Superior Court, New Castle County, March Term, 1916.
FOREIGN
ATTACHMENT, No. 46, January Term, 1916.
Argued
before PENNEWILL, C. J., BOYCE, CONRAD, RICE and HEISEL, JJ
in Court in Banc.
Action
by foreign attachment in the Superior Court by John Pierpont
Morgan, William P. Hamilton, Herbert L. Satterlee and Lewis
C. Ledyard, executors of John Pierpont Morgan, deceased
against James A. Ownbey. Entry of appearance by attorneys for
defendant on the appearance docket, etc., as in ordinary
actions, without giving security required by statute. Motion
to strike off. Granted. Judgment for want of appearance at
the second (March) term, amount to be ascertained by
inquisition at bar. Motion to open judgment and permit
defendant to appear and disprove claim of plaintiffs, without
giving security. Denied. Final judgment obtained by
inquisition at bar, at the subsequent (May) term. Motion to
open final judgment, and permit defendant to appear without
security and disprove or avoid the debt or claim of
plaintiffs. Denied.
These
several motions, in turn, were, without prejudice to
plaintiffs, first heard by the Court in Banc.
The
writ of foreign attachment was issued upon affidavit required
by the statute, with direction to the sheriff, indorsed on
the writ, that he summon as garnishee the Wooten Land and
Fuel Company, and demand bail in the sum of two hundred
thousand dollars. The sheriff made due return of the writ
that he attached all the shares of the capital stock of James
A. Ownbey in the Wooten Land and Fuel Company, a corporation
of the State of Delaware, with all the rights thereunto
belonging, and left a copy of the process with certain
directors of the company and received from the same a
certificate, made part of the return, showing the number of
shares held or owned by the defendant to be thirty-three
thousand three hundred and twenty-four and one-third.
On the
first rule day plaintiffs filed a declaration on the common
counts, without bill of particulars, with copy, and ruled
pleas by first general rule day thereafter.
Ward
Gray and Neary, attorneys for defendant, for the purpose of
entering an appearance for defendant, wrote their names on
the appearance docket as in ordinary cases, and on the same
day filed pleas with the Prothonotary, who marked the same
"Filed," and made the following entry in the
appearance docket:
"March
2, 1916. Defendant pleads, with copy, non assumpsit, statute
of limitations, payment. Rule reps. and issues by second rule
day in March."
On
March 13, 1916, the attorneys for the plaintiffs presented a
written motion to the court, asking that the appearance and
the entry so made be stricken off, and that the pleas be
stricken from the files of the court, for the reason that
security required by the statute had not been given.
On
March 14, 1916, at the request of the attorneys for
defendant, the time for the argument of the motion was
enlarged; and on March twenty-first they filed with the
Prothonotary another paper in the nature of an answer to the
motion, which after reciting the docket entries is as
follows:
"3.
The said Wooten Land and Fuel Company, while a corporation of
the State of Delaware, is engaged in coal mining and all
other of its activities and business in the states of
Colorado and New Mexico, where it has much and valuable
property, and is not and never has been engaged in business
in the State of Delaware.
"4.
That James A. Ownbey is a resident of the State of Colorado
and that the stock in the said the Wooten Land and Fuel
Company, which has been attached in this case, constitutes
substantially all of his property, assets and estate.
"5.
That a suit was instituted in the United States District
Court for the District of Colorado in the month of February
1915, by the plaintiffs in this cause and Francis H.
McKnight, a person under the control of the said executors of
John Pierpont Morgan, deceased, against the said the Wooten
Land and Fuel Company, this defendant and other persons,
praying for an accounting by this defendant, who had been the
General Manager of said Wooten Land and Fuel Company, and the
appointment of a receiver for said company. And in said cause
a recevier for said company was duly appointed and certain
matters therein referred to a master to take testimony. That
the master is still engaged in taking testimony in said cause
and the receiver so appointed is now in possession and
control of the property of the said the Wooten Land and Fuel
Company. That by reason of the premises the market value of
the shares of said company owned by this defendant and
attached as aforesaid has been temporarily destroyed,
although in fact of great value, so that the defendant has
found said shares unavailable to assist him in securing the
required bail or security to procure the discharge of said
shares from said attachment.
"6.
That by reason of the premises, the defendant has found it
impossible and avers it is impossible to secure bail or
security in the said sum of two hundred thousand dollars ($
200,000), or in any adequate sum for the release of his
shares in said Wooten Land and Fuel Company, attached in this
case.
"7.
That the defendant in the above stated case has a good
defense to the whole of any cause of action stated in said
suit, the nature of which defense is that there exists no
indebtedness upon any account or for any sum or sums of money
whatsoever, due to said plaintiffs or their decedent, the
said John Pierpont Morgan, from said defendant either at this
time or at the time said suit was instituted.
"8.
That the said writ of foreign attachment, issued as original
process in said cause, is a process existing under and
defined and limited by the statutes of the State of Delaware,
in that behalf. That said statutes, upon due interpretation
or construction thereof, provide:
"a.
That entry of the bail or security for the discharge of the
property seized under such writ of foreign attachment is not
a necessary prerequisite for the entry of appearance by the
defendant in such writ.
"b.
That the entry of appearance by the defendant in the said
writ may be made without disturbing the seizure of property
thereunder or its security for any judgment finally entered
in this suit.
"c.
That the purpose of the writ of foreign attachment is
two-fold, to wit: To compel the appearance of the defendant
in the cause and to devote or apply the value of the property
attached to the judgment, if any, obtained in the suit begun
by such process.
"d.
Where, in any case, appearance has been entered by the
defendant, and pleas filed, no judgment can be entered until
the trial of the issue so raised in said cause.
"9.
If the statutes of the State of Delaware, relating to foreign
attachment, cannot duly be construed so as to permit
appearance and defense, in case of a cause begun by foreign
attachment, without the entry of bail or security for the
discharge of the property seized under such writ, such
statutes are unconstitutional under the first section of the
fourteenth amendment of the Constitution of the United
States, in that:
"a.
Such statutes are laws abridging the privilege and immunities
of citizens of the United States.
"b.
Such statutes deprive parties defendant in cases brought
thereunder of property without due process of law.
"c.
Such statutes deny such defendants the equal protection of
the laws.
"10.
To require the defendant in this cause to give bond in the
sum of two hundred thousand dollars or in any sum adequate to
secure the payment of the amount of monies claimed by
plaintiff therein, or to procure the dissolution of said
attachment and the release therefrom of the shares of stock
so attached, as a condition precedent to the allowance, of an
appearance and entry of pleas in bar, in said cause, by said
defendant, is oppressive, unreasonable and in violation of
fundamental principles for the administration of
justice."
The
Prothonotary marked the same "Filed," and made the
following entry in the appearance docket:
"March
21, 1916. Reply to plaintiff's motion to strike
appearance and defence filed."
On
March 27, 1916, attorneys for plaintiffs filed a further
written motion to the effect that the entry so made in the
appearance docket be stricken off; that the paper writing
containing reply to plaintiff's first motion be stricken
from the files, for the reason that security required by the
statute had not been given; and on the same day, they also
filed another written motion, viz.:
"*
* * It appearing that * * * the defendant has not entered
special bail, * * * the * * * plaintiffs, by * * * their
attorneys, move, at this the second term after issuing the
writ, for judgment, collectible from the property attached,
pursuant to Sections 20 and 28, Chapter 126, being Sections
4137 and 4145 of the Revised Code, 1915.
"And
further, that the amount of said judgment be ascertained by
inquisition at bar."
The
Superior Court, considering that the questions of law raised
by the motions ought to be heard by the Court in Banc, did,
upon the joint application of the parties, without prejudice
to the plaintiffs, direct the same to be so heard.
Accordingly
the motions came on to be heard by the Court in Banc.
ARGUMENT
FOR PLAINTIFFS.
In
foreign attachments under the Delaware statute a common
appearance cannot be entered and the defendant cannot appear
and defend without entering special bail. Section 4137,
Revised Code of 1915; Section 4123, Id., Reybold v.
Parker, 6 Houst. 544.
The Act
passed in 1770 (Rev....
