Brown v. Bacon

Mr. Justice Fisher,

delivered the opinion of the court.

This is an appeal from, a decree of the superior court of chancery, dissolving the injunction and dismissing the bill.

The record presents two questions for consideration : —

1st. Whether the complainants are entitled to a perpetual injunction against the decree of Bacon, Symington, & Robins, so far as an attempt may be made to enforce it against the property named in the bill; and,

2d. Whether the bill can be maintained as a bill of inter-pleader for the purpose of settling -the claim of Woods & Fitzpatrick, and of Bacon & Co., to the money in the hands of the complainants.

- The facts as shown by the record relating to each of these questions, will be noticed at the proper time.

The complainants claim title to the property in controversy, by virtue of a purchase made at a marshal’s sale in February, 1851, under an execution issued on a judgment in favor of Woods & Fitzpatrick, rendered in the circuit court of the United States at Jackson, in November, 1839, against Thomas Redwood, a citizen of Warren county, in which county the judgment has never been enrolled under the provisions of the act of 1844. On the 7th of March, 1850, Bacon, Symington & Robins recovered a money decree in the superior' court of chancery against the said Redwood, which was duly enrolled in the proper office of Warren county before the levy and sale by the marshal, under the execution issued on the judgment of Woods & Fitzpatrick. After the purchase by the complainants at the marshal’s sale, an execution was issued on this decree, and was levied by the sheriff of Warren county on the property now in controversy. To perpetually enjoin this threatened sale, is one, and indeed the most important, object sought by the bill.

The only question requiring consideration on this branch of the-case is, whether the complainants, by their purchase under the marshal’s sale, acquired a title discharged from the lien of the decree of Bacon & Co. This question would seem to be too clear to admit of-argument; for taking the position of either party as the correct one, the same result is accomplished. If it be true that the lien of the judgment created by the law at the time the judgment was rendered in 1S39, continued up to the day of the sale by the marshal, regardless of the legislation of 1844, as contained in the enrolment act, and the statute of limitations limiting the liens' of judgments theretofore rendered to two years, then of course no question can arise as to the complainants’ title to the property. They would be held to have taken it discharged of all intervening judgments against the debtor. If, on the other hand, the position pressed by the counsel of Bacon & Co. be correct, that the lien of the United States court judgment came as fully under the operation of the enrolment law and the statute of limitations, as judgments of the S.tate courts, the result will still be the same, and the purchasers ought to be protected against the decree, the lien of which may, for the purposes of this case, be conceded as superior to that of the judgment of "Woods & Fitzpatrick, without in the least endangering the title acquired by the sale under the latter judgment. If the lien be superior, it is only so in the sense of the law which gave it existence, and not to the extent contended for by counsel. It may possibly be superior as to the money arising from the marshal’s sale, but the very law which gives to it this superiority declares that it shall have no existence whatever as to property which has once been sold under an execution against the common debtor. The question, then, may be disposed of in few words. Bacon & Co. appeal to the enrolment law for the purpose of showing that the lien of their decree was superior, on the day of the marshal’s sale, to the judgment of Woods & Fitzpatrick. The complainants admit it, and show by the seventh section of the same law, that having purchased the property at an execution sale, they took it absolutely and unconditionally discharged of the superior lien. There is, then, no room for debate as to the complainants’ title to the property; and no question having been made by Bacon & Co. as to the jurisdiction of the chancery court to grant the relief prayed, the decree dissolving the injunction and dismissing the bill will be reversed.

j'~The remaining question will be now considered, that is, whether this bill can be maintained as a bill of interpleader for the purpose of settling the conflicting claims of Woods & Fitzpatrick, and of Bacon & Co. to the money in the hands of the complainants, being the avails of the marshal’s sale.

It is certain that the complainants have done nothing making them liable to both parties for the same sum of money. Their object is to make, in the first instance, the proper application of the money, and when this shall have been done, to be discharged not only from the notes held by Woods & Fitzpatrick, but also from the threatened claim of Bacon & Co. growing out of their supposed superior lien on the fund. This being the attitude of the case,, it appears to fall strictly within the general rule on the subject of interpleaders. Under the facts as presented by the record, this is the end of the controversy ; but as both parties desire a decision on the merits, taking the allegations of the bill and the exhibits as true, we will extend our examination for this purpose. J

Woods & Fitzpatrick, going back to the origin of their title to the money, insist that as it is the product of a sale under their execution, issued to enforce a judgment of the United States court rendered in 1839, they have the superior title; in addition to which they allege that the notes of the complainants were taken as money, and a corresponding credit therefor entered on their execution.

Bacon & Co., on the contrary, insist that the judgment of the United States court, falling under the operation of the statute of limitations and of the enrolment act of 1844, ceased in 1846 to be a lien on Redwood’s property, and that their decree, at the date of the marshal’s sale, creating the superior lien, they are entitled to the money.

The facts as shown by the bill are these: Redwood’s land was sold under the execution of Woods & Fitzpatrick early in February, 1851, and purchased by Johnston for the benefit of the firm of Brown & Johnston. On the 17th of the same month, Redwood’s slaves were sold under the same execution, and were purchased by one Harris, as the agent of Woods & Fitzpatrick; but, as the bill alleges the purchase was virtually made for the complainants, in virtue of a previous arrangement or understanding of the parties, in consummating which, Brown & Johnston, instead of paying the money to the marshal for the land and slaves purchased, gave their notes, payable in one and two years, to Harris, agent of Woods & Fitzpatrick; and thereupon Harris entered a credit, as above stated, for the amount of the notes on the execution.

The first inquiry is, whether the enrolment act of 1844, Hutch. Co. 891, embraces judgments of the United States court. It provides for the enrolment of the judgments and decrees of any superior, circuit, district, or inferior court of law or equity holden within this State, provided the same be a court of record. Section 1. Its language in this respect is as comprehensive as that of the first section of the abstract law of 1841. In the case of Tarpley v. Hamer et al., 9 S. & M. 312, this court, remarking upon the abstract law, as it is commonly called, said “that the case then before them depended upon two questions: first, is the act of the legislature passed on the 6th of February, 1841, entitled an act to regulate the liens of judgments and decrees, a constitutional and valid act as respects prior judgments ? and second, if it is so, does it apply to judgments rendered in the federal court? We respond to both of these questions in the affirmative.” We quote this decision for the purpose of showing that the law, the enrolment act, applies to judgments previously rendered by the federal courts. In the case of Bonaffee v. Fisk, 13 S. & M. 682, the court again held that such judgments are clearly embraced by the provisions of the act, and sanctioned the appropriation of money which had been made by the sheriff, under executions from the State courts, to judgments of the United States court, which had been duly enrolled, and which, according to the terms of the 9th section of the act, were entitled to a priority of payment. If these decisions are -to be treated as authority, then the question is settled. They must either be followed or overruled. Looking back to the state of things which preceded the passage of the law, we do not feel the least inclined to pursue the latter course. The law was, at the time of its enactment, no less one of necessity, than it is at present one of convenience and sound' policy, and as such should be in its true spirit administered.

f~The rights of both parties must be determined by the 9th section of the law, which declares that after a sale of any property by the sheriff or coroner on execution, before the money is paid overby him, he shall examine the “judgment roll” and apply the proceeds of such sale to such elder judgment or decree having a priority of lien, and return such application upon the execution. on which such sale shall have been made. What the law requires the sheriff or coroner to do in regard to the application of money arising from a sale under execution, the marshal is equally required to do. Suppose, then, that the judgment of Woods & Fitzpatrick, instead of being a judgment of the United States court, was a judgment of the circuit court of Warren county, and had never been enrolled; and suppose further that the sheriff, instead of the marshal, had made the sale, the sheriff in such case would have been compelled to examine the judgment roll, and apply the money to the decree of Bacon & Co. If this would have been plainly the duty of the sheriff in the case supposed, it was no less the duty of the marshal in the case in which he acted. But it is said that th'e money was not paid to the marshal, and hence he was not bound to appropriate it. It is true it was not paid to him; but why was it not so paid? There is but one answer which can be given, and that is that the plaintiffs in the execution, through their agent, had otherwise directed. They, then, having been instrumental in preventing a performance of duty on the part of the marshal,, and retained the money under their own control, cannot be heard to object to the performance of his duty in its application.

Any other construction of the law would always enable a party, when it was to his advantage, to evade it, and to deprive others of the positive rights which it secures. It is immaterial under whose execution the property of the debtor may be sold, the money, when thus made, must be applied to the judgment or decree, having, in the language of the law, a priority of lien, as evidenced by the judgment roll. The party having such lien, is as much entitled to the money as if the sale had been made under his own execution. The sale destroys the lien as to the property, but it attaches immediately to the money. There are exceptions to this rule, as where the said creditor refuses to give the indemnity required by the officer, or to do any other act, without which no sale could be made; but, subject to these exceptions, the sale under a junior execution is practically a sale for the benefit of the creditor holding the prior lien. The question, then, is this. Can the complainants legally pay the money, produced by the sale under the execution of Woods & Fitzpatrick, to Bacon & Co., for whose benefit the sale was, by operation of law, made ? This question, of course, is answered in the affirmative.

Having disposed of this question, nothing remains but to give directions as to the judgment to be entered.

Decree reversed, injunction made perpetual, the amount of the two notes to be paid to Bacon & Co., and the notes themselves to be cancelled.

Smith, C. J., concurred.