reach of creditors, future as well as present, the property to which they had a right to resort for the payment of their debts." This presumption would necessarily arise if the grantor contracted debts immediately or so soon thereafter as to show that he reasonably had in contemplation the contracting of such debts at the time the transfer was made. From his inability to pay and the voluntary alienation the conclusion would naturally follow that he did not intend to pay such debts when they were contracted, and that the conveyance of the property was intended to delay or prevent the collection thereof by the sale of the property under due process of law: Winchester v. Charter, 12 Allen, 606; Winchester v. Charter, 97 Mass. 140; Morrill v. Kilner, 113 Ill. 318, 322; Moritz v. Hoffman, 35 Ill. 553; Taylor v. Coenen, L. R. 1 Ch. Div. 636, 641; Reade v. Livingston, 3 Johns. Ch. 501, 502; 8 Am. Dec. 520; Redfield v. Buck, 35 Conn. 328, 337; 95 Am. Dec. 241; Ridgeway v. Underwood, 4 Wash. C. C. 137; Howe v. Ward, 4 Greenl. 195, 206; Sexton v. Wheaton, 8 Wheat. 229, 252; Horn v. Volcano Water Co., 13 Cal. 71, 72; 73 Am. Dec. 569; Bump on Fraudulent Conveyances, 3d ed., 322; 2 Bigelow on Frauds, 99, 181, 200; May on Fraudulent Conveyances, 75; 1 Am. Lead. Cas., 5th ed., 42; 2 Pomeroy's Equity Jurisprudence, sec. 973.

This case is a fair illustration of the rule. At the time of the execution of the conveyance in question George H. Rudy was insolvent; his liabilities far exceeded his ability to pay. His vocation was farming. He had been engaged in that business for many years previous to the execution of the deed by Divilbliss and wife, and continued to farm many years thereafter. He had no other occupation, so far as is shown by the evidence. In following his vocation he purchased extensively goods, wares, merchandise, and supplies needed to support his family and in his farming operations, on a credit, from merchants in Van Buren. He made large crops, and, when gathered, delivered them to the merchants to whom he was indebted, to be appropriated to the payment of his accounts. His crops would fall far short of paying his debts, and the result was he continued to farm and contract debts and pay them in this manner every year, so far as the proof shows, using the crops of one year to pay the debts contracted in the preceding year and the current year, so far as they would extend, and was always in debt with his merchants. In this way he did business with Lynch prior to

and at the time of the execution of the deed to appellant, and was in debt to him when the lots in controversy were conveyed to his son. In this way he continued to do business with him until he became a partner of Neal. In 1871, a short time after the execution of the deed in question, he commenced buying of Neal, and in this way purchased from him and delivered crops on account until 1874, when he and Lynch became partners, and in this way did business with them until 1881; and in this way commenced business with Austin in 1876, and did business with him in the years 1876 and 1877. His habits and necessities of business were such as to plainly show that he, at the time he caused the lots to be conveyed to his son, necessarily had in view and knew that he would contract debts in the manner he did, and that his intention in procuring the execution of the deed to his son was to put beyond the reach of his creditors, antecedent and subsequent, the lots in controversy, and to deprive them of the right to appropriate them by due process. of law to the payment of his indebtedness. He could not reasonably have had any other motive. His son was about six years old, and there was no occasion for making any such provision at that time. All these facts go to prove the uncontroverted allegation of the cross-complaint that he caused the deed to be made to the appellant in order to defraud his existing creditors, "and in anticipation of and reference to his subsequent indebtedness and insolvency"—to defraud his subsequent creditors.

In paying the debt which he owed to Lynch at the time of the execution of the deed to his son, he did so by contracting another with Lynch and Neal in lieu of it, and thus continued to pay one by contracting another until he contracted the indebtedness of six thousand dollars, in the payment of which he attempted to convey the lots in controversy, by authority of the probate court. In this way Lynch and Neal, if not Austin, became subrogated to the right Lynch had to treat the conveyance in question as fraudulent (he being a creditor at the time it was executed), and to have the same set aside; became entitled to the same rights as those of the creditors whose debts their means have been used to pay: Barhydt v. Perry, 57 Iowa, 416, 419; Madden v. Day, 1 Bail. 337, 587; Mills v. Morris, Hoff. Ch. 419; Brown v. McDonald, 1 Hill Ch. 297, 304; Savage v. Murphy, 34 N. Y. 508; 90 Am. Dec. 733; Churchill v. Wells, 7 Cold. 364; Wilson v. Buchanan, 7 Gratt.

334; Paulk v. Cooke, 39 Conn. 566, 572; Anon, 1 Wall. Jr. 107; Creed v. Lancaster Bank, 1 Ohio St. 1; Bump on Fraudulent Conveyances, 3d ed., 322; Wait on Fraudulent Conveyances, 2d ed., 103; Am. Lead. Cases, 5th ed., 44.

Our conclusion is, that the conveyance to the appellant was fraudulent, and can be so treated by the creditors in this action: Acts of 1887, 193.

As it does not appear that George H. Rudy had any creditors at the time of his death except Lynch, Neal, and Austin, and the lots in controversy are not worth exceeding two thousand dollars, and as the indebtedness, in satisfaction of which the same were sold, amounted to six thousand dollars, exclusive of interest, and as it is to the interest of Rudy's estate and heirs that the contract of Rudy and his creditors, and the sale made in conformity therewith, should be permitted to stand, and as the conveyance to John M. Rudy is fraudulent and void, and he concedes that, this being true, he has no further interest in this cause, and has no objection to any course that this court may take in appropriating the lots in controversy to the payment of his father's debts, we decline entering into the consideration of what the proper practice as to the disposal of the lots is, and no one concerned, under the circumstances, objecting, affirm the decree of the circuit court.

Affirmed.

HEMINGWAY, J., did not sit in this case.

In the case of Crampton v. Schaap, 56 Ark. 253, it appeared that one Sey bert, before becoming indebted to the plaintiff, Schaap, purchased real prop. erty and caused it to be conveyed to his wife; that she, upon his death, administered upon his estate, and the whole thereof was set aside to her, and she had later also sold the property thus conveyed to her, and had then intermarried with her codefendant, Crampton. The trial court ordered moneys owing to Mrs. Crampton and derived from the estate of her husband to be paid to plaintiff. In reversing this decision the appellate court reaffirmed the rule stated in the principal case, to the effect that to avoid a voluntary conveyance a subsequent creditor must show that it was made with an actual intent to defraud, and that the presumption that such was the intent cannot be created merely by proving the existence of an indebtedness when the conveyance was executed; that the presumption of fraud does arise on proof that the grantor was insolvent at the time of the transfer, but that such presumption is not conclusive in favor of subsequent creditors. These rules were, however, held inapplicable to the controversy, because it did not appear that soon after the making of the conveyance the grantor contracted debts which he could not have reasonably expected to pay, nor was any connection shown between his debts existing at the transfer and

the debt of the plaintiff created some nine years after the date of the conveyance, nor that any of the debts existing at the transfer had been paid by contracting other debts, nor that there was any reason for subrogating plain. tiff to the rights of any creditor whose claims arose prior to the conveyance. VOLUNTARY CONVEYANCES-EFFECT OF AS TO EXISTING CREDITORS. —A voluntary conveyance of his property by an embarrassed debtor is pre sumptively fraudulent as to existing creditors: Driggs etc. Bank v. Norwood, 50 Ark. 42; 7 Am. St. Rep, 78, and note. A voluntary conveyance will be treated as fraudulent and void as to existing creditors: Snyder v. Partridge, 138 II 173; 32 Am. St. Rep. 130, and note. This question is thoroughly discussed in the monographic notes to Hagerman v. Buchanan, 14 Am. St. Rep. 739, and especially at page 746; and Jenkins v. Clement, 14 Am. Dec. 706.

VOLUNTARY CONVEYANCES-RIGHT OF SUBSEQUENT CREDITOR TO ATTACK: Fullington v. Northwestern Importers' etc. Assn., 48 Minn. 490; 31 Am. St. Rep. 663, and note with cases collected; Daggett etc. Co. v. Bulfer, 82 Iowa, 101; 31 Am. St. Rep. 464, and note; extended note to Hagerman v. Bu chanan, 14 Am. St. Rep. 750; and extended note to Jenkins v. Clement, 14 Am. Dec. 706–708.

PEARSON V. STATE.

[56 ARKANSAS, 148.]

MUNICIPAL CORPORATIONS—RIGHT OF LEGISLATURE TO RELEASE OBLIGATIONS TO.-If the treasurer of a county has become liable on his official bond to the various school districts therein, on the ground that their moneys were taken by burglars without his fault from a safe furnished him by the county, it is competent for the legislature to release him from such liability.

CONSTITUTIONAL Law-Gift of PUBLIC PROPERTY, WHAT IS NOT.-An act

of the legislature releasing a county treasurer from liability for moneys stolen from him without his fault by burglars is not a gift of municipal or public property, but a release of a claim which, though legally due, the legislature finds it to be unjust and oppressive to enforce.

A. S. McKennon, for the appellant.

Anthony Hall, for the appellee.

HEMINGWAY, J. The single question in this case is, whether it was competent for the legislature to release the treasurer of Logan county from his liability to pay the county and various school districts therein the amounts received by him for them, on the ground that the money was taken by burglars, without fault on his part, from a safe furnished him by the county for keeping it.

The appellant contends that the power of the legislature was absolute; that counties and school districts are but agencies of the state created by it to aid in the conduct of govern

ment, and that they, with their possessions, are subject to the will of the legislature, to be controlled, maintained, or destroyed as it directs-except as the power is limited by provisions expressly applicable to it.

The burden is upon the appellee to show that the power is denied to the legislature. He insists that it is denied: 1. By the provision of section 3, article 14, of the state Constitution, which ordains that no school tax shall be appropriated to any other purpose nor to any other district than that for which it was levied; and 2. By the provisions of the state and federal constitutions that prohibit legislation divesting property rights or impairing the obligation of contracts: Const. 1874, secs. 8-17, 21, art. 2; Const. U. S., sec. 10, art. 1, 14th amdt. We think it clear that the appellee's first ground is not well taken. The provision relied upon prohibits only certain appropriations of the school tax, and as the act of the legis. lature relied upon by the appellant did not appropriate the school tax, or any part of it, it does not contravene that provision.

The school tax, to which alone the constitution applies, had been appropriated by burglars, as the preamble of the act recites, before its passage, and was not subject to legislative appropriation. The act did not concern it, but concerned only the liability of a keeper of public money, by the terms of a bond, to indemnify the various municipalities interested in it against his failure to pay over moneys thus lost. If the enactment transcended the powers of the legislature, the limitation must be found in the other provisions relied upon, and not in the one under consideration.

If the bond had been executed to a private individual it is clear that the legislature could not have released the liability; but whether the constitutional provisions for the protection of private contract, and property rights, which are found in much the same form in the constitutions of most of the states and of the United States, apply to the contracts and property of municipal and quasi municipal corporations is a question upon which judicial deliverance has been frequent, full and not entirely uniform. There is no legal question upon which the books contain a richer or more abundant treasure of learning and judicial argumentation.

It was indicated in Dartmouth College v. Woodward, 4 Wheat, 518, that the right of the legislature, as regards the property of municipal corporations, was broader than existed in the