Cotton v. Parker

1 S. & M. 191

• Court: Mississippi Chancery Courts
• Decided: December 15, 1843
• Status: Published

Opinion

Chancellor.

The complainant purchased from the estate of John Furniss, deceased, at the administrator’s sale, property to the amount of seventeen hundred and fifty dollars, for which he gave his promissory note. This note was afterwards put in suit, and a judgment obtained thereon, in the name of Jane Parker, administratrix of Joel Parker, deceased. This bill is filed to enjoin that judgment, upon the following grounds :

First. That the administrator of Furniss, to whom the note was payable, wrongfully transferred it to Parker for the purpose of paying a debt due in part from the estate to Parker, and in part for the purpose of paying a debt due from the administrator, individually, to said Parker.

Second. That the complainant had, before the commencement of the suit against him, possessed himself of the promissory notes made by Furniss in his lifetime, to a greater amount than his note ' given to Furniss’s administrator ; that these notes'were placed in the hands of an attorney for the purpose of being set off against the ■one upon which the judgment was obtained ; but that the attorney, through mistake, failed to plead said notes as a set-off, but put them-•in suit against the indorser thereof, and obtained judgment thereon.

Third. That the estate of Furniss is insolvent, and that the transfer of complainant’s note to Parker by the administrator, in satisfaction of Parker’s claim on the estate, gave him an -unjust preference.

1. It was held by the Supreme Court, in the case of Prosser v. Leatherman (4 How. Rep. 237), that it is a good defence at law to an action on a promissory .bote, that the note belonged to the estate of a deceased person, and that the plaintiff received it of •the administrator in payment of an individual debt due by the latter. In that case, the note was payable and due to the intestate in his lifetime; here, the note was payable to the administrator himself. It is unnecessary for me to decide whether this difference in the character of the two notes would vary the application of the principle laid down by the Supreme Court, or not. It is sufficient that it was held to be a legal defence, and that the complainant neither made that defence, nor instituted or directed it to be made, nor shows any cause for his failure to do so. The defence, which he says in his bill he instructed his counsel to make, was that of a set-off. It is unnecessary to decide whether the mere misapprehension of his counsel constitutes a sufficient excuse for his neglect to make that defence at law, or not; because he states himself out of court, by showing that the estate of Furniss has been declared insolvent by the court having jursdiction of the administration thereof. The complainant, having become indebted to the estate by purchase from the administrator, cannot, either at law or in equity, set off any indebtedness of ihe intestate, arising in his lifetime, against that demand, after the estate has been declared insolvent. He must submit to share his pro rata dividend with the other creditors. If the rule were otherwise, the policy of the law relating to the distribution of insolvent estates might be totally defeated. One creditor would only have to watch the sale of the estate,’ and purchase to the amount of his claim, and then set off one debt against the other, and leave the other creditors to share a meagre and fractional dividend. Such an expedient would be a fraud on the law, and can find no sanction in the courts charged with its administration. If the demands were mutual and subsisting during the lifetime of the intestate, the rule would be different, notwithstanding the insolvency of the estate. In that case, one debt would be considered as extinguishing the other during the lifetime of the intestate, and the debt due him could not, of course, be regarded as assets in the hands of his administrator. The motion to dissolve the injunction must be sustained.