Case ID: del_6/html/0176-01.html
Source: Caselaw Access Project
Author: {"author": "\n      By the Court:\n    ", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Joseph B. Nickerson v. Isaac Hazel.
    A bond with warrant of attorney to confess judgment, given to one creditor alone, to secure a debt due to him, and also debts due to other creditors not named in it, if given with their knowledge and consent, is valid and binding; and when collected by him the creditors not named in the bond may sue for and recover their respective claims from him. ’
    Petition by Nickerson to take money out of Court, brought in by the sheriff upon a sale by him on execution of the goods of Hazel. Nickerson recovered a judgment by confession against Hazel for $1550, on the 23d of April, 1855, and on the next day sued out an execution upon it against his goods. On the 10th of April the firms of Brown, Feederack & Kinkle and ¡Ross, Shot & Co. brought each a suit against Hazel, and filed their affidavits of their respective causes of action, and obtained judgments by confession against him on the 28th of April; the former for $230 and the latter for $194.40, and the same day issued executions against his goods. The ground of objection to Nickerson’s application was that there was no such sum as $1550 due to him from Hazel at the time of the entry of his judgment and the issue and levy of his execution upon the goods.
    The proof was that at the time when the bond was executed, on which the judgment was entered, Hazel was indebted to Nickerson in his own right $960, and the balance was due to other parties with whom Nickerson had agreed to account for the balance to them, by taking the bond in this way, for the whole amount in his own name.
    
      Comegys, for the other execution creditors,
    contended that it should be clearly shown that the other parties, for whose benefit the bond was alleged to have been taken in part in the name of Nickerson, authorized it to be taken by him for their debts, and surrendered or released to Hazel their original debts or securities, and became' actual parties to the bond by privity at least; but there was no evidence before the Court that they had ever receipted for, relinquished, or released their original demands against him, and there was not sufficient proof that they even authorized Nickerson to secure their debts by taking a bond in his" own name, but in part for them. Such a transaction would not create a trust in favor of such creditors, and if Nickerson were to receive the money, as they are not named in the bond, but the same purports to be for his own use and benefit exclusively, they could not recover the money from him. Walters et al. v. Comly, 3 Harr. 117.
    
      Fisher:
    
    The case just cited on the other side was not like the present, for it was evident in that case that the creditors secured by the bond knew absolutely nothing of it, and never authorized it. In the present case, also, there was no proof of failing circumstances at the time on the part of Hazel. His property was sufficient to pay all his debts, and would have satisfied them if it had not been sacrificed by the urgent pressure and sale of the claimants and contestants. The only question in the case, therefore, was, did the other creditors for whose benefit the bond was taken .in part by Nickerson, authorize their claims to be included in it for the purpose of securing them against Hazel ?. If so, then they could récover them from Nicker-Son when he received the money; and on that point the testimony was clear and sufficient.
   By the Court:

The claimants under the first judgment, that is to say, the judgment in favor of Nickerson, the petitioner, are entitled to the money brought into court by the sheriff on the executions. The parties interested with him in the bond had notice of the arrangement, and concurred in the step which he thus took to secure their debts as well as his own against Hazel, as he had agreed to do; and they would have their action against him for the amount of their respective demands on his collecting the money from Hazel, and could recover the same from him. It is distinguishable from the case of Walters et al. v. Comly, 8 Harr. 117. In that case the creditors, whose claims were included in the bond, had no notice of it. The bond was executed by a debtor in failing circumstances to a third person, without the knowledge of the creditors whose claims were embraced in it, or any communication with them on the subject, and the Court held that in such a transaction the bond did not create a trust in favor of such Creditors, but was revocable at the will of the obligor, and was consequently void as to such creditors, and the amount of their demands covered by it. But in this case the creditors had knowledge of the proceedings, and sanctioned the transaction, and consequently the bond was valid and binding, and not revocable or void as in that instance.