
Bank of the United States on his promissory note, endorsed by one
of the trustees named in the deed of trust
of 1809. At the time the loan was made, R.B.L. executed a deed
of trust of eleven slaves, and among them were the slaves and the
household furniture conveyed by the deed of 1809, to secure the
bank for the amount of the loan. In 1827, R.B.L. died, entirely
insolvent. During his residence in Washington, being in reduced
circumstances, he sold some of the slaves, conveyed by the deed of
1809, for the support of his family, without objection by his wife
or her trustees. In 1834, the debt to the bank being unpaid, a bill
was filed against Mrs. E.L., the wife of R.B.L., and the trustees,
in order to compel the surrender of the remaining slaves and the
household furniture to the trustee for the bank for the sale of the
same to satisfy the debt due to the bank.
Held that the
deed of 1809, vesting the property in Mrs. L.'s trustees, was
effectual, according to the laws of Virginia, to protect the title
thereto against the subsequent creditors or purchasers from R.B.
Lee, and that the removal of R.B.L. and his wife into the District
of Columbia with the property conveyed to the trustees for the use
of Mrs. L. did not affect or impair the validity of the deed of
trust.
A liberal construction should be given to the clause of the
Virginia statute for the suppression of fraud. This is the well
established rule in the construction of the statute of Elizabeth,
which the first section of the Virginia statute substantially
adopts.
If A sells or conveys his lands or slaves to B, and then
produces to another his previous paper title and obtains credit on
the goods or lands by pledging them for money loaned, he is guilty
of fraud, and if the true owner stands by and does not make his
title known, he will be bound to make good the contract on the
principle that he who holds his peace when he ought to have spoken,
shall not be heard now that he should be silent. He is deemed in
equity a party to the fraud.
The appellant filed a bill in the circuit court stating that in
1817, Richard Bland Lee represented himself to be the owner of
certain after-mentioned property then in his possession; that he
applied to the bank for a loan of $6,000, and offered to convey the
said property in trust to secure the repayment of said sum of
money; that the loan was made, and a deed of trust executed and
delivered on 11 June, 1817, to Richard Smith, as trustee; that the
said Lee died in 1827, intestate and insolvent, leaving said debt
unpaid; that no administration was taken on his estate; that his
widow, Elizabeth Lee, the defendant, has taken possession of said
property and withholds it from said trustee, alleging that it had
been previously conveyed by her said husband in January, 1809, to
trustees for her use.
The bill charges that the said deed of 9 January, 1809, if ever
made, was a voluntary and fraudulent deed, and therefore void
against the complainants, who are
bona fide purchasers for
a
Page 38 U. S. 108
valuable consideration without notice; that the considerations
expressed in the said deed are false, or if true, insufficient to
give it solidity; that at the date of the said deed, Richard Bland
Lee was largely indebted, and incompetent at law to make the same;
that if the said deed had every legal requisite, it was executed in
Virginia, and never was recorded in Washington County, in the
District of Columbia, to which place the said Lee and his wife
removed, bringing with them the said property, or was other notice
given to the public then of its existence; that E. J. Lee, the
surviving trustee, in the deed of 9 January, 1809, and Mrs. Lee
herself knew that the complainant had loaned the $6,000 to Richard
Bland Lee upon his representations that he was the owner of the
said property and that Richard Bland Lee had conveyed the same to
Richard Smith to secure the payment of the said sum of money, and
never communicated to the complainants or to Smith until several
years after the death of Richard Bland Lee the existence of the
deed of 9 January, 1809.
The bill prayed that the deed of 9 January may be produced, the
execution thereof and the recitals therein fully proved, and that
it may be declared fraudulent and void against the
complainants.
Elizabeth Lee in her answer admits the loan and the execution of
the deed to Richard Smith, but avers she was ignorant of its
execution until long after it had been delivered, and never
consented thereto; she denies any knowledge of the representations
made by Richard Bland Lee respecting the ownership of said property
when he applied for the loan.
She says that on 9 January, 1809, she and her husband, then
living and having a long time before dwelt in Fairfax County,
Virginia, and the property in the deed mentioned therein being in
the said county, she agreed with her husband to relinquish her
right of dower in certain lands in Spotsylvania County, Virginia in
which her husband held five-eighths of eight thousand acres; also
to convey her right in certain Fairfax land containing two thousand
one hundred acres, her separate property, to trustees, to secure a
debt of $10,034 28 due from her husband to Judge Washington, in
consideration of which, and of her execution of the conveyances and
relinquishment of her dower, her husband agreed to convey to E. J.
Lee, William Maffit, and R. Coleman certain slaves, &c., of
which those mentioned in the bill of complaint are part, for her
use; that it was agreed that her said husband should be authorized
to sell any part of the said property, with consent of a majority
of the said trustees, provided he should convey to the said
trustees other property to the full value of that sold. She avers
that in execution of this agreement and in consideration of the
deed of the slaves, &c., of 9 January, 1809, she executed the
deed of the Spotsylvania land and relinquished her dower therein;
that on 9 January, 1809, she conveyed the land in Fairfax to secure
Judge Washington's debt, and on the same day
Page 38 U. S. 109
her husband, in fulfillment of his part of the agreement, made
and executed the deed of 9 January, 1809, to E. J. Lee, Maffit, and
Coleman, of the slaves, &c., which deed was duly proved and
recorded in Fairfax County Court within eight months from its date,
in which said county she still continued for some time to reside
with her husband, and where she continued to hold the said
property. The deeds are exhibited with the answer.
She declares the agreement to have been
bona fide and
without fraud, and claims to be the owner of said property. She
admits her husband sold part of the property with the consent of
her trustees, and other part under the pressure of great distress,
without their consent after they removed to Washington; that her
husband died in 1827; that they lived together until his death; and
that her possession of the property, being domestic servants and
household furniture, could not be separated from his, and was
consistent with the deed.
The case is stated more at large in the opinion of the
Court.
The circuit court decreed that the bill should be dismissed, and
the complainants prosecuted this appeal.
Page 38 U. S. 110
MR. JUSTICE CATRON delivered the opinion of the Court.
The bill alleges as a principal ground of relief fraud in fact
in the inception of the conveyance sought to be set aside; this
being denied by the answers, it is incumbent that fraud in fact
should be proved by the complainants, and which, they insist, is
established by the proofs. As the pleadings and exhibits furnish
almost the entire evidence, it becomes material to set them out to
a considerable extent. And in extracting the facts from which it is
supposed we are authorized to infer fraud, it must be done with
reference to the bearing of the local and peculiar laws of Virginia
on the transaction.
It appears that in 1817, Richard Bland Lee, the husband of
Elizabeth Lee, the respondent, borrowed from the Bank of the United
States, at their office of discount at Washington, $6,000 on his
note at sixty days, renewable at the pleasure of the bank and
endorsed by Ed. J. Lee and Walter Jones, and further to secure the
repayment of the money executed a deed of trust for eleven slaves
and sundry household goods valued at $7,200, to Richard Smith, the
cashier of office of discount, with power to the trustee to sell in
default of payment after giving thirty days' notice. The deed also
pledged some outstanding claims, not necessary to be noticed as
they proved to be of no material value. The debt not having been
paid, after long indulgence, suit was brought and a recovery had
against Richard Bland Lee and Walter Jones, one of the endorsers,
but no part of the judgment has been satisfied.
In 1834, the president, directors, and company of the bank filed
their bill against Edmund J. Lee, Elizabeth Lee, and Richard Smith,
the
Page 38 U. S. 111
trustee, alleging that Richard Bland Lee died in 1827 intestate,
that no one had administered on his estate, and that Elizabeth Lee
had converted the slaves and household goods to her own use after
the death of her husband; that she was executrix in her own wrong,
and bound to pay the debt, but refused to do so, asserting the
property pledged to pay the bank debt by her late husband had been
conveyed by him as early as 1809 to Ed. J. Lee, William Maffit, and
Richard Coleman in trust for the sole and separate use of the said
Elizabeth; that she had exhibited the deed to the complainants, but
which they aver was voluntary, fraudulent, and void as against them
because they were purchasers for a valuable consideration without
notice of such deed, as also creditors of Richard Bland Lee, the
grantor. That the considerations set forth in the deed are not
truly stated, but if truly stated they are wholly insufficient to
give validity to the same. That Richard Bland Lee, at the date of
the deed in 1809, was largely indebted and incompetent in law to
make such deed for the benefit of his wife and family.
That if the deed was duly executed, and upon legal and adequate
consideration when made, yet the same was executed in the
Commonwealth of Virginia; that the trustees had never acted under
it or taken possession of the property embraced in it, but had
suffered Richard Bland Lee, the grantor, at all times and without
interruption, from the date of the deed to the time of his death,
to retain possession of the property and to use, enjoy, and dispose
of the same, and held himself out to the world as the true and
absolute owner, and especially that the trustees had permitted the
granter to bring the slaves and furniture from Virginia to the
District of Columbia and County of Washington about the year 1814,
and there to continue his use and enjoyment of the same as if he
were the absolute, entire, and unqualified owner thereof.
That the deed was never recorded in the County of Washington,
nor notice given to the public or the complainants of its existence
during the lifetime of Richard Bland Lee, nor for some years after
his death, but he was permitted to obtain credit and contract debts
upon the faith of his being the sole and absolute owner of the
slaves and goods described in the deed, and permitted to sell and
dispose of parts of the same without any assertion of right or
title on the part of the trustees or said Elizabeth, and that Ed.
J. Lee, the only surviving trustee, and the said Elizabeth knew
that the complainants had made the loan of the $6,000 to Richard
Bland Lee in the full faith that he was the real and unqualified
owner of the property, and knew he had made and executed the deed
of trust to Richard Smith, to secure the repayment of the money;
yet they did not communicate to the complainants the existence of
the deed made for the benefit of the said Elizabeth, during the
lifetime of Richard Bland Lee, nor until several years after his
death, nor did said Ed. J. Lee or Elizabeth intimate in any manner
or give the complainants or their trustee reason to suspect that
there was any defect in the title derived under the deed to Richard
Smith, nor that Ed. J.
Page 38 U. S. 112
Lee or Elizabeth had any title or claim or pretended to have to
the slaves and furniture.
The foregoing allegations present two aspects -- 1st, that the
deed of 1809 was fraudulent and void in its inception, and 2d, that
if valid in Virginia, it not having been recorded in the County of
Washington, formerly a part of Maryland, and the continued
possession of the property covered by it having remained with the
grantor, both in Virginia and here, up to the time of his death,
was such a fraud upon creditors of and purchasers from Richard
Bland Lee as to destroy the effect of the conveyance.
The deed of 1809, amongst other things, sets forth that Richard
Bland Lee owed Judge Washington $10,034.28; and, as a part of the
consideration, Mrs. Lee had joined her husband in a mortgage to
trustees for Judge Washington's use, pledging her separate estate
to secure the debt. These specific facts the bill does not set
forth; but, by way of interrogatory, asks the defendants to answer,
whether the debt mentioned in said deed, as being due to Judge
Washington, had ever been paid; by whom, and from what funds; and
the respondents are required to produce the deed.
It also appears that the complainants commenced an action of
replevin against Mrs. Lee for the slaves and household goods; and
which was, by an agreement of the parties, suspended until the
termination of this suit.
Ed. J. Lee answers that the deed of 1809 was executed by Richard
Bland Lee to himself and others as trustees for Elizabeth Lee, the
wife of said Richard Bland Lee; that it sets forth the true
consideration for the same; that the respondent is the only
surviving trustee; that he never did give notice to the
complainants of the existence of the deed; but that he did not
know, until shortly before Richard Bland Lee's death, that he had
made the deed of trust to Richard Smith, and which never received
respondent's assent. That he cannot state, from general
recollection, how the debt due to Judge Washington was paid, but it
is his impression it was paid either by stock in the Bank of
Alexandria, which belonged to Elizabeth Lee, and was held in trust
for her by her brother Zacheus Collins, deceased, or by a sale of
part of the farm called Langley.
Elizabeth Lee answers that the loan of $6,000 was made by the
bank as charged, but that she was ignorant of the execution of the
deed of trust to Richard Smith to secure the repayment of the money
until long after the deed had been delivered and the loan made;
denies she ever assented thereto, or waived her rights to the
slaves, or any part of the property purporting to have been
conveyed by the deed. Admits the recovery of the judgment as
alleged, and that Richard Bland Lee died in 1827, intestate and
insolvent, and that no one has administered on his estate.
And, further answering, says that on 9 January in the year 1809,
the said Richard B. Lee and this respondent, then dwelling and
having for a long time before dwelt in the County of Fairfax, in
the State of Virginia, and the slaves and other personal
Page 38 U. S. 113
property hereinafter mentioned, then being in the said county,
she agreed with the said Richard to relinquish her right of dower
in a certain tract of land in the County of Spotsylvania, in the
Commonwealth of Virginia, on the Rappahannock River, containing
eight thousand acres, more or less, of five undivided eighth parts,
of which the said Richard Bland Lee was seized in fee simple, and
to join the said Richard in a conveyance thereof to Ludwell
Lee.
She also, on the same day, agreed to join her said husband in
the execution of a deed of trust to Henry Smith Turner, Thomas
Blackburn, and Bushrod Washington, Jr., conveying to them two
tracts of land in the said County of Fairfax, one situated on the
River Potomac, near the Little Falls thereof, containing sixteen
hundred acres, more or less; the other being the estate on which
the said Richard and this respondent then resided, containing five
hundred and thirty acres, more or less, which tracts of land were
then held in trust for this respondent, which last mentioned
conveyance was to be made to the said Turner and others, in trust
to secure the payment of the sum of ten thousand and thirty-four
dollars and twenty-eight cents, due from the said Richard to the
Honorable Bushrod Washington. And in consideration of the execution
of the said conveyance by this respondent, and of her thereby
relinquishing her dower in the said Spotsylvania lands, and her
right to the said lands in Fairfax, the said Richard, on his part,
agreed to convey to Edmund J. Lee, William Maffit, and Richard
Coleman, all the household and kitchen furniture, carpeting, beds,
bedsteads, bed furniture, plate, chinaware, glass, tables, chairs,
table linen, carpets, sideboards, bureaus, wardrobes; and all kinds
of furniture then in their said dwelling house and kitchen,
estimated to be worth sixteen hundred dollars, and the following
slaves, that is to say John, and his wife Alice, and their children
Patty, Betty, Henry, Charles, Johnny, Margaret, Milly, and Frank;
Ludwell, and his wife Nancy, and their children Caroline, Harriet,
Frederick, Ludwell, and Barbara; Henny and her child Eleanor;
Rachel and her child Rachel; two sisters, Kitty and Letty, and
their brothers, Alexander and Alfred; George (a blacksmith), Harry
(a carpenter), Harry (a wagoner), Tom (a carter), Thornton (a
cook), Samuel (a smith), and John (a ploughboy), to be held by the
said E. J. Lee, William Maffit, and Richard Coleman, and the
survivors and survivor of them, and the executors and
administrators of such survivor in trust for the use of this
respondent during her life, and after her death to pass to her
heirs at law, provided she died intestate, or to such persons as
she might bequeath the same to by her last will and testament, so
as she should make the same pass fully and completely, and without
limitation or condition, to her heirs or legatees. It was further
agreed by the said Richard and this respondent that the said
Richard should be authorized at any time during his life to sell or
otherwise dispose of any part of the said slaves and furniture,
with the consent of a majority of the said trustees or of the
survivors or survivor of them or of the executors or administrators
of the last
Page 38 U. S. 114
survivor, provided the said Richard should convey to the said
trustees or to the survivors or survivor or the executors or
administrators of the last survivor other property, real or
personal, to the full value of the said furniture or slaves so sold
or disposed of. And it was further agreed that if the said Richard
should fully pay the said debt to the Honorable Bushrod Washington,
without selling any part of the lands to be conveyed to the said
Henry S. Turner and others, in trust, as aforesaid, and then held
in trust for the said Elizabeth, then that the conveyance to be
made as aforesaid, to the said E. J. Lee, William Maffit, and
Richard Coleman should become null and void, as to the slaves
Ludwell, Thornton, Henry, Butler, Tom, Samuel, Jack, and
Eleanor.
And the said Elizabeth avers that in execution of the said
agreement, and in consideration of the conveyance by the terms
thereof to be made to the said E. J. Lee, William Maffit, and
Richard Coleman, for her use, in manner and on the terms aforesaid,
she did, on 16 July, 1809, in due form of law, with the said R. B.
Lee, execute and deliver to the said Ludwell, a conveyance in fee
of the said lands in Spotsylvania, thereby relinquishing her claim
of dower therein, and did, with the said Richard, in due form of
law, on 9 January, 1809, execute and deliver to the said Henry S.
Turner, Thomas Blackburn, and Bushrod Washington, Jr., a deed for
the said lands in Fairfax County whereby she conveyed her right to
the said lands last mentioned to the said Turner and others in
trust to secure the payment of the said debt, due from the said
Richard B. Lee to the Honorable Burshrod Washington in the manner
provided by the said agreement. And that the said Richard did, on
the same day, in execution of the said agreement on his part,
execute and deliver to the said E. J. Lee, William Maffit, and
Richard Coleman a conveyance whereby he transferred and conveyed to
them the said slaves and furniture before mentioned, to be held in
trust for this respondent, in the manner and on the terms before
stated, which said deed was duly proved and recorded, within eight
months from the date thereof, in the County Court of the County of
Fairfax, in which the said Richard and this respondent continued
still to reside, and in which the said slaves and furniture still
remained. And this defendant herewith exhibits the said three deeds
severally, marked, Exhibits, No. 1, No. 2, and No. 3. This
respondent avers that the said agreement before mentioned, was made
between the said Richard and her, and the said deeds executed in
pursuance thereof, fairly and
bona fide, without any
intention to defeat, defraud, hinder, or delay any creditor of the
said Richard. She is advised and insists that they were duly proved
and recorded, according to the laws of the State of Virginia, and
that, under the same, she is a
bona fide purchaser of the
said slaves and furniture, according to the terms of the said deed
to E. J. Lee and others, and that the said deed fully protects her
in the right to the said property conveyed, according to the terms
thereof, against all creditors of the said Richard, and all
purchasers
Page 38 U. S. 115
subsequently to the date thereof. And this respondent has before
herewith exhibited, as part of her answer to said deed with the
certificate of proof and record thereof, by the clerk of the County
Court of Fairfax County, marked Exhibit No. 3.
This respondent admits that no sale of the Fairfax lands was
made under the said deed to Henry S. Turner and others; she
therefore, makes no claim to the slaves, Ludwell, Thornton, Henry,
Butler, Tom, Samuel, Jack, and Eleanor; that none of the said last
mentioned slaves are in her possession or subject to her control,
nor were they so when the complainants issued out their writ of
replevin in their bill mentioned or at the time they instituted
this suit.
In this case it is agreed that the following facts be and they
are hereby admitted as true, reserving all objections to the
admissibility of the facts as competent testimony in the case,
viz., that Richard Bland Lee and his wife Elizabeth, one
of the defendants, resided at Fairfax County, in the State of
Virginia, on 9 January in the year 1809, and said Richard B. Lee
then held the negroes and other personal property, mentioned in the
deed of that date, from said Richard B. Lee, to Lee, Maffit, and
Coleman, filed with defendant Elizabeth's answer, and marked
Exhibit No. 3.
That the said R. B. Lee and his wife Elizabeth were housekeepers
and resided together in Fairfax County at the date aforesaid, that
the said negroes and other personal property continued in their
possession after the deed of the 9th January, 1809, had been made,
in like manner as such possession had been held before said deed
was made, and so continued until they removed to Washington City,
in the year 1814 or 1815, when they brought said negroes and other
property from Fairfax County with them to the City of Washington.
That from the period of said removal to Washington, said personal
property, as distinguished from the negroes, was assessed by the
officers of the corporation as the property of the said Richard B.
Lee.
That four of the said negroes were, for the first time, in the
year 1818, assessed to said Richard B. Lee. That prior to the 9th
day of January in the year 1809, the said Richard B. Lee was seized
in fee of five undivided eighth parts of 8,000 acres of land in
Spotsylvania County, in the State of Virginia, which was conveyed
by said Richard B. Lee and said Elizabeth his wife, to Ludwell Lee
in fee simple.
The execution, due acknowledgment, and recording of the deed and
bills of sale, exhibited with the defendant Elizabeth Lee's answer,
is admitted.
The execution and service of the notices exhibited with the
answer of the defendant, Edmund J. Lee, is admitted.
It is admitted that the deed of 9 January, 1809, was delivered
to the trustees therein named, and that they agreed to act, but
never took possession of the property therein mentioned, or of any
part of it.
It is also agreed that the deeds referred to in E. J. Lee's,
Elizabeth
Page 38 U. S. 116
Lee's, and Richard Smith's answers severally were duly executed,
acknowledged, and recorded, and are to be received and treated as
parts of the record in this case.
On these pleadings, exhibits, and admissions, various positions
are assumed as grounds of relief.
The deed of January 9, 1809, recites that Mrs. Lee had executed
a deed to Ludwell Lee relinquishing her right of dower to the 5000
acres of land in Spotsylvania, whereas the deed to Ludwell Lee
relinquishing the dower interest bears date subsequently, in July,
1809.
It is insisted for complainants that the recital was false and
that this part of the consideration had must be rejected. We do not
think so. The transaction is of nearly thirty years' standing, and
not so open to explanation as a more recent one; it may be that a
deed had been executed by Mrs. Lee, as recited, to Ludwell Lee, and
that it was afterwards superseded by another; be this as it may,
Richard Bland Lee was estopped by the recital in his own deed, and
Mrs. Lee's trustees bound to performance on her part, supposing the
recital to have been untrue. The substance of the contract was that
she should relinquish her dower interest to Ludwell Lee, and she
did relinquish it, obviously in compliance with the agreement; and
that it was done in July, instead of the preceding January, is an
immaterial circumstance. The husband's alienee acquired the
disencumbered estate in consideration of the deed sought to be
impeached, and in a court of equity cannot deprive the wife of the
slaves without doing equity to her by restoring the lands now
beyond our reach; provided the transaction was
bona
fide.
The other part of the consideration was the deed of trust (of
January 9, 1809) by which the Fairfax estates of Sully and Langley
were pledged for the payment of the debt due to Judge Washington.
These estates were the separate and sole property of Mrs. Lee, and
not being subject to execution by the laws of Virginia, the
creditor had not the slightest claim upon them, and it would have
been most unwise for Mrs. Lee to have onerated them without ample
indemnity.
Judging of the probabilities in 1809, from future results,
between that time and the death of Richard Bland Lee, in 1827, and
we are inclined to conclude that Mrs. Lee, with the ardor common to
her sex, mistook her true interest in making the exchange of her
lands for the slaves and household goods; that she has been greatly
the sufferer is free from doubt. The Virginia estates have passed
into other hands to satisfy her husband's creditors; most of the
slaves have been sold to supply his improvidence and necessities,
and the little that is left of the property secured to Mrs. Lee
(down to the humblest utensil) is now sought to be appropriated to
the satisfaction of the judgment on which the bill is founded.
That the deed of trust to Henry S. Turner and others to secure
Judge Washington's debt was executed in good faith is not
controverted;
Page 38 U. S. 117
the objection is that the debt was paid by means independent of
the lands mortgaged, and the mortgage discharged. The
consideration, therefore, given by Mrs. Lee for the slaves and
other property secured to her separate use is fully proved, and was
ample when the contract was made, and this is all that rested upon
the respondents to establish to resist the claim of the
complainants on the first aspect of the bill -- that which alleges
the deed to have been fraudulent in its inception.
But an after circumstance is invoked as furnishing evidence
favorable to the complainants. In the interrogating part of the
bill, the respondents are required to answer whether the debt
mentioned in the deed of 1809 as due to Judge Washington had ever
been paid, by whom, and from what funds? Edmund J. Lee responds
that he had no distinct recollection on the subject; Mrs. Lee
admits that no sale of the Fairfax lands was made under the deed to
Henry S. Turner, and others, but that the eight slaves, who in such
event were to be returned to her husband, had been disposed of by
him, &c. If Mrs. Lee meant to say that the trustees had not
sold by virtue of the deed of trust for Judge Washington's benefit,
then she answered truly; if, however, she is to be understood as
answering that the estates pledged were not applied in part to the
extinguishment of the debt, then she was mistaken. Sully, the
homestead, was sold to Francis Lightfoot Lee, in February 1811, for
eighteen thousand dollars, embracing the five hundred acres which
was Mrs. Lee's individual property, and including two hundred and
seventeen acres in addition, out of which sum Judge Washington was
paid seven thousand four hundred and fifty dollars. The estate was
not conveyed by the trustees, but by Richard Bland Lee, the
respondent Elizabeth, and Bushrod Washington, with covenants of
title and warranty. The conveyance upon its face recites in the
fullest manner that seven thousand four hundred and fifty dollars
of the purchase money had been paid by Francis Lightfoot Lee to
Judge Washington in discharge of the balance of debt due to him.
There can be little doubt Mrs. Lee, in her answer, was mistaken in
admitting to her prejudice that the Fairfax lands had not been
appropriated to the payment of Judge Washington's debt. Her
principal object seems to have been to disavow all claim of title
to the eight slaves.
Suppose, however, that Judge Washington's debt had been paid by
other means, and the Fairfax lands disencumbered of it; could the
fact influence this cause. That it could not is manifest. The
complainants, by their bill, do not seek to come in under the deed
to Turner and others; nor under that to Edmund J. Lee and others;
if they had and if the fact had been established that Mrs. Lee, by
the payment of the debts from independent means, retained her lands
and the slaves also, then a court of equity would treat her as a
trustee for Richard Bland Lee, and let in the complainants as his
assignees, to subject the slaves, &c., to the payment of the
bank debt. But the bill charges that the deed to Edmund J. Lee
Page 38 U. S. 118
and others was fraudulent and void in its inception, presenting
no case founded on the subsequent transaction alluded to, and the
Court cannot notice it other than as evidence to fix the fraud on
the respondents in executing the deed sought to be set aside, which
if valid then, must be deemed so now. The capacity of the husband
to contract through the intervention of trustees with the wife and
to make a valid conveyance, founded on a
bona fide
consideration paid out of the wife's separate estate, has not been
questioned, nor is the doctrine open to controversy.
That a liberal construction should be given to the clause in the
Virginia statute for the suppression of fraud we admit; this is the
well established rule in construing the statutes of Elizabeth,
which the first section of the Virginia statute substantially
adopts.
Heydon's Case, 3 Rep. 1 Black.Com. 88.
Fitzhugh v. Anderson, 2 Hen. & Munford 304.
On the second ground on which relief is sought, it is insisted,
the complainants are entitled to have satisfaction out of the
property claimed by Mrs. Lee.
"I. Because the continued possession, use, and enjoyment by said
Richard Bland Lee of the said property, purported to be conveyed by
the deed of 9 January, 1809, was evidence of a continued ownership,
and avoids said deed as against subsequent
bona fide
purchasers and creditors, without notice."
"II. That said deed, so executed, in Virginia, will not validate
the possession, use, and enjoyment of said property in the City of
Washington."
The investigation of this assumed ground of relief involves
considerations affecting the nuptial relation.
We are asked to deal with the conduct of a wife, living in
harmony with her husband, as if she was a third person, and to
decree against her because she did not expose her husband to the
community in which they lived, and especially to the complainants,
when within the wife's knowledge he was holding out her property as
his own, and using of it as his own, and obtaining credit upon the
faith that he was the true and absolute owner.
That Richard Bland Lee did deal with and use the property in
controversy as if it had been his own whilst he resided in this
city, and that the community did believe him the true owner, and
give him credit on the faith of the property, is no doubt true, and
it is very probable that Mrs. Lee knew the fact, but continued
passive and silent on the subject. She denies, however, that she
had any knowledge of the execution of the deed of trust to Richard
Smith until long after it had been made, and the answer, being
responsive to the allegations in the bill, is conclusive of the
fact denied, there being no proof to the contrary.
Was it a duty incumbent on Mrs. Lee to advertise the community
in which she lived that her husband had no title to the property on
the faith of which he was obtaining credit, but that it was hers?
This would have been charging the husband with fraudulent
conduct,
Page 38 U. S. 119
for it cannot be denied that if A sells and conveys his slaves
or lands and then produces to another his previous paper title and
obtains credit upon the goods or lands by pledging them for money
loaned, he is guilty of a fraud, and if the true owner stands by
and does not make his title known, he will be bound to make good
the contract on the principle that he who holds his peace when he
ought to have spoken shall not be heard now that he should be
silent. He is deemed in equity a party to the fraud. How far the
principle applies in a case of the wife of a fraudulent vendor
standing by we are not called on to decide, and wish to be
understood as not deciding. Mrs. Lee's is not that case; to say the
most, she was only passive and silent in regard to her rights
generally, although she may have had knowledge that Mr. Lee was
obtaining credit on the faith of her property, and the question is
was it her duty to have acted otherwise? All we need say is that a
court of chancery cannot hold Mrs. Lee responsible because of her
silence
Then as to the question of possession continuing with the
grantor. Leave the relation of man and wife between Richard Bland
Lee and Elizabeth Lee out of view and it would be impossible that
anyone could have been misled by Mrs. Lee's having the possession,
she having the sole and exclusive beneficial interest and right of
possession. The difficulty arises from a circumstance the existence
of which the statutes of Virginia contemplated and provided for. By
the act of 1785, it is declared that where any reservation or
limitation shall be made of a use, or property, by way of
condition, reversion, remainder, or otherwise in goods and chattels
the possession whereof shall remain in another, the same shall be
taken, as to creditors and purchasers of the persons remaining in
possession, to be fraudulent within the first section of the act,
and that the absolute property is with the possession unless such
reservation or limitation of a use, or property is declared by will
or by deed, proved by two witnesses in the general court, or the
court of the county wherein one of the parties lives, within eight
months after the execution thereof.
The statute of Virginia has been adopted in Tennessee, where it
has been holden that a deed like the present, founded on a good
consideration, and separating the title from the possession, was
within the statute and must be recorded, but when recorded,
creditors and purchasers of him who retains the possession must
take notice of it, and that the recording exempts the property from
liability to execution.
Crenshaw v. Anthony, Martin &
Yerger 110. The great object of the act was to secure the
settlement of slaves by the intervention of executors, and
trustees, so as to retain them in the family, and this could be
done by a
bona fide gift of a husband (not materially
indebted at the time) to a wife or children; if the deed was duly
recorded, to the exclusion not only of subsequent creditors, but
subsequent purchasers also, contrary to the 27th of Elizabeth,
whereby (in the language of the Supreme Court of Tennessee in
Marshall v. Booker, 1 Yerger 15) "an extravagant,
Page 38 U. S. 120
spendthrift husband may provide for his wife and children before
they are overtaken by ruin." But we can say with Lord Hardwicke, in
Russell and Hayward against Hammond, 1 Atk., "that we have
hardly known one case, where a person conveying was deeply indebted
at the time of such gift, that it has not been deemed fraudulent."
In Virginia, therefore, the possession of Mrs. Lee was in
accordance with the established practice, and is in no degree
subject to imputation.
It is insisted, however, that when Richard Bland Lee removed
into Washington City, the statute of Maryland operated on the
Virginia title of Mrs. Lee, and defeated it for the benefit of
purchasers from her husband.
The statute declares that no goods or chattels whereof the
vendor shall remain in possession shall pass, alter, or change, or
any property thereof be transferred to any purchaser, &c.,
unless the same be by writing, and acknowledged before one
provincial justice or one justice of the county where such seller
shall reside, and be within twenty days recorded in the records of
the same county. 1729, ch. 8. sec. 5.
The statute has no reference to a case where the title has been
vested by the laws of another state, but operates only on sales,
mortgages, and gifts made in Maryland. The writing is to be
recorded in the same county where the seller shall reside when it
is executed. The seller, Richard Bland Lee, residing in Virginia,
it was impossible for Mrs. Lee to comply with the act. That the
Virginia deed secured to Mrs. Lee the same rights here that it did
in Virginia we apprehend to be to some extent an adjudged question.
It has frequently arisen in the state courts. The case of
Smith
v. Burch, 3 Harris & Johnson, was this:
In 1804, Brodhag owed Jones, and gave a deed of trust on slaves
to secure the debt (three thousand dollars), executed to Smith as
trustee. The parties resided in Georgetown, where the act of
Maryland of 1729, continued in force after this District was
separated from Maryland. The deed of trust was duly proved and
recorded in the District of Columbia, Brodhag retaining the
possession of the slaves. In 1805, Brodhag removed to Alleghany
County, Maryland, and continued in possession of the slaves as
apparent owner until August, 1809, when the Sheriff of Alleghany
seized on them by virtue of an execution against Brodhag in favor
of Deakin's executors, and Smith, the trustee, sued Bruce, the
sheriff, in trespass. In that case (as in this), Brodhag had given
in the slaves to the assessor of taxes, and had sold part of them
between 1804 and 1809.
The Court of Appeals of Maryland in substance held that the act
of 1729 did not affect the case, and the only proof required to
sustain the plaintiff's title was the bill of sale (as it is
denominated), and that it lay on the defendant to prove fraud in
fact in order to avoid it.
In 1804, the jurisdictions exercised in the District of Columbia
and the State of Maryland were as distinct as those of Virginia and
the
Page 38 U. S. 121
District, so that the case of
Burch v. Smith was
similar in respect to conflict of jurisdiction with the one before
the Court.
The same point came up in Tennessee, and met the decision of the
supreme court of that state.
The following are the material facts in the Tennessee case:
In 1812, in Lunenberg County, Virginia, Daniel Crenshaw sold and
conveyed certain slaves to Richard Herring, who soon after
contracted for the purchase of a tract of land from Daniel
Crenshaw, lying in the same county; but Nancy Crenshaw, the wife of
Daniel, refused to relinquish her right of dower, and to induce her
to do so, Herring agreed with her and her son, Cornelius Crenshaw,
to convey to the latter in trust for his mother and for her
separate use two of the slaves previously purchased from Daniel
Crenshaw. The deed was duly executed and recorded in Lunenburg.
In 1814, Daniel Crenshaw and his wife removed to Tennessee,
carrying the slaves with them, Cornelius the trustee continuing to
reside in Virginia.
In Tennessee, to all appearance, Daniel Crenshaw was the true
owner of the slaves, and acquired credit on the faith of the
property. He was improvident, for which reason, manifestly, the
wife caused the slaves to be secured to herself, and it may be
remarked that similar motives have led to many, not to say most of
this description of conveyances in the states where the provisions
of the act of 1785 of Virginia prevail.
In 1821, Stacy recovered a judgment against Daniel Crenshaw in
the county of his residence in Tennessee by virtue of an execution,
founded on which Anthony, the sheriff, seized upon the slaves, and
Cornelius Crenshaw, as his mother's trustee, sued the sheriff in
detinue. The circuit court held the deed of trust void by force of
the statute of Tennessee (which is very nearly a transcript of that
of Virginia), because the deed had not been recorded in Tennessee;
a verdict was rendered for the defendant, and the plaintiff
prosecuted his writ of error to the supreme court, where the
judgment was reversed.
The court held that the deed made in Virginia, separating the
title and possession, was of a character to be operated upon by the
act of 1785 of Virginia, and had the deed not been recorded there,
as to creditors and purchasers, the title would have been deemed to
be with the possession; but having been recorded there, a title
fair and unimpeachable, vested in the trustee, and
cestui que
trust, Nancy, that being valid in Virginia, the statute of
Tennessee could not affect it. Furthermore:
The court refused to hold the wife responsible because she had
continued passive and silent in regard to her separate right to the
slaves, by which individuals might have been, and in all
probability were, induced to believe her husband the true owner and
to give him credit on the faith of the property. In that case, as
in this, the wife had done no affirmative act designedly to draw in
the creditor to trust her husband, and the court believed, by
remaining silent
Page 38 U. S. 122
she had violated no duty nor been guilty of any deceit on which
a forfeiture of her right could be pronounced.
The deed in controversy is also embraced by the 4th section of
the statute of Virginia, which, amongst other things, provides for
the recording of all deeds of trust and mortgages, upon
acknowledgment or proof according to the directions of the act, it
having been holden by the courts of Virginia and this Court, 3 Hen.
& Mun. 232; 3 Cranch 150 [argument of counsel -- omitted], that
deeds conveying chattels are included within the section referred
to. And the deed vesting the property in Mrs. Lee's trustees,
having been duly recorded in the manner required by the statute, it
was effectual according to the laws of Virginia to protect the
title against subsequent creditors of, or purchasers from, Richard
Bland Lee.
Upon the whole, we are of opinion the decree below dismissing
the bill, should be
Affirmed.
MR. JUSTICE BALDWIN dissented.
MR. JUSTICE THOMPSON did not sit in this cause.
This cause came on to be heard on the transcript of the record
from the Circuit Court of the United States, for the District of
Columbia holden in and for the County of Washington, and was argued
by counsel. In consideration whereof it is decreed and ordered by
this Court that the decree of the said circuit court in this cause
be and the same is hereby affirmed with costs.