34 time of the execution of the transfer is admissible to show his motives and as a part of the res gestae.32 Where a conveyance from husband to wife is attacked as fraudulent, evidence that the property had formerly belonged to the wife and had been transferred to the husband with the understanding that it should be restored to the wife on demand, and that the transfer sought to be set aside was in pursuance of this agreement is admissible.33 So it is proper to prove that before the conveyance and before the accrual of the plaintiff's claim the grantor had promised his wife to convey the property to her. But, in accordance with the general rule of evidence excluding proof of character and reputation in civil actions, evidence of the grantor's reputation for honesty and fair dealing is inadmissible. In an action against a grantor and grantee to set aside a conveyance as in fraud of creditors, it is proper to admit evidence which is competent as against the grantor, although it is not competent as against the grantee, where the court expressly limits the effect thereof to the grantor. Such evidence should be received and its bearing limited and explained to the jury.36 § 17. Financial condition of parties. The financial means and ability of the parties to a conveyance or transfer alleged to be fraudulent as against creditors shortly before and shortly after the conveyance or transfer are as a general rule regarded as relevant facts permissible to be proved by evidence which is otherwise com 32. Wright v. Solomon (Tex. Civ. App. 898), 46 S. W. 58. Compare Solomon v. Wright, 8 Tex. Civ. App. 565, 28 S. W. 414. 33. Fitzpatrick v. Fox, 80 App. Div. (N. Y.) 345, 80 N. Y. Supp. 677. 34. Evans v. Lewis, 30 Ohio St. 11. 35. Vansickle v. Shenk, 150 Ind. 413, 50 N. E. 281. 36. Carver v. Barker, 73 Hun (N. Y.), 416, 26 N. Y. Supp. 919; Treusch v. Ottenburg, 54 Fed. 867, 4 C. C. A. 629; Smith v. Collins, 94 Ala. 394, 10 So. 334; Pickett v. Garrison, 76 Iowa, 347, 41 N. W. 38, 14 Am. St. Rep. 220; Spaulding v. Adams, 63 Iowa, 437, 19 N. W. 341; Sax v. Wilkerson, 6 Kan. App. 203, 51 Pac. 299; Kalk v. Fielding, 50 Wis. 339, 7 N. W. 296. 40 petent.37 Evidence of the general reputation, as to credit and pecuniary responsibility, of all the parties to the transaction is admissible.38 But evidence that one of the parties to the transac tion is a first class business man is irrelevant and inadmissible to show his financial condition.39 Evidence of the insolvency of a debtor at the time he sold his property is admissible as tending to show that the sale was fraudulent. Evidence of solvency at the time of the conveyance is admissible for the purpose of showing good faith. In some jurisdictions evidence of insolvency occurring subsequent to the conveyance has been held admissible as tending to show the condition of the grantor at the time the conveyance was made, especially where no great interval of time had elapsed and when the business had suffered no considerable reverse by flood, fire, or other casualty.43 But in other jurisdictions evidence of insolvency a considerable time after the conveyance has been held to be inadmissible." 42 37. U. S.-Brittain v. Crowther, 54 Fed. 295, 4 C. C. A. 341. Ala.-Smith v. Collins, 94 Ala. 394, 10 So. 334. Evidence to show the insolvency of a trustee to whom a husband had transferred a note for the benefit of his wife held inadmissible. Rowland v. Plummer, 50 Ala. 182. Cal.-Willows Bank v. Small, 144 Cal. 709, 78 Pac. 263. Ida. Febrache v. Martin, 3 Ida. 573, 32 Pac. 252. Okla.-Marriman V. Knight, 7 Okla. 419, 54 Pac. 656. Pa.-Helfrich v. Stem, 17 Pa. St. 143; Quigley v. Swank, 11 Pa. Super. Ct. 602. S. C.-De Loach v. Sarratt (1899), 33 S. E. 365. Tex.-Jones v. Meyer Bros. Drug Co., 25 Tex. Civ. App. 234, 61 S. W. 553. 38. Sweetser v. Bates, 117 Mass. 466; Cook v. Mason, 87 Mass. 212. 1906), 105 N. W. 744, 12 Det. L. N. 721, 848. 40. White's Bank v. Farthing, 10 St. Rep. (N. Y.) 830; Whittle v. Bailes, 65 Mich. 640, 32 N. W. 874; Belt v. Raquet, 27 Tex. 471; Jack v. El Paso Fuel Co. (Tex. Civ. App. 1896), 38 S. W. 1139. 41. Hinde V. Longworth, 11 Wheat. (U. C.) 199, 6 L. Ed. 454; Smyth v. Carlisle, 16 N. H. 464; McGee v. Wells, 52 S. C. 472, 30 S. E. 602. 42. King v. Poole, 61 Ga. 373; Dumangue v. Daniels, 154 Mass. 483. 28 N. E. 900; Lane v. Kingsbury, 11 Mo. 402. 43. Woolridge v. Boardman, 115 Cal. 74, 46 Pac. 868. 44. Seaman v. Bisbee, 163 Ill. 91, 45 N. E. 208; Jones v. Snyder, 117 Ind. 229, 20 N. E. 140; Hathaway v. Brown, 18 Minn. 414; Martin v. Fox, 40 Mo. App. 664. 46 § 18. Pendency or threat of action. In an action to set aside a conveyance as in fraud of creditors, evidence of the pendency of an action or that suit was threatened against the grantor at the time of the conveyance, is admissible as bearing on the alleged fraudulent intent and tending to prove the fraud.45 Evidence of an attempt on the part of the debtor's attorney to delay the recovery of judgment in the pending action is admissible on the question of motive and the debtor may be presumed to have had notice of the proceedings of his attorney. Pleadings and decrees in the suit in which the attacking creditor recovered judgment are admissible," but evidence that bankruptcy proceedings had been previously instituted against the debtor and an order issued therein restraining him from making any disposition of his property is not admissible in a suit brought by a creditor in a state court to set aside a conveyance as fraudulent as against creditors, since such a preferential transfer is permitted by the state statute.48 § 19. Declarations and acts of grantor.-The acts and declarations of the grantor at or about the time of the alleged fraudulent conveyance are admissible to show fraudulent intent and to prove the conveyance fraudulent as to creditors." But where a convey ance is impeached for fraud as to creditors, the declarations of the parties to it, made at the time of its execution, are not admissible in evidence in favor of the parties charged with the fraud to show that it was not made with fraudulent intention.50 Where an execution is returned nulla bona and in proceedings supplemental to execution the defendant is examined as to his property, his testimony, so given, has been held competent against him in a subsequent creditor's suit to set aside a sale of his property as fraudulent, the testimony amounting to declarations of a party to the action.51 But such evidence is not admissible as against the grantee, where the transfer of title and possession had taken place prior to the giving of the testimony, being declarations of the grantor, made after transfer of both title and possession.52 To prove a fraudulent sale by the grantor, his conduct and declarations before the sale are competent and admissible to show his fraudulent intent, but must be followed by proving knowledge of the fraud in the grantee before the sale can be set aside.53 Kan.-Burlington Nat. Bank V. Beard, 55 Kan. 773, 42 Pac. 320; La Clef v. Campbell, 3 Kan. App. 756, 45 Pac. 461. La.-Smalley v. Lawrence, 9 Rob. 210. Md.-McDowell v. Goldsmith, 2 Md. Cn. 370. Mich.-Buckingham v. Tyler, 74 Mich. 101, 41 N. W. 868. Mo.-Snyder v. Free, 114 Mo. 360, 21 S. W. 847. N. H.-Badger v. Story, 16 N. H. 168. N. C.-Satterwhite v. Hicks, 44 N. C. 105, 57 Am. Dec. 577. Or.-Robson v. Hamilton, 41 Or. 239, 69 Pac. 651. Pa.-Helfrich v. Stein, 17 Pa. St. 143. Compare Curry v. Curry, 8 Pa. Cas. 247, 11 Atl. 198. S. C.-Paris v. Du Pre, 17 S. C. 282. Tex.-Solomon v. Wright, 8 Tex. Civ. App. 565, 28 S. W. 414. 50. Buckingham v. Tyler, 74 Mich. 101, 41 N. W. 868; Gruber v. Boyles, 1 Brev. (S. C.) 266, 2 Am. Dec. 665. Compare Sanger v. Colbert, 84 Tex. 668, 19 S. W. 863. 51. Finch v. Kent, 24 Mont. 268, 61 Pac. 653. 52. Lent v. Shear, 160 N. Y. 462, 55 N. E. 2, rev'g 20 App. Div. 624, 46 N. Y. Supp. 1095. 53. U. S.-Freese v. Kemplay, 118 Cal.-Landecker v. Houghtaling, 7 Conn.-Tibbals v. Jacobs, 31 Conn. 428. Iowa. Spaulding v. Adams, 63 Md.-Cooke v. Cooke, 43 Md. 522. ་ 20. Statements of debtor as to financial condition.-Statements of the debtor as to his financial condition, made to creditors at the time of the purchase of property alleged to have been afterwards fraudulently transferred, or made for the purpose of obtaining credit for property purchased prior to the conveyance alleged to be fraudulent, are admissible as bearing on the question of the debtor's intent to defraud his creditors.54 It is not necessary that such statements should have been made in the presence of the grantee, for they tend to show fraud on the debtor's part, and the grantee's connection with the fraud may be subsequently shown.55 To prove a sale of goods fraudulent as to creditors, and the intent of the seller, it is competent to show the manner in which he ob tained the goods from his creditors, as well as the manner in which he disposed of them.56 § 21. Other and separate fraudulent conveyances and transactions. In an action by a creditor seeking to impeach a conveyance of property as fraudulent as to creditors, it is competent for plaintiff to show other instances of transfers of property, made by the grantor at or about the same time to defeat creditors, to show a fraudulent intent in making the conveyance in controversy, though they do not bear on the intent of the grantee in the trans Mich.-Heath v. Koon, 130 Mich. 54, 89 S. W. 559. N. H.-Badger v. Story, 16 N. H. 168. N. C.-Ward v. Sanders, 28 N. C. 382. Or.-Robson v. Hamilton, 41 Or. 239, 69 Pac. 651. Pa.-Painter v. Drum, 40 Pa. St. 467. 54. N. Y.-Beuerlien v. O'Leary, 149 N. Y. 33, 43 N. E. 417. U. S.-Foster v. McAlester, 114 Fed. 145, 52 C. C. A. 107; Treuch v. Ottenberg, 54 Fed. 867, 4 C. C. A. 629, false statements to a commercial agency as to assets and liabili ties; Brittian v. Crowther, 54 Fed. 295, 4 C. C. A. 341. Ind. T.-Foster V. McAlester, 3 Ind. T. 307, 58 S. W. 679. Iowa.-Goldstein v. Morgan, 122 Iowa, 27, 96 N. W. 897; Spaulding v. Adams, 63 Iowa, 437, 19 N. W. 341. Mo.-Kramer v. Wilson, 22 Mò. App. 173, statement made to a commercial agency. Wis.-Kalk v. Fielding, 50 Wis. 339, 7 N. W. 296. 55. Treuch v. Ottenburg, 54 Fed. 867, 4 C. C. A. 629. 56. Lockwood v. Doane, 107 III. 235; Gray v. St. John, 35 Ill. 222. |