Day v. Allaire , 31 N.J. Eq. 303 ( 1879 )

The opinion of the court was delivered by

Sotjdder, J

This appeal is taken from the order of the chancellor, made on the advice of the vice-chancellor, discharging the order to show cause why the final decree entered in this cause should not he opened, and the defendants let in to he heard and make defence by counsel.

The petition of Maria Isabella Day, wife of Stanley Day, one of the defendants in the above cause, shows that, on October 10th, 1872, the complainant, Isaac S. Allaire, filed a bill to subject to the lien of a judgment for $4,704.59, which said Allaire had obtained against her husband, certain lands in Middlesex county, which, it was alleged, had been conveyed to her in fraud of her husband’s creditors. The defendants answered the hill of complaint, under oath, denying the fraud, and alleging a full consideration paid by the wife, through the agency of her husband, from moneys received by him belonging to her separate estate. The petition further shows that a solicitor of the court was duly retained to defend the action; that testimony was taken upon both sides; that the solicitor abandoned the case without the knowledge or consent of the defendants, omitting and refusing to take the testimony of several material witnesses, and did not present the evidence taken, or argue the cause before the chancellor, although his fees, costs and charges were fully paid; that, by such neglect, the complainant’s case alone was heard, the defendants’ testimony was not read, and they were not represented before the chancellor. With these disadvantages, the decree against which they pray relief in their petition was made against them.

It was properly held that this petition showed surprise, and that the solicitor’s misconduct was a breach of duty •which the defendants were not hound to anticipate or guard against.

Kemp v. Squier, 1 Ves. 205, says that it is discretionary in the court of chancery to set aside enrolled decrees on circumstances, and that, in that case, where there was an infant, who continued such until near the time of hearing, and was beyond seas, where the cause was neglected by the solicitor, and the merits of the case were not heard, the petitioner was entitled to have the enrollment set aside. •This case cites Robson v. Crowell, before Lord King, where a person left money with his solicitor to fee counsel, and went beyond sea. The solicitor neglected to employ counsel, and the bill was dismissed, with costs. It was held a bare default, and the court opened the enrollment, on payment of costs, and gave the complainant leave to show ' merits and apply to rehear.

The court of chancery has discretionary power, even after enrollment, to open a regular decree obtained by default, for the purpose of giving the defendant an opportunity to make a defence on the merits, where he has been deprived of such defence, either by mistake or accident, or by the negligence of his solicitor. Millspaugh v. McBride, 7 Paige 509; Brinkerhoff v. Franklin, 6 C. E. Gr. 334; 2 Dan. Ch. Pr. 1030.

The complaint here is, that the merits of the case were not .presented to the court or discussed before the decree was pronounced, and that not by the laches or fault of the petitioner, but by the neglect of the solicitor employed by her, upon whom she had the right to rely. The first case cited above was that' of one who had been an infant, and beyond sea, while he was suffering from the neglect of his solicitor. Here we have the case of a married woman, whose rights are just as carefully guarded by a court of equity, who has been undefended while her husband’s creditor was charging fraud upon her, and attempting to take from her lands which, she alleges she is prepared to show, were purchased by her separate moneys. It is certainly within the discretionary power of the court to grant relief in such a case, if the defence shown be meritorious, and prompt application is made for-its aid.

There has been no unreasonable delay in the petition in this case, and the only question that remains is, whether the petitioner has shown a meritorious defence. The facts are imperfectly set forth in the proofs that were taken for the defendants, which were not presented to the chancellor before the decree was made, but were offered with the petition for rehearing. These proofs are, manifestly, incomplete. They show, however, that Mrs. Day had property in England, independent of her husband; that it was received at different times by him, and, as she intended and supposed, invested for her, and in her name; that property in England, belonging to her, was sold about July, 1867, and remittances therefor made to her husband for her; and that, with these and other moneys from her father’s estate, she claims that real estate was purchased, in her name, at West Farms, Yew York, in 1867 and in 1869, for which deeds were given to her. If this be so, she had these lands prior to her husband’s indebtedness to this complainant, and. if the proceeds of sale of this real estate in Yew York were subsequently invested in lands in this state, in good faith, she has a title which cannot be disturbed by her husband’s creditors.

The bill of complaint charges that, on May 24th, 1870, Stanley Day was indebted to the complainant, Isaac S. Allaire, in the sum of about $5,000, and that, on June 1st, 1871, he became indebted to him in the further sum of $4,000; and, on Yovember 13th, 1871, he recovered a judgment, in the supreme court of this state, against Day, for $4,704.59, being the amount of his indebtedness second above named, with interest and costs. Why no claim or judgment was had for the alleged prior debt of $5,000, does not appear. The complainant shows, by proofs, that Day failed in January, 1871; that there -were admissions made, by Mr. and Mrs. Day, that the property belonging to Mrs. Day in England was not sufficient to purchase the property at West Farms, and that these lands were sold in Yew York, and invested -in Yew Jersey, to defeat the Yew York creditors of Stanley Day. It is needless to comment on the uncertainty of such evidence, and its denial by Mrs. Day. But Mr. Day was not called to meet these alleged admissions, nor to show the disposition made by him of his wife’s property, although it appears that he received all of her moneys, and, as she says, invested them for her. She alone testifies as to what she heard and understood of such investment, and this is weighed as hearsay, and slight evidence in her favor. She alleges, in her petition for rehearing, that she wished him and other witnesses to testify for her, but her solicitor said the case was plain in her favor, and refused to call them; that he then abandoned the suit, departed from the state, ceased to practice in our courts, and left her and her husband undefended.

It is not proper to decide the completeness of the defence, for this can only be done after all the evidence has been taken; and more especially is that the case where there is a charge of fraud, which is denied, as in the present action.

■ It is manifest that there is a meritorious answer to this claim of the complainant, and that the defendants have not been heard on the testimony of their witnesses and the due presentation of their case in court, because of the gross neglect and abandonment of their solicitor, without any laches on their part.

This is not a case where the solicitor has erred in judgment merely in conducting the cause, nor is it one where cumulative evidence only has been excluded; but it is the refusal and neglect to present to the court most important testimony, both oral and written, which might have had a controlling weight in the mind of the chancellor, and the withholding of it was a surprise and fraud upon the rights of these defendants and the petitioner who now asks for relief.

In my judgment, the rule to show cause why the final decree should not be opened should be made absolute, the order reversed, and the ease be remitted for further proofs and a hearing, on payment of the costs of entering the decree and the proceedings subsequent thereto, in the court below, and that the appellant recover costs on this appeal.

Decree unanimously reversed.