Renick v. Ludington

• Decision Date: 14 December 1878
• Citation: Renick v. Ludington, 14 W. Va. 367 (W. Va. 1878)
• Parties: RENIC v. LUDINGTON et al.
• Court: West Virginia Supreme Court

14 W.Va. 367

RENIC v. LUDINGTON et al.

Supreme Court of West Virginia.

December 14, 1878

1. As between the judgment creditor and debtor the statute requiring the judgment to be docketed has no application or force.

2. Section 5 of chapter 139 of the Code gives a positive express lien of a judgment against all the lands, of or to which the debtor shall be possessed or entitled at or after the date of such judgment, or if it was rendered in court, at or after the commencement of the term, at which it was so rendered and such lien continues until it is in some legal manner discharged.

3. Where various judgments are rendered against a debtor, and the junior judgments are docketed, and the senior undocketed and in this state of things the debtor conveys a part of the land to a purchaser for valuable consideration without notice of the undocketed judgments, and the docketed judgment liens are not discharged, the liens of the undocketed judgments must be discharged out of the proceeds of the unsold lands although the effect might be to require the holders of the docketed judgments to resort in whole or in part to the land so conveyed for satisfaction of their judgment liens.

4. Section 7 of chapter 139 was enacted for the protection of purchasers for valuable consideration without notice of judgments; but that protection only extends to the land so conveyed to such purchaser, it being liable to the satisfaction of judgments docketed according to law and to such judgments only.

5. A judgment is recovered, and an execution issued thereon, and while it is in the hands of the sheriff, an agreement is made between the creditor and debtor, by which certain claims are transferred to the creditor in satisfaction of the judgment and thereupon the sheriff, at the instance of the creditor, returns the execution " satisfied," but it appears, that said agreement on the part of the debtor was fraudulent and the execution was not in fact satisfied, the lien of the judgment is not destroyed, and its position and priority is not disturbed, although its payment may affect purchasers of part of the land of the debtor, where it does not appear in the pleadings and proofs, that such return was brought home to the purchaser, and by it he was misled to his injury.

6. A creditor, in order to preserve his rights against a surety, is not bound to active diligence, and if he merely remain passive, his rights are not thereby impaired.

7. But if he does not remain passive, but attempts to collect the debt, and compromises the same, and by such compromise puts it out of the power of the surety, against whom he subsequently proceeds, to be subrogated to the rights of the creditor and reimburse himself if he paid the debt, the right of the creditor to proceed against the surety is by such act destroyed.

Appeal from certain degrees of the circuit court of Greenbrier county, pronounced, one on the 21st day of June, 1876, and two on the 25th day of June, 1877, in a cause in said court then pending, wherein B. F. Renick was plaintiff and S. C. Ludington and others were defendants, allowed on the petition of the said defendants.

Hon. Homer A. Holt, judge of the eighth judicial circuit, pronounced the decrees appealed from.

JOHNSON, JUDGE, furnishes the following statement of the case:

B. F. Renick in September, 1874, instituted a chancery suit in the circuit court of Greenbrier county, against S. C. Ludington and others, to subject the lands of said Ludington to the payment of his and other judgment liens. The cause was referred to a commissioner and the liens audited.

The record shows that part of the appellants were purchasers of tracts of land of said S. C. Ludington. At the time of the purchase of said tracts of land there were a number of judgments against said Ludington. Some were docketed, and others undocketed. The purchasers claimed, that the judgment creditors, who had failed to docket their judgments, had lost their liens entirely, provided their enforcement would require those that were docketed to be satisfied out of the lands they had purchased.

The bill attacked as fradulent a conveyance of a tract of four hundred and fifty acres of land by S. C. Ludington to a trustee for the benefit of Mrs. Ludington, the wife of S. C. Ludington. The answer of Mrs. Ludington was filed, denying the fraud, & c. Proofs were taken and the court decreed, that said deed was valid; but afterwards the land conveyed to her by said deed was sold by a commissioner in this suit; and Mrs. Ludington became the purchaser, and paid so much of the purchase money as was required to be paid, and gave her bond with security for the residue. The sale was confirmed, and the court declared in a subsequent decree, that Mrs. Ludington had refused to accept the provisions of the deed to her trustee for her benefit, and had bought the land at the commissioner's sale; and that said lands must be regarded as " unsold" lands, that is, that they had not been sold and conveyed by S. C. Ludington.

It does not appear what induced Mrs. Ludington to consent that the lands should be sold by the commissioner. There was no exception to the report of sale by any one.

Michael Fleshman filed his petition in the cause, which he prayed might be taken as an answer to the bill and which was so treated, in which he set up his judgment against said Ludington, and showed that an execution thereon had been by his direction returned satisfied, but that it had been done through the fraud of said S. C. Ludington; that said Ludington had given him an order on certain parties, and transferred certain stock in a turnpike company; that he represented to him that he owned the stock, and that the order was good; but that the representations were false, that the order was worthless, and that he did not own the stock, and could make no transfer of it. No special replication was made to the answer.

Many depositions were taken upon the question of the fradulent inducement to order the execution to be returned satisfied, among which was the deposition of the defendant, S. C. Ludington. The evidence clearly showed that the defendant, Ludington, was guilty of fraud in the agreement made with Fleshman, by which he was induced to order the execution returned satisfied. The court decreed that the return should be set aside, and gave the judgment of the said Fleshman its place as a lien which was not docketed against the " unsold" lands of said Ludington. The circumstances, under which the court decreed that said Ludington should pay to Joel McPherson one-fourth of the judgment he had recovered against John E. Lewis, a defaulting sheriff of Greenbrier county, and his sureties, are sufficiently set out in the opinion of the court.

The court decreed, that the undocketed judgments should be paid in the order of their priorities, out of the lands of the debtor unsold, and that the docketed judgments in the order of their being docketed, after the unsold land had been exhausted, should revert to the " sold" lands in the order of their sales, taking those last sold first, and so on.

From the decrees entered in the cause on the 21st of June, 1876, and the 25th of June, 1877, an appeal was granted.

A. C. Snyder, for appellants, cited the following authorities:

Code, ch. 139, §§5, 7, 8, 9; 2 Gratt. 182; 26 Gratt. 81; 1 Story's Eq. Jur. §§ 64, c., 381, 434; 24 Gratt. 313; Id. 241; 9 Gratt. 27; 2 Bibb 40; Stat. Westm. 2, 13 Edward I. ch. 18; 1 R. Code, ch. 134, § 1; 28 Gratt. 423; 4 Pet. 124; 1 Story's Eq. Jur. §416; 2 Story's Eq. Jur. §§1502, 1503, b. and n. 1; Va. Law Journ. (May 1877,) p. 266; 1 T. R. 12, 16; 1 Story's Eq, Jur. §§105, 109; 1 Salk. 289; Story's Agency §127; 20 Iowa 373; 2 Watts 459; 22 Ill. 484; 5 Md. 281; 17 Ohio St. 635; 3 Ind. 327; 22 Md. 94; 12 Md. 144; 24 Ala. 439; 20 Ala. 662; 7 Cow. 434; 14 La. Ann. 56; 18 Wis. 575; 40 Ga. 56; 10 Gratt. 173; 64 N.Y. 294; 21 Am. R. 609, 611; 1 Story's Eq. Jur. §§165, 381, 410; Sp. Ct. App. Va. L. J. Feb. 1877; 64 N.Y. 397; 21 Am. R. 625; 1 Story's Eq. Jur. §§325, 326, 327; 3 Lead. Ca. Eq. 814, (3d Am. ed. 552.)

John W. Harris, for McPherson, appellee, cited the following authorities:

13 Edward I, ch. 18; 2 Gratt. 44; 28 Gratt. 423; 2 Gratt. 419; 1 Lom. Dig. 371 and cases cited; Acts of Va. 1842-3 ch. 74; Code W.Va., ch. 139, § §7, 9; 2 Leigh 425; 3 Leigh 532; 10 Leigh 394; Rep. Rev. Code p. 918; 10 Pet. 527; 36 Gratt. 549; 8 N.H. 389; 4 Smed. & M. (Miss.) 169; 7 Smed. & M. (Miss.) 437.

William P. Rucker, for M. Fleshman, appellee, cited the following authorities:

2 Par. Contr. (3d ed.) 271, 272 and notes; 2 Tuck. Com. 424; Adams Eq. 432; Smith Man. Eq. 68; 2 Lom. Dig. 296, 299; 3 Leigh 567; 2 Tuck. Com. 421; 6 Munf. 366; 2 Leigh 149; 1 Munf. 518; Gil. 230; Smith Man. Eq. 64; 2 Lom. Dig. 386, 387; 3 Gratt. 253; 2 Par. Contr. (3d ed.) 130, 131, 133, 134, 136 and notes; Smith Man. Law 325; 7 Leigh 346; 6 Leigh 230; 5 Rand. 31; 2 H. & M. 114; 2 Rob. (old) Prac. 310; 2 Tuck. Com. 416; 1 Wash. 145; Adams Eq., side page, 176; Angel Lim. (5th ed.) 24. 192; 10 W.Va. 662; Id. 321; Id. 677, Code Va. 770; Code W.Va. 666, §§5, 7; 2 Rand. 384; 4 Rand. 282; Code, ch. 74, §§1, 2; 1 Rob. 123; Id. 500; 4 Rand. 309, 314, 315; 1 Rob. 135; Id. 298; Code W.Va. 473; 1 Rand. 217, 327; 1 Tuck. Com. 116, 325, 327; Code W.Va. 474; 2 Call. 198; 4 Rand. 208; 8 Gratt. 148; 2 Lom. Dig. 444, 458; 7 W.Va. 442, 443; Code W.Va., ch. 66, §1; 4 Rand. 314, 315; Bump. 76; Id. 92; 3 Gratt. 33; 10 W.Va. 87; 3 Munf. 521; 1 Rob. 123; 3 Gratt. 26; 4 Gratt. 430; 2 Tuck. Com. 442, 443; Code W.Va., ch. 130, §23; 10 W.Va. 59; 1 Par. Contr. (3d ed.) 363, 364, 365; Smith Man. Eq. 47, 48; Adams Eq. 443, 444; 2 Rand. 442; 1 Greenl. Ev. 192 and notes; 2 Lom. Dig. 91; Code W.Va. 549.

OPINION

JOHNSON JUDGE.

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