Harrison v. Phillips

• Citation: 46 Mo. 520
• Parties: JAMES HARRISON, Appellant, v. ANSYL PHILLIPS, Respondent.
• Decision Date: 31 October 1870
• Court: United States State Supreme Court of Missouri

46 Mo. 520

JAMES HARRISON, Appellant,

v.ANSYL PHILLIPS, Respondent.

Supreme Court of Missouri.

October Term, 1870.

Appeal from St. Louis Circuit Court.

Edward W. Shands was duly appointed and qualified as collector of the State and county revenue within and for the county of St. Louis, in the State of Missouri, for the year 1860, and until his successor should be duly appointed and qualified. The said Shands filed his official bond for $500,000, dated February 23, 1860, wherein said Shands was principal. The bond was conditioned for his faithful discharge of his duties as collector, and paying over to the State and county aforesaid all money collected. Shands, while acting as collector and holding said office, failed to pay over the sum of $24,483.18 of the revenue collected by him or his deputies; and on the 23d day of June, 1862, the State of Missouri, through its auditor, Wm. S. Mosely, sent a copy of said Shands' account as collector to his sureties, showing said balance of $24,483.18 against him, and calling upon them for payment in order to avoid further steps. Thereupon the solvent sureties paid in said amount, each paying an equal portion thereof.

Said Shands, of the revenue so collected by him, deposited the sum of $2,878.83 in the State Savings Association of St. Louis, which sum was not made a special deposit, but was deposited in his name as collector.

On the 11th day of December, 1863, the defendant in this suit, Ansyl Phillips, instituted an attachment suit in his own name against Shands to recover the money paid by said Phillips to the State of Missouri, as bondsman. In this suit Phillips caused said State Savings Association to be garnished as the debtor of said Shands, and, after regular proceedings to that end were had, recovered of the garnishee the said sum of $2,878.83, less $39.15, costs of said suit.

Cline, Jamison & Day, for appellant.

I. When the sureties made good the deficit to the State, in equity all right to the money at the State Savings Association passed from the State to the contributing sureties in proportion as they had paid, subject only to all equities of innocent holders and claimants; and its acquisition by one of the sureties at any time thereafter, whether by legal process or voluntary payment, would in equity inure to the benefit of all, and could in no wise break the right thereto that resulted in their favor at the instant they paid the State. The diligence of one in reducing it to possession is the diligence of all, subject to all reasonable expenses incurred in getting the same, as their relation to each other in reference to this fund disabled each from acting for himself in reference thereto as against the interest of the others. The relation they bore to each other and to this fund made each one a trustee for all in relation thereto, and disabled each from acting for himself alone in its acquisition. (Furnold v. Bank of the State of Missouri, 44 Mo. 336; Seeley's Adm'r v. Beck, 42 Mo. 143; Cole County et al. v. Price et al., 12 Mo. 132; Miller v. Woodward et al., 8 Mo. 169; McCune v. Belt et al., 38 Mo. 293.) Had this been the money of Col. Shands, the defaulter, and not the property of the State, then the rule would be different, and no equity could attach thereto as between these sureties. Vigilance could then claim her reward.

II. The extraordinary remedy of distress provided by the statute, in the first instance, against the collector and his sureties in case of default on the bond (R. C. 1855, pp. 1542-4), takes from the State none of the ordinary rights secured to it by law to pursue any remedy the State should see fit to adopt in the premises to secure money or its proceeds, belonging to the State, in the hands of her defaulting trustee or officer, whether in his possession or placed by him in the hands of another, or any property or chose in action into which it had been unlawfully converted by the agent of the State.

Ewing & Holliday, for respondent.

I. The liability of the defendant can be maintained only, if at all, upon the theory that a surety who pays a debt is entitled to stand in the place of the creditor as to all liens and equities to which he has a right to look as a security for the payment of his debt. The present case can not come within the operation of that principle, unless it be shown that before and at the time the plaintiff and other sureties of Shands paid the debt of the latter to the State, the State had a valid and subsisting lien upon the indebtedness of the State Savings Association to Shands--such a lien as a court of equity would have enforced at its instance for satisfaction of its debt. (1 W. & T. Lead. Cas. Eq. 131-72; 4 Metc., Ky., 247.) Shands was the collector of the revenue, and gave bond for the faithful performance of his duties. This was the only indemnity the State ever had. Shands, by the deposit of money with the State Savings Association, became its creditor, and the same relation of debtor and creditor was thereby created that results from a deposit in any other case. The deposit by Shands was neither to the credit of the State nor the county, and whether to the credit of Edward Shands, or to Edward Shands, collector, is wholly immaterial. How could the State have a lien under such circumstances? This money, when deposited, passed into the funds of the bank, and the bank became liable to Shands for the amount of money deposited, and not for any specific fund. The bank became the debtor of Shands, and of no one else. The remedy provided for the State to recover this amount due from the collector on settlement is most summary, full, and complete--by the issue of a warrant of distress against such delinquent and his securities. (R. C. 1855, p. 1542, § 3.) The remedy is summary and complete as long as the principal or sureties are solvent, and there could be no equity if the redress is complete at law; and, on this distress warrant, the bank could have been garnished immediately for this very indebtedness. No resort to equity is necessary to reach this indebtedness.

II. The State had no lien upon this indebtedness of the State Savings Association to Shands, because the money deposited, that created the indebtedness, did not belong to the State. Shands was collector of the State and county revenue. It was his duty also, under the law, to collect the school fund. The State taxes and county taxes are, by law, assessed in the same tax book and collected on the same tax bills. For the State taxes the collector is responsible to the State, and for the county taxes to the county. It can not be said that the collector receives any certain distinguishable part of the money collected by him for State taxes, and another distinguishable part for county taxes. An action of replevin, or for the claim and delivery of personal property, as we now term it, could not lie in favor of the State against the State Savings Association for this money, even had Shands made a special deposit of the actual money collected by him.

III. The sureties in this case each paid his own proportion separately; consequently their legal demands against the principal are in their nature several, and they can not join in suing the principal. (Messer v. Swan, 4 N. H. 482, 488; Lombard v. Cobb, 14 Me. 222; Gould v. Gould, 8 Cow. 168.) In all the reported cases where sureties have been compelled to divide with their co-sureties, the money or property so divided wlll be found to have been received while the interests of the sureties were joint and not several. In the case at bar, nothing was received by Phillips until nearly two years after each of the sureties had paid his several portion of Shands' indebtedness to the State. (Agnew v. Bell, 4 Watts, 31, 33.)

IV. When the sureties paid the debt they were at once subrogated to the rights of the State, if any, and entitled to enforce, each for himself, all the State's liens, priorities, and means of payment. Their claims against Shands being several, all stood on an even plain as to liens, rights, and priorities. The principle or maxim then applies, vigilantibus non dormientibus jura subveniunt. Where judgments have equal effect as liens upon the real estate of the debtor, the creditor who first levies his execution upon the land subject to the lien thereby acquires a priority and is entitled to be first paid out of the proceeds of the sale. (Bruce v. Vogel, 38 Mo. 100; Smith v. Lind, 29 Ill. 24; Adams v. Dyer, 8 Johns. 347; Waterman v. Haskins, 11 Johns. 228.)

BLISS, Judge, delivered the opinion of the court.

The right of the plaintiff to a proportionate...