Palmour & Smith v. Johnson , 84 Ga. 91 ( 1889 )

Bleckley, Chief Justice.

1. By the code, §1952, every conveyance of real or personal estate, made with intention to delay, or defraud creditors, if such intention be known to the party taking it, is void as against such creditors ; and either notice, or grounds for reasonable suspicion, will be treated as equivalent to knowledge. An absolute deed made as a security for a debt is within this rule. “A fraudulent conveyance cannot stand against creditors, whether made to secure a debt or not. The conveyance must be pure — it must be made bona fide, and with no purpose known to or suspected by the creditor to hamper and entangle the property as against other creditors for the sake of hindering or delaying them. If made partly to secure a debt, and partly to hinder, delay or in any way defraud other creditors, and the creditor taking the deed has knowledge of this latter intention, or grounds for reasonable suspicion, no title will pass as against the other creditors. The morality of this species of conveyance must be as high as that of any other, but need not be higher. A conveyance to secure must be in all respects as clean and clear as a conveyance for permanent ownership.” Phinizy v. Clark, 62 Ga. 626, 627.

2. In the present case, the claimant was a witness in her own behalf. She was present at the trial and examined twice, once before her brother, the defendant in ft. fa. and maker of the conveyance to her, was examined, and once afterwards. She stated in her first examination that he was not in failing circumstances when the deed was made, and if he owed money, she did not know it. He testified that he told her the crops were bad and that he expected to get into a little trouble, and that he would have to make a deed to her to secure a home for her and their mother, and make his creditors hold off and give him a showing to pay his debts, and that she agreed for him to make it in her name, etc.. When she came to rebutíais evidence in her second examination, she did not deny that he made this statement to her, although she contradicted him on other parts of his testimony in several particulars. The fair implication is that she failed to deny this part of his statement only because she could not deny it truthfully. It certainly called for contradiction if it was not true, and if time, it put her upon notice of his intention in making the deed. Though she may not have known that he owed any debts, she ought to have known it, or strongly suspected, if he told her that he expected to get into trouble and wished to make a deed to hold ofi his creditors and to secure her and their mother a home. TJpon another trial, this element of the case, as well as the others, ought to be reconsidered and thoroughly iu vestigated. We think a new trial should be had, a that the court erred in not granting it.

Judgment reversed.