Sloss v. Glaze

• Citation: 231 Ala. 234,164 So. 51
• Decision Date: 17 October 1935
• Docket Number: 6 Div. 471
• Parties: SLOSS et al. v. GLAZE.
• Court: Supreme Court of Alabama

164 So. 51

231 Ala. 234

SLOSS et al. v. GLAZE.

6 Div. 471

Supreme Court of Alabama

October 17, 1935

Rehearing Denied Nov. 29, 1935

Appeal from Circuit Court, Jefferson County; J. Russell McElroy Judge.

Garnishment suit by A. Page Sloss and Everett Shepherd against Andrew L Glaze. From a judgment for the garnishee, plaintiffs appeal.

Affirmed.

Lange Simpson & Brantley, of Birmingham, for appellants.

Cabaniss & Johnston and Jos. F. Johnston, all of Birmingham, for appellee.

GARDNER Justice.

At the time of the service of the garnishment writ there was existent an executory contract wherein, so far as here pertinent, the garnishee had agreed to assume one mortgage and execute another on the property to be purchased. Garnishment proceedings are purely of statutory creation, and unless plaintiffs' case comes within some clause of the statute (section 8051, Code 1923), relief must be denied. Jones' Adm'r v. Crews, 64 Ala. 368. Further illustrations are Cunningham v. Baker, 104 Ala. 160, 16 So. 68, 53 Am.St.Rep. 27; Mims v. Parker, 1 Ala. 421; Nesbitt v. Ware, 30 Ala. 68; Richardson v. Kaufman, 143 Ala. 243, 39 So. 368; Porter & Blair Hardware Co. v. Perdue, 105 Ala. 293, 16 So. 713, 53 Am.St.Rep. 124; Murdock Brokerage Co. v. Collins, 146 Ala. 604, 40 So. 96; see, also, 28 Corpus Juris 25. And only such debts as would maintain debt or indebitatus, assumpsit, if sued on by defendant, could be subject to condemnation. Jones' Adm'r v. Crews, supra; Pettus v. Dudley Bar Co., 218 Ala. 163, 118 So. 153.

It appears also to be the general rule that the debt must be due absolutely and without contingency. 28 Corpus Juris 134, and cases cited in note to Moreau River State Bank v. Japinga, 2 A.L.R. 504. Our own case of White v. Hobart, 90 Ala. 368, 7 So. 807, illustrates this rule.

Following this line of reasoning, the garnishee insists that no debt subject to garnishment is made to appear, as the contract discloses no promise to pay money, but only to assume a mortgage and execute another, all of which was contingent upon delivery by defendant of a deed to the purchaser and abstract showing merchantable title.

Plaintiffs lay some stress upon Henry v. McNamara, 124 Ala. 412, 26 So. 907, 82 Am.St.Rep. 183. But the discussion there was in reference only to an immature claim of indebtedness, and interpreted in the light of the facts there presented, the case would seem to bear no analogy here. All considered, there appears, therefore, to be much force in the argument of the garnishee that no debt subject to garnishment condemnation is presented by the contract.

But we find no necessity for a definite decision upon this question, and pass it by without determination. This for the reason that in our opinion the ruling of the trial court is to be sustained upon a broader ground, and one which affects the real merits of the case upon the undisputed facts. Although garnishment is purely a statutory proceeding, yet it is always administered upon equitable principles. Marx v. Parker, 9 Wash. 473, 37 P. 675, 43 Am.St.Rep. 849; 28 Corpus Juris 20 and 40.

In Marx v. Parker, supra, it was observed: "It is a general rule in garnishment that the plaintiff can obtain no greater beneficial relief against the garnishee than the judgment debtor would be entitled to, and that if the debtor's recovery would be limited to a mere legal title, without beneficial interest or right of enjoyment in himself, the proceeding must fail. A judgment creditor cannot have his debt satisfied out of property held in trust for another, no matter how completely his debtor may have exercised apparent ownership over it, unless it was upon the faith of such ownership that the credit was given. *** Therefore, if the deposit in the bank was, in equity, the property of the city, although it stood in Parker's name, respondents had no right to a judgment against the garnishee." This case was quoted and the principle therein announced followed by the Court of Appeals in Allen v. Woodruff, 2 Ala.App. 415, 56 So. 247, 249, which latter case was approvingly cited by this court in Pettus v. Dudley Bar Co., 218 Ala. 163, 118 So. 153, 154, wherein the underlying principle was recognized and given application. In Allen v. Woodruff, the court said: "Garnishment proceedings were provided by statute to enable a creditor to reach property and funds of his unwilling debtor which cannot be reached by execution, but which, in equity and justice, should be applied to the payment of the debtor's debts. They were not intended to enable the creditor to subject properties or funds which in truth do not belong to the debtor, and which should not, as a matter of equity, be applied to the payment of his debts."

And to like effect is the language in Pettus v. Dudley Bar Co., supra: "Garnishment proceedings were not intended to entitle a creditor to hold such properties or funds which in truth do not belong to the debtor and which should not as a matter of equity be applied as a payment of his debts."

Applying this principle to the instant case, the correctness of the ruling in the court below is apparent.

The First National Bank, under the undisputed proof, released to Aland, the debtor, real property embraced in its mortgage, with the express understanding it should receive the property or its proceeds acquired by Aland in the exchange.

It may be well here to observe (and we find no insistence to the contrary in brief) that though such understanding was verbal, yet the parties thereto interposed no plea of the statute of frauds, and each recognizes the validity thereof. Under such circumstances, therefore, the agreement will be considered as valid an enforceable. Bailey v. Irwin, 72 Ala. 505, Ex parte Banks, 185 Ala. 275, 64 So. 74.

Any part of the purchase price therefore due to be paid Aland was in equity and good conscience to be treated as the property of the bank. Aland so desired it, and in order to effectuate his prior agreement with the bank, Aland and Dr. Glaze, after the service of the garnishment writ, canceled the contract and the real estate agency that had received the earnest money refunded the same to Dr. Glaze. This the parties had a right to do. There was no fraud or bad faith involved, and the evident purpose was to have consummated the original and prior agreement existing between Aland and the bank.

Plaintiffs' argument, as we read the brief, concedes that as the contract was executory only, the parties had a right to thus cancel it, but insist that as Dr. Glaze subsequently acquired the same property from the bank that this tends to fasten liability upon him. But such acquirement was under a different contract entirely with a different party. True Aland's contract with Dr. Glaze was canceled, and the property deeded to the bank after the issuance and service of the garnishment writ. But all this was done in recognition of the pre-existing right of the bank, and in accordance with the agreement between Aland and the bank that had been entered...