Chicago & A. Bridge Co. v. Anglo-American Packing & Provision Co.

46 F. 584, 1891 U.S. App. LEXIS 1319
CourtUnited States Bankruptcy Court, W.D. Missouri
DecidedJune 18, 1891
StatusPublished
Cited by8 cases

This text of 46 F. 584 (Chicago & A. Bridge Co. v. Anglo-American Packing & Provision Co.) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, W.D. Missouri primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chicago & A. Bridge Co. v. Anglo-American Packing & Provision Co., 46 F. 584, 1891 U.S. App. LEXIS 1319 (Mo. 1891).

Opinion

Philips, J.,

(after stating the facts as above.') It is to be kept in mind, in the consideration of this case, that the suit was instituted in the state court, and that jurisdiction in this court attaches by reason of the act of removal. It is also to be kept in mind that the plaintiff had first reduced this claim against the defendant corporation, Anglo-American Packing & Provision Company, to judgment in the United States circuit court of Kansas. That judgment was in personam, and, it being a court of record, every intendment is to be indulged in favor of the validity and conclusiveness of that judgment. According to the averment of the bill, the real estate in question is an asset of the debtor corporation.' While the legal title thereto is in the Fowlers, in equity the property belongs to the corporation, and is held by them in trust for the payment of 'the corporation debts. As such it was subject to seizure under process of attachment for the complainant’s debt. Section 4915, Rev. St. Mo.; Evans v. Wilder, 5 Mo. 313; Rankin v. Harper, 23 Mo. 585; Herrington v. Herrington, 27 Mo. 560; Dunnica v. Coy, 28 Mo. 525. The situs of the land drew to it the venue in the attachment proceeding in the Buchanan circuit court. The action could not have been instituted elsewhere. Sections 2010, 2011, Rev. St. Mo. The defendants therein being nonresidents of the state, the statute (section 2022) expressly authorizes service by publication. After due proof of publication, judgment was taken therein by default.

It is true that it is a judgment in rem only, but it constituted a lien on, the attached property, effectually binding it from the time of the levy of the writ of attachment, (Lackey v. Seibert, 23 Mo. 85,) and, when the plaintiff therein obtained its judgment, this lien became res adjudicata. [587]*587Having thus secured this lien by attachment prosecuted to judgment, the question arises, did the plaintiff therein have the right to resort to this bill in equity to remove the obstruction of the legal title in the Fowl-ers, and to subject the property to the payment of its debt, without first issuing an execution on the judgment, and having a return of nulla bona? Counsel for complainant invokes section 571, Rev. St. Mo., which declares that “any attaching creditor may maintain an action for the purpose of setting aside any fraudulent conveyance, assignment, charge, lien, or incumbrance of or upon any property attached in any action instituted by him.” This statute clearly is not applicable to the facts of this case. It obtains solely as to fraudulent conveyances, etc., whereas the deed by which defendants obtained the legal title to the property in question was not fraudulently taken. By the averments of the bill they held it under conditions of implied trust, for the use and benefit of the debtor, with a resulting trust in favor of its creditors. The general rule of equity, as contended for by respondents, is that before the general creditor can resort to a court of equity to reach his debtor’s property held under a fraudulent deed, and the like, he must reduce his claim to judgment, issue execution, and have a return of nulla bona; in other words, he must exhaust his legal remedies. The reason of this rule, requiring a judgment, etc., is that the claim must be rendered certain; otherwise, the proceeding to vacate the fraudulent transfer of the title, and to remove obstacles placed in the way of the successful operation of the execution, might be entirely fruitless if after all the debtor failed to obtain a judgment on his claim. But in this case the complainant had already obtained judgment in'personam in the United States circuit court of a sister state. What was the effect of that judgment? “A judgment rendered by a court of competent authority, having jurisdiction of the parties and subject-matter, in one stated is conclusive on the merits in the courts of every other state when made the basis of an action, and in such action the merits cannot be inquired into. * * * Accordingly, the courts of one state, when called upon to recognize and enforce a judgment from another state, must admit, not only that there is a record, and that it is what it purports to be, but also that it is just, that the money awarded to the plaintiff is legally due, and that he has a right to recover it without a reinvestigation of his claim. * * * The true doctrine is that such a judgment is to receive in all courts the same faith, credit, and respect that is accorded to it at home.” 2 Black, Judgm. §§ 857, 859; Renaud v. Abbott, 116 U. S. 277, 6 Sup. Ct. Rep. 1194. The respondents, being the principal stockholders in the corporation, and its managers, were as conclusively bound by that judgment as the corporation itself. Hawkins v. Glenn, 131 U. S. 319, 9 Sup. Ct. Rep. 739; 2 Black, Judgm. § 583. While such judgment, to be made available for process in another jurisdiction, would have to be sued over, yet, by the first judgment, the claim is rendered as certain as it ever can be. Its merits cannot be relitigated. The liability of the defendant corporation is fixed irreversibly. Hence, it is said by the chancellor in Robert v. Hodges, 16 N. J. Eq. 305:

[588]*588“The objection to the interference of a court of equity, that the claim of the attaching creditor is not ascertained, if it be entitled to any consideration, can have no application in the present case, for the plaintiff’s claims against the defendants have, in fact, been established by judgment. The fact that the judgment was recovered in another state does not impair the conclusiveness of the judgment as to the amount due. If the court where the judgment is recovered have jurisdiction of the person of the defendant, and of the subject-matter of the suit, its conclusiveness cannot be questioned in the forum of another state, where it is sought to be enforced. Moulin v. Insurance Co., 24 N. J. Law, 222.”

Where the reason of the rule ceases, the rule itself ought not longer to operate. In this case the claim was not only certain, but it had back of it a judgment conclusive and binding, and, under the law of the forum where the attachment suit was instituted, the complainant had secured and fixed his lien upon the real estate. Why should it then be compelled to proceed to execution, when all the purchaser could obtain by a sale thereunder would be a lawsuit, before he could get rid of the legal title of the respondents? He would acquire only the equitable interest of the debtor corporation in the land, after which he would be compelled to resort to a court of equity to divest the legal title. There is much practical sense in the distinction drawn by the supreme court of Maine in Brisay v. Hogan, 53 Me. 544:

“It is only when the debtor once had a title' to the land, and has conveyed it away fraudulently, that a levy can be of any use. In such case, the conveyance being fraudulent, it is, as to the creditor, no conveyance, and he may treat the title as still remaining in the debtor. But when, as in this case, the debtor never had any title, treating the conveyance to his wife as either valid or void will not give him a title. It will be either in the wife, or in her grantor; it will not be in the debtor, and a levy on it as his property would be an idle and useless ceremony. No title could possibly be obtained by it.

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Cite This Page — Counsel Stack

Bluebook (online)
46 F. 584, 1891 U.S. App. LEXIS 1319, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chicago-a-bridge-co-v-anglo-american-packing-provision-co-mowb-1891.