Case ID: va_42/html/0049-01.html
Source: Caselaw Access Project
Author: {"author": "By the court.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

*Hairston & als. v. Medley.
    May, 1844,
    Richmond.
    (Absent Cabell. P., and Stanard, J.)
    1. Principal and Agent—Liability of Agent for Extending Credit.—A commission merchant who sells produce consigned to him, on a credit, and afterwards extends that credit without the assent of his principal, is responsible for the loss which may be occasioned thereby.
    2. Distributees of Foreign Intestate—Liability for intestate’s Debts.—A debtor in Virginia, removes to Mississippi and dies, and administration is there granted on his estate, which is administered and distributed according to the laws of that state. The distributees reside in Virginia : Held, the distributees are responsible here for the debts of their intestate, to the amount of the assets so received.
    3. Appellate Practice—Irregular Admission of Party-No Objection in Lower Court.—During the pendency of a cause in a court of equity against the distributees of an intestate debtor, by his creditor, the estate of the debtor is committed to the sheriff, who, without an amendment of the bill, or the issue of process against him, comes in and files his answer, and no obj ection is taken to his doing so in the court below. This court will not reverse a decree against the distributees on this account.
    4. Same—When Decree Not Reversed for Want of Administration Account.—An administrator of .an intestate who lived and died in another state, answering that he has no assets in his hands, and knows of none that may come to his hands. This court will not reverse a decree against the distributees because no account of the administration was taken.
    5. Absent Debtors—Equity Proceedings against—Statute.— Queere. If the act 1 R. C. ch. 123, p. 474, authorizes proceedings in equity against an absent debtor, jointly and severally bound with others, who has no property within the jurisdiction of the court.
    6. Same—Personal Decree—Statute.—Qucere. If this statute authorizes a personal decree against an absent defendant.
    In 1823, Isaac Medley filed his bill in the chancery court ' of Williamsburg, against Jesse b- Dupuy, Henry Hairston, and Edmund Banks, as partners under the name and style of Dupuy, Hairston & Banks, in which he stated that he had shipped to the defendants, who transacted a commission business in Norfolk, two hundred *and thirty-eight barrels of flour, to be sold for him. That they rendered him an account of sales of thirteen barrels, under date of May 4th, 1819, the net proceeds of which were 133 dollars 64 cents. They also rendered an account of sale of one hundred and fifty-one barrels, under date of August 5th, 1819, the net proceeds of which were 969 dollars 21 cents. This last sale was made to R. & J. D. Brown of Norfolk, on a credit of ninety days. That the defendants, by their letter of September 14th, 1819, informed him that the Browns had failed to pay for the flour at the time appointed, and that defendants had given them a farther credit of thirty days; and that the Browns had given collateral security for the debt. The bill charges that this extension of credit was without authority from the plaintiff, and that the defendants had become responsible to him for the price of the flour; that the Browns are insolvent, and one of them dead; and that plaintiff has reason to doubt whether they ever gave the collateral security as stated by the defendants in their letter of 14th September 1819. He therefore prays that the defendants may be compelled to disclose what the security was so given by the Browns; and that they may be compelled to pay to him the amount for which the said parcels of flour were sold. The letters and accounts rendered are made exhibits and filed with the bill.
    Process was served upon Dupuy and Banks, and the bill regularly taken for confessed as to them; and Henry Hairs ton having removed to the state of Mississippi, there was an order of publication as to him; the publication of which, in the newspaper was proved, but there was no proof of posting the order at the door of the courthouse, though the decree stated that the cause had been proceeded in, in the mode prescribed by the statute as to absent defendants. In February 1826, the court made a decree against them for the amount due the plaintiff, according to the accounts rendered by them. *On this decree, an execution issued, which was returned no effects as to Dupuy, and that the other parties did not reside within the chancery district.
    The decree of 1826, remaining unsatisfied, the plaintiff, in 1828, filed another bill in the same court, in which he stated the fact that he had instituted the suit above mentioned, and “that various proceedings were had therein, to which he refers and prays that they may be used for more particular information.” He then states that Dupuy had removed to Ohio or elsewhere, out of the state; that Henry Hairston was dead intestate; that George Hairston had qualified as administrator on his estate, and had or might have received assets sufficient to satisfy the plaintiff’s claim; and that the brothers and sisters of Henry Hairston, who were his distributees, had received a considerable estate chargeable with the payment of the plaintiff’s claim. He therefore made George Hairston as administrator of Henry Hairston, and the said George and the other distributees of Henry, and Dupuy and Banks, defendants, and prayed for a decree against them for the satisfaction of his claims against Dupuy, Hairston & Banks.
    The bill was regularly taken for confessed against Dupuy and Banks, both of whom were insolvent. The other parties answered. They say that the partnership of Dupuy, Hairston & Banks only existed about a year, when it was dissolved, and Henry Hairston removed to Mississippi, and died in 1825, previous to the decree in the case of Medley v. Dupuy, Hairston & Banks; that they know nothing of the transactions set forth in the bill, and call for proof; that George Hairston qualified as administrator of Henry Hairston in Mississippi, and proceeded in all things according to the law of Mississippi: that by the law of that state the plaintiff should have presented his claim before the orphans court of the county in which the administration on Henry Hairston’s estate was granted; and not ^having done so, his claim is barred, and the defendants as his distributees are not liable therefor; and they plead the statute of limitations both of the state of Mississippi, and the state of Virginia.
    George Hairston not being the administrator of Henry Hairston in Virginia, the estate of Henry was committed to the sheriff of Halifax, who without any amendment of the bill making him a party, or process to bring him in, filed his answer, saying that he had no assets, and had no knowledge of any in this state.
    The distributees of Henry Hairston filed a certified copy of the proceedings before the probat court of Yazoo county in Mississippi ; from which it appeared that the administrator had settled his accounts ; and that the estate of Henry Hairston had been divided among his eight brothers and sisters, each receiving upwards of 400 dollars.
    The cause having been removed to the circuit superior court for the county of James City and City of Williamsburg, came on at the May term 1835, to be heard upon the bill, answers, exhibits, and the papers in the original cause, when the court made a decree directing the distributees each to pay their proportion of the debt due to the plaintiff. Prom this decree they obtained an appeal to this court.
    G. N. Johnson for the appellants.
    The decree in the first suit, was not evidence in this, against the representative and distributees of Henry Hairston. Pirst, because it was not relied on in the bill. That merely refers to the proceedings in the first suit, and sets up the same claim, resting on the same evidence. Second, because it is a decree against an absent defendant, which is not binding until seven years have elapsed from the date of the decree, 1 Rev. Code, ch. 123, § 2, 4, 5, p. 474-476. Third, because Hairston was dead at the time of the decree; and as to him therefore, it was a nullity.
    *If this decree is not a nullity for the reason stated, it is by no means clear that it binds Hairston personally. These proceedings against absent defendants, are not intended to give a personal decree against them, but to affect other parties or property in Virginia. It may be, and often is important, that an absent party may be decreed against as to his property in Virginia; but not that there shall be a personal decree against himself. And although it is true that full faith and credit is to be given to the judicial proceedings of each state in every other, yet it is held that a judgment to which a defendant is not a party by service of process upon him, is not binding. Story’s Conflict of Haws 509; Bissell v. Briggs, 9 Mass. R. 468; Aldritch v. Kenney, 4 Conn. R. 380.
    2. If the decree is not evidence against Hairston’s distributees, ■ then there is no evidence of the plaintiff’s claim. The only proofs are to be borrowed from the old record. The receipts and letters filed in that record, are not proved, and indeed have never been filed in this case. There is no proof that the credit was not according to the custom of the place, and there is no disavowal of the conduct of the defendants for four j'ears after the plaintiff is informed of it.
    3. The statute of limitations is a bar to the plaintiff’s claim. That claim accrued in 1819, and this suit was not brought until 1828. The claim is in its nature legal, and the plaintiff comes into this court to pursue assets in the hands of distributees. The statute began to run, and therefore continued to run, though Henry Hairston left the state before the five years had expired. But if the plaintiff relied upon the fact that Henry Hairston had left the state within five years after his claim accrued, he should have stated the fact in his bill or replication ; though in fact there is no evidence that he did leave the state within the five 3rears.
    *4. The distributees of Henry Hairston are not responsible for this claim, on account of the assets received from Mississippi. In pursuance of the laws of Mississippi, the administrator advertised for creditors; and having paid all claims, the estate was divided. It is a vexed question whether a foreign administrator is responsible here. Tunstall v. Pollard, 11 Heigh 1, decides that legatees may maintain a suit against him ; but there are authorities contra not referred to or considered in that case. Vaughan v. Northup, IS Peters R. 1. Both cases, however, recognize the binding authority of the law of the place of administration ; and will enforce against an executor or administrator the rights derived under that law. It is true that by our law a party qualifying as administrator, and paying over the assets to legatees, a creditor may follow these assets, because the trust follows them; but this is to be controlled by the law of Mississippi, and here it must be taken that every thing has been done according to that law.
    5—A Virginia administrator should have been made a party by the bill. That speaks of George Hairston as administrator, but that is obviously as the Mississippi administrator. The administration granted in Halifax was improperly granted, Henry Hairston not having resided in that county ; and that administrator was not a party, but filed his answer without the authority of the court,' or the assent of the other de ■ fendants.
    6. There should have been an account of the personal assets.
    Taylor, Grattan and Stanard, for the appellee.
    This is a bill against the distributees of a deceased partner; the surviving partners being insolvent. It has been held by this court that a creditor of a firm may go into equity against the representative of a deceased partner. Sale v. Dishman, 3 Leigh 548. A fortiori we may proceed in that court against his legatees and distributees.
    *The case resolves itself into three questions. 1. Was Henry Hairston indebted to the plaintiff. 2. Is the statute of limitations a bar to the claim. 3. Are the defendants liable for it.
    1. On the first question, the decree of 1826 is conclusive against Henry Hairston and his representatives. It is a decree of a court of competent jurisdiction in a cause in which he was regularly made a party, and_ has never been reversed. The second section of the statute in relation to proceedings against absent defendants, shews that the decree is valid until reversed in the mode directed by the act, and this is confirmed by the case of Platt v. Howland, 10 Leigh 507.
    
      The record states that the defendant is alive, and this imports absolute verity, and can only be set aside by original bill for fraud or surprise: and if the distributees of Hairston intended to falsify the record, the proceeding should have been in the same suit, upon an application to set aside that decree. As to the objection that the decree of 1826 is not relied on in this bill, it is sufficient to say that the bill refers to all the proceedings, and asks for a decree for the sums decreed, and also for the costs; and this case is in fact a continuation of that cause. .
    The objection that there cannot be a personal decree against an absent defendant, is against the letter of the act, 1 Rev. Code, ch. 123, § 5, p. 476; would defeat the purpose of its enactment, and leave the law defective in the particulars which it was intended to remedy; see Story’s Equ. PI. § 77, 78, 81; and is opposed by the case of Morrison v. Campbell, 2 Rand. 218.
    But if the decree of 1826 is void as to Hairston, the evidence is ample to prove the indebtedness of the firm of Dupuy, Hairston & Banks. The original letters and accounts rendered of the firm, leave no doubt of the facts of the receipt and sale of the flour; of the price at which it was sold; and of their having extended the ^'credit to the Browns without authority from the plaintiff. These letters and accounts are part of the papers in the original cause, referred to in this; not objected to in the court below; and as we have said before, this cause being but a continuation of that, they are essentially papers in this case.
    2. Is the statute of limitations a bar? The claim of the appellee arose in 1819. The suit was brought in 1823; and though Hairston was dead, the decree of 1826 was a decree against his partners; and the representatives of Hairston had a right to require the creditor to proceed against the surviving partners; and therefore his remedy against Henry -Hairston’s distributees did not arise until his remedy against the survivors failed: and he brought this suit within two years after that time.
    But Hairston having left the state before the statute was a bar to the appellee’s demand, 'and never having returned, his distributees are precluded from the protection of the statute by the 14th section thereof. See 1 Rev. Code, ch. 128, § 14, p. 491.
    3. It is insisted that the appellants have received no estate as the distributees of Henry Hairston, except the estate distributed in the state of Mississippi, and according to its laws; and that they are not, on account of these assets, responsible to the plaintiff. The case of Tunstall v. Pollard, 11 Heigh 1, seems to be conclusive of this question. If a foreign executor or administrator may be sued here, it is a fortiori that distributees may be subjected to pay the debts of their intestate, out of the assets of his estate in their hands. The law of Mississippi may protect the executor or administrator who has complied therewith, > as our act protects them when they have distributed the estate and taken refunding bonds; but it could not be intended that the distributees should be protected in the possession and enjoyment of their intestate’s estate, whilst his creditors were unpaid.
    *In conclusion, there is no evidence that administration was not properly granted in Halifax; but if it was not, it was only voidable and not void. Fisher v. Bassett, 9 Leigh 119; Burnley v. Duke, 2 Rob. R. 102. There can be no necessity for a plaintiff to amend his bill, or issue process to bring in a party who comes in and files his answer; and if the proceeding is irregular, the appellants are not thereby injured. ' The administrator having answered, saying he had no assets, and it being clear that Henry Hairston left no estate in Virginia, there could be no necessity for an account.
    C. Johnson for the appellants.
    A Virginia administrator was a necessary party in the cause; because the plaintiff below was not authorized to proceed against the distributees until he had failed to make his money out of the administrator. In this case such administrator was not a party. There was no proceeding against the sheriff administrator, to make him a party. He could not be made such by scire facias, as neither he nor his intestate, or any previous Virginia administrator had been a party in this suit. The bill should therefore have been amended, making him a party, so that the distributees might answer, and test the question, whether he was administrator. Upon his answer, saying that there were no assets in his hands, 'the court should have directed an account. The cases cited to shew that the plaintiff may proceed against distributees, go upon the ground that it is ascertained there are no assets in the hands of the administrator.
    The counsel for the appellee have correctly stated the questions that arise in the cause. The first is whether any debt is shewn to be due from .Henry Hairston. If the plaintiff has a valid decree against Hairston, then there was a debt, for that declares it. But the decree is a mere nullity. 1. Because Henry Hairston was ’ dead at the time it was made. 2. Because in a proceeding *against an absent defendant, every thing must be regularly done; and here there is no proof of the posting of the order at the door of the court, as required by the statute. 3. However regular the proceedings, the case did not come within the provisions of the statute as to absent defendants. The statute was intended for the single purpose of enabling the court of chancery to settle rights of property within the jurisdiction of the court; but not to authorize a personal decree against the absent defendant. The court here can ' have no authority over a citizen of another state, and no right to proceed against him personally, or to affect him otherwise than through his property here. This is not a question of judicial power, but political power; not controlled by statute law, but political law.
    
      By the reporter. The court aid not state the ground on which the decree was affirmed; but the reporter understood that they considered that the decree of 1826 was a mere nullity as to Henry Hairston: that the second suit was a continuation of the first: and that the exhibits in the first suit satisfactorily established the claim of the plaintiff.
    In 1777, the law then enacted, was confined to absent debtors. It was afterwards extended to other absent defendants, who were necessary parties, to enable'the courts to decide upon rights of property arising in causes depending before them; and such absent defendant is made a party, that his interest in the property in contest may be ascertained, and the rights of the claimants thereto may be decided. It is only in such cases that the law applies.
    If the object of the bill had been to attach the property of Henry Hairston in the state, then he would have been a proper party; hut in such case the decree would have bound the property here, and nothing more. In this case the object was not to attach the effects of the absent partner, but to establish a claim against the partnership. In such a case the absent partner having no property here, was not a necessary party; and there could be no object in making him a party, except to obtain a personal decree against him.
    We have referred the court to authorities to shew that a decree against an absent defendant is not binding upon him. It 's supposed that these authorities refer to the *effect of the decree in a foreign jurisdiction; but this is a mistake. The constitution of the United States gives to the judgments and decrees of each state, the same force and effect in the other states, that they have in that in which they are rendered. The enquiry, therefore is, what is the effect of the decree in the state where it is rendered? If it is conclusive there, it will be conclusive elsewhere; if prima facie there, it is the same elsewhere. If then this decree would be effectual in Virginia against Henry Hairston, it would be the same in Mississippi; and yet the authorities are conclusive that there it is merely void, because you have no cognizance of the subject on which it passed. On these grounds we say the decree against Henry Hairston is a mere nullity.
    If this decree of 1826 is not evidence, it is immaterial to enquire what mode should be taken to set it aside; and the question is whether upon the proofs in this cause, Henry Hairston was indebted to the plaintiff below. The bill in this second suit does not make the exhibits in the first suit, exhibits in this, but merely refers to them. But if they were made exhibits in this cause, they are then a part of the bill, and not evidence, though not objected to. If they are not exhibits, then there is no evidence that they were read. But if these exhibits in the first suit were read in this, they do not sustain the claim of the plaintiff below. The letter of Dupuy, if evidence, shews that the firm owed nothing. It shews that they had received no money for the plaintiff; and he, with full knowledge, that they had extended the credit to the purchasers, delayed for four years to make any objection to it. This delay we insist was an acquiescence in their act.
    There are cases in this court, in which it seems to be considered that the right to go against the representatives of a deceased partner depends upon the insolvency of the survivors; and therefore, that this is the period x'at which the right arises. This is not exactly correct, as will be seen by reference to Story on Partnership, ch. 15, § 362, p. 514. If Story is correct, the contract being joint and several, the statute began to run in favour of each, and each would be protected when the five years had elapsed from the date of the contract. The 14th section of the statute cannot prevent its operation, because there is no proof that Henry Hairston left the state within the five years.
    Generally, it is the right of creditors to go against legatees and distributees for satisfaction of their debts, hut with one unvarying qualification; and that is that the assets in the hands of the personal representative have been exhausted, and that he shall be a party to the suit.
    It has been a subject of doubt whether a foreign executor or administrator could be sued here; but it has never been doubted that he must be held to account, according to the laws of the country in which he qualified as such. If he has administered the estate, according to that law, he is not responsible elsewhere, according to another law. But not only does the administrator administer the estate according to the law of the state in which he qualifies, but the next of kin take the estate controlled by the same law. There is no law of nature that the property of a decedent shall be applied to the payment of his debts. Until lately, in Virginia, land was not bound for parol debts. If a devisee of land here should sell it and remove to a state where parol debts did bind the land, could he be held responsible for such debts, on account of the assets in his hands.
    The law of Virginia does not provide that assets in another state shall be responsible here to creditors. It only extends to the case of assets here, turned over by an administrator or executor, to distributees or legatees. In Mississippi, the law directs that after two years the '*administrator shall settle up, and distribute the estate; after giving notice to creditors to come in and present their claims for payment. This has been done. If the defendants were in Mississippi, they could not be held responsible; and as the law of that state is to regulate the liability of the parties, as to the assets derived from thence, they cannot be responsible here.
    
      
      Judge Stanard had been counsel in the cause.
    
    
      
      IPrlncipal and Agent.—On matters pertaining to principal and agent, see monographic note on “Agencies” appended to Silliman v. Fredericksburg, etc., R. R. Co., 27 Gratt. 119.
      Chancery Practice—Defendants—Unknown Devisees —Filing of Answer.—To the point that it is not error for the court to allow persons, who have been made parties defendant as unknown devisees, to file answers to the bill and amended bill, without petition, the principal case was cited in McCoy v. McCoy. 9 W. Va. 445.
    
   By the court.

Affirm the decree.