J.A.

Judgment. preference in respect of a person who is no creditor at all MACLENNAN at the time, and who does not become a creditor until long after the act complained of. I, therefore, think that even if the defendant knew of the insolvency of the debtor, the plaintiff could not attack his purchase on the ground of preference.

It was not contended before us that the sale was void under the other part of the section as made with intent to defeat, delay, or prejudice; but if it had, I think there is no evidence of such intent, and I agree with the learned Judge, that there was no proof of notice or knowledge on the part of the defendant of the debtor's insolvency, or of any fraudulent intent on his part, and that in that respect our decision in Johnson v. Hope, 17 A. R. 10, is applicable.

As regards the change of possession, I agree with the learned Judge also, that the uncontradicted evidence shews a complete change of possession when Brenton absconded and before the trial of the plaintiff's action, and long before the issue of the execution.

Upon the whole case I think there was nothing proved in this case which could properly be left to the jury to support a verdict for the plaintiff, and that judgment ought to have been for the defendant as found by the learned Judge in the judgment appealed against, and that the appeal should be dismissed.

HAGARTY, C.J.O., and BURTON, J.A., concurred.

Appeal dismissed with costs.

BONISTEEL V. SAYLOR.

Contract-Bills of Exchange and Promissory Notes-Megality—Public policy.

The plaintiff purchased from an alleged company fifteen bushels of hullless oats paying therefor $10 a bushel and receiving the company's bond to sell for him thirty bushels of oats at the same price. The company found in the defendant a purchaser of thirty bushels of oats and the plaintiff's oats were sold to him and the defendant's notes for $300 were transferred to the plaintiff, the defendant getting the company's bond to sell sixty bushels for him at the same price. This was but one of a very large number of similar transactions 'and both the plaintiff and the defendant were aware of this, and that these transactions could not be carried out without some one else being induced to enter into a similar transaction by which their own would be' completed and a loss probably suffered by their successors. The oats were not worth more than ordinary oats and the transactions were in fact speculative and fraudulent :

Held, [BURTON, J. A., dissenting], that the transaction could not be dealt with as an isolated one, but that the whole scheme must be looked at; that the tendency of that scheme was clearly contrary to the general well being of the public and therefore that the transaction in question forming part of that scheme was against public policy and illegal, and that the plaintiff could not recover the amount of the notes given by the defendant.

Judgment of the County Court of Hastings affirmed on other grounds.

THIS was an appeal from the judgment of the County Statement. Court of Hastings.

The action was brought upon two notes made by the defendant for $150 each, payable, on or before the 1st day of January, 1890, to W. W. Hess or bearer, and transferred to the plaintiff under the following circumstances.

There was an alleged company called the Crawford, Henry and Williams County Seed Company, said to have been incorporated under the laws of the State of Ohio on the 1st of September, 1885, for the production and sale of grain and seeds. Their operations in the County of Hastings were carried on by a man named W. W. Hess with the aid of others who like the parties to the present action dealt with him. The nature and connection of these operations one with another are sufficiently illustrated by that in which the plaintiff and defendant were more immediately concerned. In 1888 the company through Hess delivered to Bonisteel 15 bushels of hull-less oats, which for

Statement.

commercial purposes were admittedly not worth more in the market than any other good quality of oats, but the price of which they agreed with Bonisteel should be $10 per bushel, and Hess took from him his promissory note for $150, giving him in return a bond or agreement to sell for him 30 bushels at $10 a bushel, in the following form:

A BOND.

No.

Capital Stock $100,000.00.

BRANCH OFFICE, BELLEVILLE, O.

THE CRAWFORD, HENRY AND WILLIAMS COUNTY SEED
COMPANY.

Incorporated under the laws of Ohio, Sept. 1st, 1885.
For the production and sale of Grain and Seeds.

It is agreed and understood by and between the parties
named in this Bond and said Company, that the
transaction covered by this obligation is of a specula-
tive character, and is not based upon the real value of
the grain.

KNOW ALL MEN BY THESE PRESENTS, That the Crawford, Henry and Williams County Seed Company, do hereby agree to sell bushels of hull-less oats for Mr. at $10 per bushel, less 25 per cent. commission, on or before of

IN TESTIMONY WHEREOF the said Crawford, Henry and Williams County Seed Company, has caused this Bond to be signed and sealed by the Secretary of said Company, this day of

This Company will not be held responsible for any outside contracts made by agents other than those expressed on face of this bond.

THE CRAWFORD, HENRY AND WILLIAMS COUNTY SEED Co.,
Per O. H. Brasington.

This Bond is void without the Company's seal and signature of the Secretary.

BY-LAWS OF THE CRAWFORD, HENRY AND WILLIAMS Statement.

COUNTY SEED Co.

SECTION 1ST.-All bonds shall be signed and sealed by Secretary of the Company, and the By-laws on the back of said Bonds attested by the President of said Company, and this Company will be responsible for their business transactions according to laws made and provided for governing Stock Companies in the State of Ohio, and under which this company was incorporated.

2nd. The members of this Corporation do hereby agree that if any one purchasing grain of the said Company for seed, and sown by said, purchaser, by any unavoidable cause, namely, fire, drouth, floods, &c., does not possess the amount called for in said Bond issued by said Company, then said company agrees to furnish the amount called for in said Bond, and sell the same as specified in the Bond.

3rd. This Company will only bond the same variety of grain one year to the same individual.

4th. All bonds of said Company shall be redeemed before any surplus grain is sold, and as soon as said bonds are redeemed, then each purchaser of grain from this Company shall have the right to sell all grain grown by him from seed purchased from said Company.

5th. It must be further agreed by said purchaser that he will do all he can to promote the sale of grain, and the interest of the Company, and that he will report to the office of the said Company any bad conduct or misdemeanour on the part of any agent representing said Company.

Any person desiring pany, address,

A. P. WITHAN, President. information regarding this ComW. W. HESS, Belleville, Ont. Bonisteel sowed his grain, raised his crop of 30 bushels or more, and when the time arrived for the performance of the bond the company or Hess had found in Saylor another party to the scheme who was willing to buy 30 bushels of oats at $10 a bushel and to give his notes for 65-VOL. XVII. A.R.

Statement.

$300 therefor, and to take the company's bond to sell for him 60 bushels at $10 a bushel. Bonisteel then, at the request of Hess, transferred the 30 bushels, which the company had agreed to sell for him, to Saylor in satisfaction of the latter's purchase from the company, and the company handed over to Bonisteel Saylor's notes for $300 in discharge of their obligation to him, he paying them in cash the commission and charges which he had agreed to pay them for selling his oats.

The defendant set up that the notes were obtained by fraud and without consideration, and were transferred to the plaintiff without consideration after they became due and with actual notice and knowledge of the fraud, and, also, that the whole transaction was fraudulent and void as against public policy. The defendant also set up that the notes were made by him in consideration of the bond or agreement of the company being carried out, that the bond or agreement had not been carried out, and that therefore the notes were void.

The action was tried before the Junior Judge of the county of Hastings on the 19th of March, 1890, and judgment was subsequently delivered, giving effect to the objection last mentioned, and dismissing the action without costs. It was not shown at the trial whether the company was really incorporated or not, but there was evidence that at all events, even if incorporated, it was not incorporated for any real commercial or agricultural purpose, but solely for the purpose of such transactions as were in question in the action. It was also shown that the present transaction was one of several hundreds that had been entered into in the county of Hastings, and that each party to every one of these transactions knew of their nature and knew that they could not be carried out without some one else being induced to enter into a similar one by means of which his own would be completed and the danger of loss thrown upon his successor.