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Cox v WALL.
comes within the terms of Section 1548 in order to take his case out of the operation of the preceding sections. Why should this not be so? It is conceded that he must show that he bought for value; but the statute provides not only that he must have bought for value, but also without notice, and makes both a valuable consideration and want of notice essential to the validity of his title. If, therefore, he is required to prove one of the essential elements of a good title, as against the creditor who has shown that the deed was void because it was fraudulent, why not the other? It will not do to say that the law will not impute wrong or evil to any one and will not therefore presume that his purchase was not bona fide in the absence of proof to the contrary, because this would contravene the express provision of the statute which declares that the deed shall be utterly void and of no effect unless it appears that the title had been acquired by a bona fide purchaser for value and without notice of the fraud. In the original statute of 13 Elizabeth and in our Act of 1715, what is now Section 1548 of The Code, was a proviso to the preceding sections of those statutes in regard to fraudulent conveyances. In Eigenbrun v. Smith, 98 N. C., 215, this court says: "The rule is that the purchaser, knowing of the judgment, must purchase with the view and purpose to defeat the creditor's execution; and if he does it with that purpose it is fraudulent, notwithstanding he may give a full price. The question of fraud depends upon the motive. The purchase must be bona fide as well as upon good consideration. This was the rule as declared by Lord Mansfield upon repeated occasions."
In Tredwell v. Graham, 88 N. C., 214, this court through Ruffin, J., says: "As said by Pearson, C. J., in Cansler v. Cobb, 77 N. C., 30, when a grantor executes a deed with intent to defraud his creditors, the grantee can only protect his title by showing that he is a purchaser for a valuable con
Cox v. WALL.
sideration and without notice of the fraudulent intent on the part of his grantor."
In Davis v. Council, 92 N. C., 730, it is said by the court through Smith, C. J.: "The proposition itself is an imperfect statement of the principle of law, as it omits the material qualification, that such purchaser should not have had notice of the fraudulent character of the title of the party from whom he derives his,"--citing The Code, Sec. 1548. In Odom v. Riddick, 104 N. C., 521; 7 L. R. A., 118; 17 Am. St. Rep., 686, it is said that "A purchaser for value from one whose deed is declared by the jury to be fraudulent and void gets a good title if he has no notice of the fraud in his vendor's deed."
Bigelow, referring to this subject, says: "But it may still be thought necessary to inquire whether the plaintiff himself has really sustained the burden of proof, so as to require the defendant to come to the support of his defense, by merely showing fraud. It may be asked if the plaintiff ought not to go further and, though he has made a case of fraud in the grantor, offer some definite evidence of notice, or what for the present purpose is the same thing, that the conveyance to the defendant was voluntary. The answer of the authorities, though not without here and there a discordant note, is that evidence of the fraud is enough, and this whether the case be one of fraud on creditors, or fraud on a vendor; such is the better answer in those States in which in cases of fraud upon creditors, notice to the purchaser is sufficient to defeat his title." 1 Big. Fraud, p. 131.
But we think the question is directly passed upon and settled in two cases by this court: In Saunders v. Lee, 101 N. C., 7, the court says: "In McGahee v. Sneed, 21 N. C., 333, it is held that when a purchaser from a fraudulent grantee seeks relief on the ground that he is an innocent purchaser without notice, he must deny notice, and so he must in an answer
Cox v. WALL.
when he sets up the same defense to the bill of an impeaching creditor," and Gaston, J., delivering the opinion, after thus stating the rule, adds: "The want of notice is an essential part of his equity in the one case and of his defense in the other, and it is a general rule in pleading that whatever is essential to the right of the party must be averred by him."
It would appear from these cases that whatever must exist in order to protect the title must be averred and proved by him who holds that title. The burden is with him. But not so when it is sought to convert one into a trustee because be bought with notice. In the former case, the title is deemed to be bad until it is shown to be good; in the latter case the title is presumed to be good until it is shown to be bad by him who would assail it.
In Wade v. Saunders, 70 N. C., 275, Pearson, C. J., for the court, says: "The finding of the jury that the deed executed by Aaron Saunders to his son Jesse Saunders was not bona fide, but was fraudulent and done with purpose to defraud his creditors,' disposes of the other points made in the case on the part of the defendants; for how can Romulus F. Saunders, who claims under Jesse, the fradulent donee, stand upon fairer ground than he does, except as a purchaser for valuable consideration and without notice of the fraud attempted to be done by the said Jesse and his father, the defendant Aaron? There was no evidence of his being an innocent purchaser." In the same case (plaintiff's appeal), p. 279, Pearson, C. J., for the court, says: "We have not been able to see the force of his Honor's reasoning in regard to the legal effect of the two deeds of Jesse to Romulus Saunders, or how the legal effect of the deeds could be at all affected by the fact that the 'existence of this prima facie title had been brought to the notice of the court by the plaintiffs themselves.' Had the plaintiffs demanded judgment that these two deeds be cancelled in order to remove a cloud from the
Cox v. WALL.
title, then Romulus F. Saunders would have been a necessary party, and although the deed from Aaron to Jesse was deemed void, still Romulus would be allowed to protect his title by showing that he was a bona fide purchaser for valuable consideration, without notice of the fraud that vitiates the deed to Jesse, but the onus probandi would have been on him, and prima facie his title would be affected by the same infirmity.”
The plea that the defendant is a purchaser for value and without notice is in the nature of a plea of confession and avoidance, and the matter in avoidance is to be proved by the party pleading it. If it be said that the purchaser in that case will be required to prove a negative, the answer is that, though somewhat negative in form, it is an affirmative plea in substance, and besides it is peculiarly within the purchaser's knowledge whether he had notice or not of the fraud, and he can now testify in his own behalf. We think this view of the case is sustained by authority. In Boone v. Childs, 10 Peters, 210, it is said: "But still this will not be done on mere averment or allegation; the protection of such bona fide purchaser is necessary only when the plaintiff has a prior equity, which can be barred or avoided only by the union of the legal title with an equity, arising from the payment of the money, and receiving the conveyance without notice, and a clear conscience. It is setting up matter not in the bill; a new case is presented, not responsive to the bill, but one founded on a right and title operating, if made out, to bar and avoid the plaintiff's equity, which must otherwise prevail. The answer setting it up is no evidence against the plaintiff, who is not bound to contradict or rebut it. It must be established affirmatively by the defendant, independently of his oath. Such is the case which must be stated to give a defendant the benefit of an answer or plea of an innocent purchase without notice; the case stated must be made out, evidence will not be permitted to be given of
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any other matter not set out." In Jewett v. May, 7 Johns., Ch. 65; 11 Am. Dec., 401, the court lays down the following rule:"To support the plea of a bona fide purchaser without notice, the defendant must aver and prove, not only that he had no notice of the plaintiff's rights before his purchase, but that he had actually paid the money before such notice." In Weber v. Rothchild, 15 Oregon, 390; 3 Am. St. Rep., 162, it is said: "Here the defendant Rothchild has alleged facts in one part of his answer tending to show that he is a bona fide purchaser for value without notice of this property, but he has offered no evidence whatever on those issues. The plea of a bona fide purchaser for value, as here alleged, is an affirmative defense interposed by the defendant, and in this connection it is not perceived that it differs from other affirmative defenses. The party having the affirmative of the issue must offer evidence to support it. Another rule of law equally elementary which is frequently applied in such cases, is that when a fact is peculiarly within the knowledge of a party, he must furnish the necessary evidence of such fact." The case just cited quotes with approval Tredwell v. Graham, 88 N. C., 208. In Young v. Schofield, 132 Mo., 663, it is said: "Inasmuch as the averment or defense of being 'an innocent purchaser' is an affirmative allegation or plea, so must the evidence offered in its support be of the like nature; as the allegation must be affirmatively pleaded, so also must it affirmatively be proved; the onus lies on the pleader." In Edwards v. Railroad, 82 Mo. App., 101, the court says: "A question is made here as to where the burden of proof was on the question of the plaintiff's being an innocent purchaser without notice of the prior unrecorded deed. Ordinarily, the burden would be on the party whose case depends on his innocence and lack of notice. Here the plaintiff's claim of title being by a subsequent deed is invalid, unless he can establish that he was an innocent purchaser."