1803.

MATTER OF MEAGHAN, A BANKRUPT.

MR. HENCHY moved on the petition of the assignees,

July 1.

A trader on

receives 6002.

his wife's por tion, and gives a bond for

1,000%. to a

trustee, the in

that the proof of a debt of 1,000l. made by John Parker his marriage as trustee in the marriage settlement of the bankrupt and his wife, might be expunged, on the ground of the provisions in the settlement being fraudulent as to creditors. By marriage settlement dated 29th July 1797, made between terest payable the bankrupt of the first part, his then intended wife of the to himself for life, if he shall second part, and the trustee of the third part, it was agreed continue solthat 600%. part of the marriage portion of the wife, should vent but in case be paid to the bankrupt upon his executing a bond and warrant in a penal sum of 2,000l. conditioned for payment of 1,000% with lawful interest for the same within six months from the date thereof; and it was provided by the settlement that the said bond and warrant, and the money thereby secured should be held in trust from and after the solemnization

of the marriage to pay and dispose of the interest thereof to the bankrupt for life, in case he should continue solvent; and in case of his becoming insolvent or in case of his death, then in trust to pay and dispose of such interest thereof as should accrue due from such death or insolvency, to such persons and uses and in such proportions as the wife should notwithstanding her coverture appoint, to the intent that the same might not be subject to the debts of her husband; and in default of such appointment to the sole and separate use of the wife: and from and after the decease of the survivor, in case said bankrupt should continue solvent during his life, (but if not, then after the decease of the wife and the insolvency of the bankrupt) upon trust to pay the principal to and

of his death or

insolvency, the interest to his

wife for her life and the princi. pal among the children of the marriage. On bis bankruptcy, the claim of the trustee on be

half of the wife, for interest, allowed, as far as the 600%. but

not for the remaining 4001.

1803.

MEAGHAN, a Bankrupt.

amongst the children of the marriage, and in default of issue to the survivor of husband and wife.

Mr. Huband on the part of the trustee, argued that this was not a fraudulent settlement, and cited Ex parte Groome, 1 Atk. 115, ibid. 113, 120, 8 T. R. 589,(a) 2 Bl. 1106; Wyllie v. Wilkes, Dougl. 501, 2 Ves. 450, and 1 Atk. 251.

Mr. Henchy in reply mentioned the matter of Murphy, a Bankrupt, ante 44, and Ex parte Henecy, cited ante 46.

Lord CHANCELLOR.

This is a bond, which is a debt due, and nothing fraudulent is suggested but one stipulation, namely, as to the interest in case of insolvency. In England, where a provision of this kind is confined to the property of the wife, it is considered fair; but when it goes beyond that and attaches on the property of the husband it is held to be fraudulent, because no bounds can be set to it: if a trader can make a provision of this sort to the amount of 1,000l. he may do so to the amount of 100,000l. and so may stipulate on his marriage to take all his property out of the hands of his creditors by charging it, contingently, with payment of interest for his wife and children, as a maintenance for them, though in effect a provision for himself. In this case the interest so far as the dividend on 600%.: (the wife's fortune) must be paid to the separate use of the wife

(a) Staines v. Plank. Vid. the passage cited ante, p. 46, and commented on by the Lord CHANCELLOR, p. 48. His Lordship now took occasion to observe that Lord KENYON merely meant to say that a debt of this description might be so framed as to be proveable on the insolvency: but that it was merely a dictum, not necessary to the decision of the case, and pronounced by Lord KENYON after his Lordship had been long out of the habits of practice in a court of equity.

according to the settlement: but as to the dividend on the remaining 400/. it falls within all the cases.(a)

"Let the proof of the debt of 1,000l. in petition men"tioned stand, but declare that the trusts of the settlement, "so far as they give the interest of 400/ part of the said "1,000l. to the wife and children during the life of the "husband upon his becoming insolvent, ought to be deemed "fraudulent and void. And let the interest of the dividends "to be received on such debt to the extent of six-tenths "thereof only be paid to the trustee of the wife of said "bankrupt to her own separate use for life. And let the "interest on the remaining four-tenths be paid to the as"signees during the life of said bankrupt: and upon the "death of said bankrupt, living the wife, let the interest be 66 paid to the trustee of said wife for her life; and upon the "death of the said wife, living the husband, let the interest "be paid to the trustee for the benefit of the children, if "there shall be any, for the life of the husband: and upon the death of the survivor of husband and wife, let the principal and interest be paid and applied for the benefit "of the children, if any, according to the settlement: and "if none, then let the principal be paid to the wife if she "shall survive the husband, and if the husband shall survive "then to the assignees, according to the trusts of the set“tlement."

66

(a) Lockyer v. Savage, 2 Str. 947.

1803.

MEAGHAN, a Bankrupt

1803.

June 21, 23.
July 2.

A beneficial

lease obtained

under the influ

money made

or expected to be made by the

lessee to the lessor, is a fraudulent eva

sion of the statutes of usury, and an undue advantage taken of the les sor, and there

fore void.
The court
will not open a
settled ac-

DREW v. POWER.

THE bill stated that plaintiff, being tenant for life of his

estates with a power to make leases thereof for three lives or ence of loans of thirty-one years at the best improved rent and without taking a fine, became very much embarrassed in his circumstances and several executions issued against his person and property: That about March 1789, he represented his situation to the defendant, who was married to his sister, and who was perfectly acquainted with the nature of his property: That he communicated to defendant his wish to raise money to pay off the most pressing of his debts, which defendant highly approved and urged him to execute, and when he found he had increased plaintiff's anxiety to extricate himself from his embarrassments, he told plaintiff that two denominations count, where it of his estate, called Poulagower and Knockavin would shortly has been signed on a security be out of lease, and that if plaintiff would make him a lease taken on the thereof for three lives at the rent of 2001. sterl. per ann. foot of it, unless the whole he would, from the friendship he had for plaintiff, adtransaction apvance him money sufficient to pay off all his debts, and pears fraudulent, upon er- would in the course of three months pay off such as were rors specified in the bill and most pressing. Induced by this prospect of being extricated supported by from his difficulties, plaintiff promised the defendant to evidence. execute a lease agreeable to his proposal, and defendant shortly after began to make advances to plaintiff, principally by giving his own promissory notes payable at very long dates, and by bills drawn on different persons in favour of plaintiff, and continued to make advances of this nature until Nov. 1790; but these bills were drawn on mere nominal acceptors, and few of them solvent, so that when the bills became due, plaintiff was obliged to apply for payment to

defendant, who used every artifice to delay payment; by which means plaintiff's embarrassments were greatly increased. The bill further stated that about 16th Nov. 1790, defendant prevailed on the plaintiff to settle a general account on the foot of these advances, and on the foot of other dealings which had taken place between them, in which account defendant charged interest on the several sums for which plaintiff passed his bills or notes to defendant from the days on which they became due, although plaintiff charged that the greater part of them were suffered to remain a long time unpaid: That plaintiff was obliged to pay large sums in discount to get money for these notes and bills; and that many of them had never been paid by defendant: that by these means a balance was made to appear against plaintiff to the amount of 1,008/. 15s. and for this balance defendant prevailed on plaintiff to execute his bond with warrant of attorney for confessing judgment thereon. The bill charged that immediately after obtaining this bond, defendant required plaintiff to execute a lease to him of the lands of Poulagower and Knockavin agreeable to his promise, on the faith of which he alleged he had advanced him so much money; and that plaintiff under the pressure of his distresses and from the hope of defendant continuing to make him further advances, was prevailed upon to execute a lease of these lands at a rent of 2001. per ann. for three young lives, which lease was made to bear date the 1st April 1791, although really executed on the 16th Nov. 1790; and the rent was made to commence from 25th March 1791, as there was a subsisting lease of these lands which was not to expire until 25th March 1791, and defendant knew that plaintiff was restricted by his settlement from making leases in reversion: That this lease contained a covenant on the part of defendant to lay out a sum of 1254. in valuable improvements, which he had not done, and also a clause of surrender, which (the bill charged)

1803.

DREW

V.

POWER.