Clark v. Johnson & Latimer

• Citation: 7 Ala.App. 507,61 So. 34
• Parties: CLARK et al. v. JOHNSON & LATIMER.
• Decision Date: 21 January 1913
• Court: Alabama Court of Appeals

61 So. 34

7 Ala.App. 507

CLARK et al. v. JOHNSON & LATIMER.

Court of Appeals of Alabama

January 21, 1913

Appeal from Circuit Court, Geneva County; H.A. Pearce, Judge.

Action by Johnson & Latimer against J.R. Clark and another. From a judgment granting plaintiffs a new trial after directed verdict for defendants, defendants appeal. Affirmed.

W.O. Mulkey, of Geneva, for appellants.

C.D. Carmichael, of Geneva, for appellees.

THOMAS J.

This was an action on the case by appellees, Johnson & Latimer against appellants, J.R. Clark and W.H. Holloway, for the destruction of a judgment lien on one horse, the property of J.D. Holloway, against whom plaintiffs alleged in the complaint they had previously obtained a judgment in the circuit court of Geneva county and duly recorded a certificate thereof in said county. On the trial, after the conclusion of the evidence introduced by the respective parties, the court, at the request of the defendants in writing, granted them the general affirmative charge whereupon there was verdict and judgment accordingly. Later during the term the plaintiff made a motion for a new trial upon the sole ground that the court had erred on the trial in giving the general affirmative charge for defendants. This motion was granted, and formal order and judgment to that end were duly entered. The defendants prosecute this appeal from that judgment, and in the record submitted is a bill of exceptions purporting to contain all the evidence in the case. Our consideration is therefore narrowed to a single inquiry, involving several points, however, to wit: Did the lower court err in giving the general affirmative charge for the defendants? If it did, the new trial was properly granted; and if it did not, it was not.

The judgment upon which plaintiff predicated his allegation in the complaint of a lien upon the horse mentioned, and which lien was alleged to have been destroyed by the defendants, was a judgment of plaintiffs against "William Holloway and J.D. Holloway, former partners doing business under the name and style of the Holloway Mill Company." This, under the authorities, while a judgment against the Holloway Mill Company, is yet also a judgment against the partners individually, and well supports the allegation in the complaint of a judgment against said J.D. Holloway. Baldridge v. Eason, 99 Ala. 516, 13 So. 74; Dollins v. Adams & Pollock, 89 Ala. 351, 7 So. 904; Leinkauff v. Strauss & Munter, 76 Ala. 196; Blackman v. Moore & Handley Hdw. Co., 106 Ala. 460, 17 So. 629; Code, § 2506. It is the same (made so by section 2506 of the Code) as if he had been sued alone on an unsatisfied judgment previously obtained against the partnership only. Cox v. Harris, 48 Ala. 538. Under it his individual property is subject to execution issued thereon without first resorting to and exhausting the partnership property. Pearce v. Shorter, 50 Ala. 318; Dollins v. Adams, supra; Leinkauff v. Strauss, supra; Baldridge v. Eason, supra.

The lien of a recorded certificate of such a judgment covered all the individual property of said J.D. Holloway, subject to levy and sale under execution issued on said judgment, in Geneva county, where it was recorded, and hence covered the horse mentioned. Code, § 4157.

While it is a general rule, as contended by appellants, that the assets of an insolvent partner are to be first applied to the payment of his individual debts, and that partnership creditors can only share in the surplus of such assets beyond what is necessary to satisfy the individual creditors, yet this is a rule of equity, and not of law--the equity of marshaling assets--applied in the chancery court upon dissolution and settlement of insolvent partnerships, and in the probate court upon settlement of insolvent estates of decedents, when deceased had been a member of a partnership in his lifetime and left both individual and partnership obligations unsatisfied. Claflin & Co. v. Behr, 89 Ala. 503, 8 So. 45; Van Wagner v. Chapman, 29 Ala. 172; Smith v. Mallory, 24 Ala. 628; Bridges v. McCullough, 27 Ala. 661; Evans v. Winston, 74 Ala. 349.

It was not, therefore, incumbent, contrary to the insistence of appellants, upon plaintiff in this action, who is a partnership creditor, to show, before he could subject to the payment of his debt the assets of one of the individuals of that partnership, that that individual owed no separate debts, or that there would be a surplus of such assets after paying such separate debts. This would be requiring of the plaintiff, as a condition to the assertion and maintenance of a legal right, the duty of negativing the existence of facts which would support equitable rights in others, in proceedings in another court that may never be commenced, and which plaintiff was certainly under no duty to commence for them. Couch v. Davidson, 109 Ala. 320, 19 So. 507. Besides, if it were necessary for plaintiff to negative the right of the individual creditors of J.D. Holloway to "marshal" the property of his (one horse) here involved, it was sufficiently done by the introduction in evidence of plaintiff's said judgment against him, and the recorded certificate thereof. By it plaintiff obtained a legal lien on the property for the satisfaction of his debt, paramount and superior to any equity the individual or separate creditors of said J.D. Holloway might have had to marshal said property so as to pay out of it their debts before any partnership debt he might owe. Meech v. Allen, 17 N.Y. 300, 72 Am.Dec. 465.

If such marshaling proceedings had been actually commenced before the plaintiff acquired his lien upon the property, and were pending at the time of this trial, under such circumstances that the defendants here sued would still be liable to an administrator or receiver, appointed in such proceedings by the appropriate court, for the same assets of the judgment debtor here sought to be reached by the plaintiff, then the defendant could probably set this up in defense of the present action in order to avoid double liability for the same tort in converting such assets. Kelly v. McCaw, 29 Ala. 227. But even then the burden of proving such facts would not be on plaintiff. Hence there is certainly no merit in appellant's contention that in order to maintain this suit it was necessary for plaintiff to show, either that J.D. Holloway owed no individual debts, or that the amount of them was less than the total value of all his property.

The gravamen of an action of this character is the destruction of a lien on property so that it cannot be enforced against the property by the lienholder, which destruction may arise, we conceive, in various ways: Either from the destruction or consumption of the property itself; or by a removal of it from the state (Hussey v. Peebles, 53 Ala. 434); or by a hiding or concealing of it within the state; or by a removal of it to other parts of the same county, city, or state so that the lienholder does not know where it is though it is neither hidden nor concealed (Shepherd v. Taylor, 105 Ala. 508, 17 So. 88; Baker v. Allen, 161 Ala. 288, 49 South. 847); or a mere sale of it to some person without notice, actual or constructive, of the lien and under such circumstances as that such person would be protected as a bona fide purchaser against such lien; or any other act of interference with the property to such an extent that the lien upon it is lost, destroyed, or impaired, and cannot be enforced (Hussey v. Peebles, 53 Ala. 434; Baker v. Allen, 161 Ala.288, 49 So. 847; Ehrman v. Oats, 101 Ala. 606, 14 So. 361; McCarty v. Roswald & Co., 105 Ala. 511, 17 So. 120; Scarbrough v. Rowan, 125 Ala. 511, 27 So. 919; Couch v. Davidson, 109 Ala. 320, 19 So. 507; Shepherd v. Taylor, 105 Ala. 508, 17 So. 88; 13 Ency.Pl. & Pr. 168, 171). And any wrongdoer in the chain of acts by which the lien is destroyed, whether his act results directly or indirectly in the destruction, is responsible. Chattahoochee & Gulf Ry. Co. v. Behrman, 136 Ala. 511, 35 So. 132. But the final result must be a destruction or impairment in order to fix a liability on either the initial, mediate, or immediate wrongdoer; for...