Wood v. Kerkeslager , 227 Pa. 536 ( 1910 )

Opinion by

Mr. Justice Brown,

March 28/1910:

The original affidavit of defense in this case was held to be good by the court below, but, upon appeal, it was held to be insufficient: Wood v. Kerkeslager et al., 225 Pa. 296. Upon return of the record the plaintiffs moved for judgment. This motion was followed three days later by a supplemental affidavit of defense. A rule was thereupon again taken for judgment for want of a sufficient affidavit of defense, and, having been made absolute, we now have the appeal of the defendants.

It does not appear from the record that the supplemental affidavit of defense was filed by leave of court. Under the circumstances the appellants were not entitled to such leave, and, if asked for, it should have been refused. In holding that the original affidavit of defense was insufficient this court directed the record to be remitted and that judgment be entered for the plaintiffs unless “ other legal or equitable cause be shown why such judgment should not be entered.” These are the words of the Act of April 18, 1874, P. L. 64, under which we are authorized to direct judgment to be entered for want of a sufficient affidavit of defense upon an appeal from the refusal of the court below to enter it, but a reasonable con- . struction is to be given to them. It surely was not intended by the legislature that if a defendant should succeed in satisfying the court below that his affidavit of defense was good, . and, on appeal, it should be held to be insufficient, he should have the privilege of renewing his effort to defeat the plaintiff by filing another affidavit of defense on a matter which was known, or ought to have been known, to him when his original affidavit of defense was filed. If such license is to be given to a defendant, a plaintiff will succeed in obtaining judgment for want of a sufficient affidavit of defense only after the wit and ingenuity of client and counsel have been exhausted in setting forth new defenses after repeated reversals and directions by this court to enter judgment. If the court below should have regarded this supplemental affidavit of defense as good, and, on appeal, we should now hold differently and remit the record with the same order that was made on the first appeal, the plaintiffs might be confronted with a third affidavit of defense, regarded as good by the court below, and their case would become a mere shuttlecock between two, judicial battledores. “Other legal or equitable cause” which a defendant may show to the court below why judgment should not be entered against him after the appellate court has held his affidavit of defense to be insufficient is a cause which did not exist when the affidavit of defense was filed, or, if it did exist, the defendant was ignorant of it through no fault of his own. A single illustration will suffice. A legal reason would be the death of the defendant after the appeal was taken, and an equitable reason for withholding judgment from the plaintiff and permitting an additional affidavit of defense to be filed would be the discovery of a material fact by the defendant during the pendency of the appeal from the refusal of the court below to enter judgment against him, just as after-discovered evidence is often sufficient to move the discretion of a court to grant a new trial to the defeated party. But no such situation is here presented. The defendants had their full day in court, and could have set up what they now allege is a good defense, but neglected to do so.

The disposition of a case on a statement and affidavit of defense is analogous to that of judgment by the court upon the whole record after a jury trial. Every allegation in the statement not denied in the affidavit of defense is to be regarded as an undisputed fact; and every averment in the affidavit of defense is to be taken as true. If from them it appears that no fact is to be found by a jury, the case is as ripe for judgment as it could be after submission to a jury under evidence disclosing nothing to be passed upon by them. After a jury trial and when the court is about to enter judgment upon the whole record non obstante veredicto, its judgment is not to be arrested because the defendant failed to prove an alleged material fact which he knew was in existence at the time of the trial, nor is he to be permitted to set up an additional legal defense which he might have set up either on the trial or on the argument of the motion'for judgment. This is just the situation here. The original affidavit of defense alleged the assignment by Crow to the appellees to be “void,” because it contravened the federal bankrupt law. The allegation in the supplemental affidavit of defense is that it is “void” under our assignment Acts of March 24,1818, P. L. 285, and April 17, 1843, P. L. 273, the contention of counsel for appellants being that these acts are still in force, as the Act of June 4, 1901, P. L. 404, with its repealing clauses, is suspended during the pendency of the federal bankrupt act. Without now passing upon the question of the suspension of the act of 1901, it is sufficient to say that if the assignment to the appellees was void under the acts of 1818 and 1843, the defendants so knew when their original affidavit of defense was filed. Interest rei publicse ut sit finis litium, and the practice of filing a supplemental affidavit of defense under the circumstances just stated is not to be sanctioned. The extent of indulgence by a court below in allowing supplemental affidavits of defense to be filed is largely in its discretion: Andrews v. Packing Company, 206 Pa. 370; but this indulgence is not to be extended after a case has been finally heard and passed upon by an appellate court, except for legal or equitable reasons, of which the defendant could not have availed himself when his original affidavit of defense was filed. Apart from all this, however, the supplemental affidavit of defense is not good.

The assignment from Crow was direct to the appellees, and they took through no trustee. It is as follows: “For valuable consideration and for the sum of $1.00 paid to the first party by the second party, the receipt whereof is hereby acknowledged, the first party does hereby assign, transfer and set over unto the second party the sum of $17,914.59, with interest from date hereof, out of the amount of compensation presently to be determined and payable by the city of Philadelphia to the first party in the matter of the opening of the Parkway between Logan Square and Spring Garden street.” Following this assignment there was a stipulation in the agreement between Crow and the appellees that J. Lee Patton, an attorney-at-law, should receive and collect the said compensation from the city, and out of the sum to be collected by him, after making certain deductions, he was to pay to the appellees the amount due them under the assignment. In holding that the power of attorney to Patton was irrevocable we said, in sustaining plaintiffs’ appeal, that it had constituted him a trustee for the collection of the whole fund. And so he was, but not by virtue of the assignment from Crow to the appellees. The distinction between an assignment to a trustee so named or constituted in a deed of assignment and a trustee created by the assignee and the assignor together for their joint benefit, independently of and after a direct assignment to the assignee, seems to be overlooked by the learned counsel for the appellants. Again, the assignment was not only direct to the appellees, but was as collateral security for Crow’s indebtedness to them, as clearly appears in the last clause of the agreement and as was admitted by counsel for appellants on the former appeal. Bearing with the contention of appellants that the acts of 1818 and 1843 are now in force, it is not an open question that the assignment to the appellees is not within the provisions of either. The act of 1818 defines what assignments are to be void if not recorded. They must be voluntary assignments of a debtor “ to any person or persons in trust for the use of his, her or their creditors, or in trust for the use of such person or persons to whom such assignment may be so made and the other creditors of such assignor.” The assignment must be in trust for all the creditors of the assignor, or to the trustee as one of them for the use of himself and the other creditors. An assignment made directly to a creditor, either as collateral security or in satisfaction of his debt, is not an assignment in trust and need not be recorded under the act of 1818. This was first so decided in Chaffees v. Risk, 24 Pa. 432, which was followed by Henderson’s Appeal, 31 Pa. 502; Vallance et al. v. Miners’ Life Insurance Co., 42 Pa. 441, and Claflin v. Maglaughlin, 65 Pa. 492. Under the act of 1843 an assignment inures to the benefit of all creditors only when it is made to a trustee. The act has no application when the assignment is directly to the creditor himself, either in satisfaction of his claim or as collateral security for it: Penn Plate Glass Co. v. Jones, 189 Pa. 290.

The assignments of error are overruled and the judgment is affirmed.