Assigned Estate of Moss

21 A. 206, 138 Pa. 646, 1891 Pa. LEXIS 1144

• Court: Supreme Court of Pennsylvania
• Decided: January 5, 1891
• Docket: No. 160
• Status: Published

Opinion

OPINION,

Me. Justice Geeen :

The deed of assignment for the benefit of creditors from Moss and wife to Kuntz embraced, as it should have done, the land of the assignor in West Virginia, as well as his other real and personal estate in Pennsylvania, where he dwelt. The personal estate of the assignor was all exhausted by executions issued prior to the assignment. The entire fund for distribution is the product exclusively of the sales of real estate, part in West Virginia and part in Washington county, Pa. The liens in West Virginia, entered prior to the assignment, were more than enough to exhaust the whole proceeds of the land sold there. Indeed, the proceeds of the West Vii' ginia land were only enough to pay the first deed of trust n, full, and the second deed of trust in part. The third deed of trust was not reached at all, and hence the judgments, which, being entered in Pennsylvania, were the subjects of the trust, received no protection from the sales of the West Virginia land. The judgment of the appellant was one of these. The sales in Pennsylvania did not reach to pay the liens entered in that state, even after the application of all the West Virginia proceeds to the payment of the judgments, also entered in Pennsylvania, but which were secured by the second deed of trust in West Virginia. There is therefore no personal estate of any kind applicable to the payment of any of the liens either in Pennsylvania or West Virginia, unless we, by judicial decree, convert into general personalty, applicable to all the unsecured debts of the assignor, the proceeds of the sale of the West Virginia real estate left after the payment of the first deed of trust. As the liens in West Virginia were more than sufficient to exhaust all the proceeds of the sale in that state, and the liens in Pennsylvania were more than sufficient to exhaust all the proceeds of the sales in that state, we are entirely at a loss to perceive how or upon what principle we can make such a decree. To us it is quite apparent that the present contest is confined to lien creditors alone, and it is merely a question between them whether one, or another, shall be permitted to come in on the fund.

Some question is made by the appellant as to whether the fund is within the jurisdiction of the Pennsylvania court, but the position taken, that the portion arising from the West Virginia sale is not, is entirely untenable. The whole fund is now iix the hands of the accountant, and he is the assignee for the benéfit of creditors of the assignor, wbo is a citizen of Pennsylvania living in Washington county, and owning the' lands in qúestion, situate in both states. The assignee is a Pennsylvania official who must account, and who has accounted, to the Pennsylvania court, for the whole of the assignor’s property. Moreover, in his account, as filed, he has charged himself with the whole proceeds of the land sold in West Virginia, and it is the distribution of that very money that must now be determined. Still further, he is the grantee in the second deed of trust, and he is both trustee and cestui que trust under that deed, because tbe judgments which it was given to protect are judgments owned by him. He has in his hands the very money which was realized under that deed of trust. If the judgments which that deed was intended to secure were the property of other persons than this assignee, it could not be questioned for a moment that it should be distributed to the owners, of those judgments. It may well be that such distribution could be compelled by the courts of West Virginia, because the money, being the proceeds of land in that state, sold under judicial process there, would be properly distributable by the law and the courts of that state. But no such question arises here. There are no claimants to the fund under the law of West Virginia, and we are not informed that the result would be in any wise different if there were. But, this assignee is-in the position of a lien creditor having recourse to two funds, and he is engaged in a contest with another lien creditor having access to one only of the same two funds. Strangely enough he does not desire to avail himself of his right of access as a lien creditor to the West Virginia part of the fund, but actually asks the courts in Pennsylvania to consider that part of the fund as general personal estate accessible to the whole body of' the assignor’s unsecured creditors, and this, although he Would thereby cut out a lien creditor in Pennsylvania, who, if the true character of the fund is preserved, would be paid in full for his lien.

It is an anomalous position, and a strange proposition to advance, but the reason for it is discovered when we learn that’ the assignee had also guaranteed the payment of another judgment which was later in date than those of the appellees, and if he can succeed in getting the courts to hold that he is at liberty to collect liis money on bis Pennsylvania judgments alone, which are prior to those of the appellees, he can obtain, payment of the judgment posterior to those of the appellees, by treating the West Virginia part of the fund as general personal estate applicable to the payment of all unsecured debts. He thinks this would be equitable, although other lien creditors, who have just as much legal and equitable merit as he has, will thereby lose their money. We are quite unable to see it in that light. The appellees have the undoubted right prima facie to require the application of the West Virginia part of the fund to the payment of the judgments which were to be protected by the second deed of trust. That right must be enforced, unless it will interfere with the equity of the person against whom it is invoked. But he has no equity as a lien creditor against the equity of the appellees, and only claims that the doctrine should not be enforced, in order to enable him to come in with general unsecured creditors. To do this, the Virginia fund must be converted from its position as real assets applicable to the payment of West Virginia lions into personal assets applicable to all creditors alike. Why all unsecured creditors should be let in to defeat a lien creditor, it is impossible to see. Certainly they have no claim to postpone a lienocreditor with a valid lien and an undoubted priority as to them. Yet the argument of the appellant is based upon no consideration that is not common to them all. There is neither equity, nor law, nor a sentiment of justice that can be offered in support of such a position.

The assignments of error are all dismissed.

Decree affirmed, and appeal dismissed at the cost of the appellants.