Hodges v. Graham, Hodges & Co. , 25 La. Ann. 365 ( 1873 )

Kennard, J.

The plaintiff, Charles Hodges, having obtained pu the nineteenth of June, 1871, a judgment against Graham, Hodges & Co., in liquidation, and the several members of the firm, Augustus C. Graham, Charles E. Goodwyn and William R. Hodges, for the sum of fifteen thousand eight hundred and forty-three dollars and ninety-five cents, issued &fi. fa., and garnisheed E. J. Hart & Co., a commercial firm, domiciled in New Orleans, addressing to them twelve original and nine supplemental interrogatories of a most comprehensive character.

The garnishees made answers to the twelve original interrogatories, and under the ninth and twelfth answers set up the following special explanations as defenses, to wit:

First — We accounted for said consignments by settlements made with Charles E. Goodwyn on the fifteenth March, 1865, after the dissolution of the firm of Graham, Hodges & Co., which had taken place first of June, 1864; this settlement made by said Goodwyn was acquiesced iu by all the members of the firm, and it was made under-the following circumstances: Charles E. Goodwyn at the time was-largely a creditor of his firm on settlement with his copartners. Graham’s account was balanced and there was nothing to his credit, and W. R. I-Iodges was in no better condition, while Goodwyn was largely a creditor as above. We were not only creditors of Graham, Hodges- & Co., but also creditors of Goodwyn individually. Graham, Hodges & Co. were indebted to us on several accounts, viz: for advances on brandy consigned on joint account; for advances on whisky, on general merchandise account and for loans. The brandy account has been-closed by a compromise made with Charles Hodges, the plaintiff in-this suit, with the assent of W. R. Hodges, as appears by a copy of said compromise “of suit No. 5198 in the United States Circuit Court in the District of Louisiana, hereto annexed, marked ' C.’ ”

Second — That “the indebtedness to them on general account and loans, as appears by their own books, amounts to a very large sum of money, greatly exceeding the value of the whisky, after deducting the special advances.”

Third — “That said settlement cannot be attacked by garnishee process, and that the only mode in which its validity can be questioned, is by direct action.”

Fourth — That Charles Hodges, having at the time it was made, full knowledge of said settlement when made, or shortly afterward, is estopped from attacking it.

Fifth — That Charles Hodges, plaintiff, is not now, and was not at the time he instituted suit in this court, and has not been since twenty-seventh September, 1864, a creditor of Graham, Hodges & Co.; that on the contrary, on the twenty-seventh September, 1864, he was a debtor to Graham, Hodges & Co. in a sum exceeding $15,000, on a general balance of accounts.

Sixth — That this judgment was obtained by the fraud and collusion-of W. R. Hodges with the plaintiff, Charles Hodges, his brother.

Seventh — That W. R. Hodges had, on his own petition, November ill, 1868, been adjudicated a bankrupt, in New Yosk; that on his schedule then filed, his brother, Charles Hodges, was not recognizedas a creditor, nor did he place this alleged claim against these garnishees as an asset on his schedule; that Win. R. Hodges was a witness in this-suit, made no defense, swore to the loss of the firm’s books by fire.

The answer to the above twelve interrogatories, except those to the-second, third, fourth and fifth, were traversed, and nine supplemental, interrogatories filed. .

A motion was then made by plaintiff’s attorney that the garnishees show cause why “so much of their answers as set up pleas or defenses for the original defendants, and attacks the judgment under which E. J. Hart & Co. have been garnisheed, should not be stricken out as-irrelevant and inadmissible.” Also to show cause why they should not make full and prompt answers to all interrogatories, original and supplemental, under penalty of having them taken for confessed. This rule was made absolute, so far as to compel the garnishees to answer,, had the court a qua refused the prayer to strike out, reserving the right to determine whether the answers are relevant or irrelevant.

A motion for a new trial was made upon this order compelling prompt and more explicit answers, which prevailed, and on the twenty-ninth February, 1872, the original rule of twentieth December,. 1871, taken by plaintiff to compel answers was dismissed.

Prom the judgment dismissing this rule this appeal is taken.

The plaintiff invokes the well settled principle of law that garnishees are mere stakeholders, bound to disclose the truth. As to them the question is, are they indebted and can they safely pay ? They are not, as garnishees, permitted to interfere between plaintiff and defendant.. This doctrine is too well settled to need repetition.

The indebtedness being acknowledged, the garnishee can not be heard to urge any plea to protect the judgment debtor, but where the question of his (the garnishee’s) indebtedness is an open one, he cannot be deprived of any substantial defense by reason of the form of action selected by the judgment creditor.

In answer to the first interrogatory the garnishees deny any and all. indebtedness to the judgment debtors, Graham, Hodges & Co.

In answer to the ninth, they explain how their accounts were closed,, allege a settlement acquiesced in by the firm and afterwards a compromise.

To enforce the strict rule invoked by plaintiffs against the garnishees, would deprive them of whatever force there may be in these explanations.

The third person can not be divested of his possession and alleged ownership by the plaintiff, though any process which would deprive-him of explanations and defenses allowable in a direct action by the-judgment debtor to recover his property.

Judgment affirmed.

Rehearing granted.