Bamberger, Bloom & Co. v. Voorhees, Miller & Rupel , 99 Ala. 292 ( 1892 )

HARALSON, J,

-It is provided by statute in this State, that the levy of an attachment creates a lien in favor of the plaintiff. — Code, § 2957. This lien is incohoate until judgment is obtained in the attachment suit, when it becomes specific and fixed, and dates from the levy of the attachment. The levy places the property in the custody of the law, and the lien it creates can not be divested or overriden by any subsequent lien. When there are writs of attachment subsequent to the first, each differing in date of levy, and all levied on the same property, each subsequent one is levied in subordination to the ones that precede it, and the lien of each, dates from the moment of its levy ; and if all are prosecuted to judgment, they must be paid, in the order of their respective levies. — 1 Brick. Dig. 161; 3 Brick Dig. 58; Drake on Attach., §§ 225, 228.

When Cartwright sued out and levied his attachment on the property of I. Pinkus, the law gave him a lien on it, from the time of its levy, subject to be divested at law, only on. failure to prosecute his attachment to judgment, and to become fixed, if and when he obtained such judgment. This lien of an attachment is a legal, in contradistinction to an equitable lien. It is in all respects similar, in character, to an execution lien, the one being general, and the other specific; each is acquired at law, and not through the instrumentality of a court of equity. The execution lien, so long as the creditor keeps it alive, by renewals, placed in the hands of the sheriff, can not be defeated or impaired by the activity of other creditors who may have acquired junior liens. And so, no junior attachment lien can override its senior, which is subject to no infirmity to make it .void.

In this case, there were several attachments levied, subsequent to Cartwright’s, on the same property. The complainants’ was prior to the others, in date of levy; and, the attaching creditors, subsequent to Cartwright, including complainants, have a common interest, and are proceeding, to defeat Cartwright’s, on the same ground, namely, that it was issued on a simulated debt, and was intended to defraud the creditors of Pinkus, their common debtor. They each have filed a bill, to remove this alleged fraudulent attachment, so as to displace it in favor of their own. However it may have been held elsewhere, it is the settted practice in this State, that in an attachment suit at law, another creditor can not intervene by petition, and be made a party to the suit, in order that he may attack the proceedings on the ground of- fraud, or fraudulent collusion between the attaching creditor and the debtor.—Cartwright v. Bamberger, Bloom & Co., 90 Ala. 405: And it was held in that case, that a junior attaching creditor had a right to invoke the aid of a court of equity, in a bill filed against the prior fraudulent attaching creditor, to declare his attachment fraudulent, and have it set aside, to make his lien, already fixed at law, operative against such fraudulent obstruction. The purpose of a bill of the kind can not be to have a lien declared, but simply to aid in carrying into effect one already created and existing at law —Drake on Attach., § 225. In discussing this 'principle in another case, in its application to execution liens, which is apposite to the case in band, we said : “A court of equity, in dealing with legal rights, adopts and follows the rules of law, in all cases to which those rules are applicable; and, whenever there is a direct rule of law, governing the case in all its circumstances, the court is as much bound by it,-as would be a court oi law, if the controversy was there pending. The court comes as an auxiliary to give effect to, and render more available, legal liens, not to displace them, nor to subvert their order of priority, which the law has established.” And it. was further said, that a junior judgment-creditor, proceeding in a court of equity for the removal of fraudulent conveyances or transfers of prppertv, subject to execution at law, does not acquire a preference over senior judgment-creditors, who have the prior liens at law.—Mathews v. Mobile M. Ins. Co., 75 Ala. 85. No reason can be assigned for the application of this principle to execution, and not to attachment liens.

■ If the complainants and the defendants were in a court of law, which was proceeding to direct the sheriff in the distribution of the proceeds of the sale of this property, among the attaching creditors, they would be entitled to priority of payment according to the date of their respective levies. It is the duty of a court of equity, in this respect, to follow the law.

If Cartwright’s attachment was fraudulent, and was intended, as is alleged, to transfer the property levied on from Pinkus to him, it had the same effect as a fraudulent conveyance, and no equity remained in Pinkus ; for, as between him and Cartwright, the transaction was absolute and irrevocable. But, as between them, on the one side, and the creditors of Pinkus, on the other, the transaction would be void; and this bill, and those filed by the other creditors, are aimed, not at any supposed or real equity remaining in Pinkus, but to wrest the whole title from Cartwright and Pinkus, and subject the property, or its proceeds, to the superior liens of the creditors whose attachments have been in good faith sued out, to enforce the collection of their debts.

The contention, therefore, of the defendants, that the interest of Pinkus & Co. in the stock of goods, seized under the fraudulent attachment of Cartwright, the moment the attachment was levied, became an equitable estate for the benefit of bona fide creditors, and that, therefore, it became a race of diligence between the creditors as to which of them would first take advantage of this equitable right and secure a first lien on the goods, or the proceeds of their sale, by filing a bill in a court of equity for that purpose, .does not find, sanction, it would seem, either in principle or authority. If no attachment had been sued at law, and no liens there created, the principle contended for, might be applied, but it is inapplicable to. this case.

Enough has been said, already, to indicate that the complainants and other attaching creditors, defendants, have a common interest to overthrow the alleged fraudulent lien of Cartwright. They have a common tie that far; and whether the lien of the one or the other, as between themselves, is to have priority, it is a matter of common concern, growing out of the same alleged fraudulent transaction between Cartwright and Pinkus, and the legal relations of the creditors respectively, to that transaction, that it shall be annulled and held for naught. It can not be said that the bill, having for its object the setting aside of said fraudulent attachment and attempted transfer of the property of the common debtor, ana the adjustment of these competing liens for the money in the hands of the sheriff — matters springing from the same transaction, and in which all the parties are interested — is multifarious, or that there has been an improper joinder of defendants. Though their claims against Pinkus are distinct, there is a contention between them as to priority out of a common fund, and it is necessary for complainants’ relief, and proper for the relief of each, that they all be brought before the court, that their competing priorities may be rightly and finally adjusted.—Stone v. Knickerbocker Life Ins. Co., 52 Ala. 589; Adams v. Jones, 68 Ala. 117; Martin v. Carter, 90 Ala. 97.

From the developments in this case, we venture the suggestion to the lower court, of the propriety of making an order consolidating with this case the other causes pending-in equity in said court, touching the same matters here involved for determination, and try them all. together as one case. The settlement of the matters in dispute will thereby be speedier and more satisfactorily adjusted, and at less expense.

In Cartwright's Case, supra, we said, “It has been adjudged, and needs no argument to justify the conclusion, that the summary jurisdiction exercised by a court of law, in determining the priorities of the legal liens of rival attaching creditors, whether on the motion of the sheriff, or of the parties themselves, asking for a distribution of' the fund arising from the sale of the attached property, in no manner interferes with the jurisdiction of equity to adjust the rights of such rival claimants, in a proper case for cognizance hy a court of equity.—Gusdorf & Co. v. Ikelheimer & Co., 75 Ala. 148.”

The other contention of the defendants, that the complainants are barred of their lien because of their supposed laches in filing this bill, can not be sustained. In what respect have defendants been prejudiced or injured by any delay of the complainants? The money, the proceeds of the goods, was early tied up in the hands of the sheriff; the defendants made haste to file their bill for 'that purpose, and to distance the complainants in that mistaken race for priority ; and, if complainants, feeling safe in their position, delayed some time, but not so long as to damage any one, before they filed their bill, they ought not, for the short time that is pleaded as laches against them, to be deprived of the right which the law awards them, for their superior dib igence in having first sued out their attachment — the real and legal struggle for priority. The laches, to be available, must be culpable.

Nor is there any merit in the grounds of demurrer, that the bill fails to show that there has been a final determination of the suits between the other defendants and said Pinkus and Cartwright. It does not appear that the complainants were parties to those suits, nor that their decision would bind' them.

We find no error in the decree of the chancellor overruling the demurrers to the bill, and it is affirmed.