Case Name: Erwin vs. Oldham
Court: Tennessee Supreme Court
Jurisdiction: Tennessee
Decision Date: 1834-03
Citations: 6 Yer. 185
Docket Number: 
Parties: Erwin vs. Oldham.
Judges: 
Reporter: Tennessee Reports
Volume: 14
Pages: 185–189

Head Matter:
Erwin vs. Oldham.
Stock in an incorporated company, cannot be subjected and sold in equity for tlia satisfaction of a judgment obtained at law.
The complainant obtained a judgment at law against the defendant,/upon which an execution issued and was returned “not satisfied.” He then filed this bill to subject the stock whiclf the defendant had in the Nashville Bridge Company to the payment and satisfaction of his judgment. The Bridge Company was incorporated by act of assembly. The single question raised by the pleadings was whether this stock could be subjected and sold in equity to satisfy the complainant’s judgment. The Chancellor was of opinion it could not, and dismissed the bill. From this decree an appeal was prayed to this court.
Thomas Washington, for the complainant.
In this case the complainant had recovered a judgment at law against the defendants, which was satisfied in part only, by the sale of all such property belonging to the defendants, and subject to execution, as was situated within the jurisdiction of the court. The defendants being owners of a certain number of shares of stock in the Nashville Bridge Company, and which could not be reached by any remedy at law, founded upon the judgment; this bill was filed for the purpose of having said stock sold, and the proceeds applied in .discharge of the balance remaining due to the complainant on said judgment. The only question in the cause is, whether it is within the power of a court of chancery, (there being no fraud alleged in the acquisition of the stock by the defendants, to evade the payment of their debts,) to order a sale of i t, or in any manner to interfere with it, so as to make it liable for tlie object contemplated by the bill?
So far as this question depends on authority, the decided preponderance of it, is in support of the bill- I refer to 2 Kent’s Commentaries, 358: Bayard vs. Hoffman, 4 John. Ch. Rep. 450: Spaden vs. Davis, 5 John. Ch. Rep. 280: 20 John. 554, S. C.: Taylor vs. Jones,. 2 Atkyns, 600: King vs. Dupine, cited in the note to Taylor vs. Jones: Horn vs. Horn, Ambler, 79: Partridge vs. Goff, Ambler, 596: X Eden, 163: Luckner vs. Freeman, Prac. in Ch. 105.
As opposed to, or in qualification of, the doctrine of the above cases, in some respects, we have an express de- cisión in Donovan vs. Finn, 1 Hopkins, 59, and some doubts or dicta of Lord Thurlow, thrown out in Dundas vs. Dútens, 1 Ves. jun. 196: 2 Cox, 235, and subsequently reiterated by Lord Eldon, and by Lord Ghancellor Manners, in 9 Vesey, 139: 10 Vesey, 368, and M’Car-ihy vs. Gould, 1 Ball and Beattie, 387.
So far as the question here ihvolved depends on principle, or public policy, or sound justice between man and man, I can perceive little or no difficulty; but, on the contrary, every consideration of that kind appears to sanction the bill.
The argument in opposition to the bill is, that chancery has no power to enlarge legal remedies, but only to clear existing remedies of impediments which have been improperly thrown around them. That if the property sought to be subjected by the bill, was originally of such a nature as to be incapable of being reached by an execution atlaw, equity can afford no relief, inasmuch as it only comes in aid of legal process, but does not profess to extend it. That therefore, as the property of the defendants was not converted into this stock with the fraudulent design of exempting it from liability for their debts, and that as it was neither held in trust for the payment of their debts, nor had the complainant any lien upon it, the case is beyond the pale of any jurisdiction however organized.
The answer to that argument is, that this bill does not attempt any innovation upon established principles. That it asks for no new or enlarged remedies upon the judgment at law, whereby that judgment is to be enforced in a mode not hitherto prescribed; but it only insists, that for a debtor to hold property under such circumstances, leaving his creditor unsatisfied, is inconsistent with moral obligation and social honesty, and in violation of the justice which he owes to his creditor; and that the debtor’s thus holding the property in defiance of the creditor, is an act of bad faith amounting to fraud, against which it is competent for a court of equity to give relief. That where there has been a fraudulent conveyance of property for the purpose ol defeating a judgment creditor, equity m-terferes, not simply as an auxiliary to the court of law, and to supply new remedies upon the judgment at law, or to enlarge or modify old ones; but, considering the debt as established by the judgment at law, it takes entire cognizance of the case itself, upon the ground of the fraud and injustice which has been done to the creditor, and administers full relief. That a chose in action is incapable of being reached by an ordinary execution, yet it can be subjected by process of garnishment; and that by analogy, stock in an incorporated company, notwithstanding by its original nature, it may be exempted from the operation of a fi-fa. can be condemned and sold by a court of equity, as the last and only resort for the satisfaction of bona fide debts. Thatchoses in action can be reached by the proceeding aforesaid, although not held in trust for the payment of debts, and free from any lien in favor of the creditor, upon the principle that by the general scope and policy of the law of this country, the whole of a debtor’s effects in whatever form they may exist, should be liable for his debts. That it is a legal maxim that there can be no injury without an appropriate remedy; and that if in this case equity cannot give relief, as it is clear that a court of law cannot, there would be a failure of justice. That by the law of England, stock held by a bankrupt passes by an assignment of his effects to commissioners; and that a fortiori in this country where there is no reservation made in favor of a debtor of any portion of his property, stock owned by him ought not to be placed beyond the reach and control of the law. And finally, that a contrary doctrine would operate as a direct encouragement to fraudulent investments, under cover of which, in the language of the enlightened American Chancellor, Kent, cia debtor might convert all his property into stock, and settle it upon his family, in defiance of his creditors and to the utter subversion of justice.
George 8. Yerger, for defendant.
Cited Donaran vs. Finn, 1 Hop. Ch. Rep. 59, and the authorities there relied on.
Altered by act of assembly. Actof 1833, ch. 11.

Opinion:
Green, J.
delivered the opinion of the court.
This is a bill filed by the complainant to subject stock in the Nashville Bridge Company to the payment of his debt due from defendant.
It is not pretended that there is any fraud or trust in this case to furnish a ground of equity jurisdiction; and the simple question is, whether this court has power to cause stocks, credits and rights of action held by a debtor, without fraud, to be sold or converted into money, or transferred to the creditor in payment of his debt; we think it has not: and without entering into any reasoning on the subject, or review of authorities, we refer as conclusively settling the point to the case of Donovan vs. Finn, 1 Hop. Rep. 59.
Our act of assembly of 1833, ch. 11, makes ample provision upon this subject; but this bill being filed long before the passage of that apt, cannot be governed by it. Affirm the decree.
Decree affirmed.