Hays, &C., v. Griffith

• Decision Date: 17 March 1887
• Court: Kentucky Court of Appeals
• Parties: Hays, &c., v. Griffith.

Page 375

85 Ky. 375

Hays, &c., v. Griffith.

Court of Appeals of Kentucky.

March 17, 1887.

APPEAL FROM MASON CIRCUIT COURT.

WADSWORTH & SONS AND COCHRAN & SON FOR APPELLANTS.

JOHN B. BASKIN FOR APPELLEE.

A. E. RICHARDS IN PETITION FOR REHEARING OR MODIFICATION OF OPINION.

CHIEF JUSTICE PRYOR DELIVERED THE OPINION OF THE COURT.

The appellee, Mary Griffith, owned the one-half of a tract of land in the county of Mason, and some personal estate, and while the owner of this property she executed a mortgage on her interest in the land in conjunction with her brother, who owned the remaining half, to one Riley, to secure him in the payment of two notes for borrowed money upon which she was bound either jointly with, or as the surety for, her brother.

The present appellants, or some of them, who were the creditors of the brother and also of the appellee, filed a suit in equity against the two (brother and sister), alleging that the mortgage executed by them to Riley was in contemplation of insolvency, and with the design to prefer him as a creditor, and therefore their entire estate passed, under the statute, for the benefit of creditors. The court below so decided, and on an appeal to this court it was held as to the appellee, Mary Griffith, she was not insolvent, nor was the mortgage executed in contemplation of insolvency, with a view to prefer the particular creditor. The judgment from which she appealed was not superseded, and when the mandate of reversal was returned to the lower court her land and personal estate had been sold and the proceeds distributed, or a portion at least, to creditors. The sale of her estate under the judgment passed the title to the purchaser, although a reversal was had, as has been often decided by this court, and her remedy was to take the purchase money and interest that had already been paid to creditors, for the injury she had sustained by reason of the erroneous judgment below, or she might proceed to recover damages of those who had procured the erroneous judgment, and those damages would be confined to the value of the property, real and personal, at the time it was sold, with interest on the proceeds and the costs expended by her in the action; that is, the ordinary costs of such a litigation, not including attorneys' fees or the extraordinary costs incurred by her in the defense of the original action. This is not an action for a malicious prosecution, or a proceeding to recover damages by reason of the wanton or reckless conduct of the appellants, but a claim for restitution and damages against parties who, by obtaining an erroneous judgment, sold the appellee's property when they had no right to have it sold.

When money has been collected under an erroneous judgment that has been reversed, the party obtaining it may be required to pay back the money by a rule to do so, or a restitution of the property, if not sold, may be required in the same manner; but the proper remedy, where the land or personality of the party has been sold, and a recovery of its value is denied, is to bring an action for damages, alleging such facts as will show that the plaintiff is entitled, by reason of the reversal, to what he has been deprived of by the erroneous judgment. As this court intimated when this case was here on a former appeal, the appellee might proceed by rule or by a supplemental pleading, to recover what she was entitled to, we will treat the proceedings below as an action to recover damages for the wrong, as all the parties are before the court, and seem to have made no question as to the mode of proceeding. The question of more difficulty than any other in this case is as to the time at which appellee's land should have been valued in estimating the damages, whether at the date of the reversal or when the order of reference was made to the commissioner to take proof of value, or at the time of the sale of the land by the commissioner under the erroneous judgment.

It is insisted by counsel for the appellants that the only criterion of recovery is the amount for which the land sold with the interest, as the error committed was that of the court below, and not the plaintiffs who brought the action.

It is plain that one of the two parties must suffer, and the party who asks for and obtains the erroneous judgment under which the property of another is seized and sold, when it was not subject to be sold, should make compensation for the loss. It is true he has received only what the land sold for, but at the same time he has been the means of depriving the owner of its real value. We have been referred to cases where the amount of recovery has been confined to the price the property brought under the judgment with the interest; but those are cases, or the majority of them, in which the officer has sold property under an erroneous judgment that had been reversed, when he had not parted with the proceeds. In such cases the officer could only be liable for the amount realized, and in the other cases cited there was no question made as to the right of the injured party to recover more than the purchase money and interest, or, in other words, that where the property has been sold, restitution may be had in money. That the owner of land thus improperly sold may be restored the money for which it was sold is evident, but can he decline that and claim its value, and if so, when is that valuation to be made?

In the case of Thompson v. Thompson, 1 Coxe's Reports (New Jersey), page 160, it is said the words used in the judgment are, that the defendant "shall be restored to all he has lost by occasion of the judgment, and this is and ought to be the measure of damage."

Freeman on Judgments, section 482, says: "But ...