Case Name: The COMMONWEALTH, for the use of GURNEY'S Exrs., against ALEXANDER and others
Court: Supreme Court of Pennsylvania
Jurisdiction: Pennsylvania
Decision Date: 1826-06-21
Citations: 14 Serg. & Rawle 257
Docket Number: 
Parties: The COMMONWEALTH, for the use of GURNEY’S Exrs., against ALEXANDER and others.
Judges: 
Reporter: Reports of cases adjudged in the Supreme Court of Pennsylvania (Sergeant & Rawle)
Volume: 14
Pages: 257–264

Head Matter:
[Sunburn,
June 21, 1826.]
The COMMONWEALTH, for the use of GURNEY’S Exrs., against ALEXANDER and others.
IN ERROR.
A purchaser at sheriff's salé under a judgment, does not take the land subject to a previous judgment, obtained against the former owner of the land, unless it was sold expressly subject to such prior judgment.
Where, therefore, money is in the hands of the sheriff, arising from the sale of land under a judgment obtained against the present owner, creditors who have liens upon the land, by virtue of judgments obtained against the former owner, are entitled to payment out of this fund; and if the sheriff, instead of satisfying such liens, pays over the balance of the purchase money to the defendant in the execution, the previous judgment creditors may recover from him the amount' of their respective liens.
Whether the judgment creditor had not lost his lien, in consequence of his attorney having permitted the misappropriation of another fund, out of which he was entitled to payment, properly left to the jury, under the facts and circumstances of the case.
Writ of error to the Court of Common-Pleas of Centre county.
In the court below, it was an action brought in the name of the commonwealth, for the use of the executors of Francis Gurney, against William Alexander, sheriff of the said county, and Philip Benner and Isaac M‘Kinny, his sureties, upon the official bond of the former, and the facts set out in the assignment of breaches were these: On the 6th of December, 1813, a judgment for three thousand and seventy-eight dollars was entered in the Common Pleas of Centre county, in favour of the executors of Francis Gurney, against William Patton, who owned sundry tracts of land in the said county, with a stay of execution for two years. The lien of this judgment was kept alive by scire facias. After the date of the judgment, viz. on the 14th of May, 1814, Patton sold one tract of land to Samuel^ Maxwell, for a full and valuable consideration; When this sale^a^-about to take place, Thomas Burnside, esq., who was attorné'^''’f£!Í'- Francis Gurney during his life, and for his executors after his death, was pressed for a release of the lien upon this land, which he refused to give, in consequence of which Patton gave to Maxwell a bond with two sureties, to indemnify him against the lien of the said judgment. Samuel Maxwell having become indebted, among others, to G. and II. Fahnestock, gave them a judgment of April Term, 1S17, on which & fieri facias was issued, and the above mentioned tract of land purchased from Patton, levied upon, condemned, and sold. The sheriff executed a deed to the purchaser, and gave a receipt for the whole' amount of the purchase money. This suit was brought to recover the amount of the judgment' held by Gurney’s executors against William Patton.
It further appeared, that Philip Benner, on the 26th of August, 1814, obtained a judgment for one thousand five hundred and fifty-six dollars and thirty-five cents, against William Patton, under which other real estate of William Patton was sold, by virtue of a venditioni exponas, returnable to Jipril Term, 1815, The then sheriff, Mr. Rankin, executed a deed to the purchaser, gave a receipt for the whole of the purchase money, and after having paid a few judgments, took a receipt for the balance, amounting to nine hundred dollars, from the said William Patton. During the whole of this transaction, Mr. Burnside, who, though without a written power of attorney, was the agent of Mr. Gurney, and had the whole control and management of his affairs in the county, knew of the arrangement by which Patton was to give his receipt to the sheriff for the balance of the purchase money purporting to be in his hands; though nothing more than the costs was ever actually received by him. In this arrangement, Mr. Burnside, as agent, took no part, except that he was present and was consulted on the subject. He neither assented to it nor opposed it, but, as he stated in his examination, “permitted it to be done.”
After the evidence was closed,, which embraced various other matters, not necessary to be here stated, the President of the Court of Common Pleas (Reed) delivered to the jury the following
CHARGE. — We are of opinion, in this case, that the plaintiffs are ‘not entitled to recover. The controversy rests more upon principles of law, than any dispute about facts. The law we will endeavour to explain to you.
Taking the facts as set out in the assignment of breaches, endorsed on the plaintiffs’ declaration, we think they would not entitle them to recover. It is admitted, on all hands, that the sale by Patton to Maxwell could not affect or impair the lien; but the first question is, Whether the plaintiffs have any other remedy than to proceed against the land as the property of William Patton, or, in other words, whether they can demand from the sheriff their claim out of the proceeds of the sale of the title of Samuel Maxwell? — And we are of opinion they cannot. The judgment against Patton did not disfranchise him as a freeholder. It did not in law operate as a disseisin; consequently, he had it in his power to sell the freehold, and to convey it" to Maxwell, and Maxwell would hold it only subject to the incumbrance. It being, then, Maxwell’s freehold, a levy and sale of it as Maxwell’s property, would only transfer his title. Such sale could not operate on the title of Patton, for he had before parted with it, and it had become legally vested in Maxwell. It being exclusively Maxwell’s property, and Maxwell’s title that was sold, the proceeds would belong exclusively to Maxwell and to his creditors. The purchaser would stand precisely in the place of Maxwell, that is, he would have the title and the freehold, but subject to the previous incumbrance. To allow the plaintiffs to re cover, would manifestly be selling the estate of one man to pay the debt of another. It is no answer to say, that Maxwell purchased the estate liable to the incumbrance, because that incum-brance authorized the plaintiffs to proceed against the estate of Patton, which was bound by it; and it might be a materially different thing, whether they should have proceeded against Patton on this judgment, or against Maxwell. Their, titles might be different, for Maxwell might have procured a patent, extended the improvements, or in various other ways, and at great expense, completed a defective title; and in this way the whole would go to the benefit of Patton’s creditors, in preference to Maxwell’s. If Patton’s title had been sold, Maxwell might have had a chance of buying it in. If Patton’s creditors can demand the money, they would be compellable to take whatever such sale would bring; for the rule, of necessity, must be reciprocal. The purchaser, under such circumstances, either buys the land subject to the incum-brance absolutely, or totally discharged from it. It cannot abide the option of any person. If it were otherwise, there would be no certainty in sheriff’s sales, and no one could tell what price he had to pay, until after the sale, the creditors should choose to demand or not demand their claims out of the proceeds. It is indis-pensibly necessary to adopt a fixed and certain rule, either that the purchaser takes the land subject to the lien, or that he does not. To adopt the latter alternative would be in violation of all principle, and fraught with the most pernicious consequences It would be putting the control of a man’s lien into the hands of strangers, without his consent; for after a sale or two of the land, new creditors and new debtors are introduced, with whom the original parties had nothing to do. .
It is supposed the defendant is responsible for the appropriation of monies on the sales of real estate, to the liens, according to their priority. If so, how can he ascertain liens against previous owners, in different names, and of which the record can furnish him with no notice? But this is reasoning only from the inexpediency of such a sale. I care more for the principles on which such sales are made. The sheriff sells all the right, title, and interest of a defendant, and a purchaser stands precisely in his place.' And if the defendant held the legal, estate liable tp an outstanding incum-brance, it would seem to follow that the sheriff’s vendee would, hold in the same manner- If an ancestor was indebted, say by judgment, and either die intestate,or devise his land to his son, and-that son should become indebted, and the land be sold on a judgment against him, I think it could hardly be pretended that the purchase money could be claimed by the creditors of the ancestor. And in what does that case differ- in principle from the present? The whole estate of the defendant in the execution is sold, and the whole price is to be applied to liens against him, according to priority, and, if any balance, to be paid to himself.
If a person'mortgage.his property and remain in possession, he retains an equitable interest, which is the subject of levy and sale; and, if sold upon a subsequent judgment, nothing but the equity of redemption passes, and no part of the purchase money, can be applied to the mortgage, — on the ground that the estate beyond the mortgage was sold, and the proceeds are to be applied to liens beyond the mortgage.
The sole principle of appropriation of monies raised by sales of real estate, is, that the court will not turn parties round to ask the process of the court, to raise money, when the money is actually in court. I therefore hold it to be a sound rule, that no one has a right to come into court and ask for a summary appropriation to himself, who is not entitled to the process of the court to raise the money. Therefore, upon sales on judgments in the Court of Common Pleas, the sheriff is not to go out of that court to look for liens. Mortgages on which no judgments have been rendered, recognizances in the Orphans’ Court, legacies charged upon land, and all such incumbrances, are out of the sphere of summary appropriations, either by the sheriff or by the court; and, so far from the sheriff incurring any liability by the nonpayment of them, they would not be entitled to payment on a specific application to the court. I am perfectly aware of the difference of opinion that has .existed on this subject, and I do hope that this case will be reviewed by the Supreme Court, in which the judges will be enabled to fix some principles that will render the practice more uniform. The purchase of the same estate, under the same- circumstance, by the variance in practice in different counties, might cost the purchaser ten times the price in one over that in another.
Another point arises on the facts in this case. [His Honour here recapitulated the principal facts connected with Mr. Burnside’s knowledge of the arrangement by which William, Patton received the balance of the purchase money arising from the sale under Benner’s judgment.] • 1
I have only repeated a part of the evidence. The jury will remember it. Upon the facts, it is contended that the plaintiffs by their conduct, relinquished their lien, under which they now claim. It is an undoubted rule in equity, and in Pennsylvania the law is the same, that a creditor having two funds, one of which is bona fide sold-for a valuable consideration by the defendant after-wards, when the first fund is presented to the creditor, and he refuses to use it, though sufficient, that he will not be permitted to resort to the second fund, to the prejudice of the intervening rights of the third person. So that if, in this case, by the sale under Ben-ner’s judgment, an ample fund was raised to pay off all antecedent incumbrances, as well as the judgment in question against William Patton; and the plaintiffs, by their agent, assented to that fund being paid over to William Patton himself, and did not claim it when they had the legal right; and, after the other fund had been transferred bona fide, and for a full and valuable consideration to ■Maxioell, notwithstanding the stay of execution was not up at the time on the judgment which is the subject of this suit, we say that such facts would justify the jury in saying, that the plaintiffs have relinquished their lien as against Samuel Maxwell, on the equitable presumption, that that had been done which ought to have been done. If the plaintiffs omitted to assert their claim, when justice and fair dealing required them to do it, the law will not suffer them to assert it, when it is so unjust and injurious to the rights of third persons to do so.
In case of two or more judgments against land, and a sale by the sheriff on a younger one, for enough to discharge the whole, if the elder creditor should refuse to take his claim out of the proceeds, and suffer the sheriff to pay over the balance to the defendant, it would be a relinquishment of his lien as against the purchaser. Any capricious arrangements of that kind, to the direct injury of subsequent innocent creditors or purchasers, would be against equity.
The counsel for the plaintiffs excepted to the charge, and, at their request, a copy of it was filed by the court.
Potter and Burnside, for the plaintiffs in error,
referred to the Act of 1700, Purd. Dig. 263. Act of 1705, sect. 3, 6, 7, Purd. Dig. 264. Semple v. Burd, 7 Serg. & Rawle, 286. Morris v. Griffiths, 1 Teates, 189. Nichols v. Posthlewaite,.2 Dali. 131. Bank of North■ America v. Fitzsimons, 3 Binn. 358.. Moliere v. Noe, 4 Dali. 450. 2 Binn. 40. 6 Johns, i?. 51, 53. 8 Johns. 361. 10 Johns. JR. 515. 5 Johns. Ch. R. 239. Whart. Dig. 209, No. 43. Young v. Taylor, 2 Binn. 218;
Blanchard, for the defendants in error,
cited Cowden v. Brady, 8 Serg. & Rawle, 513. Gause v. Wiley, 4 Serg. & Rawle, 539. Griffith v. Chew, 8 Serg. & Rawle, 28,30, 34. 2 A tie. 246. 19 Johns. 492. Govett v. Reed, 4 .Yeales, 461.

Opinion:
The opinion of the court was delivered by
Tilghman, C. J.
This is an action on a sheriff's bond, and the breach assigned, is, that the sheriff, (William Alexander,)' having received a sum of money proceeding from the sale of the land of Samuel Maxwell, by virtue of an execution on a judgment obtained against the said Maxwell, by G. and H. Fahnes-tock, out of which money the executors of Francis Gurney had a right to receive the amount of a judgment obtained by the said Gurney in his lifetime against William Patton, the said sheriff refused to pay them, but appropriated all the money in his hands to other purposes. The fact was, that the land of Maxwell, from the sale of which the money was raised, was the property of Patton, at the time when Gurney's judgment against him was entered, and was afterwards purchased by Maxwell. There was no question, but Gurney's judgment was a lien on this land; but the
President -of the Court of Common Pleas, was of opinion, that on an execution against Maxwell, nothing but the rights of Maxwell could be sold, and therefore no part of the proceeds of that sale could be applied to any other purpose, than the discharge of judgments against Maxwell, and the surplus, if any, to be paid to Maxwell himself. . In other words, that the purchaser at the sheriff's sale, took the land subject to Gurney's judgment against Patton. I cannot assent to this opinion, because the principle on which it is founded, would work the most ruinous injustice, in all cases where the purchaser at a sheriff's sale paid the full value of the land, and is, I think, contrary to ancient practice and express adjudication. It is a subject of very great importance, on which the opinions of lawyers have been discordant, and it is not my intention to enter further into, it, at present, than is necessary to decide the question before us, which does not appear to me to be attended with any difficulty. I grant, that Fahnestock's execution against Maxwell, commanded the sheriff to sell the right of Maxwell, and no more. But what was the right of Maxwell? He had a right to the fee simple, subject to all liens by virtue of judgments, either against himself or those under whom he claimed. The question is, then, whether the court will let in creditors who had obtained judgment's against Patton, under whom Maxwell claimed, to receive payment of their judgments out of the money raised on Fahnestock's execution ? If the sheriff had sold the land, expressly subject to prior liens, the purchaser would have adapted his bid to the circumstances of the case, — he would not have bid the full value of the land, but its value, deducting the prior liens to which it was subject. But, if the sheriff sold without mention of prior liens, the purchaser would bid the full value, leaving it to the sheriff to make the legal appropriations of the purchase money. It is manifestly the interest of the debtor, that the purchaser should not be at the peril of satisfying prior incum-brances; because, under an embarrassment of that kind, the land would, in all probability, go off far below its value. And that, by long and general practice, the sheriff has taken on himself the ap-propriatipn of the money raised by the sale, and conveyed to the purchaser a title free from incumbrances, I have no doubt. In cases of difficulty, it has been usual to bring the money into court, and pray their direction as to the manner in which it is to be distributed. In the case of The Bank of North America v. Fitzsimons, 3 Binn. 358, it is said to have been "a practice of long standing in this state, when the sheriff sells land by virtue of an execution, to sell it for its full value, without regard to the lien of judgments, and to apply the purchase money to the discharge of these liens, according to their order." And, in Semple v. Burd, 7 Serg. & Rawle, 290, the words of the court, were, " that, on a sale by the sheriff, liens are paid according to their priority, without regard to their quality." As to the objection against letting in any person who was not a creditor of Maxwell, on a judgment and execution against Maxwell, it is. answered by express authority. In Nichols v. Posthlewaite, 2 Dall. 131, the case was, that A. devised land to B. charged with legacies. The land was sold on a judgment against B" and it was held, that the proceeds of the sale should applied, in the first place, to the discharge of the legacies; — and, on the same principle, the judgment creditors of the testator, had there been any, must also have been let in. The reason for letting in third persons in this summary way, is to avoid expense and circuity of action. The prior judgment creditor is permitted to receive satisfaction out of a fund, upon which he could have come by suing out an execution for himself. If A. obtains judgment against B., who afterwards aliens, to C., A. may levy on the land in the possession of C. without being put to a scire facias against him. Young v. Taylor, 2 Binn. 228. I am of opinion, therefore, that Gurney's executors were entitled to satisfaction of their testator's judgment out of the monej1 in the hands of the sheriff, raised by the sale of Maxwell's land on Fahnestock's execution. At the same time, I desire it to be understood, that 1 mean not to lay down any general rule, but eonfine my opinion to the case before the court. There may be questions between lien creditors, and particularly between mortgagees and judgment cre^ ditors, which I intend not to touch. They are of great importance, and I leave them to be decided as they arise.
But there is another question in this ease. There was evidence that Mr. Burnside was attorney for Gurney in his lifetime, and afterwards for his executors. When Maxwell was about to purchase from Patton, Burnside was pressed for a release of the lien on that land. This he positively refused to give, and, in consequence, Maxwell received from Patton, a bond with two sureties, to indemnify him against Gurney's judgment. Afterwards, other lands of Patton were sold, by virtue of an execution on a judgment obtained against him by Philip Benner. Gurney's- judgment might have been paid out of the proceeds of this sale, but the' money ivas applied otherwise by Sheriff Rankin, with the knowledge of Mr. Burnside, who did not interfere, but abstained from doing'any act indicating his consent. It is proper to mention, that, at the time of this transaction, the stay of execution on Gurney's judgment had not expired. It is true, that after Patton had sold part of his land to Maxwell, the proper fund for the payment of Gurney's judgment was the remaining land of .Patton, which ought, in the first instance, to have been resorted to. ,And I should think it very clear, that if Gurney's attorney had given a positive consent to the arrangement made between Patton and others, as to the proceeds of the sale on Benner's execution, it would be against equity that Gurney's executors should come on the land sold to Maxwell. I incline to think that the authority, of Mr. Burnside, who had no written power of attorney, and his consent to the payment of the money raised on Benner's execution, were facts proper to be submitted to the jury. And they were submitted, with the following instructions from the court:— "If, in this case, by the sale on Benner's judgment, an ample fund was raised to pay off all antecedent incumbrances, as well as the judgment in question, and the plaintiffs, by their agent, assented to that fund being paid over to William, Patton himself, and did not claim it when they had the legal right; and after the other fund had been transferred bona fide, and for a full and valuable consideration, to Maxwell, notwithstanding the stay of execution was not up at the time, on the judgment which is the subject of this suit, we say that such facts would justify the jury in saying, that the plaintiffs have relinquished their lien as against Samuel Maxwell." I cannot say, that there is error in these instructions, though 1 think it would have been very proper to remark, that -Mr. Burnside's positive refusal to give a release of the lien, and the bond of indemnity taken by Maxwell, were circumstances to which the jury should pay very serious attention. But they were not decisive, because it was possible, that although Mr. Burnside at one time refused to release the lien, he might, at another, have consented to a misappropriation of the money, which ought to have been applied to the satisfaction of Gurney's judgment. Although the stay of execution had not expired, the money might have been brought into court, and kept until Gurney's executors were entitled to call for it. A jury, however, should hare very strong proof, before they conclude, that one who had refused to release, had afterwards committed the interest of his clients by consenting to a misappropriation. Whether the jury took this part of the case into consideration, I know not. It was unnecessary that they should; because the court had instructed them, that, independently of this point, the plaintiffs, on their own statement of their case, had no right to recover.
I am of opinion, that the judgment should be reversed, and a venire de novo awarded.
Judgment reversed, and a venire facias de novo awarded.