State ex rel. Elder, Gelston & Co. v. Reaney ( 1859 )

Bartol, J.,

delivered the opinion of this court.

This is an action instituted by the appellant on the bond of an insolvent debtor, conditioned for his appearance before the commissioners; on which bond Barber, the defendant’s intestate, was surety. The questions arise solely on the pleadings, all of which present issues of law. By agreement of counsel a judgment pro forma was entered on the demurrers for the defendant, from which this appeal was prosecuted.

The suit was instituted on the 4th day of January 1848, ■and it appears from the declaration and oyer, that a certain Richard W. Reaney, on the 25th day of April 1846, applied to the commissioners of insolvent debtors in the city of Baltimore, for the benefit of the insolvent laws, and the bond upon •which this action was instituted, was executed by said Reaney, and by the appellee’s inlestate, upon the conditions, that the said insolvent debtor, should make his personal appearance ■before the said commissioners, on the 1st day of June 1846, to answer interrogatories, &c., and should also make his personal appearance before said commissioners, on the 1st day of August 1846, for his final hearing, &c. It is further alleged, that the said Richard, at the time of his application, was indebted to the appellants in the sum of $513.98, upon a judgment before recovered against him, and the breach of the condition of the bond relied on, is, that the said Richard did not ■make his personal appearance before the commissioners, on the 1st day of August 1846, &c.

The defendant pleaded seven pleas, the second and seventh were withdrawn in the court below, and the first was abandoned in this court; the appellee relying for his defence, upon the matters arising under the 3rd, 4th, 5th and 6th pleas.

The demurrer to the 3rd plea raises the question, whether the enlistment of the insolvent as a volunteer, and his acceptance by tiie Government in its service in time of war, relieved him from responsibility to appear according to the condition of the bond, or relieved his surety from liability for his failure to appear; and we think this question must be ruled against the defendant. The act of 1846,. ch. 332, was not passed until the 10th day of March 1847, long after ihe breach of the condition of the bond, and, therefore, has no application to the .case; apd we did not understand the appellee in his argument, as claiming exemption under the act of 1846. But he argued, that since the act' of 1834," ch. 336, which placed these bonds pn the footing of bail bonds, giving to the surety the power to surrender the insolvent, the surety is relieved from his responsibility wherever any thing occurs which places it beyond his power to arrest and surrender the principal. This argument rests upon the assumption, that the enlistment of Reaney, exempted him from arrest and placed him out of the surety’s power. Admitting that proposition to be true, without meaning so to decide, it was the consequence of Reaney’s voluntary act, and not of any constraint on the part of the government, and could no more exempt him from responsibility on his bond, or relieve his surety, than if he had voluntarily absented himself from the State for any other purpose.

No authorities have been cited in support of the defence set up by the 3rd plea. It was expressly decided by the Supreme (Court of Massachusetts, in the case of Sayward vs. Conant, 11 Mass., 146, “That it was no defence to a scire facias against bail, that their principal had enlisted into the Army of the United States, since their becoming bail for him, and before judgment against him in the principal action;” and that decision is in conformity with the authorities.

By the fifth plea it is alleged, that Reaney had applied forthe benefit on the 13th of August 1845, and was finally discharged, and that afterwards, and within two years, to wit, on the 25th of April 1846, he applied again, and that the bond sued on was given on his second application.

This is not a good plea; it is based upon the supposition, that the second application was illegal. Without intending to decide, that if the second application was illegal it would furnish a good defence to a suit on the bond, we have seen no law which prohibited such second application. The act of 1845, ch. 139, sec. 1, in our opinion does not apply to insolvent applications in the city of Baltimore. But even if it did, it did not go into operation till the 1st of June 1846, after the second application of Reaney. The 4th section of the act of 1819, ch. 84, which was also cited by the appellee, prohibits a second application within two years, only in the case where the petitioner had failed to obtain a final discharge under the •previous application.

The defendant’s demurrer to the replication to the 6th plea, raises the question, whether, if a debt be due by a party and he apply for the benefit of the insolvent laws, and pending the application and before final discharge, an absolute judgment be recovered thereon against him, said judgment is affected by, or subject to his subsequent final discharge on said application; said application not having been in any manner pleaded or relied upon in the suit?

The principiéis well settled, that after judgment the defendant cannot avail himself of any matter which might have been pleaded or relied on as a defence to the action. See Kemp vs. Cook, et al., 6 Md. Rep., 305. Moore vs. Garretson, Ibid, 444. Miller vs. Fiery, 12 Md. Rep., 207. In this latter case it was held, that on a scire facias, a defendant could not plead his discharge under the insolvent laws granted prior to the original judgment. The same principle applies to the defence set up here, under the 6th plea. It was competent for Reaney to plead his application for the benefit of the insolvent laws, and the pendency thereof in the original action against him; and although such a plea would not have been a complete bar to the action, nor would it have abated the writ, yet it would have prevented the recovery of an absolute judgment against him, and reduced it to a qualified judgment; subject to the result of his application. Not having availed himself of such a defence at the proper time, and the judgment in this case being absolute and unconditional, it is too late afterwards to make the objection.

There remains only for us to consider the defence arising under the 4th plea. By this plea it is alleged, that Reaney ap~ plied for the benefit of the insolvent laws, on the 25th of April 1846. That afterwards, to wit, on the 23rd of February 1848, the commissioners changed the time for his final appearance, and extended it till the 3rd day of June 1848, and that such proceedings were had under said application, that said Reaney was afterwards, on the 10th day of July 1848, finally discharged, &c.

To this plea the plaintiff replied, that when Reaney applied for the benefit, the 1st day of August 1846 was appointed for him to appear, and he .did not, and that the commissioners of insolvent debtors then made, to the county court, a final and unfavorable report in his case, absque hoc, that the time was afterwards extended, &c.

The defendant rejoined, that the commissioners did, on the 23rd of February 1848, change the time for the final appearance until the 3rd day of June 1848, &.C., and to Uns the plaintiff demurred generally.

The decision of the question raised by this demurrer, depends upon the construction of the acts of Assembly, defining the powers and duties of the commissioners of insolvent debtors.

The act of 1819, ch. 84, sec. 1, directed the application to be made to the commissioners, and authorized them to grant a personal discharge, and to fix the time for final hearing, which was to be before the county court. They were also required to report to the county court, whether the petitioner had complied, or had not complied, with the terms and conditions of the insolvent laws. The act of 1821, ch. 250, provided, that in cases where the insolvent may fail to appear on the days required by law, the commissioners, or the county court, as the case may be, shall have power, in their discretion, if they believe such failure not to have been designed for fraudulent purposes, to continue the case of such petitioner upon their docket until some other convenient day, whereof notice is to be given.

The act of 1831, ch. 316, greatly enlarged the powers of the commissioners; by the 3rd section they were authorized to hear finally, and to grant a final discharge to, the petitioner; mid byr tlio same section it is enacted, “That the said commissioners shall have the same powe,r and discretion of extending and changing the time for such final appearance, as is now vested in said (Baltimore county) court, and under the same limitations, and to the same effect and operation to every intent and purpose.”

By the 4th section, the commissioners are required, notwithstanding their power in respect to final discharges, to report and return to the county court, after such final discharge, or unfavorable decision, all their proceedings, and the papers in the case, &c.

And by a proviso to- this section, it is declared as follows: “Provided, that when the commissioners shall extend-or change the time as aforesaid for final appearance, and shall have made report and return, as aforesaid, to Baltimore county court, the said commissioners may thereafter grant a final discharge as aforesaid, or otherwise proceed to every effect,, as if such report and return had not been made, and shall make, report and return of such further proceedings,” &c.

Under this proviso, we entertain no doubt of the power of the commissioners, to extend the time for the final hearing of an insolvent; notwithstanding a previous unfavorable report made by them to the county court. They still retain jurisdiction over the case, and by the express words of the act may “thereafter grant a final discharge, or otherwise proceed, to every effect, as if such report and return had not been made.” It is erroneous to suppose, that after such report none of the papers remain in their possession. The late Court of Appeals, in conslruing the act of 1819, ch. 84, decided, that “the commissioners in the case of an unfavorable report,, were required to return to the county court, only deeds of assignment and such other papers, relating to the estate of the applicant, and brought, before them, as they may deem it proper to have preserved; and that they were not required to return the schedule and all other proceedings which may have been had before them; these last remain in their custody.” Glasgow vs. Sands, 3 G. & J., 96.

In our opinion, the law in this respect remains unaltered by the 4th section of the act of 1831, which required, in case of an unfavorable report, all their proceedings and the papers in the case of the insolvent debtor, to be returned, “as such proceedings and papers are now required to be reported arid returned. ’ ’

The commissioners having retained the custody of the papers in the case, with jurisdiction over the subject, and power' to enlarge the time for the insolvent' to appear, the allegation,that they did- so enlarge the time, and that thereupon such! proceedings were had, as that the insolvent was afterward's-finally discharged, is sufficient. It was not necessary to allege, that continuances were properly entered, nor that notice' was given; the legal presumption is,- that their proceedings' were regular and conformable to law. Bowie vs. Jones, 1 Gill, 208.

It was contended by the appellant, that, upon the failure of the insolvent to appear, according to the condition of the bond, the right of the plaintiff to sue attached, and could not be divested by any subsequent act of the commissioners, and the cases of Kiersted vs. The State, 1 G. & J., 231, and Osbourne vs. The State, 10 G. & J., 1, have been cited to show, not only that by such failure the right of action accrued, but also, that the measure of damages is the amount of the debt due the plaintiff.

Those cases arose before the passage of the act of 1836, ch. 293, which gave to the county courts the power to extend the time for the insolvent to appear. That power, we have shown, was possessed by the commissioners under the act of 1831. The exercise of such a power by the court or the commissioners, must necessarily alter the extent of responsibility upon the bond, for if the*right of action attaches upon the failure to appear, and the creditors have thereupon a right to recover the full amount of their demands, no benefit whatever could accrue* to the insolvent from an enlargement of the time.

In this case the suit was brought after the breach of the condition, and before the subsequent action of the commissioners, as set up in the 4th plea. The plaintiff had a right of action at the time the suit was instituted, and the defence under the plea is not a complete bar; it is matter of defence arising afterwards, and exempts the defendant from liability, except for nominal damages. Tile judgment below must therefore be reversed, and judgment entered for the appellants for the costs in this suit.

(Decided March 18th, 1859.)

Judgment reversed, and judgment for appellants for costs.