Case Name: Robinson et al. v. Williams, Etc., et al.; Robinson et al. v. Lovegrove et al.
Court: Supreme Court of Ohio
Jurisdiction: Ohio
Decision Date: 1900-04-10
Citations: 62 Ohio St. 401
Docket Number: 
Parties: Robinson et al. v. Williams, Etc., et al. Robinson et al. v. Lovegrove et al.
Judges: 
Reporter: Ohio State Reports, New Service
Volume: 62
Pages: 401–410

Head Matter:
Robinson et al. v. Williams, Etc., et al. Robinson et al. v. Lovegrove et al.
Mortgage foreclosure — Court of common pleas has jurisdiction — Notwithstanding previous assignment of mortgagor for creditors — Effect where assignment does not include all property covered by mortgage — Objection by mortgagee to suit by assignee to obtain order to sell land assigned.
1. The court of common pleas has jurisdiction in the foreclosure of a mortgage, notwithstanding a previous assignment of the mortgagor for the benefit of creditors, in all cases where the remedy in the probate court is inadequate. And this is so where the assignment does not include all the property covered by the mortgage; or, as in this case, the mortgagor, after making the mortgage, has platted the land into lots and streets and made of it an addition to a city, without the assent of the mortgagee, and disposed of some of the lots.
2. Where a suit to foreclose a mortgage is rightly commenced in the common pleas, pending an assignment in the probate court made by the mortgagor, the subsequent commencement in the same court of a suit by the assignee for the purpose of obtaining an order to sell the land as assigned property, can not be sustained against the objection of the mortgagee.
(Decided April 10, 1900.)
Error to the Circuit Court of Franklin County.
Arnold, Morton & Irvine; Robinson & Woodburn and Robert W. McCoy, for plaintiffs in error.
Any person capable of executing a deed can make an assignment of his property for the benefit of creditors. Upon the execution and delivery of the deed the property assigned is constituted a trust for the benefit of the creditors of the assignor, and the assignee becomes a trustee charged with the proper administration and fulfillment of the trust. 'The title to the property at common law vested in the trustee, but courts of equity asserted and exercised jurisdiction over the trust estate and provided for its proper ádministration by the trustee. This was the law in Ohio prior to the time assignments for creditors were made subjects of statutory provisions. Burrill on Assignments, par. 18, page 23; Brashear v. West, 7 Pet., 608; Giauque’s Manual for Assignees, p. 24; Wambaugh, Trustee, v. Mutual Life Ins. Co., 41 W. L. B., 76; Lindsey v. Coates, 1 Ohio, 243; Kerwhacker v. R. R. Co., 3 Ohio St., 172; King v. Beck, 15 Ohio, 559; Bloom v. Richards, 2 Ohio St., 387; R. R. v. Keary, 3 Ohio St., 201; Pomeroy’s Equity Jurisprudence, par. 994; Perry on Trusts, par. 594.
In the absence of statute abrogating or limiting his power, the trustee or assignee in an assignment for the benefit of creditors must sell the property in accordance with the provisions of the deed. Burrill on Assignments, par. 365; Pomeroy’s Equity Jurisprudence, par. 1062; Perry on Trusts, par. 598.
In no one of the assignment law's passed by the legislature has there been any attempt to define what shall constitute an assignment for the benefit of creditors, nor is there any attempt or pretense to confer upon the citizen the right to make an assignment. The statutes prescribe simply the mode of administering the assignment and provision is "made only for the proper execution of the trust. Bishop on Insolvent Debtor, par. 104; Giauque’s Manual for Assignees, p. 25; Harkrader v. Leiby, 4 Ohio St., 602.
The right and duty of the assignee for the benefit of creditors to sell the assigned property, both real and personal, exists independent of the statutory provisions on the subject. He must sell the property to fulfill the obligations of the trust. The statutes are concerned only with the manner of the sale and its execution in the way that will best protect creditors and subserve the interest of the public in the administration of the assigned estate and the devotion of a man’s property to the payments of his debts. Johnson v. Sharp, 31 Ohio St., 611; Haskins v. Alcott, 13 Ohio St., 214; Cross v. Carstens, 49 Ohio St., 567; Blandy v. Benedict, 42 Ohio St., 299; Saylor v. Simpson, 45 Ohio St., 141; Schuler v. Miller, 45 Ohio St., 325; Wilson v. Swigert, 31 W. L. B., 353; 33 O. L., 13.
This act was repealed by the act of March 14,1838, 36 O. L., 56, which made all assignments to trustees, in contemplation of insolvency with intent to prefer certain creditors, inure to the equal benefit of all the assignor’s creditors. This statute was then in turn repealed by the act of March 11, 1853, 51 O. L., 57, and by the act of March 14, 1853, 51 O. L., 463, the legislature substantially re-enacted the act of 1838, except that the words “the courts” were substituted for “Of chancery” in committing the administration of such assignments to the control of the courts. But this change was due simply to the fact that the distinctions between the forms of procedure in law and chancery were abolished at that time. Bagaley v. Waters, 7 Ohio St., 359.
The mortgagee’s interest in the property under the mortgage is transferred to the fund arising from the sale by the assignee, and all creditors, mortgagees of real estate and of personal property, as well as all others must work out their interests through the administration by the assignee under the supervision of the probate court. Lindeman v. Ingham, 36 Ohio St. 1; Ingham v. Lindeman, 37 Ohio St., 218; McLain v. Simington, 37 Ohio St., 660; Sayler v. Simpson, 45 Ohio St., 141; Clapp v. Banking Co., 50 Ohio St., 536; McNeil v. Hagerty, 51 Ohio St., 262; Havens v.Horton, 53 Ohio St., 343; Mercer et al. v. Cunningham, 53 Ohio St., 361; Reis v. Bank, 10 C. C. R., 656; 5 C. D., 20; Farwell v. Findlay, 11 C. C. R., 100; 5 C. D., 303; Barker v. Lamkin, 11 C. C. R., 103; 5 C.D., 54.
In the matter of the administration of assignments for the benefit of creditors, it is the probate court that has the broad and general jurisdiction, while that of the common pleas court is carefully limited and strictly defined . The jurisdiction of the common pleas court is exceptional. If there is a valid assignment, the common pleas court can exercise an, original jurisdiction only in the instances provided for in sections 6343, 6344, 6351 and 6352, R. S., and its jurisdiction under 6351 is concurrent with that of the probate court, and in all these cases granted only to aid the probate court in the administration of the trust. Railroad Co. v. O’Hara, 48 Ohio St., 343; Doan v. Bitely, 49 Ohio St., 588.
What is held in this case with reference to proceedings by executors and administrators is equally applicable to proceedings to sell instituted by assignees for the benefit of creditors'.
The term “lien” in section 6351 is to be given an extended meaning, and the jurisdiction of the probate court extends to equitable liens of every kind and nature. The equity powers of the probate court in an action for the sale of real estate are not confined to those expressly conferred by section 6351, and the other sections of the statute, but extend to those conferred by implication in the power given to do some special thing. Woerner’s American Law of Administration, Vol. 1, p. 340, citing Guier v. Kelly, 2 Binn., 294; Dunda’s Appeal, 73 Pa. St., 474; Williamson’s Appeal, 94 Pa. St., 231; Dehart v. Dehart, 15 Ind., 167; Hurd v. Bladen, 43 Ill., 348; Millard v. Harris, 119 Ill., 185; Hales v. Holland, 92 Ill., 494; Donovan’s Appeal, 41 Conn., 551; Blanton v. King, 2 How. (Miss.), 856; Titterington v. Hooker, 58 Mo., 593; Hyland v. Baxter, 98 N. Y., 610; Shoemaker v. Brown, 10 Kans., 383.
This proposition is supported also by the following authorities: Seaman v. Duryea, 10 Barb., 523, affirmed by N. Y. Court of Appeals, 11 N. Y., 324; Rice on American Probate Law and Practice, par. 3; Shollenbarger’s Appeal, 9 Harris, 341; Lex’s Appeal, 97 Pa. St., 289; Boyden v. Frank, 20 Bradwell’s Ill. App., 176; Doggett v. Dill, 108 Ill., 560; Wilson v. Aaron, 132 Ill., 238; Newlin v. Baily, 15 Ill. App., 199; Field v. Ridgley, 116 Ill., 424; Hewett’s Appeal, 53 Conn., 24; Campbell’s Appeal, 80 Pa St., 298.
We wish to direct the court’s attention to the statutes and decisions in Illinois where jurisdiction over the administration of assigned estates is vested in the county courts whose powers and limitations are analogous to those of our probate courts, in the exercise of this jurisdiction. Wilson v. Aaron, 132 Ill., 238; Freydenhall v. Baldwin, 103 Ill., 325; Hanchett v. Waterbury, 115 Ill., 220; Colburn v. Shay, 17 Brad-well, 280; Preston v. Spalding, 18 Ibid., 341; Clarke v. Burke, 163 Ill., 334.
A deed of assignment takes effect from the time it is delivered to the probate judge of the proper county. The jurisdiction of the probate court then attaches, and the assigned property is in custodia legis. Section 6335, R. S.; Betz v. Snyder, 48 Ohio St., 492; Claffin v. Evans, 55 Ohio St., 183; Shoe Co. v. Mercer, 35 Am. St., 331; Wilson v. Aaron, 132 Ill., 238; Hanchett v. Waterbury, 115 Ill., 220; Williams v. Benedict, 8 How., 112; Bank v. Horn, 17 How., 169; Morgan v. Lewis, 46 Ohio St., 1; Barrick v. Gifford, 47 Ohio St., 184; Bronson v. Schneider, 49 Ohio St., 438; Scott v. Dunn, 26 Ohio St., 66.
The assignee is really but an officer of the court, an instrument to carry into effect the provisions of the statutes for the administration of the assigned estate. Though the title of the property is in him, it is a bare legal title. Dresback, v. Stein, 41 Ohio St., 77; In re Mann, 32 Minn., 60.
The jurisdiction of the probate court of Union county over the assigned property and the fund arising from the sale thereof once acquired continues until the assigned estate is fully administered and the trustees discharged. 12 Amer. & Eng. Ency. Law, 292.
B. Woodbury, for defendant in error.

Opinion:
Minshall, J.
These two cases are so connected that the disposition of one necessarily disposes of the other, as will hereafter appear.
In Robinson et al., Trustees, v. David E. Williams et al., the original suit was commenced January 28, 1897, in the common pleas of Franklin county by Williams against DeWitt C. Postle, assignee and others, to foreclose a mortgage on the property described in the petition, and to enjoin its sale by the assignee under an order made by the probate court of the county in the matter of the assignment of Lewis F. Postle, that had been made in Union county, the residence of the assignor, August 15, 1895. The mortgage had been made January 12, 1891, by Lovegrove and wife, then owners of the land, to one Keim to secure a note of $2,000 and interest, and by him assigned for a valuable consideration to Williams. The principal and part of the interest was due at the commencement of the suit. No question is made as to the validity of the mortgage, or as to the priority of its lien on the land. After the execution of the mortgage, the mortgagors, Lovegrove and wife, on August 17,1894, sold and conveyed the land to Lewis F. Postle, who assumed the mortgage, and shortly afterwards platted the land into lots and streets, and made of it two additions to the city of Columbus. In the second addition a one-fourth of an acre was reserved. The land embraced in the streets amounted to some three acres. He was unable to sell any of the lots, except two, became embarrassed and made an assignment to DeWitt C. Postle. He, the assignor, being at the time a resident of Union county, the assignee filed the same in the probate court of that county on August 15, 1895; and on the same day filed a duplicate thereof in the probate court of Eranklin county. Postle, assignee, obtained an order from the probate court of Franklin county, and was about to sell the land as assignee, when this suit was commenced by Williams. It may be observed that this order was of no avail, as the probate court of Franklin county had no jurisdiction of the matter of the assignment. For the purpose of obtaining an injunction, the plaintiff averred, in addition to the fact that the assignment did not and could not, include all the property covered by the mortgage, that the property is ordered and advertised to be sold in lots as platted; that there is now no market for the premises as subdivided into lots, and that as platted the lots are not desirable, having but a short frontage on High street; that two years have elapsed since the additions were made, and only two of the lots had been sold, having been conveyed back to the Lovegroves in part payment of the purchase money; but that if they are offered for sale under the mortgage as an entirety, there will be a much better chance to find a purchaser; and that great and irreparable injury will be done him by a sale by the assignee, under the circumstances. An injunction was allowed as prayed for.
Afterwards on May 8, 1897, Postle, assignee, having been removed, and Robinson and McCoy appointed trustees, the latter entered their appearance to the action, and moved to dissolve the injunction on the ground that the court had no jurisdiction. This motion was overruled. They afterwards, on July 7, 1897, filed an answer, averring that the court had no jurisdiction; and that on May 5, 1897, they had commenced an action in this court, the Franklin county common pleas, asking for an order of sale of the land by themselves as trustees; and prayed that the action of the plaintiff be dismissed. A demurrer to this answer was sustained. The trustees excepted, and not desiring to plead further, the court ascertained the amount due the plaintiff on his mortgage, and made the usual order of sale to be executed by the sheriff, and requiring him to report his proceedings to the court for its further order.
On error to the circuit court this judgment was affirmed; and error is prosecuted here to reverse the judgment on the ground that the court had no jurisdiction.
The case presents this question: Whether the common pleas had jurisdiction of the suit to foreclose the mortgage, it having been commenced after the assignment had been made in Union county? Quite general powers are conferred by section 6351, Revised Statutes, in connection with sections 6350f and g. on probate courts in administering assignments for the benefit of creditors, where they have jurisdiction of the matter of the assignment. But general as they are, they do not preclude the common pleas, in proper cases, from exercising any of its power as a court of general jurisdiction at law and in equity, when necessary to afford relief to a party that cannot be afforded in a proceeding in the probate court, or so fully and amply as right and justice requires. Dwyer v. Garlough, 31 Ohio St., 158. It is supposed that the rule of this decision has been abrogated by the act of March 24, 1891 (88 Laws, 181). It will be observed, however, that section 6350/ only empowers the court to order a sale of the assigned land free of dower, where the wife, on being made a party "elects" to take the value of her contingent right of dower in money. There is no power to compel her to do so in invitum. And it will be further observed, that section 6350<7 applies to a case only where the assignor and Ms wife have jointly executed a mortgage upon any of the real estate assigned, or the husband has executed a purchase money mortgage. Whether under the latter section the wife's contingent right of dower can be divested against her consent by a proceeding in the probate court (as it might be to her interest to redeem) need not be considered here, as no such question is presented in this case. It thus appears that the principle of the above decision remains unimpaired, and applies to this case. The probate court is one of limited jurisdiction; it has such powers, and such only, as the statute confers on it. No general power is conferred on it to cause the sale of lands, not the property of the assignor. Here certain of the lots covered by the mortgage as well as the streets of the additions were not included in the assignment, and could not have been as they did not belong to the assignor at the time of the assignment. Justice does not require that the mortgagee should, in such case, wait until so much of his security as is included in the assignment, has been disposed of, before resorting to that not contained in the assignment; nor that he should be compelled to divide up his remedy by becoming a suitor in two courts instead of one. He had the right, therefore, to resort to the court that could give him a full and complete remedy in one suit.
It follows that the judgment in both cases should be affirmed. For, conceding that in the suit subsequently commenced by the trustees in the common pleas, the mortgagee might have obtained an order for the sale of all the land, including the streets, covered by his mortgage by filing a cross-petition and asking for a sale under his mortgage, still, as his suit .had been rightly commenced, the commencement of another suit by the trustees in the same court, however adequate the remedy as to him might have been, could not affect the jurisdiction of the court in the suit previously commenced by himself. The view taken of the case renders it unnecessary to consider the question, at what time the probate court acquires jurisdiction in the matter of an assignment to the exclusion of all other courts, whether it is from the filing of the deed of assignment, or from the qualification of the assignor as required by statute; for, in any case, where the relief that may be had in the probate court is not adequate, the common pleas has jurisdiction.
The superior excellence of a court of general jurisdiction like our common pleas, resides in the fact that whatever the case may be, there will not in general be a failure of justice from the want of power in the court to hear and determine. Its jurisdiction is in all cases easily determined. It possesses all the powers of a court of justice that are not expressly denied to it, or exclusively given to some other tribunal, and in all questions of doubt, jurisdiction is resolved in its favor. Judgment in both cases
Afibrmed.