Mayor v. Baker

• Citation: 26 A. 324,51 N.J.E. 49
• Parties: MAYOR, ETC., OF CITY OF PATERSON v. BAKER.
• Decision Date: 03 April 1893
• Court: New Jersey Court of Chancery

26 A. 324

51 N.J.E. 49

MAYOR, ETC., OF CITY OF PATERSON

v. BAKER.

Court of Chancery of New Jersey.

April 3, 1893.

(Syllabus by the Court.)

Bill by the mayor and aldermen of the city of Paterson against Elizabeth D. Baker to compel defendant to deliver to complainant certain bonds adjudged to belong to the city. Judgment for complainant.

T. C. Simonton, for complainant.

Samuel C. Mount, for defendant.

VAN FLEET, V. C. The object of this suit is to compel the defendant to surrender two bonds for cancellation. The complainant rests its right to the relief it asks on the following propositions: That by a judgment pronounced by the supreme court of this state in November, 1882, it was adjudged that the defendant's testator was not the bona fide owner or holder of the bonds in question, and, as the complainant has paid the full value of the bonds to their true owner, and as they are negotiable, and still unmatured, and thus in a condition which puts in the defendant power to impart full validity to them by making sale of them to an innocent purchaser for value, justice can only be done and wrong prevented by compelling the defendant to surrender the bonds. The claim is that, although the bonds are worthless in the defendant's hands, yet, in consequence of their negotiability, she may nevertheless dispose of them in such manner as to make them valid in the hands of an innocent third person, and will, in that event, deprive the complainant of the immunity to which, by the judgment of the supreme court, and its own act in making payment, it is entitled. If it be true that the effect of the judgment of the supreme court and the payment to the rightful owner is to render the bonds in the hands of the defendant without legal force as against the complainant, then it is manifest that nothing short of their surrender will put it completely out of the power of the defendant to commit the wrong against which the complainant asks protection. The dispute in this case had its origin in the following facts: The complainant, in April, 1865, issued 200 coupon bonds for $500 each, payable to hearer on the 1st day of December, 1897, bearing 7 per cent. interest, payable semiaunually on the 1st days of June and December of each year; about the time of their issue one John Petrie purchased several of these bonds, among them the two numbered 535 and 542. The two so numbered were stolen from Petrie's dwelling about the 1st of January, 1866. Public notice of the theft was given in April, 1867. Subsequently, and some time prior to 1870, the complainant, on proof of the theft, and after receiving a bond of indemnity, paid Petrie the full value of the two bonds. In 1873 or 1874 Petrie heard that the stolen bonds were in the possession of one James Baker, and shortly thereafter visited Baker, and tried, without success, to find out how and where Baker had obtained them. When the coupons attached to these two bonds, falling due December 1, 1874, were presented for payment, payment was refused. Nothing further was done by either party until May, 1881, when Baker brought suit against the complainant in the supreme court to recover the amount due on 13 coupons attached to each of the stolen bonds. To a declaration containing a special count on the 26 coupons, and the common counts, the complainant filed a plea of the general issue, but subsequently, on a demand for particulars specified as the ground of its defense that Baker was not the bona fide owner and holder of the bonds to which the coupons sued on were attached. On the issue thus made up, a trial was had, resulting in a verdict for the complainant and against Baker, on which judgment was entered in November, 1882. That judgment still stands in full force. No attempt was ever made, so far as appears, to arrest or reverse it. Baker died in March, 1885, leaving a will, which has been admitted to probate, and under which the defendant, besides becoming his executrix, takes all his personal property. She is his widow. With respect to the bonds in question, she stands in the right of her testator, and precisely where he did. She admits that the bonds came into her possession on his death as part of his estate. So she merely succeeded to his rights; if the bonds were worthless in his hands, they are equally valueless in hers.

The first and most important question presented is, is it true that it was adjudged by the supreme court, in the suit just mentioned, that the defendant's testator was not the bona fide owner or holder of the instruments in question? In other words, that they were invalid in his hands as against the complainant? If so, that question is resjudicata between these litigants, for, in my judgment, nothing is better settled as a principle of jurisprudence than that the judgment of a court of competent jurisdiction, on a point of law or a question of fact, or on a question of blended law and fact, does, so long as it remains unreversed, have the effect, as between the parties and those standing in privity with them, to put the question or matter adjudged at rest finally and forever, and for all purposes. The principle and the reason on which it rests were stated by Chief Justice Shaw in Sawyer v. Woodbury, 7 Gray, 499, 502, as follows: "It is a principle lying at the foundation of all well-conducted jurisprudence that when a right or a fact has been judicially tried and determined by a court of competent jurisdiction, the judgment thereon, so long as it remains unreversed, shall be conclusive upon the parties and those in privity with them in law or estate. The ground of such principle, we think, when rightly understood, is that the judgment presents evidence of a fact of so high a nature that nothing which could be proved by evidence aliunde would be sufficient to overcome it, and therefore it would be useless for a party against whom it can be properly applied to adduce any such evidence, and accordingly he is estopped or precluded by law from doing so." There can be no doubt then that if the complainant's right to relief in this suit rests upon the same point or question, which, in essence and substance, was litigated and determined in the suit at law, the matter in controversy here must be regarded, as between these parties, as having been finally and conclusively settled by the judgment at law, and to stand res adjudicata. After judgment final, in case no appellate proceedings are taken, in the words of Mr. Justice Field, in Bissell v. Spring Valley Tp., 124 U. S. 225, 230,8 Sup. Ct. Rep. 501: "The fact and the law are adjudged matters between the parties, and not open, therefore, to any further contest."

Now, while it is true that the suit at law was not founded on the bonds which the complainant, by this suit, asks to have surrendered, but rested wholly on certain coupons issued with the bonds in question here, still it does not at all follow that the point or question litigated and determined in the suit at law is not, in every essential respect, the same precisely that the defendant attempts to agitate in this suit. There is a plain difference, resting on obvious considerations of justice, as was held in Cromwell v. Sac County, 94 U. S. 351, and again in Bissell v. Spring Valley Tp., supra, between the effect of a judgment, as a final and conclusive determination of the rights of the parties, when it is set up in a second action resting on the same claim or demand on which the first was founded, and its effect when it is set forth in a subsequent litigation between the same parties, founded upon a different claim or cause of action. In the first, where the second suit is based upon the same claim or demand involved in the first, the judgment in the first must be treated as a finality, "concluding," in the language of Mr. Justice Field in Cromwell v. Sac County, (page 352,) "parties and those in privity with them, not only as to every matter which was offered and received to sustain or defeat the claim or demand, but as to any other admissible matter which might have been offered for that purpose. Thus, for example, a judgment rendered upon a promissory note is conclusive as to the validity of the instrument and the amount due upon it, although it be subsequently alleged that perfect defenses actually existed, of which no proof was offered, such as forgery, want of consideration, or payment. * * * But where the second action...