Nicholson v. Schmucker

Citations

• 81 Md. 459
• 32 A. 182
• 1895 Md. LEXIS 58

Syllabus

<p>Insolvency — • Unlawful Preference — BonaPide Sale — Statute of Frauds.</p> <p>A conveyance of real estate made by a person who is adjudicated an insolvent within four months thereafter, is not void as a preference under the insolvent law, when the consideration thereof was paid prior to the date of the deed, and the same was executed in pursuance of a valid contract to make the conveyance.</p> <p>Defendants, who were co-owners with N. of certain real estate, agreed to buy his interest therein for $7,000. Certain negotiable bonds belonging to defendants were in the possession of N. for safe-keeping, and it was agreed that he should take seven of these bonds in payment for the property. The deed from N. was not executed until more than'a month after the agreement. At the time the agreement was made N. had, without the knowledge of the defendants, hypothecated one of their bonds and sold another, but defendants believed N. to be solvent, and there was no intent to acquire a preference. Within four months after the execution of said deed, N. was adjudicated an insolvent, and his trustee in insolvency filed a bill to vacate the conveyance, as containing an unlawful preference. Held, that the deed did not create such preference, but was a bona fide conveyance for a consideration paid at the time, and as such is valid under the Act of 1890, ch. 364.</p> <p>In the above case the parol agreement to convey the land was not void under the Statute of Frauds, since it was fully performed on both sides.</p>