Richardson v. Lightcap

52 Miss. 508
CourtMississippi Supreme Court
DecidedApril 15, 1876
StatusPublished
Cited by1 cases

This text of 52 Miss. 508 (Richardson v. Lightcap) is published on Counsel Stack Legal Research, covering Mississippi Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Richardson v. Lightcap, 52 Miss. 508 (Mich. 1876).

Opinion

Simrall, C. J.,

delivered the opinion of the court.

' T. M. Lightcap, being indebted to D. G. Pepper for the purchase of several lots in the town of Tchula, to provide in part for the payment therefor, drew the following order:

21st April, 1873.

Mr. Henry 8. IJooher, Lexington, Miss. :

• Dear Sir — The claim in your -hands for collection against Mr. M. A. Griffith, for the amount of mechanic’s lien for repairs, amounting to $775 and the interest thereon, when •collected you will please pay over or hold against the order of D. G. Pepper, and oblige. Yours, very truly,

T. M. Lightcap.”

■ Pepper being indebted to complainants, Richardson & May, $1,375, secured by a mortgage or deed of trust on the same lots, with their consent sold the property to Lightcap for "$1,375, taking Lightcap’s notes, one for $200 and one for $77§j due the 1st of January, 1874, bearing interest at the rate of ten per cent, per annum from date, which were indorsed and delivered bjr Pepper to Richardson & May. At the time •of the sale, and as parcel of the arrangement, Lightcap gave the above order, which Pepper specially assigned by indorsement as follows: “Hold subject to the order of Richardson & Mai'-,” and delivered it to Hooker, the attorney of record for Lightcap. Hooker recognized the order and agreed to pay the money, when collected, to Richardson & May.

[512]*512The complainants allege that but for the giving of the order- and the agreement that the proceeds of the claim against which it was drawn should, when collected, be applied to the indebtedness of Lightcap on his purchase, Pepper would not have made the sale, nor would Richardson & May have consented and ratified it. Lightcap is insolvent, and, owing to the depreciation in the value of the property caused by the burning of' the houses on it, the purchase money will not be paid unless the order is collected.

The complainants further allege that the sheriff has collected, or is about to collect, the claim referred to in the order, and, though notified of their rights, declines to pay the money to them on the pretense that the order has been revoked by Lightcap.

The complainants further state that after giving the order Lightcap fraudulently, for the purpose of defeating their claim, drew another order on the fund in favor of Messrs. Allen &, Dyer, who were associate counsel with Hooker in the litigation' with Griffith. The sole consideration was their fees as-attorneys. They had notice of the order on Hooker.

Lightcap was immediately put in possession of the property by Pepper, and has ever since been in undisturbed possession. It is averred that he knew the reasons for the sale, and that his notes and order would be transferred to Richardson & May.

Lightcap, in his answer, admits the sale and the terms, but neither admits nor denies that it was made with consent of' Richardson & May; neither admits nor denies that the order was given to Richardson & May, or that Hooker recognized or-agreed to pay it when the claim should be collected; states-that the order was given as collateral security, pro tanto, for the purchase money of the lots, and when collected should be-so applied; admits that he drew an order in favor of Allen & Dyer for their fees, but in good faith, and without fraudulent-notice.

The answer then assumes the character of a cross-bill, and prefers allegations to the effect that Pepper made fraudulent. [513]*513misrepresentations that be bad title to three-fourths of tbe lots, whereas be well know that be only bad title to an undivided one-half.

Trusting to tbe truth of these statements, they operated as an inducement to him-to make tbe purchase.

He further alleges that Pepper is insolvent, and that the covenants in his deed afford.no security or indemnity.

He prays for a rescission of the contract, cancellation of the deed and of his obligations for the purchase money.

In accordance with the prayer of the original bill, an injunction was issued and served, restraining the sheriff from paying over the money to Allen & Dyer, or Lightcap,.and restraining them from receiving it.

On motion the injunction was dissolved, and from that order an appeal was taken.

The motion was made on the bill and answer.

The complainants’ equity is predicated on the order drawn by Lightcap on Hooker, in favor of Pepper, his assignment to them, the notice to Hooker, and his agreement to respect it.

It is claimed that thereby was wrought an equitable assignment pro tanto of the funds against which it was drawn irrevocable, and which could not be defeated by the subsequent act of the drawer.

The case? as made in the bill is much like that of Fitch et al. v. Stamps, 6 How., 495. There, as here, the order was upon the attorneys for the proceeds of a claim which was in judgment. After the acceptance of the order McGehee, the creditor, assigned the judgment to Fitch for value. In a contest between Stamps, the payee of the order, and Fitch, assignee of the j udgment, the court held that Stamps was an equitable assignee pro tanto of the fund, and was entitled to protection though the debtor had not assented thereto, and clearly so if he so assented.

Subsequently, in Anderson v. Miller, 7 S. & M., 586, it is declared in general terms that the assignment of the attorney’s receipt for collection carries with it an equity to the proceeds [514]*514of the judgment. The effect of such a transaction is that the judgment creditor becomes but a mere trustee, “having no right to the judgment in himself.” After notice the debtor could not rightfully pay except to the owner and holder of the order. Roberts v. Bean, 5 S. & M., 587.

We are not disposed to accede to the request of counsel for appellee to reconsider these cases. We accept them as affirming the law upon the subject.

Applying it to the case stated in the bill, wo are of opinion that Richardson & May, assignees of Pepper, became equitable owners of so much of the fund in Hooker’s hands for collection as would pay the principal and interest of the order.

It remains to be considered whether the answer so completely meets and destroys the equity of the bill as to have justified, at this early stage of the litigation, a dissolution of the injunction.

The allegations of the bill connect the order with the sale as a means in part of paying the price of the property; the obligations for the purchase were to be transferred, and were in fact transferred, to Richardson & May, who were the mortgage creditors of Pepper, whose cooperation and consent was therefore necessary in the consummation of the sale. It is positive^ averred that the sale would not have been made except for the security of the fund in Hooker’s bands to the extent of $775 and interest. The material part of that allegation Lightcap admits.' He says “it (the order) was given as collateral security for the purchase moiieju” In response to these averments which connect Richardson & May with the sale, and of their standing in relation to Pepper and the property as mortgagees, he is equivocal, and neither admits nor denies them.

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57 Miss. 628 (Mississippi Supreme Court, 1880)

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Bluebook (online)
52 Miss. 508, Counsel Stack Legal Research, https://law.counselstack.com/opinion/richardson-v-lightcap-miss-1876.