SUPREME COURT.

Globe, Volume XXIII, Issue 2225, 14 April 1881, Page 3

SUPREME COURT.

Wednesday, Apbil 13. [Beforo His Honor Mr Justice Johnston and a special jury.] The- Court re-opened at 10 a.m. CBEDITORB' TBUSTEBS OF H. Qr/ALMBB V THHBEBA AND H. QUAIiMEB. This was an aotion brought by Frederick Trent, the trustee in tha insolvent estate of Henry Qualmer, ore of the defendants herein, to declare a settlement made by him of property at Bingsland on his wife, the other defendant, fraudulent and void. Mr Joynt appeared for the plaintiff. Mr Holmes for the defendant. Mr Aynsley was ohoßen foreman of the special jury. Mr Joynt having opened the case to the jury, called evidence in support of hiß case that the settlement had been executed fraudulently and with intent to deprive his creditors of the property, and defeat and delay his creditors in realising the said estate. By request of his Honor, Mr Joynt cited oaßes to show that he had a right on the faots to ask that the settlement be upset. [Oases cited, Ware v Gardiner, 7 Law Reports Equity; Freeman v Hope, L.R. Chancery Appeals, 538; M'Kay v Douglas, L.R., 14, Equity 106 ; in re. Pearson, ex parte Stevens, L.R., 3 Ch. div. SO7 ; Cornish v Chartee, L.R. 14, Equity 4847. J On the authority of ttose cases he submitted that the case came within tho statute of Elizabeth, and that on the faots he should prove he had a right to ask the jury to declare that the settlement made by the debtor was fraudulent, and intended to defeat his creditors.

Mr Holmes said at the proper time when tho facta came out, he should contend that the caseß cited by his learned friend did not apply. His Honor said that Mr Holmes could take this course.

The bankruptcy proceedings having been admitted, Mr Fredorick Trent, trustee in the estate, gave evidence as to the examination of the bankrupt before him on oath, and put in the notes of such evidence, which were read by the Deputy Registrar. His Honor asked the legal gentlemen whether they could not go at once to the jury on the evidence just read. Mr Holmes could not deny the statements thus made by his client. Mr Joynt was quite willing to go to the jury on this point whether this disclosed a breach of the statute of Elizabeth.^ Mr Holmes declined to have this done, as the statement only contained a portion of the facts he should prove. As instructed, he should submit that the settlement was unassailable, and he should prove a great deal more than appeared in the statement just read. His Honor said that on the statement now read Mr Joynt had thrown the onus of proving that there was no breach on the defendants. That was, he had adduced sufficient evidence to go to the jury that there had been a breach within the meaning of the Btatute by the execution of the settlement. Mr Holmes said he was prepared to accept the position of having the onus of proof on him. Mr Joynt then proceeded to further examine Mr Trei»t as to the transactions between himself and bankrupt. Mr Trent went on to detail conversations with the bankrupt, who stated that he had settled the property on his wife to prevent his being jumped on. Mr Holmes called his Honor's attention to the fact that one of the jurymen, Mr E. S. Harley, had proved his debt against the estate.

Mr Harley BEid ho was a co-trustee with Mr Hennah, and had proved his debt on the estate of the bankrupt. He was not now interested in any way. Mr Holmea desired his Honor to take a note of hia objection. Hia Honor decidedly would not. Mr Holmes had proved nothing. Mr Harley stated that he was not now interested at all. Surely Mr Holmea would not say that anyone being interested at any time, but not at the time of being sworn, was incapacitated from serving as a juror. Mr Holmeß would certainly take objection. His Honor said that Mr Holmes could, if he proved that Mr Harley had not stated what was correct, bring proceedings in error. [ Mr Holmes did not for an instant doubt Mr Harley, but Lo should submit with all

respect that he was incapacitated from sitting as B juror.

Mr Joynt then proceeded to further examine Mr Trent. Mr Holmes cross-examined the witness at some length. The deed of [settlement, mortgages, &c, in the case were produced. The following witnesees were then called for the plaintiff, viz. .—A. M. Cooper, R. W. Rose, T. Pavitt, A. H. Price, and Charles Duggan, who deposed that in all cases the defendant, Honry Qualmer, had told them that the property was his, nover telling them that it was settled on his wife. The evidence of these witnesses went to prove that the defendant, Henry Qualmer, always treated the property as his own, and not his wife's. Mr Holmes opened the case for the defendant, admitting the first, second, and third issues, disputing the fourth, which raised the question in dispute. He should submit that the fourth issue could not be put to the jury, and he should object to it being joined without the proof of the intent to defraud, defeat, or delay the creditors on the part of the bankrupt. His Honor said that if Mr Joynt applied to have the issue amended, he should allow it; otherwise he would have to direct the jury on it as it stood. Mr Joynt declined to amend.

Mr Holmes stated the defence to be that the defendant Qualmer requiring more money than he had himself, applied to his wife to give him certain money which had been given to her by her father. She agreed to do so, providing he gave her a settlement of the land intended to be bought, and it was drawn in the usual terms of natural love and affection and other considerations. His Honor pointed out that the giving of the money by the wife to the husband would not be sufficient to sustain the deed in point of law, as the money really was his own. Mr Holmes went on to point out that the defendant wound up his business at the Plough Inn by coming out with a credit balance of £BOO odd, and yet they were asked to believe that he had fraudulently executed a deed of settlement. Ho had no creditors, but had come out with a balance of over £BOO. Evidence was called for the defence, viz., the two defendants, Theresa and Henry Qualmer, to show that the latter obtained the money from the former in order to carry out the buildings and buy the land comprised in the settlement.

Mr Holmes and Mr Joynt addressed the jury. Hib Honor eaid he should rule to the jury that if, at the time of the settlement to the wife, the defendant intended trading at a short distance of time, and that in course of that trading he would hare creditors who would otherwise have been able to have power over his property at Bingsland, the settlement made to protect his wife for his own interests, the deed would come under the provisions of the statute of Elizabeth, and be made with a fraudulent intent and to defeat and delay his creditors. The jury were perfectly at liberty to find a special verdict (if they were of opinion that it was necessary) on the fourth issue, as to the or otherwise of the settlement, by returning a verdict either that the defendant did or did not contemplate entering into trade, and that he had given this settlement to protect his property against creditors he might have in the course of suoh trade, and afterwards beoame insolvent. If th«y were satisfied that this were so, then they must find that the deed was fraudulent and intended to defeat and delay his creditors. Mr Holmes objected ito his Honor's ruling on the authority of McKay v Douglas, 26, L. 8., 723. His Honor took a note of Mr Holmes' objection. Mr Holmes submitted that his Honor should have put it to the jury whether the debtor was on the eve of entering into the very transaction which resulted disastrously. His Honor declined to do this. Mr Holmes next objected to His Honor's ruling, because there was no evidence that the bulk of defendant's property had been conveyed by the deed to his wife. His Honor said that it did not matter whether it was the bulk or one-fifth of the property. If the deed had been made with a view to dispose of a small portion of his property only, that would be defeating his creditors within the meaning of the statute. The jury retired at 5 p.m. to consider the issues. At 5.10 p.m. they returned into Court with a verdict that the deed was fraudulently executed, and with intent to defraud and defeat the creditors. His Honor certified that the case was a proper one for a special jury. The Court then adjourned to 20th April in its nisi prius jurisdiction.