Fraudulent transfer

“ The burden is upon the attacking creditor, but where the fraudulent intent on the grantor's part is made out, and the circumstances are suspicious, the purchaser must show that he has paid value; and, if he does, it must then appear that the purchaser had notice of the fraud. ”

“ It is too obvious for comment that in all this the only use of the words fraud and fraudulent is to stigmatize acts which are adverse to the plaintiff's view of his own rights. But there is not a syllable which defines an act fraudulent in nature, or done or performed under the influence of corrupt motives, or by corrupt means, by the defendant or by any of the land officers who have had to deal with his claim. ”

“ The defendants insist that it was made with the fraudulent purpose, on the part of the vendors, of cheating, hindering, and delaying their creditors, and that the vendees either intended by their purchase to aid in accomplishing that result, or, at and before their purchase, were chargeable in law with notice of the fraud designed by the vendors. It is unnecessary to set out all the facts which, according to the bill of exceptions, the evidence tended to establish. ”

“ The promise not to assign with preferences against the bank does not of itself avoid such an assignment for fraud.
'It is claimed, however, that the deed is fraudulent and void on its face, (1) because it appropriates partnership assets to the payment of individual debts in preference to the debts of the partnership; and (2) because of the peculiar provision which is made for bidding by the creditors of the second class at any public sale that may be made of the assigned property. ”

“ But we are not. To obtain money was the sole object of this fraud. The use of the mails was crucial to the total success of the fraudulent project. We are not justified in chopping up the vital banking phase of the scheme into segments and isolating one part from the others. That would be warranted if the scheme were to defraud the collecting bank. ”

“ If the defrauded seller can reach the goods before they have left the hands of the fraudulent person, he may replevy them or he may seize them if that is possible. It is not worth while to go into the various kinds of fraud that may be practiced in the sale of goods, but there is one specific kind that comes up very commonly which is worth mentioning ”

“ There is no necessary connection between the intent to defraud and that to prefer, but in asmuch as one of the common incidents of a fraudulent conveyance is the purpose on the part of the grantor to apply the proceeds in such manner as to prefer his family or business connections, the existence of such intent to prefer is an important matter to be considered in determining whether there was also one to defraud. ”

“ To advance money for a son-in-law to repair the frauds he had committed, even with the hope of concealing the perpetration of them, is not, we think, an offence which may not be excused; nor can a security taken for the repayment of money so advanced be deemed fraudulent. If the notes were to be taken upon condition that the holders would forbear to prosecute the criminal, or if the repayment of the money advanced were to depend upon his escape from prosecution, the validity of the contract might well be questioned. ”

“ It is no answer to this liability to say that the act done by the agent was of a fraudulent character, and that the principal did not authorize the commission of a fraud. For a fraud committed by a partner or an agent the principal is not liable criminally; but he is liable in a civil suit if the fraud be committed in the transaction of the very business in which the agent was appointed to act. ”

“ Nicoll, 4 Pet. 295, and must be considered as binding on court and jury, in deciding on this part of the case.
'To taint a transaction with fraud, both parties must concur in the illegal design; it is not enough, to prove fraud in the debtor; he may lawfully sell his property, with the direct intention of defrauding his creditors, or prefer one creditor to another; but unless the purchaser or preferred creditor receives the property with the same fraudulent design, the contract is valid against other creditors or purchasers who may be injured by the transaction. ”

“ Their language is that the officers and people have conspired together for the purpose of defrauding the plaintiffs, and to prevent them from obtaining service of process. Is it fraud in a debtor to endeavor to evade the service of process? Is it any more fraudulent than it is not to pay the debt? Fraud is not the proper term to apply to such conduct. It may be morally wrong. It may be dishonest; but it is not fraudulent in the legal sense of the term. Inability to serve process on a defendant has never been deemed an excuse for not commencing an action within the prescribed period. ”

“ This fraud did not spend itself with the execution of the contract. Its taint entered into every swollen estimate which was the basic cause for payment of every dollar paid by the P.W.A. into the joint fund for the benefit of respondents. The initial fraudulent action and every step thereafter taken, pressed ever to the ultimate goal payment of government money to persons who had caused it to be defrauded.
Government money is as truly expended whether by checks drawn directly against the Treasury to the ultimate recipient or by grants in aid to states. ”

“ The principle laid down in the charge of the judge, that one who claims to have been drawn into a fraudulent purchase must exercise care and vigilance to discover the fraud, and must be prompt in repudiating his contract on the ground of such fraud, is a sound one. ”

“ In § 60 merely preferential transfers are defined, and the terms on which they may be set aside are provided; in 67e, transfers fraudulent under the well-recognized principles of the common law and the statute of Elizabeth are invalidated. ”

“ He did not elect to do this, however, but brought an action of trover, setting up a fraudulent conversion of his property by defendants. In the first five counts of his declaration he charges a fraudulent conversion of his interest in the stock, and, in the last five counts, that the defendants had induced him to make further payments on such stock in the way of margins, by false and fraudulent representations. ”

“ And thereupon the said defendants further excepted to the following matters or propositions of law contained in the said charge, to wit:
'We now come to the inquiry, whether the assignment is valid or void.
'It is alleged to be fraudulent in fact, and in law. Fraud, in fact, consists in the intention to prevent creditors from recovering their just debts, by any act which withdraws the property of a debtor from their reach; both parties must concur in the illegal intention. ”

“ E. By Statute of Frauds and Fraudulent Conveyances. All gifts, grants, loans, alienations or conveyances made with fraudulent purposes were valid only between the parties making them and their heirs, assigns, and administrators, and in no way barred the action of creditors. [163] A conveyance of goods or chattels, without a valuable consideration, was considered fraudulent, unless it was made by a will duly proved and recorded or a deed acknowledged and proved. By act of 1805, such recording had to be done within nine months to be valid against creditors or future purchasers. ”

“ The charge, it is, therefore, submitted, annuls the whole law of notice as to fraudulent conveyances, and makes every one a fair purchaser, who is not a participator in the fraud; so that a wife or father have only to remain wilfully ignorant of a husband's fraud, and a family settlement will be valid of property acquired by highway robbery. ”

“ A mere doubt or suspicion of the fairness of the transaction, ought not to be sufficient to lead to the finding of any act to be fraudulent, unless the conduct and situation of the parties, and the effects intended to be produced by the act, appear inconsistent with their integrity, and admit of no reasonable interpretation but meditated fraud, to be effected by the agreement, sale or deed ”

“ As noted, the decision below was based squarely on the Second Circuit’s 1982 decision in Margiotta, and we therefore begin by briefly recounting the events that led up to and followed that decision. The federal wire fraud statute, §1343 (like the older federal mail fraud statute, §1341) , targets the use of certain instrumentalities to advance “any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises.” ”

“ As an initial matter, I note that §17 (a) (2) does not require scienter, so the maker of the statement may still be liable under that provision. Aaron, supra, at 695–697. Moreover, an ongoing, “egregious” fraud is likely to independently constitute a primary violation of the conduct-based securities laws, wholly apart from the laws prohibiting fraudulent misstatements. ”

“ II. We contend that there was actual fraud by the commissioners in the execution of their trust; and if we admit the special act of February 14, 1844, to be valid, the sale and conveyance made by the commissioners to themselves and their partners are void.
A trustee who becomes a purchaser of the trust estate is, in the estimation of law, a fraudulent purchaser; and, because of the temptation and opportunity to commit fraud, and the ease with which he can cover it from detection, such purchase is of itself a fraud, and a title procured under it is void, at the option of the cestui que trust. ”

“ Minch, which was an action to recover back money paid on a policy fraudulentl obtained by a husband on the life of his wife, the fraud not having been discovered until after the money was paid, the court said: 'Again, if the husband, as the agent of the wife, procured the policy by fraud, she cannot retain the benefit of it, and be relieved from the consequences of the fraudulent means by which it was obtained. It is established that an innocent principal cannot take an advantage resulting from the fraud of an agent without rendering dering himself civilly liable to the injured party. ”

“ It is different from the case of a lost note of bond. Fraud is charged, and documents exist which in equity ought not to exist. I think the complainant is entitled to have the fraudulent transaction wiped out, and to be restored to his original status. ”

“ On the other hand, if the fraud itself be secret in its nature, and such that its existence cannot be readily ascertained, or if there be fiduciary relations between the parties, there need be no evidence of a fraudulent concealment other than that implied from the transaction itself. ”

“ Brading is clearly an aider and abettor of the scheme to defraud, which a State may punish, but is he an aider and abettor of the federal offenses of using the mails to defraud and causing the fraudulent check to be carried across state lines? I think not, unless we are willing to say that aiding and abetting the scheme to defraud is aiding and abetting any means used for the consummation of the fraud. Brading must aid and abet the federal crimes, not just the fraudulent scheme. ”

“ The question before us, then, is whether, in view of the state of the evidence upon the defense that the notes were procured by fraud, the trial court erred in directing a verdict for the plaintiff. It is apparent that there was evidence sufficient to go to the jury that the signatures of some of the defendants had been obtained by means of fraudulent representations. Upon this point, the supreme court of the territory said: 'The defense, as we have seen, was principally that the signing of the notes was procured by fraud. ”

“ There was no evidence of fraud, unless the facts which have been referred to justify the inference of fraud. We are at a loss to understand how fraudulent conduct can justly be imputed to a pledgee when it appears that whatever was done in executing the power of sale was on e in full compliance with the terms of the pledge, and when there is no evidence that any unconscionable advantage was taken of the pledgeor or his creditors. ”

“ When the intent is to pay, it is necessarily understood by both parties, and need not be expressly represented as existing. When the intent is not to pay, it is of course concealed. Whether the deceit is called a false and fraudulent representation of the existence of an intent to pay, or a fraudulent concealment of the existence of an intent not to pay, the fraud described is, in fact, one and the same fraud. ”

“ The penalty of forfeiture is annexed to the act of making an entry knowingly by means of false invoices, or false certificate of the consul, or of any other invoice which contains an undervaluation, or by means of any other false or fraudulent documents or papers. No doubt one of the objects of the provision is to secure to the government the duties imposed by the statute, but another is, to protect the officers against imposition and fraud by the importer or agent, and to inculcate and enforce good faith and honest dealing with those officers while engaged in the execution of their duties. ”

“ Indeed, it is impossible for a person to embezzle the money of another without committing a fraud upon him. The definition of the word 'embezzlement' is given by Bouvier as 'the fraudulent appropriation to one's own use of the money or goods intrusted to one's care by another.' In San Francisco v. ”

“ Cases of fraud are recognized exceptions to the general rule that the commission of one wrongful act has to legal tendency to prove the commission of another. Such other acts always have a bearing upon the questions of fraudulent intent or guilty knowledge where they are in issue. Thus, a single act of passing counterfeit money is very little, if any, evidence that the party knew it was counterfeit, since the innocent passing of such money is an every-day occurrence ”