delivered the opinion of the Court:
The first question presented is: Whether the defendants, Cranmer and Carson, were competent witnesses, to speak *575as to the actions, or conversation of the grantor, or to give their opinions of his sanity at the time the deed was' executed, founded upon such actions or conversations at the time of the execution of said deed, or at any other time. Section 23 of chapter 130 of the Code provides, that:
“ A party to a civil action, suit or proceeding may be examined as a witness in his own behalf, or in behalf of any other party in the same manner, and subject to the same rules of examination as any other witness, except as follows
Then follow seven exceptions, the first and second of which are as follows:
“ 1st. An assignor of a chose in action, shall not be examined in favor of his assignee, unless the opposite party be living.
“ 2d. A party shall not be examined in his own behalf, in respect to any transaction or communication had personally with a deceased person, against parties who are the executors, administrators, heirs-at-law, next of kin, or assignees of suoh deceased person, where they have acquired title to the cause of action from or through such deceased person, or have been sued as such executors, administrators, heirs-at-law, next of kin, or assignees. But where such executors, administrators, heirs-at-law, next of kin, or assignees shall be examined on their own behalf in regard to any conversation or transaction with such deceased person, then the said assignor or party may be examined in regard to the same conversation or transaction.”
This section was mainly taken from the New York Code of procedure, and a number of cases are found in the reports of the decisions of that state on the construction thereof. In Clarke v. Smith, 46 Barb. 30, the court held: “ The Code, section 399, prohibits the examination of a party in respect to any transaction or communication, had by the party personally with a deceased person. The plaintiff was called to testify as to what took place *576between him and the deceased, in regard to what she sa’d as to his claims against her, and as to her paying his bill, and paying him money. It matters not whether the object of the testimony was to prove the affirmative or negative. It was to prove something between him and the deceased, about which she could have testified if alive, and the injustice of allowing a party to testify under such circumstances is apparent. It seems hard at first, that the plaintiff is not allowed to contradict the statements of the witnesses, who testified to what the deceased said on the subject, but there is in truth no hardship, because the law was not altered in this respect. Before the Code the plaintiff could not have been a witness at all, and so far as relates to transactions between the plaintiff and deceased, the law remains unaltered.” Van Alstyne v. Van Alstyne, 28 N. Y. 375; Kerr v. McGuire, ibid 446; Dyer v. Dyer, 48 Barb. 190. In Stanley v. Whitney, 47 Barb. 586, the action was brought by an administrator, on a bond executed to the intestate by the defendañt, conditioned for the payment of $907.49, with interest. The defense was usury; the answer alleging that the defendant executed a promissary note to the intestate for $986.00, which was usurious; and that the bond in question, and a mortgage accompanying the same, were given to take up the note, and as a substituted security for the original debt. In the court below the defendant was allowed to give evidence in his own behalf, that the only consideration he received for the note was the amount of $800.00, paid him by Rose. The supreme court held that the evidence was inadmissible, as it related to a transaction had with the deceased, and reversed the judgment and granted a new trial. Strong v. Dean, 55 Barb. 337.
• In both the above cases the court held, that the test of the admissibility of the evidence is: “Does it tend to prove what the transaction was?” John Timon v. Mary Claffey et at., 45 Barb. 438, was an action brought by the Roman Catholic Bishop of Buffalo, to establish a des*577troyed will, alleged to have been duly made by James Claffy. In the court below the plaintiff was offered &s a wit-' ness in his own behalf, to prove conversations had between the plaintiff and the deceased, at the time of malting the will, and before, on the subject of the will. The supreme court held that the evidence was inadmissible. In Lee v. Dill, 39 Barb. 516, ivas a contest as to the capacity of a testator, who was over ninety years of age, to make a will. Robert L. Dill was, in the court below, offered as a witness in his own behalf, and objected to as incompetent, and the objection overruled, and he was sworn and examined as a witness. In the course of hi@ examination he was permitted to testify to conversations with the testator, material and relevant to the issue and tending to establish the will. The jury on the issue rendered a verdict in favor of said Dill. In the supreme courtupon the hearing of the appeal had in the case, Allen, Judge, said: “Without referring in detail to the circumstances, which made the evidence objected to relevant and necessary on the part of Dill, it is sufficient to say it was regarded by him and was in truth important for him to prove, that the will was prepared from and in accordance with directions proceeding from the testator. Without such evidence it is probable, that a verdict would have been obtained affirming the will as the will of the deceased. The title of the claimant (Dill) was under the will, and all the negotiations and preparations, and all the circumstances between him and his father leading to and resulting in the will, were parts of the res gestee, and entered into and made a part of the principal transaction, by which Mrs. Lee was to be deprived of her rights as heir-at-law and next of kin. And it follows that every part of this transaction, and every material circumstance must be proved by competent testimony.”
It was held to be error to admit the evidence, and the verdict was set aside and a new trial granted.
In Hatch v. Peugnet, 64 Barb. 190, the judge in the inferior court admitted evidence to be given by the *578plaintiff, Mrs. Hatch, a daughter of the testatrix of and communications between the testatrix, Mrs. Hagan and the plaintiff; Mrs. Peugnet, was a legatee and executrix named in the said will, and such evidence tended to maintain the issue in favor of the plaintiff Mrs. Hatch, and against the defendant Mrs. Peugnet. It was objected by defendant’s counsel, that such evidence was against the provisions of section 399 of the Code. Leonard, J udge, said: “ The provisions of that section as amended in 1869 and in force at the time of the trial stripped of verbiage not applicable to this case are as follows : “ No party to an action nor any person interested in the event thereof * * * shall be examined as a witness in regard to any personal transaction or communication between such witness and a person, at the time of such examination, deceased, * * against the executor or survivor, of such deceased person,” *. * *.
The admission of the evidence of Mrs. Hatch, as to transactions and conversations between herself and her mother, were against Mrs. Peugnet, an executrix and legatee under the will in question. It was in clear disregard of the terms of the section of the Code above cited.” We have but one case decided in our own State, giving a construction of the second exception to the provisions of our Code under consideration, and we think the decision is conclusive of the question. In Calwell v. Prindle’s adm’r, et al., decided at the last term at Charlestown; he cause was an injunction by Calwell against A. F. Mathews, administrator of Prindle, to restrain him from selling property under a deed of trust, executed by Calwell to Mathews, trustee, to secure among others a debt to Prindle. In the suit Calwell was introduced as a witness in his own behalf, and was permitted to testify, that the debt secured by said trust to Prindle was evidenced by a note, and that he had paid the note and taken it up, and that it was lost. J udge Haymond, who *579delivered the opinion of the Court, said: “ That the payment of the note or bond by the plaintiff to Prindle, with the Thomas order, was a transaction had personally with Prindle, is manifest; and that the conversation between plaintiff and Prindle, then or before or after-wards, was a communication, had personally with Prin-dle, is equally clear; the execution and delivery by plaintiff of a note or bond to Prindle * * * was also a transaction had personally by plaintiff with Prindle, and the note or bond itself is and must necessarily constitute a part of that transaction, whether in the hands of Prindle or plaintiff. The obtaining of the note or bond by plaintiff from Prindle is also a transaction, had personally by plaintiff with Prindle, and the possession of the note or bond by plaintiff, after he had obtained it from. Prindle, is necessarily a part of the transaction by which it was so obtained by plaintiff from Prindle. The one cannot be separated from the other, so as to render the plaintiff incompetent under the statute to testify as to the one fact, and competent to testify as to the other; and so the note or bond being in fact a transaction, had personally with Prindle by the plaintiff, it must follow that the plaintiff is not competent to testify as a witness on his own behalf as to any matter or thing, in relation to his possession or loss of said note or bond.” It seems to me clear that Carson, the eestui que trust in said trust deed, is incompetent to testify as to any communication or conversation had with the deceased. The making of the deed of trust is itself a transaction, and he cannot be permitted to testify one word as to its 'execution. It seems to me it follows as a matter of course, if he could not be permitted to testify as to the conduct and conversation of the deceased at the time the deed was executed, he could not be permitted to give his opinion of the sanity of the grantor at the time the deed was executed, based upon such conduct and conversation. For if he was permitted to give his mere opinion as to the sanity of the grantor, the other party would certainly have *580the right to show, on cross-examination, upon what facts that opinion was based, and would thus be compelled to have the very testimony before the court or jury, that the statute excludes, or be denied his right of cross-examination. The mere opinion of a witness to the sanity of a party is entitled to little or no regard, unless reasons be given, which would warrant the opinion. He could not speak at all as a witness in his own behalf as to the execution of the deed; and he surely could not give his opinion of the grantor’s condition oí mind, made up from the transaction itself. His opinion as to the sanity of the grantor, drawn from any transaction or conversation, had personally with him at the time of the execution of the deed, or at any other time, was clearly inadmissable.
Does G. L. Cranmer stand in any better position? His evidence is oí the same character. He is the trustee. He certainly had an interest in the transaction; he was interested to the extent of his commissions, at least. The legal title to the property was in him; he had sold it as trustee, but had not completed the sale. He derived his interest in the trust deed in- the same manner and from the same source, that Carson derived his, and it seems to me that the statute, that would exclude the evidence of Carson as to the transaction, conduct and conversation, would exclude that of Cranmer. I think therefore, that his evidence as to these matters was also inadmissible. The same character of evidence of Mrs. Anderson and her son John, was inadmissible for the same reasons.
How. then did the proof stand at the time the issue was ordered? Anderson was a man who was in the habit of drinking. He was treated for an eruptive disease, and for his condition consequent upon his dissipation in February 1873, by Dr. Cracraft. George Spind-ler, William Marshall, A. H. Patterson, Charles Allen and Mary E. Marshall all testify clearly to acts and conversations of the deceased, occurring early in April *5811873, and continuing until after the trust was executed, which acts and conversations are sufficient to show, that' he had not mind sufficient to execute a deed, unless it was done in a lucid interval. Among the hallucinations he had, which most, if not all, the witnesses testify to, was that he thought he knew where there was gold in the neighborhood; and this idea was in his mind when Dr. Hildreth saw him on the 24th of May 1873, seventeen days after the deed was executed. The doctor gives that conversation about the gold, as one reason that convinced him that the man was insane. He said he had $7,000,000.00 dollars in gold, and proposed to give the doctor $1,000,000.00. Dr. Cracraft testifies that on the 16th day of June 1873 he was suffering from acute mania, and shortly thereafter he was confined to the jail of Ohio county as a lunatic, and died not long thereafter.
On the day the deed was executed, Mrs. Marshal] came to the city with Mr. Anderson and his wife, and she said they could not trust him to drive, that he ran the horses, so that it was unsafe, and that he was not then under the influence of liquor.
We think the evidence clearly established general insanity in Anderson, before and continuing up to the time of the execution of the deed, and afterwards. The law presumes every man to be sane; but that presumption may be overthrown by proof; and in this case it is over-throAvn, not only by the opinion of the witnesses, but by the facts they relate, which are irreconcilable with sanity.
The presumption of law is always in favor of sanity, at the time the deed was executed, of a person whose deed is brought in question, and the burden of proof lies on him who asserts unsoundness of mind, unless a previous state of insanity bas been established j in which case the burden is shifted to him who claims under the deed. There is but one witness who testifies to the sanity of the grantee shortly before the execution of the *582deed • tbe burden, of proof was clearly shifted to the party ' claiming under the deed. No competent witness has testified as to his condition at that particular time. It is then clearly established that at the time of the execution of the deed of trust by Samuel Anderson, on the 7th day of May 1873, he was not sane, and was therefore incapable of executing a valid deed.
Should the court then have directed the issue? It was clearly improper to have ordered the issue under the circumstances and legal proofs, as they existed at that time. The chancellor may - in the exercise of his discretion, either direct an issue or refuse to do so; but this discretion must be properly exercised, and a mistake in its exercise is just ground of appeal.
When there is such a conflict of evidence, that it is so nearly balanced as to make it doubtful on which side is the preponderance, an issue ought to be directed; but where, though there be a conflict, it is not of such a character, no issue ought to be ordered. Such doubt in the mind of the chancellor must not be a factitious but a reasonable one, justified by such conflict of the evidence.
In this case the preponderance of the legal testimony was clearly against the sanity of the grantor, both before and after the execution of the deed ; and no lucid interval at the time of the execution of said deed is proved; it was error therefore to have directed the issue. It was the duty of the chancellor to have disregarded the verdict of the jury, and to have set aside the order directing the issue, and to have entered a decree, upon the proofs as they stood at the time the issue was ordered. And it is the duty of the Appellate Court, in reviewing a decree founded on the verdict of a jury, rendered on an issue out of chancery, to look to the state of the proofs at the time the issue was ordered, and if satisfied that the chancellor has improperly exercised his discretion in directing the issue, to render á decree, notwithstanding the verdict, according to the merits, as disclosed *583by the proofs on the hearing when the issue was ordered: Jarretts v. Jarretts, and cases there cited, infra, decided' at the present term.
Therefore the decree of the 19th of June 1875, directing an issue in this cause, and also the decree of the 7th of February 1876, dissolving the injunction and dismissing the bill, must be reversed with costs to the appellants against the appellee Alexander Carson; and this Court, proceeding to render such decree, as the circuit court of Ohio county should have rendered; the deed of the 7th day of May 1873, executed by Samuel Anderson to G. L. Cranmer, trustee, is set aside, cancelled and annulled, and the injunction granted in this cause is perpetuated, with costs to the plaintiff against the defendant Alexander Carson; and it not appearing from the record whether the said defendant, Watkins, has paid any part of the purchase money, under the purchase at the trust sale, this cause is remanded to the said circuit court, with instructions to restore to Watkins the purchase money so paid, if any, and for further proceedings to be had therein, if necessary, according to the principles governing courts of equity.
Judges Greek and Moore concurred.Decree Reversed, deed set aside and injunction perpetuated.