Deans v. Robertson

• Decision Date: 17 January 1887
• Court: Mississippi Supreme Court
• Parties: WILLIAM DEANS AND WIFE v. W. H. ROBERTSON ET AL

1 So. 159

64 Miss. 195

WILLIAM DEANS AND WIFE v. W. H. ROBERTSON ET AL

Supreme Court of Mississippi

January 17, 1887

APPEAL from the Chancery Court of Clay County, Hon. F. A. CRITZ Chancellor.

From January 1, 1883, to February 5, 1886, W. H. Robertson & Co. were carrying on the business of merchants without a privilege license. During that time William Deans became indebted to them for goods bought in the sum of five hundred and ninety-three dollars and eighty-five cents. On January 17, 1886, they executed their two notes, payable October 1 1886, to Robertson & Co. for that amount, and secured it by a deed of trust on certain real and personal property. These notes and security were assigned by Robertson & Co. to the First National Bank, of West Point, as collateral security for a debt due it from Robertson & Co. The notes fell due and were not paid, and the trustee was proceeding to sell the property covered by the deed of trust, when Deans and wife filed this bill against Robertson & Co., the bank, and the trustee, setting out the above facts and asking that the sale be enjoined and the notes and deed of trust be ordered to be surrendered for cancellation, because null and void under § 589 of the Code of 1880 by reason of the failure of Robertson & Co. to have a privilege license.

The bill nowhere offers to pay the notes of complainants held by the bank, which are admitted to be justly due. The defendants demurred to the bill on the grounds (1) that the bill shows no equity as against the defendant, the First National Bank (2) that the bill fails to show any equity. The Chancellor sustained the demurrer and the complainants appealed.

Affirmed.

Fred. Beall, for the appellants.

1. The main question in this case is whether the assignee of a claim, void in the hands of the assignors, who were merchants, because they had not paid their privilege tax, can enforce the collection thereof, they holding it as collateral?

In Robertson & Co.'s hands the claims were void, utterly null, so far as they were concerned, and they could maintain no suit thereon. Can the First National Bank, which now holds those claims as collateral security to a debt owed to the bank by Robertson & Co., base a claim or maintain a suit thereon?

The answer depends on a construction of § 589 of Code of 1880.

Robertson & Co. base a claim on the contracts in this case. The claim based by them on these void contracts they attempt to assign to the bank as collateral security. If they could base no claim on the contract, if it was in absolute nullity in their hands, how can a transfer of nothing become something in the hands of the bank? As to Robertson & Co., it was as a blank piece of paper. The writing of their name on the back certainly cannot have the effect to create a contract binding on Dean and wife.

2. As to the right of appellants to bring on the fight, to have the first deed declared void as a cloud upon their title to their land and other property, that is a right as old as equity itself, as hoary-headed as punitive justice. In this connection I refer to McWilliams v. Phillips, 51 Miss. 196; Union Natl. Bk. v. Fraser, 63 Ib. 231; Thalemer v. Brinkerhoff, 20 Johns. 399.

Barry &amp Beckett, for the appellees.

The bill shows that it is brought by appellants to enjoin a foreclosure of the trust-deed in pais.

While Robertson & Co. are debarred from going into a court to assert their rights, they are not precluded by the statute from acting in pais. The court says, "its language is plain and unambiguous. It declares that no suit shall be maintained in favor of the violator of the law," e...