Brown v. Scott

• Decision Date: 01 January 1865
• Citation: 51 Pa. 357
• Parties: Brown et al. versus Scott.
• Court: Pennsylvania Supreme Court

Page 357

51 Pa. 357

Brown et al. versusScott.

Supreme Court of Pennsylvania.

ERROR to the Court of Common Pleas of Butler county, in which this was a scire facias sur mortgage, by Alexander Scott against John M. Orr, with notice to J. E. Brown and Hugh Campbell, terre-tenants.The pleas were payment, set-off and an execution attachment, issued by one Bell, a creditor of plaintiff, in which Orr, the mortgagor, was garnishee.To the plea of the attachment, the plaintiff replied that the judgment on which it was issued had been assigned to the terre-tenants, and was now owned by them, and that plaintiffs were willing to credit it to the mortgage-debt.

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Golden & Neale, for plaintiffs in error.—1.Orr's answers should have been received.About the time of issuing of the attachment, Orr gave Scott notes to the amount due on the mortgage; Scott transferred these notes to innocent persons for value, and Orr's answer substantially claimed them as payment; there was some evidence of a combination between Scott and Orr to defraud Scott's creditors.This was a question of fraud, and courts are liberal in admitting evidence tending to show the nature of the transaction: Garrigues v. Harris, 5 Harris 544.Where any concert is shown, the declaration of one party is evidence against the other: Peterson v. Speer, 5 Casey 479; McCaskey v. Graff, 11 Harris 321;McDowell v. Rissell, 1 Watts 165;Scott v. Baker, 1 Wright 330.

Scott himself offered the deposition of Orr, his particeps criminis; the answer would have weakened his general testimony.It was not subject to the rule, that Orr had not been asked as to time and place; the answer was a record.

2.Scott having taken negotiable notes for the mortgage-debt from the mortgagor, cannot issue his scire facias on the mortgage, without taking up the notes.The notes were outstanding, and owned by holders for value: Small v. Jones, 8 Watts 265-6;Kean v. Dufresne, 3 S. &R. 233;Burden v. Halton, 4 Bing. 454(15 E. C. L. 37);United States v. Parker, 1 P. C. C. 267;4 Watts 265;16 Ill. 161;1 Johns. 34;10 Johns. 104; 9 Misso.63; 8 Cowen 77;1 Peters 264;Story on Promissory Notes, §§ 104, 105 and 404, and the notes.

3.The proof was that negotiable notes had been taken for the amount of the mortgage-debt.The presumption is they were taken as payment, not as collateral.If this were not so the debtor might be compelled to pay twice: Watts v. Willing, 2 Dallas 100;Thatcher v. Dinsmore, 5 Mass. 299;Goodenow v. Tyler, 7 Mass. 38;Bayard v. Shunk, 1 W. & S. 92;Murray v. Lardner, 2 Wallace 110, opinion of Justice Swayne particularly, p. 122;Story on Promissory Notes, §§ 104, 105, 404.

4.The transaction between Scott and Orr was alleged to be a combination to defraud Scott's creditors.If so, as between Scott and Orr and those claiming under them, it would be a legal satisfaction of the mortgage: Cook v. Grant, 10 S. &R. 211, 212;Stewart v. Kearney, 6 Watts 453;Sherk v. Endress, 3 W. & S. 255.The terre-tenants had a right to any defence available to their predecessor, Orr: Sankey v. Reid, 1 Jones 95.The position here denies plaintiff's right to sue: Montefiori v. Montefiori, 1 W. Bl. R. 364.

5.The attachment would prevent suits by Scott on the mortgage, whilst it was depending.Nor can he recover interest, pending the attachment: Irwin v. Pittsburgh and Connellsville Railroad Co., 7 Wright 488; 1 Casey 301; 9 Barr 470.

No question of abandonment arose.Scott and Orr's fraudulent arrangement prevent the plaintiff from taking judgment.

Bredin and McJunkin, for defendant in error.—The attachment was pleadable only in abatement: Engle v. Nelson, 1 Penna. R. 443.The plea of set-off to let in the Bell judgment discontinued the attachment.The attachment suspended interest only on so much of the attached debt as is equal to the attaching judgment: Mackey v. Hodgson, 9 Barr 470;Jackson v. Lloyd, 8 Wright 85.It follows, therefore, that suit on the residue of the debt would not be suspended.The conduct of the owners of the Bell judgment was an abandonment; the nature of the writ imposed diligence, and the delay was an abandonment in law.

The answers of Orr were in a judicial proceeding against him.They were no more than pleas, and pleas would not be admissible.There was no evidence that Scott designed fraud at or before the time Orr answered: 1 Greenl.Ev., § 111;Reichart v. Castator, 5 Binn. 113.

The terre-tenants cannot set up fraud.It is not a case of executed fraud sought to be frustrated by the parties intended to be defrauded, but of unexecuted frauds sought to be frustrated by the privies of a party to it.The law will not relieve a party from his fraud, because he shall not be allowed to plead his own turpitude: Evans v. Dravo, 12 Harris 62; Hendrickson v. Evans 1 Casey 441;Williams v. Williams, 10 Id. 213.These terre-tenants, by setting up the fraud of the persons in whose shoes they stand, make it their own.But they cannot set it up, because the plaintiff can open his case without it: Swan v. Scott, 11 S. &R. 164; Thomas v. Brady, 10 Barr 170; Evans v. Dravo, 12 Harris 65.

When Orr's deposition was taken, he was not called on to explain his answers: McAteer v. McMullen, 2 Barr 33;Solms v. McCullough, 5 Id. 473; Wertz v. May, 9 Harris 274.Whether the notes were paid or unpaid did not concern the terre-tenants — they cannot be called on to pay the notes.Orr must show that he has paid them before he can use them in his defence.

The opinion of the court was delivered by STRONG, J.

The plaintiffs in error are terre-tenants of the land upon which the mortgage rests.They bought subject to it, and they are now attempting to defend against the scire facias sued out to enforce it.The grounds of defence taken by them on the trial in the court below were three.The first was that an execution-attachment against Scott, the mortgagee, had been laid upon the debt some years before the scire facias issued, that the attachment remained undisposed of, and that it was a bar to any proceeding on the mortgage.Of this branch of the defence it might be said that it is not properly before us.No exception was taken to the charge of the court respecting it, and if there had been it could have availed the terre-tenants nothing.The pendency of an attachment-execution is no bar to an action against the garnishee, at the suit of the legal holder of the debt attached.It has been said that it is pleadable in abatement, but even that is not strictly true.It neither abates nor bars an action, and pleading it can have no other effect than giving notice of the claim of the attaching-creditor, and to enable the court to mould the judgment to protect the rights of the parties.Especially in this case was the attachment immaterial.The claim of the attaching-creditor was only $292.79, with some interest, while the sum due upon the mortgage exceeded $1600.It would be a great hardship if a creditor should be barred from recovering a judgment for any part of so large a debt by an attachment of so insignificant proportions when compared with the debt itself.Besides, the groundlessness of the position taken by the terre-tenants is more manifest, if possible, in view of the fact that the jury was allowed to deduct the entire amount claimed by the attachment from the debt secured by the mortgage.They have therefore sustained no injury.

A second position taken by the terre-tenants was that the plaintiff could not proceed upon the mortgage, because he had taken from the mortgagor in the fall of 1859 or spring of 1860, negotiable promissory notes for the amount of the debt then unpaid, and had negotiated them.In reference to this the court below instructed the jury that if the notes were taken from the amount of the mortgage, with an agreement that they should be received as satisfaction in full or to the extent of the notes, it would amount to a satisfaction of the mortgage, and the plaintiff could not recover.But if the arrangement was that the notes should be received not as absolute payment, but to enable the mortgagee to raise money, and to be credited on the mortgage when paid, and if they had not been paid, and the mortgagee still remained liable for them, taking the notes did not amount to a defence.Thus far no just exception could have been taken, and none was taken.But the court was asked to instruct the jury that, should they find negotiable notes were given by Orr (the mortgagor) and accepted by Scott (the mortgagee) for the amount of the mortgage, the legal presumption is that such notes were given and accepted in satisfaction and payment of the mortgage.This propositionthe court refused to affirm, and the refusal is now claimed to have been erroneous.The complaint is, however, not sustainable.It is true, that in Massachusetts and in Maine it is held that if a debtor gives his negotiable promissory note for the amount of his precedent debt, the law presumes it a payment and discharge of the debt, in the absence of any agreement to the contrary.But such is not the general rule of the common law.No such presumption is raised.It is a question for the jury without any presumption of discharge of the antecedent debt.So it is held in the English courts, in those of the United States, and in the courts of the states generally: Sheehy v. Mandeville, 6 Cranch 553;Peter v. Beverly, 10 Pet. 567;Burdick v. Green, 15 Johns. 247;Davidson v. Bridgport, 8 Conn. 472;Elliot v. Green, 2 N. H. 526.And such is undoubtedly the doctrine maintained in this state.In Hart v. Boller, 15 S. &R. 132, it was asserted as a general rule that if one indebted to another by note gives another note to the same person for the same sum, without any new consideration, the second note shall not be deemed a satisfaction of the first, unless so intended and accepted by the creditor, and it was said the intention...