Wilson v. Gifford

12 Ohio C.C. 597
CourtOhio Circuit Courts
DecidedSeptember 15, 1896
StatusPublished

This text of 12 Ohio C.C. 597 (Wilson v. Gifford) is published on Counsel Stack Legal Research, covering Ohio Circuit Courts primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wilson v. Gifford, 12 Ohio C.C. 597 (Ohio Super. Ct. 1896).

Opinion

Caldwell, J.

The following statement of facts will be sufficient to understand the law questions in the case, and those are the only-questions involved.

There is a corporation in Chicago, in the state of Illinois;, that corporation has a debtor residing at Akron, Ohio; that debt is evidenced by a promissory, note made payable in-Chicago, where the corporation has its residence. The cor[599]*599poration becomes insolvent, its debtors proceed against it; they apply to the United States court and have a receiver appointed. That receiver, it will be admitted, takes possession of all property in the state of Illinois belonging to that corporation.

After the receiver was appointed, but before he takes possession of any property, or of the debt, before hejcollects the debt owing to the corporation by the party living' in Akron, another party in Akron sues the corporation [and garnishees the corporation’s debtor who lives in Akron,— that is, after the receiver is appointed^.

The garnishee answers in that case admitting the debt -to the corporation, and is ordered to pay to the plaintiff in the attachment case. A contest arises between the receiver of the corporation, and the attaching creditor living in Ohio.

Out of these facts arise certain questions of law:

First, how far the doctrine of comity is carried.

It is claimed on behalf of the attaching creditor, that a voluntary conveyance by a party in one state, transfers title and right to his assignee or his transferee, whoever it may be, to his property wherever that property may be found.

That is admitted, and that is the law generally.

Another proposition is,, that if the conveyancers not voluntary, but is forced, as where creditors may put a party in bankruptcy, or where creditors may undertake to force the property out of the hands of this corporation, by means of a receiver, for their payment, that in those instances it does not operate as such a transfer of the property that it will prevent a creditor of that corporation who lives in another state,from garnishing, as in this case, and enforcing the garnishee process by way of judgment upon the same.

That proposition is true, and there is reason for this. .

As to the first proposition, where one party conveys his property by his own voluntary act, he passes by such conveyance the full and complete title to that property, [600]*600wherever it may be. But in the other case there is no conveyance of property at all,- — no passing of title, except as the creditors are undertaking to fasten upon that property. You may fasten upon property and get a lien upon it by means of a receiver, by means of forcing a debtor into bankruptcy, or into insolvency courts, as you can in many states, or by attachment, and perhaps other ways.

That however is not a complete transfer of the property, but it is only reaching it by process of lawj; and the law prevails generally in the states, — -quite generally, and that is the law of Ohio as we understand it; it has been not positively announced in the 38th Ohio St., but clearly intimated by the court that that is the law of Ohio — that a resident creditor of the state will be protected as to assets of the insolvent in the state, as against a receiver, or against an involuntary bankruptcy proceeding — a receiver appointed in another state.

The second propositiSn of law arising is this. When a federal court acquired jurisdiction of this matter, it prohibited' all other courts form obtaining any jurisdiction over these debts, or over these assets, although they might be in another state.

That rule of law is not well stated. The rule is now well settled, that where a United States court gets jurisdiction in a case of this kind, that that jurisdiction is exclusive of the state courts only within the jurisdiction of that United States court.

That being the rule, as we understand it to be laid down by the courts, it clearly follows that a‘United States court of Illinois, that court’s jurisdiction being limited to a territory that would not include the state of Ohio, does not prohibit the courts of the state of Ohio from taking jurisdiction of this matter.

The third proposition is, that this indebtedness of the debtor residing in Akron, to the corporation, being evidenced [601]*601by a note, that the situs of that debt is where that note is made payable, or where it is. This note was made payable in Chicago; this note is admitted, to have been in Chicago, and therefore it is held that the situs of this property of this insolvent corporation, so far as this note was concerned, was in the state of Illinois; and that being true, that a complete title of it and the possession of it passed to the receiver, and having passed to the receiver, that we have no right to touch the matter in this state.

If that is the correct proposition of law, then no doubt this attachment must fall, but if it is true that the situs of this debt is not in Illinois, but in Ohio, then such result does not necessarily follow.

That leaves in this case, then, only this one proposition to be considered.

There are cases that hold that the situs of that debt is in Illinois. There are some cases, two in Pennsylvania, and one in 2 Wallace Jr. 131, and another in 17th Pa. St., 91; then there is a case of Gillander v. Howe, 35 New York 657, that hold the doctrine that the situs of that debt is in Illinois, and I need only read from a part of the decision announced by Peckham, J. in the New York case referred to. The case recognizes this distinction between a debt and other personal property; and Speed v. May, and Caskey v. Webster, were declared in that case to be correctly decided upon that distinction.

The court say:

“,A chose in action cannot be said to have any actual situs in the place where the debtor resides; as a general principle, it is payable at the residence of the creditor, if not expressed otherwise, and a tender,to be good, must be made to the creditor. There would seem, therefore, to be no sound basis for the debtor’s state, to legislate exclusively as to the legality of a transfer of that debt, made by a foreign creditor. In such case, as in all others, where the property transferred does not actually lie within the jurisdiction of another government, a sale or a contract, valid where made, is valid everywhere. ’ ’

[602]*602If the proposition is true in this state, that the situs of that debt was in Illinois, then the reasoning of Judge Peck-ham in that case, as well as the courts in the other cases, must prevail in this.

This matter of allowing a receiver in another state, appointed by a court in another state, to come into Ohio to collect the debts due the debtor’s estate of which he has become receiver, is purely a matter of comity; and comity, as it has grown up, has become a rule of law to some extent, but it is not always a uniform rule of law; the states do not hold the same in regard to it.

The reason for not allowing a receiver to come into a state and collect the debts, where those debts have been attached by persons residing out of the state where the receiver receives his authority, is, that that”property of the debtor has been in the state where a debt has been contracted, relying upon that property as a source of payment of that debt.

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Bluebook (online)
12 Ohio C.C. 597, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wilson-v-gifford-ohiocirct-1896.