KEMPNER
v.
CHURCHILL
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In this fraud case, the Supreme Court affirmed a lower court's judgment that Kempner fraudulently induced Churchill to sell him goods at an inadequate price by using threatening language about rumors in town and urging him to complete the transaction quickly. The Court held that while fraud must be proved rather than presumed, circumstantial evidence—including false receipts, hastily prepared accounts, and the removal of goods—can be as convincing as direct testimony and, combined with Kempner's own coercive statements, sufficiently established fraudulent intent despite the inadequacy of consideration alone not being conclusive proof of fraud.
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Mr. Justice GRIER, delivered the opinion of the court. It has been frequently held that fraud ought not to be presumed, but must be proved. But the evidence of it is almost always circumstantial. Neverthéless, though circumstantial, it produces conviction in the mind often of more force than direct testimony. It would be a troublesome, as well as an unprofitable task, to examine all the very astute arguments, founded on the large mass of testimony contained in the record, to show that the court below have come to a wrong conclusion. It suffices to say that it sufficiently appears that the evidence before'the court fully justified their conclusion. It is true that mere inadequacy of consideration, unless extremely gross, does not per se prove fraud. But the direct testimony here confirms the fact that Kempner urged the acceptance of his offer to purchase with arguments such as this: “ There is some pretty rough talk in town about you. You had better not delay this matter. You had better let me have the goods and put the money in your pocket, and let the creditors go to the devil.” The circumstantial evidence amply confirms this direct evidence of fraud. 1st. The false receipts given for full value on Saturday. 2d., The account of stock made out on Sunday. 3d. The removal of the goods into a cellar on Monday. The defendant’s endeavor to prove by experts, that the price given was sufficient, tends only to confirm the correctness of the'decree of the Circuit Court, which is Affirmed with costs.
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Hammond v. Hopkins, 143 U.S. 224 (U.S. 1892)
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Van Iderstine in Bankruptcy of Fellerman v. Nat'l Disc. Co., 227 U.S. 575 (U.S. 1913)
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Schreyer v. Scott, 134 U.S. 405 (U.S. 1890)
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