Malcolm v. Hodges

Tuck, J., delivered the opinion of this court. The appellant, as trustee of Sprigg & Meseke, under the insolvent laws, filed a bill against the appellee to vacate a deed from Sprigg & Meseke to him, as trustee, for the benefit of their creditors, on the terms and conditions mentioned in the deed. The case was heard on bill, answer and replication, before the chancellor, who dismissed the bill, being of opinion, that as the conveyance transferred all the property of the grantors, and contained no reservation to them of any surplus, after paying the preferred or any class of creditors, it was not void. The validity of the deed must be determined without regard to the surrounding and other circumstances averred in the answer.

If admissible for any purpose they are not proved. “ We are to look to the character with, which the law stamps the deed, without reference to extrinsic facts as to motive. If the law imputes to the grantor a design in making the deed, no evidence of intention can change the presumption. If the ⁴²⁶ law declares the deed to be void, it is no matter how the question of fraud in fact may stand.” 3 Md. Rep., 40 , Green vs. Trieber. Upon consideration of the deed we are of opinion, with the' chancellor, that if good in other respects it would operate as a conveyance of all the grantors’ property, joint and separate..

The terms are not very clear; but, construing all its parts-together, the legal effect of the granting clause and the habendum is to vest in the grantee title to all their property and effects of every description. But we think the instrument is void as against the appellant, representing the creditors of the grantors,, because the necessary effect of the trusts declared therein is to-secure to the grantors any surplus that may remain, after paying the claims of those creditors who may come in under its terms within the time limited. The law is now too well settled to admit of dispute, that deeds of this description must not only convey all the property of the debtor, but they must, in terms, dedicate the whole for the benefit of the creditors, subject to such preferences as may be declared in the deed. There must be no reservation to the debtor, express or implied.

We cannot look outside the assignment to ascertain whether there will be a surplus or not. That would make the efficacy of the instrument depend on extrinsic circumstances,