Case ID: sc-eq_23/html/0207-01.html
Source: Caselaw Access Project
Author: {"author": "Dargan, Ch.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Wade Hopkins and G. W. Hopkins v. Susan E. Hopkins, administratrix of J. A. Hopkins.
    
    Columbia,
    
      May, 1850.
    If there be a general or continuing agency, the statute will not commence to run until the termination of the agency; but if the agency be special, and relate to isolated transactions, in regard to which the agent received special authority from his principal to act for him in those particular matters, then the statute of limitations will commence to run from each of those several transactions, each of which will be barred or not, according to the time which has elapsed from their respective dates to the filing of the bill.
    Where there has been an assignment (for valuable consideration, or for the consideration of love from a parent to a child,) of legal chases that are unassignable at law, this Court will entertain a bill in the name of the assignee for the enforcement of such claims; p'ovided the assignor be made a party either as a complainant or defendant, and provided also there be bona, fides in the transaction of the assignment. If the object be to obtain an unconscientious advantage over the party to be brought to the reckoning, the Court will not lend itself to the enforcement of the inequitable arrangement
    Where the bill is filed for the enforcement of his claims, by the assignee of legal chases, unassignable at law, the assignor is not a competent witness for the assignee, but must be a party to the suit, either as complainant or defendant.
    Where a party has submitted his case, upon a final hearing, to the judgment of the, Court, he has no right to the privilege of being allowed to amend. He should have done that at an earlier stage of the proceedings; more particularly, where he has been notified by the plea of the adverse party.
    
      Before Dunkin, Ch., at Chester, July Sittings, 1849.
    CIRCUIT DECREE.
    Dunkin, Ch. Ferdinand Hopkins departed this life in January, 1843. By his will, dated in October, 1825, he devised and bequeathed to his widow, Sarah Hopkins, his whole estate, so long as she remained his widow. Sarah Hopkins was appointed executrix, and two other persons executors; but she alone proved the will, and qualified thereon. The testator left four children, to wit: the complainants, Wade and G. W. Hopkins, a daughter, Mary, and John A. Hopkins, the intestate of the defendant, who departed this life in June, 1846.
    This bill was filed on the 19th May, 1847. It states, among other things, that the intestate of the defendant was indebted to Sarah Hopkins in a large sum of money for the proceeds of the cotton crops of the estate of Ferdinand Hopkins, deceased, from 1834 to 1845, inclusive, (except 1841,) which proceeds the intestate had received as the agent of Sarah Hopkins, and also for the sales of certain mules, &c., made in 1841, and for hire of slaves in the same year; and also for cash advanced to and money paid for said intestate by Sarah Hopkins, at various times between the fall of 1834 and March, 1846 — that this account and demand had been assigned by ^ Sarah Hopkins to the complainants, on the 17th February, 1847, for valuable consideration. The bill prays a discovery of the cotton, &c. sold; of the mules, &c. and the price; and that an account may be taken of what is due to complainants on said assigned demands, and payment decreed, &c. The defendant, demurred, generally. The cause was heard, on the demurrer, by Chancellor Caldwell, and his decree, overruling the demurrer, was filed 19th July, 1847. The decree stated that “although assignments of choses in action are valid in équity, yet they will not generally be carried into effect in favor of mere volunteers, but only in favor of persons claiming for a valuable consideration.” “But here,” (proceeds the decree) “the plaintiffs allege that the account has been assigned by Sarah Hopkins for value received,” &c. This is, therefore, a different case from a mere voluntary assignment, &c.
    The answer of the defendant was filed on the 6th April, 1848. She disclaims any personal knowledge whatever of the principal facts alleged in the bill; she was, at the time, young, unmarried, lived in a different district, and had no /connection with the parties; she has heard that her husband, before his marriage, resided with his mother, and afforded her his aid in the management of her affairs — that, although illiterate, she was very particular, and did not plaee implicit confidence even in her own children, and that she kept her own money; that her husband may have sometimes received, for his mother, the sales of her cotton, but she does not doubt that he accounted to her, and she is impressed the more particularly with this conviction, from the fact that, very soon after her husband’s death, Sarah Hopkins came to the house, and desired to see the account sales of cotton for the preceding year, amounting to $ 180, stating that her son had not settled for that, but she made no claim for any previous bills — that this bill was thereupon given or shown; that she, or one of the complainants, G. W. Hopkins, as her agent, had free access to all her husband’s papers, of which they availed themselves as far as they desired — that Wade Hopkins, the other complainant, was then in Mississippi — that he was indebted to his deceased brother, the intestate of the defendant, on a note for $1720, on which note the defendant has been obliged to institute a suit. In respect to the alleged assignment, the defendant “ denies that any valuable consideration was paid; she believes, and hopes to be able to establish by proof, that the assignment was the result of a combination and confederacy between the said Sarah Hopkins and her two sons, the complainants, to make the said Sarah a witness, to establish the said account by her testimony, contrary to the rules of tne common law, and without precedent in this Court.” The defendant also relies for her defence on the statute of limitations, and insists that Sarah Hopkins should be a to the proceedings, more especially as she, the defendant, would hope to establish a balance against her in relation to the estate of Ferdinand Hopkins, deceased.
    Upon this state of the pleadings, the Commissioner, on the 21st June, 1849, ordered a reference upon the accounts, “reserving all the equities of the case.” This seems altogether irregular, while a plea in bar is on record. The Commissioner has no authority to overrule the plea. He might, with equal propriety, have made a similar order before the Chancellor overruled the demurrer. The Act of the Legislature was intended to give the power to the Commissioner only in cases where the party submitted to account, and the order is therefore made as of course to expedite the cause. But it was said that the provision reserving the equities secured to the defendant all her rights. The Act authorizes the Commissioner to make no such qualification. It is a high power, to be exercised by the Court alone, and under special circumstances. A principal object of determining on the plea in bar is defeated, if all the expense and delay of litigation is to be first encountered in the Commissioner’s office ; of which a more lively and instructive illustration cannot well be presented than in the history of the case before the Court.
    As was anticipated by the answer, Sarah Hopkins was the principal if not the only material witness to sustain the account against the estate of the intestate. The result of her testimony and of the other evidence is, that during several of the years mentioned her deceased son received for her the amount sales of the cotton sent to market, and did other occasional acts for her which were befitting their relative situation ; she had an opportunity every year and any day in the year to .know what he had done for her, and the manner in which he had done it. The utmost that-can be made of the evidence is, that the intestate was the special agent of the witness, Sarah Hopkins; and the doctrine upon this subject, maintained by the Court in Van JRhyn v. Vincent, is too salu-i tary not to be adhered to. “The defendant’s testator,” say the Court, “was merely the receiver of so much money to the use of the complainants, and if the amount had been known, she might have brought her action at law for money had and received, (o which action the statute of limitations would have been a protection to the defendant. The trust, then, is not the foundation of the jurisdiction of the Court of Equity in this case, but the want of a discovery — and where a party has a mere legal demand, and the Court of Equity has a concurrent jurisdiction, for the purpose of discovery, the defendant is as well entitled to the benefit of the statute of limitations in a Court of Equity as at law.” When the loose and informal manner in which such things are usually done is considered, and that receipts are more frequently omitted than taken on such occasions; and moreover, as in Rowland v. Martindale, that the memoranda kept by the agent in a book are not evidence for him, even after his death, the Court more readily interposes the shield which the law has provided against stale, and, it may be, unfounded demands. There is no part of the account assigned for which Sarah Hopkins would have had any right to ask a discovery against her deceased son, which is not effectually barred by the statute of limitations. The items within the statute are for moneys loaned to the intestate, or moneys paid for him, which are clearly merely legal demands, and to be substantiated like any other demand of that character.
    
      1 McC. C. 310.
    
      Bail. Eq. R. 226.
    9 Sim, 327.
    Story Eq. Ju-ris. S. 1048 and 1049, and note, 2 Myl. and Keene, 590.
    And this brings the Court to the inquiry, whether the mere assignment of a debt will give the assignee a right to sue in Equity, when the assignor could only pursue his remedy at law. In the very well considered case of Hammond v. Massinger•, the Vice Chancellor ruled that the assignee of a debt, not in itself negotiable, is not entitled to sue the debtor for it in equity, unless some circumstances intervene which shew that his remedy at law is, or may be, obstructed by the assignor. The Court is of opinion that this principle is well sustained by the authorities in this country, as well as in England, and that it would be fatal at least to so much of the plaintiff’s claim to a status in this Court as is not barred by the statute of limitations.
    But there is another view of this case which the Court is not permitted to pass by. The evidence is entirely satisfactory, even from the testimony of Sarah Hopkins, that the assignment to her sons, the complainants, was wholly voluntary, or without valuable consideration. It is scarcely less clear, that the object of assigning the debt was, to have the benefit of her testimony to establish the demand. The incalculable mischief which would result from giving any countenance to a transaction of this character, and influenced by such motives, are so obvious, that the Court would be justified in establishing a precedent, if not in creating a rule, to discourage and repress them. But there is no absence of authority. Champerty and maintenance are forbidden by the common law, as offensive to justice, and leading to oppression. Courts of Equity go farther, and discountenance all proceedings which, in the language of Lord North-ington, “ savour of maintenance.” “ Courts of Equity,” says Mr. Justice Story, “ are ever solicitous to enforce all the principles of law respecting champerty and maintenance; and they will not, in any case, uphold an assignment which involves any such offensive ingredients.” Maintenance has been variously defined. In Harrington v. Long, the Master of the Rolls said, “ maintenance is where there is an agreement, by which one party gives to a stranger the benefit of at suit, upon condition that he prosecute it.” “ Maintenance,” continues he, “is properly discouraged, because it promotes litigation, and leads to oppression.” But, as he afterwards says, the mere assignment of a chose in action is not maintenance. It is necessary to inquire into the motive or object of the party. Both in that case and in Burke v. Greene, it 2 was shewn that an assignment of this kind may be made under circumstances which render it illegal — that the object with which the assignment was made, tainted it with maintenance. In the latter case, Lord Manners said, if the' assignee had a private purpose to answer, by getting the suit into his hands, “ that is neither more nor less than dealing for a suit in Chancery, which the Court will not allow — a purchase made for such a purpose is, according to all the authorities, maintenance.” In the case before the Court, the complainants had.no interest whatever in the alleged demand of Sarah Hopkins against the estate of the intestate. They procured the assignment to themselves for the purpose of enabling them to institute a litigation m this Court in their own name, and thereby secure the testimony of the assignor to substantiate a merely legal demand, which testimony would be inadmissible in the ordinary forum. By obtaining a voluntary transfer of the rights of Sarah Hopkins, they proposed and intended to conduct a successful litigation against the defendant, which Sarah Hopkins could not successfully conduct for herself. Looking at all the circumstances of the transaction, the language of Sir Launcelot Shadwell may well be applied to it: — “ If,” says he, “ bills of this kind were allowable, it is obvious that they would be pretty frequent, but I never remember any instance of such a bill as this being filed, unaccompanied by special circumstances.” Jeremy Bentbam, and some other theorists of that class, have suggested, as an improvement in the administration of justice, that each party should be permitted to tell his own story, and be sworn as a witness in his own case. But the suggestion has found no favor with those who are familiar with courts of justice. Experience justifies the conviction, that such innovation in the practice would have no tendency to elicit truth ; and that it is due to the infirmity of human nature, that it should be protected from this strong temptation to perjury. But it has never yet been supposed that the cause of justice would be advanced by hearing only one side, or by permitting one party to tell his tale, while the lips of his adversary were closed, whether in death or by the rules of law. So scrupulous is the law, that, even in cases of usury, which constitute an exception in relation to the rules of evidence, the exception is only permitted to prevail while both parties are alive. But what would be the security. tQ pr0perty) if a man might fabricate a demand, assign it to his son, or his friend, and then establish it by his own oath? jt jjej as in this instance, that the assignment was voluntary, and expressly without recourse, and, therefore, the assignor had, technically, no interest in the issue. But it is against morality to hold out this temptation to fraud and perjury. It is against public justice and public policy to permit or encourage this species of traffic ; “ this officious intermed-dling in the materials of litigation, in which a person has no interest,” or to allow suits in this Court to be thus manufactured and thus sustained.
    
      Ball & Beat- ^ 517-
    
      Note. — As to the competen-news see Bell v. Smith, n E. c. L. Rep. 198-
    points which have been considered, the Court *s opinion that the bill should be dismissed, and it is accordingly so ordered and decreed, and that the complainants pay the costs of the proceedings.
    The complainants appealed, on the following grounds, viz:
    1. Because the Chancellor erred in deciding that the demand of the complainants was a mere legal demand, and their only remedy was in a court of law, where they must sue in the name of Sarah Hopkins, when, from the evidence, it appears John Hopkins was the general agent of Sarah Hopkins; for many years transacted all her business (she being illiterate and could not write); sold all the crops made on her plantation; superintended her hands, and his own, which they worked together in copartnership for several years; and the matters of account between them were such, that a court of law could not afford adequate relief.
    2. Because the statute of limitations was not applicable to the case, and if it was, the evidence takes the case out of it.
    3. Because love and affection is a' good consideration, and sufficient to support the assignment to complainants, and the complainants were not strangers.
    4. Because the Court erred in deciding that the complainants were guilty of champerty and maintenance, in taking the assignment from Sarah Hopkins ; and, therefore, the bill could not be sustained.
    5. Because Sarah Hopkins was a competent witness for complainants. t
    
    6. The decree is, in other respects, contrary to law and the evidence.
    
      7. Because the Commissioner’s report, modified by the complainants’s exceptions, ought to have been sustained.
    
      Herndon, for the motion.
    
      Gregg, McAlilly and Dawkins, contra.
   Curia, per

Dargan, Ch.

In the argument of this appeal, many questions have been presented, and earnestly urged upon the attention of the Court. From the disposition which the Court has thought proper to make of the case, it will not, be necessary for me to notice and discuss in this opinion, all the questions that have been made.

The complainants are the sons of Mrs. Sarah Hopkins. The. defendant’s intestate, and late husband, John A. Hopkins, was also her son, and lived with her, while the complainants lived in the west. The bill charges that John A. Hopkins was the agent of his mother, Mrs. Sarah Hopkins, and sold her cotton and some other property, and that, by virtue of this agency, he sold her cotton, and received the proceeds of the same, from the year 1834 to the year 1845, inclusive, with the exception of the year 1841 ; for which he has never accounted, and is still indebted to a large amount. It is also stated in the bill, and is proved, that Mrs. Hopkins has executed an assignment to the complainants, of her account against the estate of the intestate; the items of which consist of the proceeds of the sales of the cotton, charged to have been received by him in the years before mentioned, of some money lent, and the proceeds of the sales of some mules. The assignment purports to have been executed for valuable consideration, but it is admitted that the consideration was love and affection. The answer of the defendant denies all knowledge of the transactions stated in the bill, which she alleges relate to a period of time before her intermarriage with the intestate, while she lived in another district, and was a stranger to the relations that subsisted between the different members of this family. These are the simple facts of the case, upon which I am to announce the judgment of this Court.

The first point to which I will direct my attention will be the plea of the statute of limitations, which the presiding Chancellor held to have barred the claim, with the exception of such portion of it as arose within four years before the filing of the bill. There is not the slightest difference of opinion between the members of this Court as to the principles of law which bear upon this question. If there was a general or continuing agency, the .statute would not commence to run until the termination of the agency. Assuming that there was a general and continuing agency, the statute would not bar the account; as the agency (if such an one existed) continued to the day of the intestate’s death, and the bill was filed within one year afterwards. If the agency was special, and related to isolated transactions, in regard to which the intestate received special authority from his mother to act for her in those particular matters, then the statute would commence to run from each of those several transactions ; and each of which would be barred or not, according to the time that had elapsed from their respective dates to the filing of the bill. From the fragments of the evidence have been pointed in the brief, it would seem that there ’ was a general agency. But the Chancellor who tried the cause is of the opinion that if all the evidence had been presented, the conclusion to be deduced from the whole would be, that the agency was special. The brief in this case was very imperfectly prepared. And this has been the case with a great many oí the briefs furnished during this term, which has occasioned much difficulty and embarrassment to the Court. I will take the occasion to say, that this affords just ground of complaint; and further to remark, that if error and misconception arise from this cause, there cannot be a doubt as to where the responsibility should fall. From the view which the Court has taken of this case, the plea of the statute of limitations becomes unimportant. And I should not have felt it necessary to remark upon it. but for the purpose of preventing misapprehension.

The assignment of an open account, or a chose in action not negotiable by mercantile law, or assignable by legislative enactments, vests no legal title or interest in the assignee; who, for this reason, can maintain no legal action on the same in his own name. But it is different in this Court, where the assignee may enforce, by a suit in his own name, choses of this character, which have been assigned to him for a valuable consideration ; subject, of course, to the equities that subsisted between the original patties. Nor can it be doubted that an assignment from a parent to a child, of choses in action, not assignable at law, and of mere equities, may be supported in this Court, on the consideration of love and affection. The Court can and has enforced such claims, in suits brought in the name of the assignees. But in either case, whether the assignment be made for valuable consideration, or for the consideration of love and affection between parent and child, the bonafides of the assignment may become the subject of inquiry in this Court, and if, on investigation, that be found wanting, the Court will refuse its aid. It does not follow, unless there be fraud, that the Court will affect to set aside the assignment. But if an unconscientious advantage is sought to be taken, the Court will withhold its assistance, and leave the party to struggle with his difficulties in the best way he can. In such an event, he would have no other remedy than to prosecute his action at law in the name of the original creditor.

This Court is of the opinion that where the assignee of an open account, or of such choses as are the subject matter of this suit, files his bill in Equity against the debtor, to enforce the demand or demands which have been assigned to him, the assignor should be made a party, either complainant or defendant. This, perhaps, may not be necessary, when the assignor has parted with his whole estate in the chose, both legal and equitable. But the demands in this account thatv have been assigned to the complainants, are all legal choses ; that is to say, they are choses upon which an action may he maintained at law by the party to whom they were originally due. The assignee has a mere equitable interest, while the legal estate remains in the assignor. The assignor should be made a party, therefore, on the general rule, that all persons having an interest, legal or equitable, should be made parties to the proceeding. There is something more than form in the enforcement of this rule incases like the present. It serves to meet and carry out the substantial justice of the case. When a creditor, either by himself or his assignee, files his bill against the defendant for an account,'the claim is subject to all equitable discounts which the defendant may succeed in establishing against it. If, on stating the accounts, there is a balance found in favor of the defendant, he is entitled to a decree for such balance. A party praying an account is entitled to it only on the condition that if, on a settlement, he should be found to be the debtor, a decree should go against him for the balance. This is pure equity. And the converse of it would be highly inequitable, and would lead to circuity of actions and multiplicity of suits. But this wholesome rule of justice could not be enforced, and this responsibility would be evaded, if the assignee were permitted to file a bill for an account, without making the assignor a party. The assignee would not be liable for any balance in which the assignor should be found indebted to the defend-, ant. He should, therefore, bring in the assignor as a party, who would be liable for a decree for such balance, and thus prevent the vexation, expense and delay of another suit, on the part of the defendant; and save the Court the trouble of trying two causes, where one would answer every purpose. This Court is therefore of the opinion that Mrs. Hopkins, the assignor, should have been a party to the bill, either as a complainant or defendant. And further, the Court is of the opinion that, being a party, and an interested party, she could not be a competent witness. -The assignee would be entitled to any balance that would be found due by the defendant; but it is obvious that the accounting of the defendant would be with the assignor, who would go into the examination, subject to the liability of a decree against her if a balance should be found due to the defendant. It would be to the interest of the assignor to swell the amount of her claims against the defendant, and to reduce his against herself. She would, for this reason, be incompetent.

The complainant’s solicitor has asked the Court, in the event of Mrs. Hopkins being a necessary party, that he be allowed, by an order of this Court, to amend his bill, so as to make her a party. This, of course, is equivalent to asking (for another trial. It is to be remarked that the defendant ' has insisted upon the objection as to the want of a necessary party, during the whole progress of this cause. She first filed a general demurrer, which embraced the objection as to the want of parties, where, as in this case, the omission of a proper party appears upon the face of the bill. The demurrer being overruled, she urged the same objection in her answer. She urged it upon the hearing on the Circuit, and again on the hearing before this Court. During all these successive stages of the litigation, the complainants have persisted in their course, and have not moved to amend for the purpose of making a new party. But, after the final hearing on appeal, they ask, not by motion, but by parol, in the event the Court should be of the opinion that Mrs. Sarah Hopkins is a necessary party, that they be allowed to amend. The competency of the Court, in the exercise of its discretion to do this, and on its own motion, is not doubted. It would be done on a proper occasion. It was done in Neely v. Anderson, where the question was not made in the pleadings, nor discussed in the Circuit Court. But it was discovered that the case involved the rights of infants, who were not parties. The decision would of course not be binding upon them, nor terminate the litigation. Under these circumstances, this Court, in the exercise of its undoubted discretion, and on its own motion, ordered the bill to be amended, and the infants to be made parties. When a party has submitted his case, upon a final hearing, to the judgment of the Court, he has no right to the privilege of being allowed to amend. He should have done that at an earlier stage of the proceedings ; more particularly, where he has been notified by the plea of the adverse party.

Dec. Term, 1848.

But I will now discuss the ground upon which I am more particularly instructed by the Court to place its judgment. I have already stated that where there has been an assignment (for valuable consideration, or for the consideration of love from a parent to a child,) of legal ckoses that are unassignable at law, this Court will entertain a bill, in the name of the assignee, for the enforcement of such claims ; provided, that the assignor be made a party either as a complainant or defendant; and provided also, there be bona jides in the transaction of the assignment. If the object be to obtain an un-conscientious advantage over the party to be brought to the reckoning, the Court will not lend itself to the enforcement of the inequitable arrangement. It seems to the Court that the purpose of the parties to this assignment was not in good faith to the defendant. The object was to obtain an undue advantage, by enabling Mrs. Sarah Hopkins to become a witness in establishing her account against the estate of her deceased son. From the relations between the assignor and the assignees, it did not matter much to her whether she or they got the benefit of this claim. If she wished to make a donation of this amount to her sons, why did she not sue for it in her own name, and, after recovery, give it to them 1 It cannot be doubted that the assignment was a mere contrivance to recover, by means of her own testimony, a claim which she could not otherwise recover. The arrangement was in their understanding to have the effect of opening her mouth as a witness, while the lips of the defendant were to remain hermetically sealed. Death had stamped his cold signet upon the lips of the other party to the contract. He could not speak from the grave. If he were living, he would not have been allowed to speak as a witness; but he would know in what manner best to make his defence. If his wife were allowed to speak as a witness, although she was necessarily ignorant of many of. the alleged facts, she might have testified to what she stated in her answer, that, shortly after her husband’s death, Mrs. Hopkins came to her house, and .desired to see the account of sales of the preceding year, amounting to $ 180, stating that her son had not settled for that, but making no claim for the sales of the preceding years. I allude to this for the purpose of illustrating how little it tends to the development of truth, and the attainment of justice, to receive in evidence the statements of one party to a legal controversy, without receiving those of the other. Just such a state of things has the contrivance of the complainants and their co-laborer produced. Mrs. Hopkins, according to her own statements, had demands against her deceased son. They were demands that were properly cognizable at law, and if she had resorted to that Court, she would have occupied her natural and proper position of a plaintiff, and would be bound to prove her case by disinterested testimony. Knowing or fearing that she would not be able to succeed in a Court of Law, the contrivance of the assignment was resorted to, for the purpose of enabling the case to be brought into this Court, where it was supposed she might be a witness. The mala fides in the transaction of the assignment, according to the principles which I have before stated, is a sufficient ground for the Court to refuse to entertain the complainant’s case; more especially, where the claim at best wears a somewhat equivocal character, and it seems that substantial justice has already been done by the decree of the Circuit Court.

It is ordered and decreed that the decree of the Circuit Court be affirmed, and that the appeal be dismissed.

Dunkin, Ch., concurred.

Decree affirmed.