Page:Federal Reporter, 1st Series, Volume 10.djvu/141

 PADDOCK V. FISH. 129 �407, 415 ; and see DecJcer v. Boice, 83 N. T. 215 ;) and the same point has been ruled in regard to a bona fide grantee's title as against an assignee in bankruptcy under section 5046. Beall v. Harrell, 1 N. B. E. 400, per Bradley, J. I think the same effect must be given to a mortgage when taken by a honafide purchaser, as to a deed to a hona fide grantee. Such statutes concerning the efifect of fraudaient trans- fers are construed according to their design, to prevent frauds and provide remedies against them; but not to create new frauds by applying the statutes against persons who deal in good faith upon the strength of apparent titles. Untii levy or bill filed, or some notice of the fraudaient character of the previous transfers, hona fide encum- brancers are, therefore, protected, and the remedies of creditors, or those representing them, are transferred to the proceeds, which stand in the place of the property sold or encumbered by the fraudaient grantee. �I do not perceive in the evidence any reason to doubt that Lam- bert bought this bond and mortgage in good faith. It was offered for sale at a discount, like numerous others at the same time. It was a second mortgage preceding a prier mortgage of $4,000. There was nothing unusual in the cireumstances. Lambert went to look at the property, and was satisfied of its value, His son, a lawyer, examined the title, and reported the title satisfactory, and thereupon he paid $850 on March 21st, of which $114.50 was used in paying the taxes on the property for the year 1873, and the balance, $735.60, was given to the assigner. AU this was in the usual and customary course of sach transactions. Lambert is legally chargeable with knewledge, through his atterney, that the deed to Mrs. Fish, two months before, was fer $10, and natural love and affection. But he did not know Eugene Gammeyer, nor anything about his business or cireumstances, nor whether he was in business or had any creditors; and nothing naturally suggested any inquiry on that subject. The epen gift to his mether of the heuse in which she lived, as shown upon the face of the deed, weuld not naturally suggest the idea of any intended fraud upon creditors. Such frauds are usually accompanied by some eencealment. Searches against the property and against Mrs. Fish disclosed no claims against either by any one, and nothing indicated that Eugene Gammeyer had anything to do with the mortgage offered for sale by Augustus. It was not apparently given as a considera- tion of the conveyance; nor was it executed to Eugene, but to AugustuB ; and it does not seem to me that the cireumstances would v.lO.no.l— 9 ��� �