Case ID: ohio-st_62/html/0025-01.html
Source: Caselaw Access Project
Author: {"author": "Spear, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Vandenbark v. Mattingly et al.
    
      Creditor’s bill — Procedure against equitable assets — Section 5464 Rev. Stat. — Jurisdiction of court of common pleas — Not ousted by pendency in probate court of petition by assignee to sell lands, when — Legal procedure.
    
    The jurisdiction of the court of common pleas of an action in the nature of a creditor’s bill, brought under authority of section 5464, Revised Statutes, is not ousted because of the pendency in the probate court of a petition for an order to sell lands by an assignee for the benefit of creditors, where the object of the action in the common pleas is to subject to the payment of the plaintiff’s judgment a fund belonging to such judgment debtor, (a secured creditor of the assignor), being proceeds of a sale of the assignor’s lands which may remain in the hands of such assignee for distribution.
    (Decided February 20, 1900.)
    Error to the Circuit Court of Muskingum county.
    The plaintiff in error brought action in the common pleas of Muskingum against Thomas Mattingly, Martha E. McGowan, George L. Foley, as assignee in trust for the benefit of creditors of Thomas Mattingly, and certain other persons, creditors of Mattingly, in the nature of a creditor’s bill. The petition showed the recovery, January 6, 1896, of a judgment by the plaintiff against the defendants Mattingly and Martha E. McGowan, in the sum of $441.60 and costs; that the same remained in full force wholly unsatisfied; that the defendant Mattingly is wholly insolvent and owns no personal property or real estate subject to execution out of which any part of said debt can be made; that Martha E. McGowan, owns no personal property or real estate subject to executiofi, but is the owner of equitable interests in certain notes (particularly described) , and which were secured by mortgage on lands of said Mattingly in the county.
    Defendant Foley, as assignee of Mattingly, on November 14, 1895, filed a petition in the probate court of Muskingum, asking an order to sell the real estate of Mattingly to pay debts, making all lienholders parties. The land has not been sold, but will probably sell for a sum in excess of the amounts due the mortgage creditors and leave a balance belonging to Mrs. McGowan. Equitable relief was asked, and that the portion of the fund realized from the sale of the land Avliich should be found coming to Mrs. Mc-GoAvan, be subjected to the satisfaction of plaintiff’s judgment.
    To this pleading Mrs. McGowan filed the following answer:
    “Martha E. McGowan, one of said defendants, pleading only to the jurisdiction of the court, for ansAver to the petition says: the said Thomas Mat-tingly made an assignment for the benefit of creditors under the statutes of Ohio on or about the 6th day of November, 1895, to said George L. Foley as assignee, and therein conveying to said Foley in fee a certain valuable farm which on the 29th day of February, 1896, was sold at public auction by said Foley as such assignee, to one Michel Mattingly for the stun of $7,950. This defendant, at the time of said sale, held a mortgage on said farm for $7,000, Avith interest thereon at the rate of 5 per centum per annum from September 1,1894. She had pledged the notes secured by said mortgage to secure debts of the said Thomas Mattingly to the amount of $6,503. There is no means in the hands of said assignee applicable to the payment of any unsecured creditors of said Thomas Mattingly. The costs and expenses of said assignment chargeable to said real estate and which must necessarily be paid out of the proceeds of the sale of said realty, will equal, if not exceed, the remainder of the purchase money of said realty, after satisfying the said mortgage to this defendant. The remainder of said purchase money, after satisfying the holder of said mortgage notes stated in the petition coming to this defendant under the said mortgage, is in the hands of said assignee as such and subject to the order of the probate court of said county.
    “The said Collin Vandenbark is a party defendant in the said probate court in the case of George L. Foley, as assignee of Thomas Mattingly, v. Thomas Mattingly and others, in which said land was sold as aforesaid and said fund produced, and all and singular the parties plaintiff who have signed petitions in this court to have applied any of said funds secured by this defendant’s said mortgage, are defendants in said action pending in said probate court. This defendant has all the while been, and now is, a defendant in said action in said probate court.
    “Wherefore, this defendant says that this court has not jurisdiction of the subject matter of this action.”
    To this answer a general demurrer was filed by the plaintiff, and a like demurrer by The Citizens’ National Bank, a judgment creditor which had become defendant on its own motion. On hearing, the demurers were overruled, and neither the plaintiff nor the Bank desiring to plead further, the petition of the plaintiff and the cross-petition of the Bank were dismissed and judgment awarded against them for costs. On error this judgment was affirmed by the circuit court. The present proceeding is by plaintiff below to reverse these judgments.
    
      Charles M. Y anden!) ark, for plaintiff in error.
    
      W. 3. Ball, for Mattingly and McGowan.
   Spear, J.

One question only, is presented by the record. . That is: Had the court of common pleas jurisdiction of the action? We are of opinion that the answer must be in the affirmative.

The plaintiff’s suit was brought under favor of section 5464, Revised Statutes, which gives authority to a judgment creditor, where his debtor has not personal or real property subject to levy on execution sufficient to satisfy the judgment, to reach any equitable interest of the debtor in any real estate as mortgagee, or otherwise, or in any chose in action, due or to become due, or in any judgment or order, and to subject such equitable interest to the payment of the judgment by action. Such action is equitable in its nature. To obtain the relief desired, the creditor must appeal to a court having adequate equity powers, in other words, general equity powers. Such powers are possessed by the court of common pleas. That court, therefore, was the proper court in which to begin the action unless jurisdiction of the subject matter and the parties had previously been acquired by another court possessed of adequate equity powers. The answer avers, and the contention is, that as to this controversy the probate court had acquired jurisdiction by virtue of the assignment of Mattingly and the commencement by the assignee of a proceeding in that court to procure an order to sell the lands of Mattingly. But the probate court is a court of limited, and not of general, jurisdiction. All grants of jurisdiction are specific, and the auxiliary and incidental powers of the court are expressly limited to such as are necessary and proper to carry into effect the powers expressly granted. Davis v. Davis, 11 Ohio St., 391. True, within this rule, that court was clothed with jurisdiction to fully execute the trust created by the assignment, which included all the assigned property, but the assignment conveyed only the property of Mattingly. It did not, and could not, convey the property of Mrs. McGowan; nor did the creditor ,seek. to reach the property of Mattingly. His effort was to ’ subject the ’¡property of' Mrs. MeGowan and that only. Hence the trust created by Mattingly’s assignment could be fully executed by the probate court without adjudicating the claim of Vandenbark against his debtor.

It appears by the answer that Vandenbark is a party defendant in the proceeding in the probate court, and that Mrs. McGowan is also a party. It does not appear that the former was a party at the time his action in the common pleas court was commenced. If not the probate court had not then acquired jurisdiction of the matter in issue, even if it had power to acquire such jurisdiction. And it can hardly be urged with reason that if the common pleas had jurisdiction of the action at its commencement, such jurisdiction could be ousted by the making of the plaintiff a party to the proceeding in the probate court. Miers v. Turnpike Co., 11 Ohio, 273.

It is not necessary here to take space in giving construction to either section 6351 or 6145, Revised Statutes. The authority given the probate court to order payment of liens and encumbrances by the former section is not applicable to the claim of Vandenbark against Mrs. McGowan. There was, at the time’ of the assignment, no existing lien in favor of Vandenbark for the court to order paid, or refuse to so order, and as before stated, he was not asking relief against Mattingly, nor against the assigned property, but against Mrs. McGowan and her interests only. His action was, primarily, to obtain a lien. Nor did the latter section which gives power to that court “to determine the equities between the parties and the priorities of lien of the several lien-holders on said real estate, and to order a distribution of the money arising from the sale of such real estate according to the respective equities and priorities of lien as found by the court,” apply to the claim of Vandenbark for the same reason, and for the further reason that the amendment of that section, of date April 14, 1896, making the same applicable to proceedings by assignees, was not passed until after Yandenbarlds action in the common pleas had been commenced. The fact that the assignee might be required to pay the fund belonging to Mrs. McGowan into the common pleas by virtue of its order, rather than directly to her, is a mere incident, and cannot affect the question of the jurisdiction of that court.

The demurrer to the answer should have been sustained. The judgments below will be reversed and the cause remanded to the court of common pleas for such further proceedings as may be necessary to preserve and enforce the rights of the parties.

Reversed.