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6 Cal. 119

Chenery v. Palmer

California Supreme Court

Decided July 1, 1856

California Supreme Court · decided 1856-07-01

The plaintiff received from C. J. Hutchinson a bill of sale for 250 head of cattle, November 30th, 1853. It appears from the testimony, and is admitted, that the bill of sale, though absolute on its face, was intended only as a mortgage to secure certain sums paid and to be paid by Chenery for Hutchinson.

Good law ✅— No negative treatment on recordhow we know

Decided 1856-07-01

How this case has been cited

Cited by 11 later decisions — most recently November 1909

1 district · 9 state decisions

40185618601870188018901900decided

Later decisions citing this case, by decade. The current decade is in progress, and our corpus holds fewer opinions from the most recent years, so the latest bars are undercounted — not a real decline.

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The first opinion of the Court was delivered by Mr. Justice Heydenfeldt,

¶1Mr. Chief Justice Murray and Mr. Justice Terry concurring.

¶2If the conveyance from Hutchinson to the plaintiff was a sale of the property, then it was void as to creditors for the want of immediate delivery, by the 15th section of the Statute of Frauds.

¶3That it was not an actual sale, but only a mortgage, might be a question to be investigated between vendor and vendee, to prevent an attempted fraud by one against the other; but where the rights of third persons are to be affected, it is not the province of either to alter or vary the terms of the written instrument, given and accepted between them as the evidence of their respective rights.

¶4If the bill of sale was, by a private understanding between the parties, to operate only as a mortgage, then it was a secret trust to the extent of the surplus over the debt secured, for the benefit of the vendor, and void by the 11th section of the same statute. It was placing the property beyond the reach of his creditors, who certainly had the right, except it maybe under peculiar circumstances, to avail themselves of the surplus. In what manner this could be done, it is unnecessary here to determine, and may depend upon the circumstances of each case.

¶5Wherever there is no dispute as to the facts, and the law upon those facts declares a transaction fraudulent and void, it is not a question for the jury. The Court in such case may direct the jury how to find, or set aside the verdict if they find the contrary. See Billings v. Billings, 2 Cal. R.

¶6Upon the whole case as presented by the record, the judgment helow is correct, and must be affirmed.

On the re-hearing, the opinion of the Court was delivered by Mr. Chief Justice Murray.

¶7Mr. Justice Terry concurred.

¶8A re-argument was had in this case, upon a suggestion that advances had been made by Chenery to Hutchinson, after the delivery of the property in question.

¶9If the relation of the parties had béen that of bailor and bailee, or pledgor and pledgee, then there would be no doubt but the plaintiff might assert his claim for these advances, thus made upon the property in his possession. There is no evidence however that the original contract was ever abandoned. In fact, it appears from the testimony of Hutchinson that these same advances were contemplated and agreed ón at the time of the original sale or mortgage. Under these circumstances the contracts must be regarded as an entirety, and however honest the intentions of the parties, the law from motives of public policy having-declared the contract void, all subsequent acts under it must relate to its inception, and are alike tainted with fraud.

¶10*123We axe disposed to regard this as a hard case, but do not see how the consequences can be avoided, as any other rule would enable a party to cure a fraudulent conveyance by subsequent payments or advancements made in good faith.

¶11The whole contract is indivisible, and must stand upon the legality or bona Jides of its inception. The judgment heretofore rendered is affirmed.

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