THE LAW OF Voluntary and Fraudulent Dispositions of Property UNDER THE STATUTES OF ELIZABETH. PART I. THE GENERAL OPERATION OF THE STATUTES OF ELIZA- THE statutes of Elizabeth now in force against fraudulent conveyances are the 13 Eliz. c. 5 (a), and the 27 Eliz. c. 4 (b). The statute 13 Eliz. c. 5, is made for the protection 13 Eliz. e. 5, of creditors. It declares all conveyances and disposi- protects tions of property, real or personal, made with the in- creditors. tention of defrauding creditors, to be null and void· against them. (a) See Appendix No. I., where it is given in full. The statute was confirmed by 14 Eliz. c. 11, s. 10; made perpetual by 29 Eliz. c. 5, ss. 1, 2. Sections 5 and 7 are repealed by 26 & 27 Vict. c. 125. Other statutes had been previously passed on the same subject-viz., 50 Edw. 3, c. 6, 3 Hen. 7, c. 4, against fraudulent gifts of goods and chattels. By Manx statute, "all fraudulent assignments or transfers of the debtor's goods or effects shall be void and of no effect against his just creditors." Mills' Statute Law of Isle of Man, p. 238. Corlett v. Radcliffe, 14 Moore, P. C. 121, 132. This stat (b) See Appendix No. II., where it is given in full. ute was made perpetual by 39 Eliz. c. 18, s. 32; from section 7 to the end of the Act is repealed by 26 & 27 Vict. c. 125. 27 Eliz. C. 4, protects purchasers. Conveyances The statute 27 Eliz. c. 4, is made for the protection of purchasers. It makes void, as against subsequent purchasers of the same lands, tenements, or [2] other hereditaments, all conveyances, * &c., made with the intention of defeating them, or containing a power of revocation. There is in each statute a proviso that nothing thereon good con- in contained shall extend to defeat any estate or interest sideration made on good consideration and bonâ fide to any per and bonâ fide son not having at the time any notice of such fraud (c). are excepted. What prop The statute 13 Eliz. c. 5, applies to all kinds of property 13 Eliz. erty, real or personal; but it does not enlarge the remec. 5, applies dies of creditors, or subject any property to execution which is not already in law or in equity subject to the rights of creditors (d). to. What prop The statute 27 Eliz. c. 4, applies only to real property erty 27 Eliz. and chattels real; it does not include personal property (e.) c. 4, applies to. Re-enacted in Ireland; New York. By the Irish statute 10 Car. I, sess. 2, c. 3, both these statutes are re-enacted for Ireland. They have also been substantially re-enacted in New York (f), with some additional provisions and increased checks upon fraud. The most material provision is as to conveyances intended to defraud purchasers. It provides that "No such conveyance or charge shall be deemed fraudulent in favour of a subsequent purchaser who shall have actual or legal notice thereof at the time of his purchase, unless it shall appear that the grantee in such conveyance, or person to be benefited by such charge, was privy to the fraud intended" (g). Statutes apThe statute 13 Eliz. c. 5, is in force in Maine, New ply in Amer- Hampshire, Massachussetts, Delaware, Pennsylvania, ica, Maryland, South Carolina, and Iowa. The various statutes in the other States are modelled after it, and in the main are simply a re-enactment of it (h). (e) 13 Eliz. c. 5, s. 6; 27 Eliz. c. 4, s. 4. (d) Story, Eq. Jur. 12th ed. ss. 367, 368; Kent, Com. 12th ed. vol. 2, 443; post, pp. 17, 18, 21. (e) Post, pp. 202 ei seq. (f) New York Revised Statutes, part 2, ch. 7, tits. 1-3, vol. ii. pp. 68, 72. (g) See post, p. 196. (h) Bump. Fr. Conv. (Amer.), 2nd ed. 10; Story, Eq. Jur. 12th ed. s. 253. The statute 27 Eliz. c. 4, has been adopted in many of the States of America, with some modifications; although it has received a somewhat different construction (i). Australia, * These two statutes are in force in Australia, [* 3] New New Zealand, and Upper Canada (ii). Zealand, Upper Canada.. It has been frequently observed that the statute 13 13 Eliz. C. Eliz. c. 5, was merely declaratory of what was pre- declaratory viously the common law of the land (k). Lord Coke of the comseveral times (1) comments on the word "declare," mon law. which is used in the statute, as showing that this was the case. Lord Mansfield, indeed, said (m) that the principles and rules of the common law, as now universally known and understood, are so strong against fraud in every shape, that the common law would have attained every object proposed by the statutes 13 and 27 Eliz (n). So it was said by the Supreme Court of the United States that the Acts of the 13 and 27 of Eliz. were considered as only declaratory of the principles of the common law (o). As to the statute 13 Eliz. c. 5, it may well be doubted How far this whether anything more was intended by these expres- is so. sions, than that "whatever offends against the order and good morals of society is an offence against the law.of England, and punishable at common law" (p); and that "the law abhors covin, and therefore every covinous act shall be void" (q). But be this as it may, the statute in question expressly laid down and more clearly defined the law on the subject; whereas the doctrine of the common law was so general as to be vague and difficult of application. (i) Story, Eq. Jur. 12th ed. ss. 427-434. (ii) 3 Burge, Col. Law, 644; see The Laws of the Australasian Colonies, by J. D. Wood, 12 et seq. (k) Per Lord Brougham in Rickards v. Attorney-General, 12 Cl. & F. 44 and see Barton v. Vanheythuysen, 11 Hare, 126, 132; Ryall v. Rolle, 1 Atk. 178. (1) Co. Lit. 76 a, 290 b; 3 Rep. 82 b. (m) In Cadogan v. Kennett, Cowp. 434. (n) See also Ex parte Mayor, 34 L. J. Bkcy. 25. (0) Hamilton v. Russell (Amer.), 1 Cranch, 309; Bump. Fr. Conv. (Amer.), 2nd ed. 10. (p) Lofft, 385. (4) 3 Com. Dig. p. 295. statutes. As to the statute 27 Eliz. c. 4, the proposition here laid down seems too extensive. The statute, indeed, as it is now construed in favour of subsequent purchasers defeats any voluntary conveyance, whether fraudulent Judicial decisions in England have even gone so far as to avoid a voluntary conveyance in favour of a subsequent purchaser who bought with full notice of that voluntary conveyance (r). or not. Generality [4] *In one respect, however, both these statutes and simplici- were moulded in strict conformity with the rules of the ty of the common law. If "simplicity was the striking feature of the common law" (s), it was in an almost equal degree the chief feature of the statutes of Elizabeth, which are couched in very general terms, so as to include, and allow their application by the Courts, to, any fraudulent contrivances to which the fertility of man's imagination might have resorted, as a means of eluding a more precise and inflexible law. The constant growth of fraud; and the suppression of it by the statutes; which are to The statute 13 Eliz. c. 5, is expressed to be directed against fraudulent feoffments, &c., "more commonly used and practised in these days, than hath been seen or heard of heretofore" (t). So it has been since, and will ever be to the end of time; for fraud is infinite, and will always attempt to evade whatever is done for its suppression; to prune it back on one side is but to give it a stimulus to branch out with fresh vigour in some other direction (u). But the simplicity of the enactment (v) and-if the expression may be allowed-its expansiveness, have enabled the judges to bring within its scope, and extend its operations to, almost every kind of transaction resorted to by debtors to the prejuIdice of their creditors. 66 "These statutes," said Lord Mansfield, cannot be construed receive too liberal a construction or be too much exliberally. tended in suppression of fraud" (w). So in Tuyne's Post, p. 193. (s) Sug. Pow. 8th ed. Introduction, p. 1. (t) Appendix No. I. (u) See Mortlock v. Buller, 10 Ves. 306; Lawley v. Hooper, 3 Atk. 279; Story, Eq. Jur. 12th ed. s. 186. (r) In Ryall v. Rolle, 1 Atk. 165, 184-5, Lord Hardwicke said, "the Act was made in the simplicity of former times, long before those large and airy notions of credit prevailed which have been since introduced;" S. C. 1 Ves. 348, 374. (w) In Cadogan v. Kennett, Cowp. 434; et vide Moo. 617; see Bump. Fr. Conv. (Amer.), 2nd ed. 12. Case (x) it was resolved that "because fraud and deceit abound in these days more than in former times, all statutes made against fraud should be liberally and beneficially expounded to suppress the fraud." The word "voluntary" is not to be found in either of Neither the two statutes of Elizabeth (y). Both statutes are statute pointed at fraudulent conveyances. *This limits the scope of the statute 13 Eliz. [* 5] c. 5; for it follows that a conveyance cannot be avoided under that statute merely because it is voluntary. That fact, of itself, does not necessarily bring the conveyance within the statute (z). So Lord Mansfield said, "the statute [13 Eliz. c. 5] does not militate against any transaction bona fide, and where there is no imagination of fraud" (a). speaks of voluntary con veyances. Construction By the construction that the statute 27 Eliz. c. 4, has received in England, a conveyance of real estate or of 27 Eliz. c. chattels real is always void as against a subsequent pur. 4, in England chaser for value, if it be voluntary, because it is deemed fraudulent in law, though in fact it may have been perfectly free from any taint of fraud (b). But it is not necessary that a conveyance should be voluntary in order to come within it. If executed with express intent to defraud, it will be void by the statute (c). In America, however, the statute 27 Eliz. c. 4, has re- in America. ceived a somewhat different construction, and it seems now to be settled law there that a voluntary conveyance is not avoided by a subsequent sale to a purchaser with actual notice of it (d). In the United States it seems the better doctrine that a voluntary conveyance will be upheld if bona fide even against a subsequent purchaser without notice (e). (x) 3 Rep. 82 a; and see Wimbish v. Tailboys, Plowd. 59; Rob, Fraud. Conv. 542. (y) Holloway v. Millard, 1 Mad. 418; Bump. Fr. Conv. (Amer.), 2nd ed. 263, 264. (z) Post, pp. 36, 50. (a) Cadogan v. Kennett, 2 Cowp. 434; Mackey v. Douglas, L. R. 14 Eq. 121; post, p. 36. (b) Townshend v. Windham, 2 Ves. 10; Trowell v. Shenton, 8 Ch. D., per James and Cotton, L.JJ., 325. (c) Perry-Herrick v. Attwood, 2 D. G. & J. 39. (d) Story, Eq. Jur, 12th ed. ss. 427, 428; Sterry v. Arden (Amer.), 12 Johns. 536. (e) Cathcart v. Robinson (Amer.), 5 Peters, 264, 280; Story, Eq. Jur. 12th ed. ss. 428, 429; Kent, Com. 12th ed. vol. 4, 464. |