Moore's Appeal

7 Watts & Serg. 298

Opinion

The opinion of the Court was delivered by

Kennedy, J.

The first exception taken by the appellants to the decree of the court below is, that the court erred in ordering the several judgments against John Moore in favour of the Cumberland Valley Rail-road Co., the Southern Loan Co. and the Car-lisle Savings Fund, respectively, to be paid out of the moneys in court arising from the sale of the real estate of John Moore, as subsisting liens thereon from their respective dates. Writs oí fieri facias had been sued out on these judgments against John Moore when he was possessed of personal property, and engaged in manufacturing iron pretty largely within the county; and it was alleged that the sheriff, in whose hands these writs were placed for execution, had seized and taken by virtue thereof personal property of Mr Moore sufficient to satisfy the same, and if the plaintiffs therein respectively had not received payment, it was because they had neglected to look to. the sheriff for it, who had made himself accountable to them. The appellants, however, failed to show any such seizure of personal property; and although they gave evidence tending to prove in some degree that the sheriff, by great vigilance on his part, might possibly have gotten personal property of the defendant named in the executions sufficient to have satisfied the several amounts thereof, yet the neglect of the sheriff in this respect, however gross and clearly proved, could not affect or destroy the liens of the several judgments in favour of the Cumberland Valley Rail-road Co., the Southern Loan Co. and the Carlisle Savings Fund, upon the real estate of the defendant, Mr Moore. The liens of their judgments, therefore, remained in full force, and, being prior in point of time to the liens of the mortgage taken by N. Wilson Woods, as also of the mortgage taken by William Moore, and the several judgments obtained by the other appellants against John Moore, the court were right in giving the former a preference.

But William Moore, one of the appellants, also further complains that the court erred in decreeing that the judgment in favour of Charles Barnitz, another of the appellants, against John Moore, should be paid out of the moneys due on the mortgage of N. Wilson Woods, in preference to $2450 of the same mortgage which had been assigned to him by the said N. W. Woods. The mortgage was executed and recorded on the 8th day of May 1843, and the judgment was obtained by Charles Barnitz against John Moore two days afterwards, to wit, on the 10th of the same month, for $1000; and on the 23d day of December following, 1843, N. Wilson Woods assigned $2450 of his mortgage to William Moore. But previously to this, on the 10th of May preceding-, the same day that Charles Barnitz obtained his judgment against John Moore, N. Wilson Woods signed an agreement in the following words:

“Whereas, John Moore has this day confessed an amicable judgment to Charles Barnitz for the sum of $1000, payable six months after date, and for the better securing the said Charles Barnitz, I do hereby agree and covenant that in case the said judgment shall not be paid by the said John Moore to the said Charles Barnitz, or be received out of the proceeds of the said John Moore’s real and personal estate, I will then make good to the said Charles Barnitz the whole of the sum of $1000, or any part thereof which may not be paid by the said John Moore, or received out of his real and personal estate. In testimony whereof I have hereunto set my hand and seal, this 10th May 1843.

[Signed, but not sealed] N. W. Woods.”

Barnitz not having received or been paid in any way any part of his judgment against Moore, and it appearing that Moore and N. W. Woods were both insolvent, therefore claimed by force of the guaranty just recited to be paid the amount of his judgment out of the moneys secured by the mortgage given to N. W. Woods. This was opposed by William Moore, inasmuch as it would go to preclude him from receiving the amount claimed by him under the assignment made to him. The court, however, conceiving that Barnitz was entitled to a preference, decreed in his favour.

The court seem to have thought that the claim of Charles Barnitz came within the principle acted upon by this court in the cases of Erb’s Appeal, (2 Penn. Rep. 296), and Himes v. Barnitz, (8 Watts 39). Each of these cases, it may be observed, was attended with circumstances different from the present; and in Himes v. Barnitz the application of the principle was, perhaps, carried to its utmost limit. In Erb’s Appeal, Orr was held entitled to be paid his judgment against B. M’Cormick, and Mary Moore as surety of M’Cormick, out of the moneys raised from a judicial sale of M’Cormick’s real estate, in preference to a prior judgment in favour of John Martin, which had been assigned to Mary Moore, and by her assigned to Christian Erb, the appellant, after the money had been made, first, upon the ground that Mary Moore, the surety of M’Cormick, had in reality obtained the assignment of Martin’s judgment against M’Cormick, in consideration of her having joined M’Cormick as his surety in giving a new judgment to Andrew J. Dearmond, which included, by the consent of Martin, the judgment in his favour, and was actually satisfied afterwards by a seizure and sale, under an execution issued upon it, of personal property belonging to B. M’Cormick, and property belonging in some small part to Mary Moore, but chiefly with property which she had received as an indemnity for her having become surety in the judgment to Orr, who claimed, therefore, to be paid the amount thereof out of the moneys arising from the sale of the real estate of M’Cormick, the real debtor, seeing nothing was actually due, or at least very little, on the elder judgment in favour of Martin, which it was agreed Mary Moore should have the benefit of at the time she became surety for M’Cormick; and, secondly, upon the ground, so far as she had become the real owner of the elder judgment in favour of Martin against B. M’Cormick, that her right thereto was acquired as an indemnity for having become surety in the judgment given to Orr, and Orr, therefore, became entitled to claim the benefit of it, on the principle of equity, which seems to be well settled, that the creditor is entitled to the benefit of all securities the principal debtor has given to his surety, as well as those which shall have been given to the creditor himself by the principal. Maure v. Harrison, (1 Eq. Cas. Abr. 93); Wright v. Morley, (11 Vez. 22); Scribner v. Hickok, (4 Johns. Ch. Rep. 530); Ib.130. And in the second of the cases relied on by the court below, Mrs M’Clure, who was a judgment creditor of Peter Ege, the principal debtor,was held entitled to be paid the amount of her judgment out of the proceeds of the real estate of Peter Ege, which had been taken in execution and sold by the sheriff, in preference to two elder judgments, originally in favour of tbe executors of Michael Ege, but assigned by them to Joseph A. and Michael P. Ege, who had undertaken to pay Mrs M’Clure’s judgment, in consideration of which they had put into their possession, as owners, the personal property of, and claims for money coming from the executors of Michael Ege to Peter Ege, the principal debtor, as an indemnity ; and by means thereof in settling the claims of Peter Ege against the estate of Michael- Ege with his executors, obtained the assignment of the two elder judgments against Peter Ege, which they assigned afterwards to Charles Barnitz, with a full knowledge on his part of all the circumstances connected with their becoming the assigns thereof, who notwithstanding claimed to be paid the amount of the same under the assignment to him. The circumstances of this latter case, though somewhat complex, will be found, when properly scannéd,.to present in substance the case in which Joseph A. and Michael P. Ege had become the sureties of Peter Ege, the principal debtor, for the payment of Mrs M’Clure’s judgment against him, and by means of the property and claims placed in their hands by Peter Ege, the principal debtor, as an indemnity in effect, and to enable'them to fulfil their promise of suretyship to Mrs M’Clure, they obtained the assignment of the two elder judgments against the principal debtor, which they afterwards assigned to Mr Barnitz without paying Mrs M’Clure. Under this view of the case, it would seem to be right that Mrs M’Clure, according to the rule in equity mentioned above, being the judgment creditor of Peter Ege, for whom Joseph A. Ege and Michael P. Ege had become bound as sureties to pay her the amount of her judgment, should be considered as entitled to the benefit of the two elder judgments against Peter Ege, the principal debtor, which they had got an assignment of by means of the property and claims placed in their hands by Peter Ege as an indemnity; and this would seem to be right even against Mr Barnitz, notwithstanding he had taken an assignment of them for valuable consideration, seeing he did so with full knowledge of the means by which his assignors acquired their right.

But- in the case before us, Charles Barnitz claims the benefit of the mortgage given to N. Wilson Woods before the latter undertook to pay the debt, in a certain event, owing by John Moore to C. Barnitz, and without any view or reference to such future suretyship. The mortgage was given by J. Moore and accepted by N. W. Woods for purposes altogether different from and wholly unconnected with any debt which J. Moore might have owed Charles Barnitz at the' time. It is therefore clear that Charles Barnitz cannot claim to have the benefit of it on the ground that it was taken of John Moore by N. Wilson Woods as an indemnity or security for or against paying the debt of Moore to Barnitz. Had it been, it would have fallen within the principle acted upon in Erb’s Appeal and Himes v. Barnitz. But any specialty or even simple contract creditor of John Moore, where N. W. Woods had become surety for the payment of the debt, though no judgment had been obtained for the recovery of it against either the principal or the surety, might as well claim to have the benefit of the mortgage taken by N. W. Woods, as C. Barnitz in this case. If Charles Barnitz had had a judgment against N. Wilson Woods for the debt owing to him by John Moore, and it had been shown that nothing could be got of Woods to satisfy it upon an execution issued against him, then possibly the court might have interposed and directed it to be paid out of the money coming to N. W. Woods on the mortgage, provided it would not have been prejudicial to the other sureties or creditors of John Moore named in the mortgage, and N. W. Woods had not parted with all his right thereto for a valuable consideration. But I do not see well how the court could interfere to defeat the right of a bond fide assignee for a valuable consideration, seeing Charles Barnitz had no judgment against N. W. Woods for the debt owing to him by John Moore, or lien of any sort upon the fund in court; in short, nothing except a promise in writing without seal, and without even stating any consideration whatever for it. In no instance of the kind, I apprehend, did a court ever interpose and direct the money of the promisor in court to be paid to the promisee without consent. Mutual judgments between the same parties may doubtless be set-off against each other by the court in the exercise of its equitable powers; but to permit the money of N. W. Woods, which is in court, to be taken out by C. Barnitz, because he says that N. W. Woods is indebted to him upon his promise, which is the most favourable aspect that the present case can be presented in for C. Barnitz, has never been and I think cannot be allowed by the court.

It only remains to say whether the assignment byN. W. Woods to William Moore of the $2450 due on the mortgage is not good against the claim of Charles Barnitz; and we think it is. As against Mr Barnitz, we see no reason why N. Wilson Woods could not have assigned and disposed of all his interest in the mortgage to whomsoever he pleased for a valuable consideration. .It is clear Mr Barnitz had no lien upon or connection whatever with it, either in law or equity, to prevent his doing so.

The decree of the court below, as far as it is in favour of Charles Barnitz, is reversed, and the $2450 of the mortgage money assigned to William Moore ordered and decreed to be paid to him out of the money in court; the residue of the decree is affirmed, and the costs of the appeal, together with the previous proceedings, directed to be paid by the appellants who have failed to prosecute the same with success.