Case ID: nc_5/html/0468-01.html
Source: Caselaw Access Project
Author: {"author": "Locke, Judge, Haix, Judge,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Richard Russell v. Presley Hinton.
    "J l From Warren. J
    A person- summoned as a garnishee may avail himself of any defence which he could make, were he sued by his creditor.
    A. summoned as a garnishee in a suit between B. and C, declared that he had given his bond to C. for £8/0 ; that the debt really due at the time was only £801 15s; that the bond was given upon an usurious consideration, and therefore void. B. urged A. to make some, contract with C. for taking up this bond, assuring him that he might have confidence in C’s integrity, and that if he would make such contract, C. would certainly p'ay to him B, the debt which he owed • to him; and A. believed from B’s representations, that if. he made this contract, he would not be called upon by B. as a garnishee. A. agreed by a day certain to take up his bond and make payment to C, upon his deducting 12 1-2 per cent, from the amount thereof. After this contract was made, but before the day of payment agreed on, B. sued out an attachment against C, and A. was summoned as garnishee. Notwithstanding this summons, A. complied with his contract with C. and paid the money on the day. On this garnishment, no judgment of condemnation will be entered, and the garnishee shall be discharged.
    Richard Russell sued out an original attachment against Edward P. Davis, then residing in the State of Virginia, and Presly Hinton was summoned as a garnishee, to declare whether he owed said Davis, and if so, to what amount. Hinton appeared, and in his garnishment stated, that some time in the year 1804, he purchased from Davis a tract of land, paid down part of the purchase money, and gave six separate bonds to secure the balance; three of which bonds he had discharged, and as to the other three, he not finding it convenient to pay them as they became due, had entered into a contract with Davis to allow him more, than six per centum per year upon the money, provided .Davis would prolong the time of payment; and the three bonds amounting to £801 ■ 15s. 0d, currency of Virginia, had been surrendered to him, and he had given a new bond to Davis for the sum of £870, like money, and a longer time for payment had been given. He declared this last bond was given upon an usurious consideration. He further stated, that some time after this new bond was given, Davis came into this State, and that Davis, Russell and himself had frequent conversations upon the subject of the debt due by Davis to Russell, and also of the debt due by himself to Davis; that Russell urged him to make some other contract with Davis whereby the bond to Davis might be taken in, or as Russell expressed it, purchased in; alleging that he, Russell, had full confidence that in that event, Davis would discharge the debt due to him. That in consequence of Russell’s persuasions and solicitations, he made a contract with Davis for the taking in of said bond, believing from Russell’s representations that he would discharge him from any garnishment in relation to the said bond. That shortly after he had made his contract with Davis as aforesaid, Russell sued out this attachment and had him summoned as a garnishee: that notwithstanding this summons, he had fulfilled his contract with Davis, and had paid to him five huhdred pounds. Being asked what were the terms of the last contract between himself and Davis, he answered, that he proposed to Davis to take up the bond by a day certain, if Davis would discount twelve and an half per cent, thereon, and pay him part in cash, part in tobacco, and assign to him bonds on demand for the balance: that Davis acceded to this proposition, and the day of payment happening after he had been summoned as.a garnishee in this caSe, he had, notwithstanding the summons, complied with his agreement and made the payment. Upon this statement of facts, it was submitted to this Court to decide, Whether the Plaintiff was entitled to judgment of condemnation against the garnishee?
   Locke, Judge,

delivered the opinion of the Court:

The garnishee has stated at full length, the nature of the debt, and the amount thereof, due to Davis at the time he was summoned at the instance of the present Plaintiff, and the last contract made with Davis, under which he has paid the five hundred pounds which the Plaintiff prays may be condemned for his use. He submits to this Court how far he is liable to the Plaintiff’s demands. To determine the extent of this liability, it may be necessary to consider it on the ground of the debt due to Davis at the time lie was first summoned: and, secondly, on the ground of his second contract, by virtue of which the first debt was extinguished or surrendered to the Defendant. As to the first, it is a general principle, that a garnishee, when summoned by the Plaintiff in attachment, is entitled to make every defence against such Plaintiff, that he would be entitled to make against the original contracting party, had he brought suit. For it is rather a case between them, than between Plaintiff and garnishee; in as much as the Plaintiff’s right to recover must depend on some existing debt between gar-’ nishee and his creditors. If, then, Davis had brought an action of debt upon the bond for £870, and Hinton had p]eaded the statute of usury, (as he has virtually done here,) and.the evidence shewed to the Jury that Davis had reserved to himself eight or ten pounds for the forbearance of every hundred pounds attempted to be secured by the bond, the Jury must have found that the bond was given on an usurious consideration, and therefore void: and if void as between Davis and Defendant, will be equally so between Defendant and Russell. On that part of the garnishment, therefore, no doubt can be entertained. -, ,

But it is alleged, that as Defendant, by virtue of a second contract, and after he was summoned as a garnishee in this case, has paid over to Davis five hundred pounds', ho is liable to the Plaintiff for that amount. This part of the case seems to indicate more than usual skill on the part of the- Plaintiff, to circumvent and ensnare an honest, unsuspecting man. At whose instance was this second contract made ? Did it not proceed from the intimations of the Plaintiff himself ? He recommended this measure to the Defendant, at the same time assuring him that he had full confidence in the integrity of Davis, and if this contract was made by Defendant, he felt certain that the debt which Davis owed him, would be paid. lie did not say, in express terms, that Defendant should be discharged from his garnishment: but his mentioning, that if Defendant made the contract, he had full confidence that Davis, in that event, would pay his debt; that owing to these solicitations of the Plaintiff’, the contract was made, and in full confidence that Russell would look to Davis for his debt, and discharge Defendant, seem to be tantamount to an express discharge. For, if Defendant was or could be liable, there was no necessity to place any confidence in Davis, because the Plaintiff had the Law on his side to compel a payment from Defendant, let Davis act in any way lie pleased. But the case has impressed a belief upon the minds of a majority of the Court, that Plaintiff, knowing the bond to be usurious, and therefore his remedy gone against the garnishee, induced the Defendant to change the nature of his debt to Davis, under a belief which he artfully enforced, that if Defendant did so, he should not be called upon as a garnishee: and having induced Defendant to make a positive contract with Davis, a contract which, he well knew, Defendant would feel himself bound in honor to comply with, he would lay hold of that circumstance to compel a second payment by Defendant, by calling upon him as garnishee,.after he bad promised to Davis the payment of the money in such way, that Plaintiff well knew as an honorable man he could not decline the payment. If, then, the Plaintiff has made such de» clarations of bis feliance upon the integrity of Davis, as to induce Defendant to pay such sum as was really and honestly due to Davis, but of which Davis liad no legal mea^ns of compelling payment, be cannot afterwards have any claim on Defendant. If he should be made liable, he wrould be compelled to pay this debt twice, when, without the advice and influence of the Plaintiff, be was not liable to pay any part of it. The statute pf usury shielded him effectually. The Defendant cannot recover back the money which he paid to Davis, supposing it to have been paid upon an illegal consideration. Wc are therefore of opinion, that no judgment of condemnation ought to be rendered against the garnishee, and .that he ought to be discharged.

Haix, Judge,

contra. — I think now as I did in the case of Gee v. Warwick, that a garnishee has a right to avail himself of any legal defence which he might have in his power, were, he sued in an action at Law by his creditor. If, in the present case, the debt due by the Defendant to Davis, was contracted upon an usurious consideration, it would furnish a good plea to the Defendant in an action o i - brought by Davis to recover it. ' The rights of the debtor a,,e no{. jmpairecl by the absconding of the' creditor : but to answer ,the purposes of justice, the rights of the creditor so absconding, are, bf our act of Assembly, transferred to others to whom he is a debtor. In such case, the garnishee is under the same moral as well as legal obligation to pay any debt to the Plaintiff, the creditor of his creditor, that he felt himself bound by to pay it to his creditor before he absconded. The Plaintiff’s claim, in this case, is as strong upon the Defendant, as if Davis had assigned the bond in question to him. Although the garnishee may háve a good defence against a recovery upon the bond, founded upon the act of Assembly made to prevent usurious contracts, he ought not, after having voluntarily relinquished it as to Davis, to be permitted to shelter himself under it as to Russell. He was under no tie, legal or moral, to pay a cent to Davis j but, except as to this defence, he was under both to pay it to Russell. If lie was disposed not to retain another man’s money unconscientiously, he should have well considered whose money it was. His conduct to Davis proves very clearly, that he did not intend to avail himself of that defence, but to pay what was really due. But he paid it to a person who was not entitled to receive it either on equitable or legal principles. The Plaintiff ought not thereby to be injured. In short, I think, that as the garnishee has relinquished the only defence he had at Law, (which is fully evidenced by his second contract with Davis) he stands, .as to the present Plaintiff, as if such defence never had been in his power é, and that having paid the money fo Davis, he paid it in his,own wrong, and of course should be compelled to pay it again, to the Plaintiff, whose moral right to receive it cannot be questioned, and whose legal claim to it the Defendant should not be permitted to dispute, after having renoun-eed the benefit of the only plea which, from his garnishment, he could with any success have relied upon. ■ 
      
       3 Term Rep. 266. Doug. 468.
     
      
       2 Hay. 354.