Case ID: rawle_1/html/0295-01.html
Source: Caselaw Access Project
Author: {"author": "Gibson, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

[Lancaster,
    June 1, 1829.]
    The BANK of PENNSYLVANIA for the use of ECHELMAN and another, against WINGER and another, with notice, &c.
    IN ERROR.-
    The possession of money .by the sheriff arising from the sale of lands, sufficient - to satisfy a judgment earlier than , that under which the sale was made, is not per se, a satisfaction of such earlier judgment.' The prior judgment creditor may waive his priority in favour >:cf a subsequent one, without working an extinguishment of his judgment, which may be1 satisfied out of any other land originally bound by it. And, if the subsequent judgment creditor become the assignee of the first judgment, he succeeds to all the rights of the assignor. ’ . , ■
    This ease came before the court oh a writ of error to the Court of Common Pleas of Lancaster county, in which it was a Scire Facias upon a judgment issued by the plaintiffs in error, The Bank of Pennsylvania> for the use of Jacob Echelman and Benjamin Ver'nor, against Jacob Winger and, Peter Reidebaugh, with notice to Catherine and Elizabeth Stoolfoos,
    
    As it appeared from the record, the case was thus:—Jacob Echelman, on the 9th of Jlpril, 1822, obtained a judgment against Peter Reidebaugh, one of the present defendants, for seven thousand eight hundred and fifty dollars. Upon this judgment he issued a Fieri Facias to Jlpril Term, 1822, under which the defendant’s real estate was levied upon, which, by virtue of a Venditioni Ex-ponas, returnable to JLugust Term, 1822, was sold on the 28th of 
      June, 1823, for eight thousand five hundred-and five dollars. The conditions of sale stated, that the property was to be sold for lawful money of the United States, to-be paid on or before the 16th of August, 1823, and that the sheriff would execute a deed at the next August court, conveying to the purchaser all the estate of Reidebaugh in the premises.' The purchaser executed a bond for the purchase money, to which Echelman was a witness. Of the proceeds of the sale, Echelman received eight thousand two hundred and thirty-three dollars and seventy-eight cents, and the residuo went to satisfy three small judgments of an earlier date. At January Term, 1822, a judgment was entered ,in favour of Benjamin Vernor against Peter Reidebaugh, conditioned for the payment of two thousand six hundred and fifty-one dollars. Prior to-the judgment under which the sale took place,, viz. on the 27th of Novemberr 1¡S20, the Bank of Pennsylvania had obtained a judg- • ment against Jacob Winger and Peter Reidebaugh. It appeared in evidence that Reidebaugh had endorsed notes for Winger, which were discounted by the Bank of Pennsylvania and the Farmers’ Bank. To indemnify him against these endorsements, and also to secure payment for a quantity of grain, Winger gave to Reidebaugh a bond for eight hundred dollars,'upon, which judgment was entered on the 28th of December,s 1819. -This judgment was marked satisfied on the 26th of February, 1S20, the amount, having been paid by the assignees of Winger, who had made an assignment for the benefit of his creditors, and whose property yielded more than-enough to pay his debts. . ■ '
    . On (he 29th-of August, 1823., the Bank of Pennsyíúania assigned their judgment against Jacob Winger and Peter Reidebaugh, to Jacob Echelman and Benjamin Vernor, who issued a Scire Facias to revive it, returnable to November Term, 1823, with notice to Catherine and Elizabeth- Stoolfoos. Judgment in the Scire Facias having been- obtained, a Fieri Facias on which the real debt was marked three hundred and eleven dollars, issued to January Term, 1824, from the return of which it appeared, that the debt, interest, and costs, had been paid by the assignees of Jacob Winger, under his voluntary assignment, made for the benefit of his creditors.
    On the 1st of May, 1824,’on motion of the counsel of Winger’s assignees and affidavit filed, the court granted a rule to show cause why the money paid, into the hands of the sheriff, on the execution in this case, should not be repaid to the assignees, the execution set aside, the judgment opened and the defendants let into a defence. After argument, .the court decided, that the defendants ’should bo let into a defence; that- the execution should remain as a.security, and that the money paid under it should remain in court to abide . the event of the suit. The cause was tided on the plea-of payment, to ascertain whether any thing was due on the original judgment.
    
      On the trial; the court, below were requested by’ the counsel, both of the plaintiffs and the .defendants, to instruct the jury on certain points, which they respectively submitted, and to file their charge of record. In order to understand the case, it will be necessary .that these points, together with the charge of the court, and the errors assigned in it, should be fully set out. ■
    -The plaintiffs’ points were as follows; viz:—
    
      (i 1st. That a payment to a sheriff bn an execution in his hands, is a payment to the-plaintiff in the same, and the persons paying the money to the sheriff never can recover the same back in any form of action,- and therefore the defendants in tliis case have no right to a return of the money paid.
    • “2d. That Henry D. Oberholtzer, Henry Carpenter, and Christian Winger, being the assignees of Jacob Winger, who was the principal in the note on which this suit is brought, and the estate of the said Jacob Winger, in the hands of the said assignees, being" sufficient to pay all his debts and-considerably more, and the-.estate of the said Peter Eeidebaugh, the other defendant, surety or endorser being insufficient for that purpose; having paid off this execution, which in equity and good conscience, they ought to have done, have no right to a return of the money so paid, and the verdict must therefore be for the plaintiffs.
    . “ 3d. That the money being made and paid, as appears by the return of the sheriff, was so paid under a full knowledge of all the circumstances of the case,, and with ample means for obtaining such knowledge, on an execution issued on a judgment of a court of competent jurisdiction^ and therefore cannot -be recovered back again in any form of- action,- nor cannot be refunded to the persons paying the same, and therefore the plaintiff is entitled to recover. ■
    4th. That although the amount of the sales of the real property of Peter Eeidebaugh, who was the endorser for Jacob Winger,. may have been sufficient to pay the-judgment in this case, yet the-plaintiff or his. assignee had his- option to pursue the estate of Jacob-Winger, the principal, if fie saw fit so to do, for the payment, and was not bound to take his money from or out of the sales of the property of the endorser, the. principal having sufficient funds to-pay; and the defendant, Jacob Winger, or rather his assignees,, having, in consideration of there being sufficient funds, paid the .. amount of the execution and eosjs to the sheriff, did no more than-injustice and equity they ought to have-done; therefore they'have no right to have the money refunded ’to him or them, and the'verdict must be for the plaintiffs.
    “ 5th.’ That if the assignees had, previously to paying the debt and-costs on this execution, paid the amount of the note on, which this , judgment was obtained, to Peter Eeidebaugh, the endorser, trusting to his honour to discharge the same, such payment was in fraud. of the creditors- and in ;their own wrong, and could not raise any equity in their- favour, nor could it be permitted legally to operate as an injury to the subsequent judgment and mortgage creditors-of the said Peter Reidebaugh.
    
    “ 6th. That if the equity is equal, the law will not interfere between the parties, but to permit them to remain in the same situation they now are in.” ' v
    The following were the defendants’ points:
    “ 1st. That under the laws of Pennsylvania, the original judgment on 'which this Scire Facias issued, was on the 28th- of June, 1823, satisfied and extinguished; the sheriff on that day, having sold the real estate of Peter Reidebaugh, one of the defendants in this suit, for eight thousand five-hundred and five dollars, a sum more than sufficient to’pay that judgment -and all prior incum-brances. . .
    “2nd. That as Jacob Echelman was a witness to the single bill for eight thousand five hundred and five dollars, executed by the purchaser-of Peter Reidebaugh’s real estate, sold,at sheriff’s sale, he had full legal notice, when, on the 29th of August, 1823, he and B. Vernor, took an assignment of the judgment from the bank, that by the law of Pennsylvania it-was paid and-extinguished. - ' . ■' '•
    “ 3rd; That if the jury believe the testimony of Peter 0. Donnel, it would be against e'quity and good conscience to find, a verdict for the plaintiffs in this'case.” •
    “ Charge or the Court.—In this case, the Bank of Pennsylvania, ,on the 27th. day of November,-1820, obtained a judgment-against Jacob Winger and Peter Reidebaugh. This judgment was afterwards assigned to Jacob Echelman and Benjamin Vernor on the 29th-of August, 1823. •„
    
      Jacob Echelman, on the 9th of April, 1822, obtained judgment against Peter Reidebaugh, one of the defendants in the suit of the bank, for seven thousand'eight hundred and fifty dollars. On this judgment a Fieri Facias issued, under which the real estate of Peter Reidebaugh was levied upon and condemned- A -Venditioni Exponas issued. The conditions of the sale which - took place upon-this Venditioni Exponas, stated that the premises were to be sold for lawful money of the United States, to be paid at or upon the 16th of Aiigust, 1S2.3, and the sheriff-'would execute a deed at the next August court, conveying all the estate, right, and title of Peter Reidebaugh, consisting of his right, title, and interest of, in .and to a certain tract of land containing one hundred' and three acres,' (more or less,) situate in Leacock township, adjoining lands of William Brinton, Jacob Musser, and -others, with the improvements thereon erected. It was struck off on the 28th of Juné, 1823, to Jacob Musser for the sum- of eight thousand five hundred and five dollars," which was paid by the purchaser. Mr. Echelman was a witness to the bond given for the puchase money, and this is evidence of notice to him of the state of the case. The judgment of the Bank of Pennsylvania being first,in point of priority was entitled to be paid out of .this money,and the sheriff having received the amount of this purchase money, and being bound to pay the liens according to their priority, the defendants contend that the judgment of the Bank of Pennsylvania was thereby satisfied and extinguished. Jacob Echelman and Benjamin Vernor, notwithstanding these proceedings, obtained from the bank on the 29th of August, 1S23, an assignment of their judgment against Winger and Reidebaugh, issued a Scire Facias on it with notice ‘to Catherine and Elizabeth Stoolfoos, obtained a judgment and issued a Fieri Facias to January Term, 1824, for the sum of three hundred and eleven dollars, with interest from the 24th of .November, 1823.' ■
    
      “ On this execution there is an endorsement, “ that the debt, interest, and costs, were paid by Oberholtzer and Winger, who were the assignees of Jacob Winger, under a voluntary assignment, made ■ by him for the benefit of his creditors.”
    
      “ Now the allegation of the defendants is, that the judgment of the bank having been satisfied and extinguished by the sale of Reidebaugh’s property and the payment of the proceeds into the hands of the sheriff, all the subsequent proceedings on that judgment .were irregular and void, and the money paid on the execution was forced from the assignees.; that it was paid to them in their .own wrong, and the plaintiffs not being entitled .to receive it, it should be returned to them; and these are the questions for you to try and determine under the testimony in this cause. Other matters than I have mentioned, have been given in evidence, which the parties judge material, and which it will be proper for you to consider and determine. ;
    “ The record shows that Peter Reidebaugh, on the 28th of December, 1819, obtained a judgment against Jacob Winger for eight hundred dollars: this judgment was marked satisfied on the 26th of February, 1S20. It appears in evidence that the bond on which this judgment was entered, was given by Winger to Reidebaugh, for some grain, and to indemnify him from the notes due the Pennsylvania Bank and the Farmers’ Bank, and. that the amount was paid off by the assignees of Jacob Winger, who,' it seems, had in their hands more than sufficient to pay all his debts. If Reidebaugh, when he received the money, had appropriated, it as he ought to have done, there would have been no question in the case, and we would have been saved the trouble of this trial; but. he did not pay it, and retained the money. ’ ’ .
    “ On this point of the case the defendants contend, that if you believe the testimony of Peter O.'Donnel, it would be against equity and conscience to find a verdict for the plaintiff. And, on the part of the plaintiffs, that if the assignees had, previously to paying the debt and costs on this execution, paid the amount of the note on vvhich judgment was obtained-to Peter Reidebaugh, the endorser, trusting to his honesty to discharge the same, such payment was in fraud of the creditors and in their own wrong, and could not raise any equity in -their favour, nor could it be permitted legally to opérate as an injury to the subsequent judgment and mortgage creditors of the said, Peter Reidebaugh. ■ - ; , . •
    “ It appears to me that .quite,as much stress as'was necessary was laid upon this payment .on both sidés as it respects the question before the court. , It was an unfortunate payment on the part of the assignees^ and it does not appear to me how it can have much operation either’ against them, or in favour of the plaintiffs, who were not privy to it, nor had any concern in if. If the question were made, as it affects Reidebaugh, it would have great weight. - If he were resisting payment it would be a complete answer. It would then manifestly show he -was no" longer to be considered in the light of a surety. If no injury were done to others, equity would be clearly in favour of permitting the money to come out of Reidebay.gh’s'esí&té..’ - ' '
    “ The case depends principally, if not altogether, upon the question how far the law considers the proceedings, under the execution of Mr. Echelman as a satisfaction and extinguishment of the judgment of the bank. ‘
    
      “ The plaintiffs contend, that although the amount of the sales of the real property of. Peter Reidebaugh, who was endorser for Jacob Winger, may.haye been sufficient to pay the judgment in this case, yet' the plaintiffs or their assignees had their option to. pursue the estate of Jacob Winger, the principal, if they saw fit so to do for payment, and were not bound to take their money out of the sales of the property of the endorser, the principal having sufficient funds to pay, and the defendant,- Jacob Winger, or rather his assignees, having,, in consideration of there being sufficient funds, paid the amount of the execution .and costs to the sheriff, did no more than in justice and equity they ought to .have done, and there- • fore they have no right to have the money-refunded to them,-and your verdict must'be for the plaintiff's.'
    “ It appears to the .court, that the plaintiffs had no such option as is contended for, and that they were bound to take the money made upon the execution if they were entitled to it, of which there can be no doubt; and it is the opinion of the court, that under the laws of Pennsylvania, the original judgment on which the Spire Facias issued, was, on the paymant of the money to the sheriff on the execution against Reidebaugh, satisfied and extinguished, the sheriff having received a sum more than sufficient to pay that judgment and all prior incumbrances.
    The counsel for the plaintiff Iiave requested the court to instruct you as in Nos. 1, 2, and 3. The money being paid into court on an execution, and waiting the decision of the court and jury, none of the parties are precluded from any remedywhich they before had. The rules relative to voluntary payment do not apply. . The matter is open to all the. law. and equity of the case, and the payment neither lessens'or enlarges the rights of the plaintiffs or defendants.
    “ You will consider the evidence and arguments in the case, and render such verdict as you think right. . If you are of' opinion that the evidence shows an extinguishment of the judgment, you will find for the defendants, otherwise you will find for the plaintiffs.” ...
    The errors assigned in this court were, '
    “ 1st., The court charged the jury on the fourth point submitted by the plaintiff as follows, to wit: “ It appears to the court that the plaintiffs had no such option as contended for, and that they were bound to take the money made upon the execution, if they were entitled to it, of which there can be no doubt; and, it is the opinion of the court that under the law of Pennsylvania, the original judgment on which this Scire Facias issued; was, on the payment of the money to thé sheriff on the execution against Reidebaugh, satisfied, and extinguished; the sheriff having'a sum more than sufficient to pay that judgment and all prior incumbrances:” in the whole of which there is error.
    “2nd. The court charged the jury on the fifth point of the plaintiffs, and third and last of the defendants: “It appears to me that quite as much stress as was necessary was laid upon, this payment on hoth sides, as it respects the question before the court. It was an unfortunate payment on the part of the assignees, and it does not appear-to me how it can have much operation, either against them or in favour of the plaintiffs, who were riot privy, to it, or had any concern in it. If the question were made as it might affect Reidebaugh,. it would' have great weight;if he was resisting payment, it would be a complete answer. It would manifestly show he was no longer to be considered in the" light of security, if no injury was done to others. Equity would be clearly in favour of permitting the money to come out of Reidebaugh’s estate.” In this there is , error, -and it is not an answer to the points, and was calculated to mislead the jury:
    “ 3rd. That the first, second, third, and sixth points submitted by the plaintiffs, are not answered by the court, although'very material to the matter in controversy, and so far as they are answered there is error in the answer.
    “4th. The general errors.”
    
      Evans and Norris, for the plaintiffs in error,
    cited 1 Johns. Ch. Rep. 410, 512. The Commonwealth v. Miller’s Administrators, 8 Serg. & Rawle, 458. Patterson v. Swan, 9 Serg. & Rawle, 16. Barnet v. Washebaugh, 16 Serg. & Rawle, 414. 
      Morris v. Tarin, 1 Dall. 147. Same v. Same, 2 Dall. 115. 1 Day, 130. 1 Esp. 5, 16.
    
      IV. Hopkins, for the defendants in error,
    cited 2 Bac. Ab. 739. Harris v. Fortune, 1 Binn. 125. Moliere’s Lessee v. Noe, 4 Dall. 450. Hunt v. Breading, 12 Serg. & Rawle, 41. Cowden v. Brady, 8 Serg. & Rawle, 508. Whart. Dig. 90, pl. 4. Lighty v. Brenner, 14 Serg. & Rawle, 132, 133. Gilb Law of Executions, 25, 26. 2 Saund. 47, a. n. 1. 2 Bac. Ab. 720. The Bank of North America v. Fitzsimons, 3 Binn. 358. Auwerter v. Mathiot, 9 Serg. & Rawle, 403. 2 Johns. Ch. Rep. 443.
   The opinion of-the court was, delivered by

Gibson, C. J.

It was long a. .moot point whether ’ the sale of land on execution would discharge a prior lien; but I believe no one eyer suspected that it would discharge .the debt. Such a consequence could be produced only by treating the debt and its' lien as inseparable. The lien is, however, but a security which may be released either before or after a sale, and, as any other security, without affecting the.existence of the debt. By a sale, the purchase money is substituted for the land; and as it is withdrawn from the control of the debtor, and put within that of the lien creditors', I admit that they are bound to look to the application of it, insomuch that a loss of any part of it,will have to be borne by him whose act occasioned it: in other words, that the debtor may,, in equity and conscience, consider whatever has perished in the hands of the sheriff, as actually paid to him who is entitled to‘ receive it. ,But can he do so. in respect of what has gone into his own pocket, or, what is the same thing, in easé of his debts ? It never has been supposed— certainly it never has been decided—that he can. Where a creditor has had two funds, we have .prevented him from frustrating the lien of another who had but one; yet that could Hot be done if the rights of the parties were1 fixed by the sale; for the'prior judgment creditor would be paid by operation of law, and before the court could interpose.. Hunt v. Breading (12 Serg. & Rawle, 37,) is cited to show that a levy to the Value of the debt, is-perse, satisfaction of the execution on which-the levy7 was made. It would be more.tp the purpose to show that it' discharges other executions which bind the goods. If such were the law, a multitude of cases would necessarily have arisen under it; and the total absence of decision on the subject, is satisfactory evidence that the principle does not exist. Surely a right to priority of payment may be waived without waiving that of which it is but ah accident. .A creditor may.-release the land without releasing the debt; and why not the purchase money, Which is in the place of the land ? It seems to me he does no more when he waives his preference in favour of those who claim under the debtor by title subsequent. It is a principle of common sense, which has been embodied as a maxim, that any one may waive a-right, r^egted for his own benefit. What injury can it do any one ? Surely Reidebaugh, whose proper- debt was paid with his own money, could not object to the waiver of.preference by the bank: and -.let us see whether Winger, his co-debtor, has, any better right to do so. . .

' Winger and Reidebaugh originally stood in the relation of principal and surety; so that the refusal of the'bank to take satisfaction out of the land of the surety, was in furtherance of the equity between the debtors themselves; and to. this Reidebaugh, the surety, could not object. But, previous to this - Winger had put into his hands funds to discharge the whole debt, which Reidebaugh misapplied; and the original relation between'them, therefore, was, in fact, reversed. But of this the bank was not apprized, and it was therefore justifiable in acting in conformity to the equity of the original, relation. It waived its preference in favour of a surety to pursue the principal—the very thing-that a, court of equity would have compelled it to do. - I will not stop to inquire whether the relation of principal and surety is dissolved by a judgment at law, although the negative of the question is sustained by a solemn decision of this court, and there can be.no reason why the fixing of the parties at law should absolve the principal from the moral obligation to protect his surety. For the purposes, of the argument I will. admit that the relation is extinguished. The consequence is that both are principals, and stand in equal equity as between themselves. How then could Winger object to the waiver of its preference by the' bank, if Reidebaugh could not ?'■ A creditor may collect his debt from either of two principal debtors, dr from both, at his election. If then the sale by the sheriff wére not payment per se, the bank had nothing in its hands but the means of actual payment, which it is not bound to retain in favour of any one but a surety. This principle is well.settled both in Pennsylvnia and England. The Commonwealth v. Miller’s Administrators (8 Serg. & Rawle, 457.) Reed v. Garvin (12 Serg. & Rawle, 103.) The bank then might -well permit the proceeds of Reidebaugh’s land to go to his use without, injury to Winger, who was in no aspect entitled to be treated as-a surety, and who, had no other right to ob-' ject than that of Reidebaugh himself.

Thus far I have considered the question as if it were between the defendants and the bank. The judgment is, however, owned, in part, by Echelman, the plaintiff in the judgment on which Reidebaugh’s land.was sold;and the question is whether he did not stand in, at least, as favourablé a situation' as did the bank. The case is just this: the bank had a judgment against two, which was bought in by a younger judgment creditor, to enable him to give a preference to his judgment against one of them. I cart see nothing wrong in that. An assignee .for valuable consideration, succeeds to all the rights of the assignor. Even an assignee, with notice, succeeds to the rights pf a purchaser without it, because, having paid for the advantage arising from the ignorance of the assignor, he is entitled to 'the benefit of it. If then the bank might have used its judgment, so as to favour Echelman,- he acquired the same capacity; for when distinct rights concur in the same person, they are to be treated as if they existed separately in different persons. So far was it from being unconscionable in him to possess himself of the means and capacity of the; bank, that a court of .equity would have given him the benefit .of them. If,” says Chancellor Kent, “a creditor has a lien on two parcels of land, and another creditor has a lien, of a younger date, on one of these parcels only, and the prior creditor elects to take his whole demand out-of .the land on which the junior creditor has á lien, the latter .will be entitled- either to have the pri- or creditors thrown upon the other fund, or to have the prior lien assigned to him, and to receive all the aid it can afford. . (Cheesboraugh v. Millard, (1 Johns. Ch. 412.) I cite this case because it contains a principle, in every particular, applicable to the case before us, and also references to the authorities. Echelman, therefore, could have compelled the bank to exhaust its means of obtaining satisfaction from the lands of Winger,- or, on payment of the debt, to assign its lien. It has voluntarily done the latter; and'Echelman brings, in aid of the legal capacity of the bank, the equity of a junior judgment creditor to have that capacity exerted for his advantage. It seems to me that, independent of all ’other considerations, this is decisive in his favour. Iam therefore of opinion that the judgment be reversed. Judgment reversed.