Collins v. Hydorn , 69 N.Y. Sup. Ct. 286 ( 1891 )

Learned, P. J.

This is an appeal by two of the defendants from a judgment on the decision of the special term. The action was brought to set aside certain transfers of real estate as fraudulent and void, as against the creditors of Elisha AY. Hydorn. The important question’ in this case is whether the matter is res adjudicata in favor of these two defendants. One George W. Wiswall on the-day of-commenced an action against the same defendants for the purpose of setting aside these same conveyances on the same ground, viz., that they were fraudulent as to creditors. Pending that action, the plaintiff, Wiswall, made an assignment to this present plaintiff, Collins, for the benefit of Wiswall’s creditors. Afterwards that aetion came on to be tried before the special term, and was decided by that court in March, 1890. In that action the court held, as matter of fact, that the conveyances from Elisha AY. Hydorn were made for a good, valuable, and sufficient consideration, and without any intent to defraud; that they were received by J. Bartlett Hydorn without any intent to defraud the creditors of Elisha; that the conveyances of J. Bartlett Hydorn, through Gilbert M. Greer to Hattie M. Hydorn, were made for a good, valuable, and sufficient consideration, and without any intent to defraud the creditors of Elisha; and that they were received by her without such intent, and without any knowledge of any intent, to defraud on the part of her grantor. These findings are directly upon the very issues involved in this present case. That case was appealed to the general term, and was there examined, and the judgment was there affirmed November, 1890, (12 N. Y. Supp. 581.) It was appealed to the court of appeals, and was there affirmed, (27 N. E. Rep. 412.) This present action was commenced in January, 1887, by plaintiff, as a judgment creditor, in his own right; the other action about the same time. It is claimed by defendants that Collins was not only the assignee of Wiswall, but that, as a creditor of Wiswall, he was beneficially interested in the action, alter the assignment to him for the benefit of creditors. On this point there seems to be no proof. The defendants make two claims on the subject of res adjudicata: First, that all the creditors of Elisha W. Hydorn are privies, through their debtor, to the transaction by which the conveyances were made to the present appellants, and therefore are bound through him by the judgment rendered in the case of Collins v. Assignee; second, that at least Collins, having been an actual party to that judgment, is bound thereby.

On the second point the plaintiff urges that the decision against him in his representative capacity does not bind him in his own right. We pass over the first point. In considering the second, we may suppose that Wiswall, instead of making an assignment for the benefit of creditors to Collins, had sold absolutely to Collins the judgment against Hydorn and the pending action. If Collins, then, as assignee of Wiswall, (though not for the benefit of creditors,) had carried through that litigation, and had been defeated on the very point now at issue, viz., the fraudulent nature of the transactions, would not that judgment have concluded him in the present action ? It seems to us that it certainly would. As between Collins and these defendants, it would.have decided the questions of fact; and to permit him to litigate these questions again would be contrary to settled doctrine and unjust. To show how strong the rule is, we need only cite Griffin v. Railroad Co., 102 N. Y. 449, 7 N. E. Rep. 735, and cases mentioned in the opinion. Of course, Collins might have been defeated in the former action on some other ground, as, for instance, that Wiswall was not a judgment creditor, or that liis debt had been paid. But there is no such escape here. The very questions of fraudulent conveyances in all their particularity were passed upon, and the judgment was affirmed in both appellate courts. How, the only question is, can this general and most excellent rule be evaded on the ground that Collins in the one suit was assignee for creditors; in the other, was creditor himself? What difference does this make? He was under the highest obligation to contest the matter in the other action to the best of his ability. We must'presume he did so. If he did not, then certainly he stands in a very unfavorable light here. Then, if he has tiled these questions once, and has been unsuccessful, ought he to be allowed to experiment with some other tribunal, and thus set up one judge against another? He has had his day in court. The two actions were pending at the same time. It would seem that both might have been tried when one was. The same plaintiff controlled both. When Wis-wall assigned to Collins, and Collins was substituted, it was not necessary that he should add the word “assignee” to his name; and, if he did so, that act did not make the litigation any the less his own. In Bates v. Stanton, 1 Duer, at page 87, the court, speaking of the rule which makes a prior judgment conclusive, says that the term “parties” is not “restricted to those who are parties upon the record. It includes all who have a direct interest in the subject-matter of the suit; a right to make a defense or control the-proceedings.-” Applying that language to this case, we see that Collins was, not only-a party upon the record of the former judgment, but that he had a. right to control the proceedings therein. Of course, it is easy to suggest a case in which the former adjudication might have depended solely upon the-representative character of the party, and in which, therefore, there could be: no decision as to a right or a liability in a character not representative. Such, is Hall v. Richardson, 22 Hun, 444. But nothing of that kind exists here.. This plaintiff was not defeated in the former action for any defect in liis right to bring the action. He was defeated because facts were decided which would defeat the present action. Therefore the controversy is res adjudicata„

Some cases are cited which are supposed to hold a contrary view. Jackson v. Mills, 13 Johns. 463. The question of res adjudicata did not arise in that, ease. Hor did it arise in Sinclair v. Jackson, 8 Cow. at 565; nor in Jackson v. Hoffman, 9 Cow. 271. The” question was not involved in Rathbone v. Hooney, 58 N. Y. 463. The court held that the plaintiff’s title was consistent with the foreclosure suit, and that the “validity of the mortgage as a mortgage of the trust-estate was not, and could not have been, adjudged in the foreclosure suit.” If this is so, then there was no res adjudicata. It is true that the court afterwards makes an obiter remark, at page 467, that a judgment against a party sued as an individual is not an estoppel in a subsequent action in which he sues, or is sued, in another capacity or character, citing the cases just above mentioned; none of which have any reference to the question of res adjudioata. How different the facts of that case are from those of the present will appear on examination. The court say: “The plaintiff was entitled to the judgment rendered (that is, the judgment in the foreclosure suit) wholly irrespective of that question;” that is, the validity of the Brown mortgage as a charge on the trust-estate. Now could it be said in this case that the defendants in the former action were entitled to the judgment rendered, irrespective of the question of fraud in their conveyances, the question now in dispute? Clearly not. They obtained their judgment by establishing against this plaintiff that the conveyances were not fraudulent. He ought not to try the facts again.” The remark of the court above cited may sometimes be true. At any rate, it does not apply to the present case. It is probably true where the second litigation involves rights or liabilities growing out of the new capacity. For instance, if A. sued on a note, and was defeated on the ground that it did not belong to him, he probably might afterwards sue as A., executor, etc., and prove that it belonged to him as executor. But the question here is whether one who has sued simply as assignee, and has been defeated, for the reasons stated in this case, can sue again in his own name, and can harass the defendants by compelling them again to defend their conveyances. We think not. The judgment should be reversed, and a new trial granted, costs to abide the event. All concur.