Case ID: sc-eq_9/html/0369-01.html
Source: Caselaw Access Project
Author: {"author": "O’Neall, J. Harper, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Peter Gowan vs. Adam Tunno, John Walker et al.
    
    No matter at what price one may buy a judgment, as against the defendant he may claim the whole.
    J. W., being the holder of a judgment against R. M., and also his indorser in hank, received from R. M. a sum of money, and gave him a receipt generally, on account: the notes were protested, and, by agreement, the money was applied to them, and the receipt destroyed: Held, that junior judgment creditors of R. M. had no right to require the money to be applied to J. W's. judgment, as a payment.
    Though partnership effects should be first applied to partnership debts, yet, after these are exhausted, a judgment against the partners, as such, binds the separate estate of each partner from its date.
    The holder of a judgment, formally and technically entering on the record satisfaction in part, cannot have the ^ntry vacated because it was gratuitous.
    
      Before DeSaussure, Ch.', at Charleston, January, 1832.
    This case came up on exceptions to the report of the Master, Mr. Furman. The report is as follows :
    
      “ In obedience to the decretal order made in this case,. I have been attended by the parties,' and have taken an account of the several debts of Robert Murray mentioned in said order. The debts of record are, first, a judgment obtained by Adam Tunno vs. Murray & McLeod, entered up in the City Court, on the 2d July, 1824, for $582 65, with interest from said date on $500, Second, a judgment obtained by J. M. Lowrey vs. Murray & McLeod, entered up in the Court of Common Pleas, on the 23d June, 1827, for $ 137 03. This is supposed to be paid. Third,, a judgment obtained by J. B. Clough, assignee, vs. Robert Murray, and entered in the Court of Common Pleas, on the 16th February, 1828, on a bond, the penalty of which is $ 14,981 40, now held by John Walker, assignee of Clough. Fourth, a judgment obtained by Adam Tunno vs. Robert Murray, and entered up in the City Court, on the 27th July, 1830, for $294 50, and interest on $250, from August, 1830. Fifth, a judgment obtained by Peter Go wan vs. Robert Murray, and entered up in the Court of Common Pleas, on 20th April, 1831, on several causes of action, for $-. The amount due on which is $-. Sixth, a judgment obtained by Robert Murray vs. Robert Murray, Sr., and entered up 18th June, 1831, on a bond for $1972 84, on which there is due $-. Seventh, a judgment obtained by John Bowden & Co. vs. Robert Murray, on 28th June, 1831, and entered up in the Court of Common ■Pleas. Amount of Judgment, when entered, $2081 20.
    
      “ I find that Robert Murray died intestate, in 1831, without assets to pay the judgments of record against him. I have taken an account of the estate, a particular statement of which appears on papers accompanying this report.
    “An objection is made by Mr. Go wan, the complainant, to the first judgment of Mr. Tunno, on the ground that it is a copart-nership debt of the firm of Murray & McLeod. I find that Robert Murray and George McLeod, some time in the year 1820, formed a copartnership, and carried on business as merchant tailors in this city, and continued to do so until May, 1823, at which time the copartnership was dissolved ; that, at the dissolution of the copartnership, the whole of the funds were left in the hands of Robert Murray, who was to settle the affairs and pay the debts. At the time, it was the impression that the concern was solvent. Mr. Tunno held a note of the firm, and after the dissolution the same was renewed by Robert Murray, who signed the renewal ‘Murray & McLeod, by Robert Murray,’ and the judgment was obtained on a note so drawn. I find that George McLeod, the other partner of the firm of Murray & McLeod, removed from Charleston, and departed this life on the-day of-, 1831, utterly insolvent. I also find that Robert Murray, on the 26th April, 1826, agreed in writing to pay the judgment of Mr. Tunno, by monthly payments of $ 100 each. As the copartnership of Murray & McLeod had been dissolved, and the funds placed in the hands of Murray to pay the debts, as he renewed the notes, and these matters having occurred previous to the contracting of the debts which appeared against him individually, and as the other' partner died before him, insolvent, I have allowed the said judgment and execution as liens on the estate of Murray, tobe paid according to their priority.
    
      “ The amount due on the judgment held by Walker, as assignee, is disputed on several grounds. It appears that John Ferguson, who had been carrying on business as a merchant tailor in this city, in the year 1820, sold out his stock to Murray & McLeod, who then entered into copartnership and continued the business formerly carried on by Ferguson. For the stock sold them, Ferguson took the joint and several bond of Robert Murray and George McLeod, conditioned for the payment of f>7,490 70, payable in instalments. Some time after, this bond was assigned to the Charleston Fire and Marine Insurance Company by Ferguson, who guaranteed the payment. The Company afterwards assigned it to James Butler Clough. At the time the bond was assigned to Clough, Robert Murray gave a certificate in writing, in which he admitted that there was then due on the bond the sum of $>4,300. Mr. Clough brought an action on the bond, and entered a judgment thereon, as before stated. After the assignment of the bond to Clough, Ferguson, who had guaranteed its payment, entered into a negotiation to purchase it, and borrowed from Mr. Walker the sum of $750, to assist him in effecting the purchase. For the amount so loaned he gave a receipt, expressing that the said sum was advanced to him on account of Murray and McLeod’s bond. The negotiation failed, but Mr. Ferguson used the amount loaned by Walker, and so informed the latter. Subsequently, however, Ferguson did make an agreement for the purchase of the said bond, for the sum of $1,000; but, not having the funds himself, he applied to Walker to take the contract, and he, consenting, paid the money, and took an assignment of the bond. It does not appear that Murray took any part in procuring the assignment of the bond : indeed, Mr. Ferguson states that he had no concern in making the arrangement, and that the whole interest in the bond was assigned to Walker. It appears, however, after the assignment of the bond to Walker, he indorsed a receipt on the bond, in the following words: ‘Received, 28th July, 1828, of Robert Murray, $4,367 80, leaving a balance due thereon of $1,888 70,’ and on the judgment he indorsed the following receipt: ‘John Walker, assignee of this judgment, comes here into Court, and acknowledges to have received the sum of $4,367 80, leaving a balance due of eighteen hundred ánd eighty-eight dollars, seventy cents.’ There was no money paid at the time these indorsements were made on the bond and judgment; but the object of making them appears to have been to discharge Murray from liability on the'bond, except so far as was necessary to refund Walker the amounts he had advanced, at the several times above mentioned, to purchase the bond. The particular circumstances which have attended the transaction ' are detailed in the evidence of Mr. Axson and Mr. Ferguson, and in the original papers. It appears that Mr. Walker received at one. time, from Robert Murray, the sum of $989 50, which the complainant contends must be regarded as a payment on his judgment, and that though it was returned to Murray, or rather was applied to taking up some notes of his, indorsed by Walker; yet that it was not in their power to set up the judgment again in this manner, after it had been reduced by a payment. The complainant also contends that the only amount which Walker can claim upon the judgment is the sum of one thousand dollars, paid by him when he procured the assignment; that the $750 paid to Ferguson could not give him any right against Murray, and he must look to Ferguson for it. And, therefore, as his claim was limited to fl,000 and interest, and he received the sum of 989 50, there is but a small balance due on the judgment. It appears to me that Mr. Walker is entitled to claim both sums he had advanced to purchase the judgment. There is no doubt that Murray owed a sum on the bond equal to the amounts advanced by Walker. Indeed, in the testimony offered respecting the indorsements on the bond and judgment, there is proof of an admission to that effect. It, therefore, could not make any difference to him what arrangements were made between Walker and Ferguson, if he was not called on to pay more than was actually due. It does appear that the sum of $989 50, received by Walker, was intended to be a payment on the judgment, as this sum was received from a note or notes of Murray, indorsed by Walker, which were discounted in Bank. After the receipt of the money, however, some of Murray’s notes, upon which Walker was indorser, became due, and at Murray’s request, the former applied almost the whole of the sum he had so received to the payment of the said notes, and Murray gave up the receipt whjch-Walker had given him, for the payment so 'made'. On the other hand, Walker claims to set up the judgment so as to recover, not only the amounts advanced to purchase it, but also certain notes of Murray which he held, most of them friendly indorsements, which he was obliged to pay in July and August last, amounting to about $800. Although, from the testimony, it appears that when the judgment was assigned to Walker, Murray'had no agency in the transaction, yet, from the circumstances which attended the making the indorsements on the bond and judgment, the evident intention of the parties to execute an effectual and entire discharge, by Walker to Murray, of monies due on the bond, except the sum of $1,888 70, and as there may be some uncertainty as to what was the actual amount due on the bond when it was assigned, there having been also some transactions between Walker and Murray, I have disallowed claims beyond the sum of $1,888 70 and interest. Should, therefore, the Court be of opinion that the sum of $969 50 is not to be regarded as a payment on the bond and judgment, the said judgment and execution will be a lien on the estate of Murray, to the amount just mentioned, according to its priority.”
    
    To this report the complainant filed the following exceptions :
    1. In allowing the judgment of Tunno to be a lien on the estate of the intestate, in preference to the individual judgment of the complainant — Tunno’s judgment being one against the copartnership of Murray and McLeod, and its being a settled rule of law in this State, that individual judgments take individual property, and copartnership judgments copartnership property.
    2. Because no part of the testimony proved Tunno to be other than a copartnership judgment creditor, and none could be legally introduced for that purpose, Tunno being estopped from denying his own record.
    3? Because it is submitted the Master erred in allowing the $750 advanced by John Walker to John Ferguson, and used by him, as an item which could possibly be covered by the judgment against Robert Murray, held by Clough, and assigned to Walker.
    4. Because it is submitted the Master should have admitted the $989 50-100, acknowledged by Walker to be the amount due on the judgments. The agreement by Murray to revive the judgment and apply the $989 50-100, otherwise than to the judgment, was subsequent to the intervention of other judgments, and even of the complainant’s judgment, and Murray could not then, without a clear fraud on his other judgment creditors, whose liens had accrued, revive a judgment already extinguished and satisfied.
    5. Because it is submitted the report of the Master is, in other respects, against law and the facts appearing by evidence.
    6. Because the judgment of Walker is also a copartnership judgment, and ought to have been disallowed on the same ground.
    The defendant, Walker, also excepted to so much of the report as disallowed the judgment of J. B. Clough held by him, as a security for any thing more than the amount paid by him for it, and contended that he was entitled to the amount of his debt as rendered to' the Master and established by proof; and that the receipts which, he gave on the bond, and on the record, are no release.
    DeSaussure, Ch. This case comes up on the report of the Master, and exceptions. These involve some questions of difficulty and nicety, which have been well considered and decided by the Master. The questions made before me have been fully and learnedly argued : and I should desire to go fully into the examination of the doctrines discussed. But as I concur in the views taken by the Master in his report, and adopt-them, it seems to me less necessary.
    It is, therefore, ordered and decreed, that the exceptions on both sides be overruled, and the report confirmed.
    The complainant and the defendant, Walker, appealed.
    Thompson, for complainant.
    
      Petigru, contra.
   The opinion of the Court was delivered by

O’Neall, J.

The complainant contends that Walker’s judgment should not stand for more than $ 1,000, the sum at which he boughJ.it. This is supposed to be correct, because $750 of the money advanced by him, was with his consent used by Ferguson, and not applied, as first intended, to buy the judgment. But there cannot be any force in this objection. No matter at what price Walker bought the judgment, he was, as against the debtor, entitled to the whole amount. He owed the money, and to him it must have been immaterial to whom he was to pay. The only question between him .and the assignee, was, how much was due on the judgment: the assignment gave Walker the right to demand the whole, and whether he abated a part or none, was optional with him. But, in fact, Walker appears to have pursued a perfectly just and equitable course. He was willing to give $1,750 for the judgment. Ferguson was authorized to give that much for it. He subsequently bought it for $1,000, and the defendant paid that sum in addition to the $750, which he had previously advanced for it, so that he claimed on the judgment no more than the money and interest which he paid for it..

The complainant insists that $9S9 50, paid by the deceased to Walker, was a payment and satisfaction pro tanto of the judgment. I am very much inclined to think 'that if the money had been paid on the judgment, no subsequent agreement between the parties to give it a different application, could set up the lien of the judgment as against third persons for the sum so paid. But it appears that the only evidence on this subject, is the answer of the defendant. He swears, that he was,the endorser of the deceased in several banks; that the deceased is now indebted to him, by notes'which he endorsed and has been compelled to pay, in a considerable sum besides this judgment. That he gave a receipt for the money generally on account; that, after a short time, finding that three' notes of Murray, endorsed by him, amounting to $925, had been protested, the said Murray requested him to apply the money which he had received, to their payment; that he did so, and Murray gave him up the receipt; which has been destroyed. According to this statement, he had the right to apply the money to any of the different debts of Murray for which he (Walker) was liable, or which belonged to him. The money was a mere deposit with him, and if he applied it as his debtor wished, it would be difficult to say how his creditors can change the application.

It is supposed that Tunno’s judgment is a copartnership debt, and cannot be enforced against the individual estate of one of the partners. There is no doubt that the judgment was a debt against the firm of Murray & McLeod. But there is as little doubt that, on the death of McLeod, the judgment survived against Murray, and it became, in law, the debt of Murray alone, and that it could alone be legally enforced against him or his representatives. But I should think that a judgment against partners created a lien, from its date, on the estates of both partners. If there were both partnership and separate estates, the rule in equity would be, that the partnership eifects should be first applied to the partnership debts: but after these were exhausted, I know of no rule which would authorize subsequent judgments against either of the partners, to be preferred to senior judgments against them both.

By Murray’s agreement with the defendant, he made the judgment his own debt: this was before the complainant obtained a judgment, and he has, therefore, in no point of view, a right to complain.

The defendant, Walker, contends that he has a right now to be paid under his judgment, not only the balance of $ 1,888 70, with the interest thereon, but also the sum of $802 which he has paid as an endorser of Murray. This depends upon the question whether Walker can now vacate the entry of the receipt of $4,367 80 made by him on the judgment, for which, it is conceded, no money was paid by the deceased. It was purely gratuitous on the part of Walker, and done to reduce the judgment to the amount actually paid for it by him. Without entering into the question, whether, if this was to bo regarded merely as a receipt, Walker would not have the right to vacate it as without consideration ? it will be sufficient for the purposes of this case to say, that the entry made is a suggestion entered, formally and technically on the record, of satisfaction in part, to the amount of $4,367 80. It is made thereby a part of the record, and against it the defendant can not aver any thing.

The Chancellor’s decree is affirmed.

JohnsoN, J., concurred.

Harper, J.

I concur, reserving my opinion on the ground of appeal taken by the defendant Walker.

Decree affirmed.