Riddell v. Shirley

Heydenfeldt, J., delivered the opinion of the Court. Murray, C. J., concurred.

The facts, as found by the jury, show that Robinson, the vendor of the plaintiff, was in insolvent or embarrassed circumstances; that he [490]made the sale to discharge debts which were liens or charges upon his homestead, for the purpose of saving it to himself; of all which, the plaintiff was aware, at the time he made the purchase. This was certainly a transaction, calculated to hinder, delay, or defraud creditors. Although the law secures the homestead from execution arising from ordinary indebtedness, it is yet made chargeable for debts by the act of the parties interested in its preservation, and in some cases by operation of law. Where such cases exist, it would seem to be only fair, that the homestead should remain answerable for the debts charged upon it, and not, after becoming a source of credit, be relieved, intentionally, by the disposition of all the other property of the debtor, leaving nothing for the satisfaction of the other creditors. Such a sale, except to a creditor in payment of his debt alone, and free from knowledge.of or collusion with the object of the debtor, must be considered a fraud in fact and in law. It is a sale with the direct intent of benefit or advantage to the seller, to the injury of the creditors.

This view renders it unnecessary to consider separately the various points made on error.

The judgment is reversed, and the cause remanded.