Paulina Whiting, and Helen Whiting, Heirs At Law of Ruggles Whiting, Deceased James Richardson, Administrator of Ruggles Whiting, and Enfield Johnson, and Gabriel Johnson, Appellants v. the Bank of the United States

• Decision Date: 01 January 1839
• Citation: 13 Pet. 6,38 U.S. 6,10 L.Ed. 33
• Parties: PAULINA S. WHITING, AND HELEN B. WHITING, HEIRS AT LAW OF RUGGLES WHITING, DECEASED, JAMES RICHARDSON, ADMINISTRATOR OF RUGGLES WHITING, AND ENFIELD JOHNSON, AND GABRIEL J. JOHNSON, APPELLANTS, v. THE BANK OF THE UNITED STATES
• Court: U.S. Supreme Court

38 U.S. 6

13 Pet. 6

10 L.Ed. 33

PAULINA S. WHITING, AND HELEN B. WHITING, HEIRS AT LAW

OF RUGGLES WHITING, DECEASED, JAMES RICHARDSON,

ADMINISTRATOR OF RUGGLES WHITING, AND ENFIELD JOHNSON,

AND GABRIEL J. JOHNSON, APPELLANTS,

v.THE BANK OF THE UNITED STATES.

January Term, 1839

APPEAL from the Circuit Court of the United States for the District of Kentucky.

The case as stated in the opinion of the Court, was as follows:—

'This is the case of a bill, purporting to be a bill of review.The substantial facts, as they appear on the record, are as follows:—Gabriel J. Johnson, being the owner in remainder of a five acre lot, No. 9, in Louisville, Kentucky, of which his mother, Enfield Johnson, was tenant for life, under the will of his father, and being also the owner in fee by another title of another piece of land adjoining the five acre lot, a part of the slip No. 2, on the 12th day of November, A.D. 1818, conveyed the same in mortgage to James D. Breckenridge, to secure the latter for his endorsements of three certain notes of Johnson to Ruggles Whiting, each. for four thousand dollars, and for any other notes and contracts which Breckenridge should thereafter make, execute, accept, or endorse for the benefit of Johnson.Afterwards, on the 9th day of August, A.D. 1820 Johnson & Breckenridge, as his surety, being indebted to the Bank of the United States in the sum of nine thousand nine hundred and thirty-one dollars and thirty-seven cents, arrangements were made between them and Whiting, by which Whiting assumed the payment of the same debt, and gave his note therefor, to the bank accordingly; and as security for the due payment thereof, Johnson and his motherEnfield Johnson, Breckenridge and Whiting, on the same day, executed a mortgage of the five acre lot and slip of land above mentioned to the Bank of the United States, reciting, among other things, the foregoing arrangement.The condition of the mortgage, among other things, stated, that it was agreed by the parties, that after the satisfaction of the said demands due by Whiting to the bank, and by Gabriel J. Johnson to Whiting, the estate or the residue thereof, or any surplus in money, by the sale thereof, should be paid or conveyed to Enfield Johnson, or her assigns.The mortgage also contained a stipulation for the sale of the premises, to meet the payment of the debt due to the bank.In April, 1823, the debt due and thus secured to the bank remaining unpaid, a bill for a foreclosure and sale was brought by the bank, in the Circuit Court of the United States for the District of Kentucky; and to that billGabriel J. Johnson, Enfield Johnson, and Whiting were made parties.But Breckenridge was not made a party.At the November term of the Circuit Court, A.D. 1826, a decree of foreclosure of all the equity or right of resumption of the defendants in the mortgaged premises, was passed; and a further decree, that the premises should be sold by commissioners.The sale took place accordingly; the bank became the purchasers, and the sale was confirmed by the Circuit Court, at May term, 1827.In the intermediate time between the original decree of foreclosure and the sale, viz., on the 26th of February, 1827, Whiting died in Massachusetts, leaving the plaintiffs in the present bill, Paulina Whiting, and Helen B. Whiting, and one L. R. Whiting(since dead without issue) his children and heirs at law who were then infants under age; and the youngest, Helen, did not come of age until 1831.

The present bill is brought by Paulina Whiting and Helen B. Whiting, by James Richardson, administrator of Ruggles Whiting, and by Gabriel J. Johnson and Enfield Johnson, against the Bank of the United States: and after stating the proceedings in the original suit upon the mortgage, and that the sale was made at a great sacrifice of the property, it relies on the following grounds of error in the proceeding, decree and sale in the original suit.1.That it was irregular and erroneous to entertain the bill, and pronounce the decree for foreclosure and sale, without Breckenridge being made a partydefendant.2.That it was irregular and erroneous to sell the property mortgaged without a revival of the suit against the heirs of Whiting.3.That it was unjust and oppressive to sell in the manner and at the price at which the sale took place.

The answer of the bank denies all equity in the plaintiffs, and insists that the decree and sale were fair and just.It also denies that Whiting and Breckenridge had any title to the property; and insists that they joined in the mortgage, merely to complete the arrangements made between Johnson and themselves.It also denies that the death of Whiting was known at the time of the sale.It states that the property was, after the purchase by the bank, improved, and parts thereof sold to bona fide purchasers, for valuable considerations; and by reason of the improvements, and the extension of the city, parts of the grounds so sold are now among the most beautiful and densely built parts of the city.The answer also states, that Whiting died insolvent and deeply indebted to the bank, by certain other judgments and notes.'

The case was argued by Mr. Underwood, at the bar, and by a printed argument submitted by Mr. Lovering for the appellants; and by Mr. Serjeant for the appellees.

For the appellants, Paulina and Helen Whiting, it was contended, they have an evident interest in the land.Being all infants at the death of their father, in February, and at the rendition of the last decree in May, they are within the exceptions of every statute of limitations operating by direct or remote analogy on this case; and their rights being joint, the disabilities must be removed before the statute can run.In England the limitation to bills of review is twenty years, and by the law of the United States five years, on writs of error; which furnishes the criterion in this case.Act of the Legislature of Kentucky, of 1816.May vs. Marsh, 2 Litt.Rep. 148

The interest of Whiting in the land was also certain and evident, and material.The title to the bank was his only security for a part, at least, of his large demand, and the only consideration for his assumption of the debts of Johnson to the bank.The hopeless insolvency of Johnson rendered the security of the land the only means of indemnity for his responsibility for the debt of ten thousand dollars—the bank held the property as a trustee for his benefit.

The proceeding in the original cause was to be regulated by the laws of Kentucky; and as Breckenridge had an interest in the property, he should have been made a party.The record shows the existence of this interest, and he has been deprived of it by the decree of the Court; and yet no notice of the proceedings has been given to him.

By the laws of Kentucky the assignee of a promissory note is liable to the assignor, if due diligence has not been used to collect the note; and Brackenridge was the endorser of notes given for a steamboat.Whiting had proceeded on the notes against Johnson, and had obtained judgment against Johnson.He then made an agreement to discharge Johnson, holding Breckenridge liable on his endorsements.The mortgage was the means of indemnity to Breckenridge, and for this reason he was a necessary party in the proceedings to foreclose.Any balance which should remain after paying the debt to the bank, would have been applied for the relief of Breckenridge, on the notes of Johnson.Morrett vs. Western2 Vern. 663.Haines vs. Beach, 3 Johns. Ch. Rep. 456. 4 Ch. Rep. 605.Ensworth vs. Lambert, 6 Ch. Rep. 450. 4 Con. Rep. Su. Ct. U. S. 190.Caldwell vs. Taggart, 4 Peters, 190.Mayo vs. Tompkins, 6 Mun. 520.

The sale of the property after the decree of foreclosure was irregular, without reviving the proceedings against the representatives of Whiting.His death before the sale made it as necessary to make his heirs and representatives parties as it was originally necessary to make Whiting a party.If it is said, that there was a right to sell under a levy made before the death of the defendant; a number of authorities sustain the contrary position.

The partydefendant has a right to come in after a sale, and object to it; if any thing in the proceedings has been irregular or illegal.If the return to the order of sale had stated that all the parties were dead, would the Court have confirmed the sale?By the laws of Kentucky the defendant has a right to point out what part of the estate may be sold under an order of sale.The necessity of the presence of the defendant at the sale, is therefore apparent.Both Breckenridge and Whiting were dead at the time of the sale, and yet the sale was confirmed.The decree confirming the sale should therefore be opened, and the parties now before the Court should be allowed to come in and redeem.Allen vs. Belcher etal. 2 Hen. & Mun. 595.Also Mackey vs. Bell, 2 Mun. 523.Lovell vs. Dana, 2 Mun. 367.Forman vs. Hunt, Ibid, 622.

The interest in the complainants is sufficient for a bill of review.4 John J. Marshall's Reports, 500.This case shows that a bill of review will lie in such a matter as that now presented to the Court.

This case will be decided by the cases which have been decided in the Courts of Kentucky.In Kentucky bills of review are allowed for errors on the face of the record, and not in cases where the error is in the decree only.In Kentucky a bill of review lies for any error in the proceedings in the case.There the decree does not, as in England, set forth the whole matter in the cause; and to deny a bill of review on the principles which apply to the cases in the Court of Chancery in England, would be to deny it altogether.

If this is the law, and it will not be denied, the record exhibits such errors as may be brought before the Court by a bill of review.Brackenridge was a necessary party.He had a deep interest in the proceedings against the land.

No...