Evarts v. Hyde , 51 Vt. 183 ( 1878 )

The opinion of the court was delivered by

Redfield, J.

This is an action on the case, with counts in trespass and trover, in which plaintiff seeks to recover the value of certain property sold by the officer on an execution in favor of the defendant against the plaintiff and another. The plaintiff claims that the sheriff’s sale was irregular and void for want of legal notice as to part of the property sold, valued at $478.25, and that the sale was altogether void by reason of the plaintiff’s bankruptcy and discharge therein. Recovery has been had against the officer for this part of the property sold, execution issued, and he has been committed to jail thereon, and has remained in prison until this time. The plaintiff also claims that the defendant has so far participated in the wrongful acts of the officer, that he has become a joint trespasser.

I. We think the judgment was not void. The attachment upon the writ was more than four months before the plaintiff was declared a bankrupt; anda judgment for the purpose of enforcing the lien created by attachment, was permitted by the bankrupt act. By section 5106, creditors, whose debts are provable, are not allowed to prosecute to judgment any action thereon, until the question of the bankrupt’s discharge is determined ; pending suits are to be stayed on application of the bankrupt, to await the discharge, provided there is no unreasonable delay in procuring the discharge. And pending suits may be permitted to proceed to determine the amount due. The assignee may also procure a stay of proceedings. In Palmer v. Merrill, 57 Me. 26, it was adjudged that the court were not to take judicial knowledge of the proceedings in bankruptcy; and that the court could not properly refuse to proceed when neither the bankrupt nor the assignee appeared and requested it. The adjudication of bankruptcy does not devest a State court of its jurisdiction in a pending cause ; in many cases it is the duty of said court to proceed to final judgment; in other cases it is the duty of the court, on application of the bankrupt or his assignee, to stay proceedings until the question of discharge is determined, unless it should be satisfied that the bankrupt is guilty of unreasonable delay. Freeman, in his treatise on the enforcement of judgments against bankrupts, says — “ The rendition of judgments against bankrupts or their assignee, establishes either that the defendants waived their rights, or else that the court determine that the case was one in which it was proper to render the judgment entered. The judgment, if erroneous or irregular, should be corrected by appeal, or by some appropriate proceeding in the tribunal where it was entered.” But by the record in this case, this plaintiff appeared in the cause, and~u consented ” that final judgment should be rendered against him. The judgment is not, therefore, void, and the execution issued upon it protects the officer, if his proceedings thereon were regular, in the sale of the property, so far as this plaintiff is concerned. Eyster v. Gaff, 1 Otto, 521.

II. It has been determined by the judgment of this court, that the sale of the cows, horses, and some other personal property was irregular, and the officer, for that reason, was adjudged liable as a trespasser ab initio. It is stated that the defendant and his attorney, Mr. Edson, were present at the sale", and the plaintiff made known to them that he had been adjudged a bankrupt, and for that reason forbid the sale. Mr. Edson, after consulting with the defendant in regard to the question raised by the plaintiff, told the officer “ to go on with the sale.” The exceptions state that “ there was no evidence tending to show that either Hyde or his attorneys knew of the fact of the defective notice of the sale at the time of giving such instruction, or at any time until after Hyde had received the avails of the sale from Burgess.” The party for whose benefit a sale of property is made, is not liable for the consequences of an irregular and illegal sale by the officer, unless he counsel or consent to the very act which constitutes the illegality and wrong; or, knowing that the proceedings of the officer were irregular, consents to the same by taking the avails of such sale.. In Hyde v. Cooper, 26 Vt. 552, Redfield, O. J., says : “ The defendant’s receiving the avails of the sale has never been held to imply any consent to any irregularity in the proceedings of the officer, even if known to the party, especially when such irregularity consisted in some technicality, of which the party is supposed, ordinarily, not competent to judge.” The court further say : “As a general rule, perhaps, when the mistake is one of fact, and such as makes the officer a trespasser, and the party knowing all the facts consents to take the avails of the sale, or where he counsels the very act .which creates th.e liability of the officer, he is implicated to the extent of the officer. But when the party does not direct or control the course of the officer, but requires him to proceed at his peril, and the officer makes a mistake of law in judging of his official duty, whereby he becomes a trespasser even by relation, the party is not affected by it even when he receives the money which is the result of such irregularity, although he was aware of the course pursued by the officer. He is not liable unless he consents to the officer’s course, or subsequently adopts it.” The record certifies that there was no evidence tending to show that.the defendant had any knowledge of the irregularity until after he received the avails of the sale. And there is no reason to suppose that at the time the plaintiff notified the officer of his bankruptcy, and for that reason forbid further proceeding, either party had in mind that the officer’s proceeding, thus far, was irregular.

It is true that the record states that Mr. Edson, in behalf of the defendant, said to the officer, “ go on with the sale ” — the ordinary language of direction and command. But this must be interpreted in- the light of the question proposed to him and the difficulty he was asked to solve. The question put by the officer to the party, in substance, was this: The party whose property I am about to sell now gives notice that he has been adjudged a bankrupt, and for that reason forbids further proceedings, that is a question of law which I refer to you, shall I desist or proceed ? The party consulted with his attorney and directed the officer to proceed in the execution of his process notwithstanding the plaintiff’s bankruptcy. If that was error, he took upon himself its consequences and nothing more. But he is not thereby made participant in a legal wrong to which he never gave consent and of which he had no knowledge.

III. It is claimed that the execution on which the property was sold was void, for the reason that the officer had become liable to the creditors for omitting to charge on execution the property attached on the writ, and had taken out the execution for his own protection. It has often been held in this State, that when an officer has paid an execution by reason of his liability for neglecting to collect it of the debtor, he is subrogated to the rights of the creditor in the execution, and a fortiori, when he had not paid, but had merely become liable. State Treasurer v. Holmes, 4 Vt. 110; Oliver v. Chamberlin, 1 D. Chip. 41; Bellows v. Allen, 23 Vt. 169. The cases cited from New York, founded upon what is conceived to be a matter of public policy, cannot be allowed to overturn the established rule in this State.

IV. The debt ■ in this case existed when the bankruptcy proceedings were commenced, and judgment thereon was rendered after plaintiff was adjudged a bankrupt and pending the proceedings ; and the plaintiff insists that the judgment does not change the character of the debt, but that the judgment is cancelled by the final discharge. Under the bankrupt law of 1841 the doctrine contended for by the plaintiff was established in two reported cases, — Harrington v. McNaughton, 20 Vt. 293, and Downer v. Rowell, 26 Vt. 397. And the same rule, in a qualified form, is established in New York. In. Monroe v. Upton, 50 N. Y. 595, the court maintains that it has entire jurisdiction of the case and the parties, and, for delay of the bankrupt in asserting his rights, or other sufficient reason, may deny the bankrupt all benefits of his discharge. In this case, the bankrupt and the assignee not only omitted to ask a stay of the proceedings, but the plaintiff appeared in court and consented to the judgment. It is not therefore void. And whether the status of the debt has been so far changed by the judgment that it could not be affected by the final discharge, if seasonably pleaded or asserted, we need not discuss ; it is good as against this plaintiff and his after-acquired property while it continues in force, and cannot collaterally be assailed. Eyster v. Graff et al. 21 Otto 521.

Judgment reversed, and judgment that the defendant recover his costs.