Hulbert v. . Hulbert

111 N.E. 70, 216 N.Y. 430, 1916 N.Y. LEXIS 1509

• Court: New York Court of Appeals
• Decided: January 4, 1916
• Status: Published

Opinions

Seabury, J.

This a proceeding in an action of partition for the distribution of the proceeds of a' sale of real property. On March 7th, 1904, St. Paul’s Church of the village of Waterloo, N. Y., docketed a judgment for $906.84 against Fred Hulbert. On April 21st, 1904, judgments for $2,830.57 and $2,351.71 respectively were docketed against said Hulbert by the defendant Story now deceased. All of these judgments were filed and docketed in the office of the clerk of Seneca county. At the time these judgments were docketed Hulbert was without property. In 1910, on the death of his father, Hulbert inherited an undivided one-third interest in the real estate which it was sought to partition in this action. On November 24th, 1913, pursuant to leave granted by the court, the St. Paul’s Church issued an execution on its judgment against the property of said Hulbert. On February 6th, 1914, the sheriff of Seneca county sold Hulbert’s undivided interest in said real estate to one Bacon who is a defendant herein, for the sum of $1,437.10 and issued to him a sheriff’s certificate of sale which he now holds. The present action for partition or sale was not commenced until after the execution of the St. Paul’s Church had been placed in the hands of the sheriff. The interest of the defendant Hulbert in said premises was sold in the partition action March 28th, 1914, for $1,753,38, which sum has been paid into the court subject to" its further order. The proceeds of this sale are insuf ficient to pay all of the judgment liens in full. The appellants, who are executors of the estate of Story, claim that these proceeds should be applied pro rata on all of the liens. The respondent Bacon claims, and he has been accorded by the court below, a preference for his lien and the payment thereof has been ordered to be made hi full. It is clear that Bacon acquired no rights as against the owner of the Story judgments, by virtue of the sale of the property to him and the delivery by the sheriff of a sheriff’s certificate of sale, unless the fact that the execution issued by the St. Paul’s Church and the act of the sheriff in advertising the property for sale served to give to the lien of the St. Paul’s Church a preference over the liens of the Story judgments. It is necessary, therefore, to inquire what the status of the judgment liens was and whether the act of the St. Paul’s Church in issuing an execution upon its lien and the act of the sheriff in advertising the property for sale gave to that lien a preference over the others. Pursuant to the settled rule, which is not questioned by either party upon this appeal, the three judgments referred to became liens on the after-acquired property of the judgment debtor at the time of its acquisition by the debtor. (Matter of Hazard Estate, 73 Hun, 22; affd. on opinion below, 141 N. Y. 586.) The liens of these three judgments, therefore, attached simultaneously to the interest of Hulbert upon his acquiring title to that interest on the death of his father. It was held below that the judgmeht of the St. Paul’s Church acquired priority by reason of the execution issued thereon and the act of the sheriff in advertising the property for sale. The theory upon which the ruling was made was that the act of the St. Paul’s Church in issuing the execution was such an exhibition of diligence as to entitle that judgment creditor to a preference over the liens owned by the other judgment creditors. The only authorities relied upon by the lea'rned Appellate Division to sustain this view were the cases of Adams v. Dyer. (8 Johns. 347, 350) and Waterman v. Haskin (11 Johns. 228). In Adams v. Dyer (supra) there is a short per curiam opinion which says: “ Perhaps, the mere act of delivery of the execution to the sheriff, did not gain a preference as to the lands, hut hy the act of the sheriffs in making advertisement of the lands for sale, the first execution was begun to he executed. Here was an act- hy which priority, ' in some respects, was gained. There was priority as to the time of sale, and that priority could not be defeated by the second execution. ” The case of Waterman v. Haskin (supra) announces the same conclusion relying solely upon the authority of Adams v. Dyer (supra). Although our attention has not been called to any subsequent case in this jurisdiction which has followed the decision announced in these two cases, it must be conceded that the rule announced by them has been followed in other-jurisdictions. (Elston v. Castor, 101 Ind. 426; Lowry v. Reed, 89 Ind. 442; Smith v. Lind, 29 Ill. 24; Lippencott, Johnson & Co. v. Wilson, 40 Iowa, 425; Burney v. Boyett, 2 Miss. [1 How.] 39.) Notwithstanding that the decision in Adams v. Dyer (supra) and Waterman v. Haskin (supra) has been followed in other jurisdictions, the rule announced hy these decisions was early questioned in this state. In Wood v. Colvin (5 Hill, 228, 230 [1843]), Bronson, J., speaking for the court, said: “ It has on several occasions been taken for granted that there must he a levy on real estate; but the point has never been so adjudged. The cases are collected in Green v. Burke, (23 Wend. 498). When the judgment is a lien upon the land, it is not necessary that the sheriff should make any formal levy or seizure before proceeding to advertise and sell. It would be an idle ceremony for him to go to the land, or make an inventory of it, or do any other act of the like nature. The judgment binds the land, which is already in the custody of the law before the execution issues. The execution comes as a power to enable the creditor to reap the fruits of the seizure already made.

“ After lands were subjected to sale on execution, and before the judgment was made a lien, (see per Chancellor Lansing in Catlinsr. Jackson, 8 John. R. 546), the sale of lands and of goods on execution stood substantially upon the same footing, and a levy or seizure was necessary in the one case as well as in the other. But when the judgment was afterwards made a lien on the land, there was no longer any reason for requiring a levy before the sheriff proceeded to advertise and sell. The seizure was already made when the execution came to his hands. Lawyers and judges have still continued to speak of the supposed necessity of a levy upon land, without adverting to the fact that the reason for the rule had entirely ceased. But as there is nothing but dicta upon the point, we feel ourselves at liberty to say, that since the judgment has been made a lien upon the land, no formal levy or seizure by virtue of the execution is necessary.”

A good deal of confusion has arisen and the decisions seem not to be in harmony as to the status of the judgment lien. This condition seems to have arisen because of the statutory changes that have been made. A review of the changes which the law upon this subject has undergone will tend to a better understanding of the existing rule which we are called upon to apply to this case. At common law when a judgment has been rendered for a debt the sheriff was directed to cause the sum needed to-be made {fieri facias) out of the goods and chattels of the defendant or levied {livari facias)' out of his goods and the fruits of his land, but the land itself was not subject to be taken in satisfaction of the debt. “ Our common law,” say Pollock & Maitland in their History of English Law, “ will not seize his land and sell it or deliver it to the creditor; seignorial claims and family claims have prevented men from treating land as an available asset for the payment of debts.” (Vol. 2 [2d ed.], p. 596.) In 1285, by virtue of the statute of Westminster 2 (13 Edw. I), c. 18, the election was given to a creditor who sued for such debt or damages to have a writ to the sheriff “ for levying the debt of the lands and chattels, or that the sheriff deliver to him all the chattels of the debtor (except his oxen and beasts of the plough) and a moiety of his land until the debt be levied. ” The writ of elegit was founded upon this statute. It was subject to certain restrictions' and operated differently even as to chattels from a fieri facias. (2 Tidd’s Prac. 939.), These restrictions need not now be commented upon, as our purpose will be served by tracing the procedure that was pursued under it in reference to the lands of the debtor. If the debtor had no land the sheriff need not take or return an inquisition. If there were lands it was necessary that the inquisition should be taken and returned, describing the land with convenient certainty, and after it is taken the sheriff delivers a moiety to the plaintiff by metes and bounds. (2 Tidd’s Prac. 940.) It was formerly usual for the sheriff to deliver actual possession of a moiety of the lands, but at the time Mr. Tidd wrote his practice of the King’s Bench (1801) the sheriff was only required to deliver legal possession, and in order to obtain actual possession the plaintiff must proceed by ejectment. ' The writ of elegit, however, has been said to be “almost unknown in the United States.” (Freeman on Executions, § 310.) There are, however, instances of its use in Virginia, Alabama, North Carolina and Delaware. (Freeman on Executions, § 310.) Although authorized in New York, in practice it is doubtful if it was ever adopted. In commenting upon it Chancellor Lansing said: “ Whether the elegit was ever introduced in practice, is doubtful, as the small value of the income of real estates, afforded little inducement to resort to it, as a means of satisfying a debt due upon a judgment.” (Catlin v. Jackson, supra, at.p., 547.) . “

Prior to 1132 no judicial salé of land could he- made in New York under any common-law process. Such a sale was expressly prohibited by the so-called “Charter of Libertyes & Priviledges ” which was enacted by the colonial legislature October 30th, 1683. (Laws of the Colony of New York, 1664-1719, vol. 1, p. 111.) By a subsequent statute passed soon afterwards by the same legislature a levy “by extent on the defendant’s lands or against the defts goods and chattels & for want thereof his person” was authorized. (Nov. 2nd, 1683, chap. 12, Laws of the Colony of New York, 1661-1719, vol. 1, p. 134.) While these colonial statutes seem to have sanctioned the elegit, it is probable, as already remarked, that in practice that writ was not used. The act of 5 Geo. H, c. 7, which was applicable to. the “Plantations and Colonies in America,” provided that after September 29th, 1732, the lands of the debtor “shall be liable to and chargeable with all just debts, etc.” This statute was intended to enable British subjects in England to sell real estates on execution in the colonies in order to satisfy the debts due to them. It received a liberal construction which extended it to all judgments. (Catlin v. Jackson, 8 John. R. 520, atp. 547.) Under this statute the fieri facias was the appropriate writ under which the lands could be sold, but hi several essentials the effect of the execution was necessarily different from a fieri facias levied upon personal property only. (Catlin v. Jackson, supra, at p. 547; Hanson v. Barnes’ Lessee, 3 Gill & John. Rep. [Md.] 359, 367.)

By the act of 1774 (Laws of the Colony of New York, 1769-1775, vol. 5, p. 637) provision was made for docketing the judgment in the name of the person against whom the judgment was entered, and it was declared that a judgment “not Docketed and entered in the Books” should not affect lands as to purchasers or mortgagees, or have any preference against heirs, executors or administrators. In 1787 (Laws of New York, 1785-1788, vol. 2, ch. 56, p. 467) and in 1801 (Laws of 1801, ch. 105) these provisions were substantially re-enacted. These statutes provided that the land of the debtor should be subject to sale in the same manner as his personal property, and made provision for the docketing of the judgment, and provided that a judgment not docketed should not affect lands as to purchasers or mortgagees. Whether the legal effect of these statutes was to make the judgment itself a lien upon the real estate of the debtor it is not necessary to determine. In Koning v. Bayard (14 Fed. Cas. No. 1924), decided in 1829, it was held that such was their legal effect. The first statute to specifically declare that “the said judgment shall be a lien on such lands, etc., ” was the Revised Laws of 1813 (Vol. 1, ch. 50, p. 501). By that statute it was enacted “ That all and' singular the lands, tenements, and real estates, of any person against whom any judgment shall have been obtained in any court of record, for any debt; damages, costs or other sum of money, shall be subject to be sold upon execution to be issued upon such judgment, and the said judgment shall be a lien on such lands, tenements, and real estates : Provided, etc.” This statute also provided that a judgment hot docketed should not affect any lands and tenements as to purchasers and mortgagees. This statute has been several times re-enacted, amended and amplified (2 R. S. part 3, ch. VI, title 4, art. 2, sections 11 and 12, and Laws of 1840, ch. 386), and the substance of it is expressed in the present provisions of "the Code of Civil Procedure relating to this subject. (See sections 1250 and 1251 of the Code of Civil Procedure.)

By virtue of the statutory changes which have been made in relation to this subject a judgment upon being filed and docketed becomes a lien upon the real estate of the debtor. It is no longer necessary that an execution should be issued upon the judgment in order to cause the judgment to become a lien upon real estate. Adams v. Dyer (supra), decided in 1811, and Waterman v. Haskin, decided in 1814, had under consideration judgments that were docketed prior fco the enactment of chapter 50 of the Revised Laws of 1813. At the time these two cases were decided the legal effect of the statutory change that had taken place had not heen determined. Waterman v. Haskin (supra) was decided solely upon the supposed authority of Adams v. Dyer (supra), and the short opinion that was rendered in Adams v. Dyer ignored the question whether any statutory change had been made. Whether this was because the judgment itself was not deemed a lien prior to the statute of 1813, and the judgments under consideration in these cases were entered prior to the passage of that act, it is needless to speculate.

Of course it is true that if the judgment actually became a lien upon the land it can make no difference whether it is a hen by virtue of express statutory enactment or by necessary implication from other language used in the statute. It is, however, a significant fact that at the time Adams v. Dyer (supra) and Waterman v. Haskin (supra) were decided it was an open and ■undecided question in this state whether the lien attached upon the filing of the judgment or whether subsequent action by way of execution must be taken in order to cause the lien to attach. It was not until more than fifteen years after these cases were decided that it was first held in Koning v. Bayard (supra) that under earlier statutes by implication the judgment became a lien from the date of filing. Even after this decision, as Judge Bronson pointed out in Wood v. Colvin (supra), the effect of the statutory provision was not fully appreciated by judges and lawyers. The fact that this question was undetermined when Adams v. Dyer (supra) and Waterman v. Haskin (supra) were decided, and that it was not determined until subsequent statutory enactments had made the original legislative purpose clear, explains why the court in these cases assumed that the rule prevailing as to the acquisition of a lien upon personal property also prevailed as to real property and accorded a preference to the-judgment creditor, first taking proceedings by way of execution. The statute has now removed any doubt that may have existed on the subject and declared that the lien attaches as to land from the filing of the judgment. Under these circumstances the ruling in Adams v. Dyer (supra) and Waterman v. Haskin (supra) should not be so applied as to make the unnecessary act of issuing an execution the ground for according, as between creditors of equal rank, to one creditor a priority over another. To so apply these decisions is to fail to give effect to the existing statutory provisions on this subject.

Whatever the legal effect of the early statutes may have been it is perfectly clear that since 1813 the judgment itself is a lien upon the real property of the debtor. The legal effect of this statutory rule is that from the moment a judgment is duly filed and docketed legal rights in the real estate of the debtor attach. In the case now under consideration the liens of the three judgments attached simultaneously to the property of Hulbert upon his acquisition of the interest derived from his father. By virtue of the statute they were at that time equal liens entitled to share pro rata in the proceeds of the debtor’s property. Such being the case, how can it be held that the issuing of the execution and the advertising by the sheriff — acts which would be an idle ceremony—should give a preference to the creditor ? Once a lien is acquired it is a right which cannot be lost by the performance of an unnecessary act by another creditor. With as much reason could it be held that as between two mortgagees holding mortgages of equal rank, the one who showed the greatest diligence in commencing an action of foreclosure should acquire a preference over the other. Under the terms of the statute the judgments of the appellants became liens on the real property of Hulbert of equal rank with the lien of the judgment of the St. Paul’s Church. The lien of these judgments of the appellants, having attached, did

not forfeit their position of equality and become subordinate to a lien of equal rank, merely because its owner did not do a useless thing. In Rankin v. Scott (25 U. S. 177, 179) Chief Justice Marshall said: “The principle is believed to be universal, that a prior lien gives a prior claim, which is entitled to prior satisfaction, out of the subject it binds, unless the lien be intrinsically defective, or be displaced by some act of the party holding it, which shall postpone him in a court of law or equity to a subsequent claimant. The single circumstance of not proceeding on it until a subsequent lien has been obtained and carried into execution, Has never been considered as such an act.” The. diligence of a junior judgment creditor could not affect the lien of a senior judgment creditor, and if it could not affect the lien of a senior judgment creditor, it cannot affect the lien of equal rank. The principle that equity favors the diligent has no application where one creditor displays his diligence in the doing of useless and unnecessary things. The liens of the three judgments attached when Hulbert acquired the property. The issuing of an execution upon one of the judgments could not affect the relative rank of the liens as between themselves. It is urged that, although this reasoning was adopted in Rockhill v. Hanna (4 McLean, 554), where the court refused to follow Adams v. Dyer (supra) and Waterman v. Haskin (supra), that case was not followed in the United States Supreme Court. In Rockhill v. Hanna (56 U. S. 189, 196) the United States Supreme Court considered the question presented in Rockhill v. Hanna (4 McLean, 554) and intimated an opinion in accord with the rule declared in Adams v Dyer (supra) and Waterman v. Haskin (supra), but the decision of the court was not placed on that ground, the court saying: “ But we do not think it necessary to rest the decision of this case, merely on the question of diligence, or to decide whether this doctrine has been finally established as the law of Indiana. The plaintiff’s lien does not, by the statement of this case, stand on an equality as to date with that of the other judgments. By electing to take the body of his debtor in execution he has postponed his lien, because the arrest operated in law as an extinguishment of his judgment.”

Under the circumstances disclosed, and in view of the fact that Adams v. Dyer (supra) and Waterman v. Haskin (supra) declare a rule contrary to our existing statute we feel compelled to hold that these decisions are no longer controlling upon us and that we should give effect to the rule declared in the statute.

The order appealed from should be modified by directing that the fund now deposited in court should be distributed pro rata between the three judgments, and as so modified the order should be affirmed, without costs to either party.