Sheffield v. Preacher

• Decision Date: 17 September 1932
• Docket Number: 8782.
• Citation: 165 S.E. 742,175 Ga. 719
• Parties: SHEFFIELD v. PREACHER et al.
• Court: Georgia Supreme Court

165 S.E. 742

175 Ga. 719

SHEFFIELD v. PREACHER et al.

No. 8782.

Supreme Court of Georgia

September 17, 1932

Syllabus by the Court.

In equity suit to set off judgments purchased by plaintiff against judgment against plaintiff, assigned to defendant after it was rendered by municipal court, and before final judgment was rendered by superior court, defendant assignee's equitable ownership of judgment should be treated as equivalent of complete ownership in determining right of set-off (Civ. Code 1910, § 4521).

Claim of assignee of judgment is not subject to rights acquired by judgment debtor against judgment creditor after assignment (Civ. Code 1910, §§ 3653, 4274, 4340-4342, 5668, 5670, 5948, 5969).

Judgment held by assignee held not subject to set-off in favor of judgments against judgment creditor purchased by judgment debtor after assignment (Civ. Code 1910, §§ 3653, 4274, 4340-4342, 5668, 5670, 5948, 5969).

1. In a suit in equity to set off a judgment held by the plaintiff as assignee against a judgment claimed by another assignee equitable ownership by the latter assignee should be treated as the equivalent of complete ownership in determining the right of set-off.

2. The claim of the assignee of a judgment is subject to such equities and defenses as may have existed in favor of the judgment debtor against the judgment creditor at the time of the assignment, but is not subject to rights which did not then exist in favor of such judgment debtor and of which he did not become possessed until some time later, as by the subsequent purchase of judgments against his judgment creditor. Accordingly, a judgment which is held by an assignee is not subject to a set-off in favor of judgments existing against the assignor, but not acquired by the judgment debtor until after the assignment of the former judgment. The trial court erred in granting the injunction and in allowing the set-off as prayed for.

Error from Superior Court, Fulton County; G. H. Howard, Judge.

Suit by G. L. Preacher against I. M. Sheffield and others. Judgment for plaintiff, and named defendant brings error.

Reversed.

McElreath & Scott, of Atlanta, for plaintiff in error.

Hendrix & Buchanan and Geo. & John L. Westmoreland, all of Atlanta for defendants in error.

BELL J.

This was a suit in equity to enjoin the enforcement of a judgment existing against the plaintiff and claimed by another as assignee, and to subject the same to a set-off in virtue of three other judgments existing against the plaintiff in the judgment first referred to and held by the plaintiff as assignee. The case is here upon exception to a judgment in favor of the plaintiff. E. W. Romberger obtained a judgment against G. Lloyd Preacher, in the municipal court of Atlanta on March 31, 1930, for $1,299. This judgment was transferred to I. M. Sheffield on June 30, 1930, and on the same date Preacher was given notice of this assignment and furnished with a copy thereof. The assignment was bona fide and was based upon a consideration of $400. Preacher, however, was prosecuting an appeal at the time of this assignment, and carried the case by certiorari to the superior court, where on February 10, 1931, a final judgment was rendered in favor of E. W. Romberger and against G. Lloyd Preacher, as principal, and National Surety Company, "the security on the bond in certiorari," for the same amount of principal, and for additional sums as interest and costs. This is the judgment against which the right to offset was claimed by the plaintiff. On May 6, 1931, G. Lloyd Preacher purchased three judgments which were existing in favor of different parties and against E. W. Romberger, representing an aggregate sum of about $600, each of which antedated the final judgment of Romberger against Preacher as described above. After purchasing these three judgments, Preacher paid to J. I. Lowry as sheriff the difference between the amount of these judgments and that of Romberger against himself, and then brought this suit for the purpose of offsetting the balance and to enjoin the enforcement of the Romberger judgment. The parties defendant to this suit were J. I. Lowry, sheriff, E. W. Romberger, and I. M. Sheffield, assignee.

The court granted a restraining order and a rule nisi. At the hearing the above facts being established without dispute by the evidence, the judge rendered a judgment allowing the set-off; whereupon Sheffield excepted.

1. Preacher purchased and had assigned to him three judgments rendered in favor of different parties, against Romberger, and aggregating about $600. Preacher after paying the difference in cash placed these judgments in opposition to a judgment rendered in favor of Romberger against himself for $1,299. He is claiming the right of set-off, and is seeking the aid of a court of equity. The judgment against which the right of set-off is claimed was rendered in the superior court on a petition for certiorari. It is claimed that Sheffield is not the owner of this judgment, and therefore is not in a position to resist the set-off. The point is made in behalf of Preacher that Sheffield's assignment was in relation only to the judgment rendered by the municipal court; whereas, the final judgment against which the set-off is claimed was rendered by the superior court on certiorari. Whether or not Sheffield should be considered as the legal owner of this judgment, it is clear that in virtue of the assignment of the prior judgment which culminated therein, he was the equitable owner of the final judgment; and Preacher, being in a court of equity, must respect the equities of his adversary. Civ. Code 1910, § 4521; 25 Am. & Eng. Enc. Law (2d Ed.) 616; 34 C.J. 706.

2. The judgments purchased by the plaintiff and now sought to be used as a set-off were in existence when the judgment was rendered against the plaintiff in favor of Romberger. They were also in existence at the time the latter judgment was assigned to Sheffield. They were not judgments in favor of this plaintiff, however, and neither did the plaintiff acquire them until after the assignment to Sheffield. While the claim of Sheffield as assignee of the Romberger judgment was subject to such equities and defenses as may have existed in favor of Preacher against Romberger at the time of the assignment, it was not subject to rights which did not then exist in Preacher's favor, and of which he did not become possessed until some later time, as by the purchase of the judgments which he is now attempting to assert by way of set-off. Having no right of set-off at the time Sheffield purchased the judgment against him, he could not subsequently acquire this right so as to defeat the claim of Sheffield. Any other rule would tend to destroy the salability of judgments, which by the law are...