was given to secure a debt actually owing by the mortgagor does not, as matter of law, disprove the existence of a fraudulent intent on the part of the debtor." In the course of the opinion in that case, the chief judge observed: "We are of the opinion, however, that the fact of the payment of a valuable consideration upon a transfer of property is not, as a proposition of law, inconsistent with the existence of an intent to defraud, and that in the application of this principle, no distinction can be made between the consideration furnished by an existing debt, or one arising in any other manner. It is undoubtedly evidence, and usually strong evidence, of the intent with which the conveyance is made, but is simply a circumstance to be considered by the court in determining the question of intent. The statute itself declares all conveyances made with a fraudulent intent absolutely void, exeept in the case of those made upon a good consideration and in ignorance on the part of the purchaser of the fraudulent design of his grantor. It contains, therefore, the strongest implication that the payment of a valuable consideration is not inconsistent with the existence of an intent to defraud, and of such knowledge on the part of the purchaser, of the fraudulent design, as will avoid a conveyance made to him, even though accompanied by the payment of an adequate consideration. The vice in the argument of the court below, if any there is, seems to be in its assumption that the mere payment of a good consideration by the vendee, upon the transfer of property by an insolvent debtor, as matter of law disproves the existence of a fraudulent intent in such a transaction."

At the conclusion of the opinion from which the above quotations have been made, it is said, viz.: "From this review of the authorities it seems clear that where there is an actual intent to defraud, no form in which the transaction is put can shield the property so transferred from the claims of creditors, even though a full and adequate consideration be received for the same." Here we have a case of the non-change of possession, and that fact, by virtue of 5 of title 2 gives rise to the presumption that the sale was fraudulent and void; and it is also "conclusive evidence of fraud" by the very terms of the statute, unless it is made "to appear" on the part of the plaintiff, who is the person "claiming under such sale or assignment that the same was made in good faith and without any intent to defraud such creditors or purchasers." The onus of making it appear that the purchase was "in good faith and without any intent to defraud" was upon the plaintiff. The burden of giving proof that should answer the requirements of the statute was upon the plaintiff, and continued with him throughout the trial.

In Tilson v. Terwilliger, 56 N. Y., 273, which was a case where there was not an immediate and continued change of possession under a bill of sale, it was said by Folger, J., on page 276: "The statute is imperative that the sale must be followed by a continued change of possession, or it shall be presumed to be fraudulent. It is then upon the vendee to make it appear that the transaction was in good faith, and with no intent to defraud. This is a ques

tion for the jury. And whatever other rules of law there may be, in our judgment it should in this case have been submitted to them. Here was a presumption in favor of the defendants, growing out of the possession found in the vendor. Against this was the testimony of the vendee alone. His credibility in such a position was in issue. We do not think that when there is on one side the presumption against the legality of the transaction which the statute makes, and on the other the vendee seeking by his own oral testimony alone to repel that presumption, that the matter may be taken from the jury and passed upon by the court as a question of law."

In making out the affirmative of the proposition resting upon the plaintiff, proof of payment of adequate consideration undoubtedly was strong evidence, persuasive evidence, for the consideration of the jury, but as the statute in its fourth section has provided that questions of fraudulent intent arising under the statute shall be deemed a question of fact and not of law, it is not within the province of the court to hold as matter of law that the proof of the consideration, adequate and abundant though it be, was sufficient to establish that the purchase by the plaintiff was "made in good faith and without any intent to defraud" the creditors of his vendor.

Mr. Stephens, in his Digest of the law of evidence, states in article 93, at page 152: "Whoever desires any court to give judg ment as to any legal right or liability dependent on the existence or non-existence of facts which he asserts or denies to exist, must prove that those facts do or do not exist." With that rule before us, it may be observed that the plaintiff sought the verdict of the jury to the effect that his purchase was made in good faith and without any intent to defraud, which facts he was required to prove to overcome the presumption of fraud and the "evidence of fraud" furnished by the non-change of possession of the property purchased; he was required to prove his good faith, and that his purchase was "without intent to defraud.

Mr. Stephens also says, in article 95, page 153, that the burden of proof in any proceeding lies at first on that party against whom the judgment of the court would be given "if no evidence at all were produced on either side. Applying the rule to the case in hand it may be observed that the judgment of the court would be given, if no evidence at all were produced after the fact appeared that there was not a change of possession of the goods purchased, against the plaintiff. The plaintiff therefore took the burden, and must carry "through the case the burden of the facts he is bound to prove."

In Siedenbach v. Riley, 111 N. Y., 560; S. C., 20 N. Y. State Rep., 124, Earl, J., in dealing with the effect of a non-change of possession said, viz.: "Here, as we have before stated, the jury were authorized to find that this sale was not accompanied by an immediate delivery and followed by an actual and continued change of possession of the property sold. And hence the presumption that it was fraudulent and void as against creditors was N. Y. STATE REP., VOL. XXXII. 81

conclusive unless the plaintiff made it to appear that the sale was made in good faith and without any intent to defraud creditors. The burden was upon him to make this appear, and we are of opinion that there was evidence from which the jury could find that the plaintiff had failed to show that the sale was in good faith and without any intent to defraud."

We think the sense of the charge complained of was to the effect that after the jury had found that there was no change of possession, and after they had found that the plaintiff and his assignor "paid an adequate consideration for the property, the burden is upon the defendant to show that there was fraudulent intent." Such a charge in effect as a ruling, as a matter of law, is that proof of an adequate consideration overcomes the presumption that the purchase is fraudulent and void; overcomes the evidence of fraud which arose from the non-delivery of possession of the property, and relieves the plaintiff from the burden cast upon him by 85, to make it appear on his part that the sale was made in good faith and without any intent to defraud the cred itors of his vendor.

Our attention is called to Leach v. Flack, 31 Hun, 606, in aid of the contention of the plaintiff. In that case the referee in the court below had refused to sustain the ownership of the plaintiff in certain property purchased by her of her son under a bill of sale by reason of the non-change of possession, "although he also found the fact to be established by the evidence that the plaintiff was no party to the fraud, but received the bill of sale without notice of her son's embarrassment in business, and without any intention to hinder, delay or defraud any of the existing or subsequent creditors of the vendor." He also found that she "had no knowledge of any intention on his part to deceive or defraud any of his creditors." And after such findings of fact were made, it was held by the court that to deny her the right of recovery was erroneous; following the law as laid down in Dudley v. Danforth, 61 N. Y., 626. In the latter case the referee had found "that the purchase and sale was made in good faith for the purpose of paying to plaintiffs an honest debt owed by Edget to them;" and it was held that after such a finding of fact made, it would be unavailing to find that the "transfer was made with intent on the part of Edget to hinder and delay his creditors, and that the plaintiffs had previous notice of such intent on the part of Edget" "without a further finding that plaintiffs participated in such intent." We see nothing in the case which reaches the question involved in the case in hand.

In Starin v. Kelly, 88 N. Y., 420, it appeared that the plaintiff before levy "purchased the property of Besson, and that at the time of the levy he had the property in his possession," and the questions of fact were found in favor of the plaintiff, and the only questions of law determined in the case related to the rulings upon the trial; and under the issue in that case, it was said, viz.: "To maintain the issue on the part of the defendant it was sufficient for him in the first instance to show Besson's fraudulent intent in making the sale. Then it was for the plaintiff to show that he

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667 purchased the property for a valuable consideration. His title would then be unimpeachable unless the defendant should make it appear that he had previous notice of Besson's fraudulent intent or that he participated in the fraud. In Waterbury v. Sturtevant, 18 Wend., 353, it was held that the question of fraud in such a case may depend upon the motive of both parties; that the purchase must be bona fide as well as upon a valuable consideration; and that the fraudulent intent of the may be inquired into was also decided in 43 Barb., 448. think the case does not support the contention of the plaintiff.

grantee

We

Our attention is called to Mitchell v. West, 55 N. Y., 107, where it was held that a purchaser under a bill of sale unaccompanied by delivery and change of possession is not required by the statute of frauds, 2 R. S., 136, § 5, to show, as against the creditors of the vendor, in addition to the proof of, or in order to establish the bona fides of the sale, that there was a valid excuse for leaving the property in the vendor's possession." In that case it was claimed "that in addition to proof that the sale of the chattels was bona fide, and that there was no intent to defraud the creditors of the vendor, it was necessary to show some valid excuse or reason for leaving the property in his possession." The court held that such excuse or reason need not be shown; following the memorable decision in the court of errors in Hanford v. Artcher, 4 Hill, 271. It is said by the learned counsel for the appellant that "if’ the intent of the plaintiff and his assignor was honest in purchasing the property it makes no difference whether there was any change of possession whatever;" but as we have already seen. the question of the intent of the plaintiff is one of fact which must be left for the jury to determine, and when the want of change of possession appears in the case then the statutory presumption is against the plaintiff, and the burden is upon him to relieve himself from the presumption that arises from the evidence furnished by force of the statute by the non-change of possession.

Possibly, the trial judge may have been of the opinion that there had been a change of possession; but upon the evidence given upon that subject it was his duty, in obedience to the requirements of the provisions of the statute, that questions arising thereunder should be regarded as questions of fact and not of law, to submit that question to the jury; and the same duty remains with this court to regard the question as a question of fact and not a question of law, and therefore it is not appropriate for this court to assume that an erroneous instruction to the jury on the subject of the burden of proof may not have influenced the jury in reaching a verdict adverse to the defendant. We think the instruction was erroneous, and by reason thereof the verdict should not be allowed to stand.

Judgment and order reversed on the exceptions and a new trial ordered, with costs to abide the event.

MARTIN, J., concurs; MERWIN, J., dissents.

THE SPRINGVILLE MANUFACTURING CO., Pl'ff, v. LOWELL LINCOLN, as Substituted Assignee of John F. Plummer & Co., Def't.

(New York Common Pleas, General Term, Filed June 16, 1890.)

1. FACTORS-DEL CREDERE COMMISSION.

A del credere commission is earned when the guarantee is made not when it is performed.

2. SAME.

Where the proceeds of sales are to be remitted "from time to time, the identical moneys received are not required to be paid over, and a failure to remit is not equivalent to embezzlement, so as to deprive the factor of his right to commissions.

3. SAME SET OFF.

Defendant's assignors sold goods on commission for plaintiff under an agreement by which they were to receive a certain commission for selling and an additional commission for guaranteeing prompt payment. They made collections which they did not remit, and executed a general assignment for creditors, and further payments on the sales were made to the assignee. Held, that the assignee was entitled to set off the amount of the del credere commission on the sales against the amount due to plaintiff from the assignors.

SUBMISSION of agreed controversy.

Strong & Cadwalader, for pl'ff; Wm. B. Hornblower and James Byrne, for def't.

BOOKSTAVER, J.-The Springville Manufacturing Company is a corporation organized under the laws of the state of Connecticut, and engaged in the manufacture of cloths and woolens. Between the 1st day of January, 1886, and the 19th day of March, 1890, the firm of John F. Plummer & Co., of the city of New York, were engaged in business as commission merchants, and on or about the 1st day of January, 1888, that firm entered into an agreement with the Springville Manufacturing Company, whereby the company was to ship and consign goods manufac tured by them to said firm as its factors for sale for the account of the company; the proceeds of such sales were to be remitted from time to time, and prompt payment of all sales was guaranteed by the firm; as compensation for such services it was agreed that John F. Plummer & Co. should receive a commission of six per cent upon the sales made by the firm, which commission was understood to be made up of 3 1-2 per cent for selling the goods, and 2 1-2 per cent for guaranteeing prompt payment by the purchasers, and there was to be paid by the company an additional one per cent for all other expenses except freight.

On the 19th of March, 1890, the firm of John F. Plummer & Co. executed a general assignment of its property to Jeremiah P. Murphy for the benefit of its creditors, which was duly recorded on the same day.

Between the dates of the agreement of the original parties and the date of the assignment, the company from time to time shipped and consigned goods manufactured and owned by it to the firm as its factors or commission merchants for sale pursuant to