Case Name: John S. Williams, Administrator of James Williams, deceased, Appellant, v. Robert M. Gibbes and Charles Oliver, Executors of Robert Oliver, deceased
Court: Supreme Court of the United States
Jurisdiction: United States
Decision Date: 1854-12
Citations: 17 How. 239
Docket Number: 
Parties: John S. Williams, Administrator of James Williams, deceased, Appellant, v. Robert M. Gibbes and Charles Oliver, Executors of Robert Oliver, deceased.
Judges: Mr. Chief Justice TANEY, Mr. Justice McLEAN, and Mr. Justice DANIEL dissented.
Reporter: United States Reports
Volume: 58
Pages: 239–274

Head Matter:
John S. Williams, Administrator of James Williams, deceased, Appellant, v. Robert M. Gibbes and Charles Oliver, Executors of Robert Oliver, deceased.
In 1816, an association called the Baltimore Company, was organized in Baltimore, for the' purpose of furnishing advances and supplies in fitting out a military expedition under General Mina, against Mexico, then a part of the dominions of the King of Spain. See 11 How. 529, and 12 Ib. 111.
One of the shareholders having become insolvent, in 1819, his trustee sold the share in 1825. The original transaction being illegal, the share could not be considered, by the laws of Maryland, as property passing .by the insolvency to the trustee-. Consequently, tlk „ale by the trustee passed nothing to the assignee. The court of appeals of Maryland so decided, and this court adopts their construction of tbeir own laws.
An act of the Legislature of Maryland, passed in 1841, made the sale of 1825 valid, so far only as defects existed for the want of a bond, by the trustee in insolvency,
• and the want of a ratification of the sale by the court. But it did not purport to cure other defects in the title of the trustee. Nor did the cqurt of appeals decide that it went any further than to cure the two defects above mentioned.
In 1846, theBaltimore county court distributed the fund, and awarded the proceeds of the share in question to the executors of the assignee. This decree -was affirmed by th<j court of appeals in 1849. But during this time there was no person authorized to protect the interest of the insolvent.- He had died in 1836, and no letters of administration upon his estate were taken out until 1852.
In the distribution of a common fund amongst the several parties'interested, an absent party, who had no notice of the proceedings, and who was not guilty of wilful laches or unreasonable neglect, will not be concluded by the decree of distribution from the assertion of his right by bill or petition against the trustee, executor, or administrator ; or, in case they have distributed the fund in pursuance of an order of the court, against the distributees.
The English and American cases upon this point examined.
The present claim being made by the administrator of -the insolvent, against the executors of the assignee, it is not necessary, under the circumstances of the case, to tnm, the plaintiff over, for his remedy, against the distributees.
This was an appeal from the circuit court of the United States for the district of Maryland.
It was, in some respects, similar to the preceding case of McBlair, administrator of Goodwin v. Oliver’s executors; but it differed from it in the important point that the original holder of the share, namely, Williams, never made any assignment of it to Oliver. The title of the latter was derived exclusively from a purchase made by him from George Winchester, the trustee of Williams in insolvency.
The Mexican .Company consisted originally of ten persons, each holding one share. One of the parties declining to pay up, the remaining nine advanced the necessary amount, and thus the company was reduced to nine persons or firms, namely, D’Arcy and Didier, Hollins and McBlair, Descoves and Mercier, Dennis A. Smith, Jeremiah Sullivan and John Sullivan, John Gooding, James Williams, Thomas Sheppard, and Lyde Goodwin.
In 1819, James Williams applied for the benefit of the insolvent laws of Maryland, and George 'Winchester was appointed his trustee, from whom Mr. Oliver purchased the share, in 1825, for $2,000. Winchester had omitted to give bond or to have the sale ratified by the court, and an act was afterwards passed by the legislature of Maryland, to cure these defects.
Williams died in 1838, and no letters of administration were taken out until 1852, when the present appellant became his administrator, and filed the bill in the present cas¿ The ground assumed was the same with that taken by McBlair, in the preceding case, namely, that if the assignment to Oliver made by the trustee in insolvency was void, the interest of Williams must remain in his personal representatives.
On the 4th of October, 1841, a bill was filed on the equity side of the'county court of the sixth judicial district of Maryland state court, by Philip B. Thomas and John White, trustees of Dennis A. Smith, against the following persons interested in the share of Dennis A. Smith, namely: Dennis A. Smith, James W. McCulloh, administrators; Job Smith, the President and Directors of the Mechanics’ Bank of Baltimore, John Glenn, David M. Perine, William Gwyn, and James W. McCulloh, trustees; Mrs. Smith, William Brown, James Brown, John Patterson, Walter Smith, executor; Clement Smith, George Brown, Herman Perry; Virgil Maxcy, Samuel Nevins,-Nevins, Joshua Lippencott, John S. Smith, Richard Harding, and A. H. Lawrence, and the President, Directors, and Company of the Bank of the United States.' The bill set forth the deed, the amount awarded to D. A. Smith, and the whole amount awarded to Glenn and Perine, the existence of charges and claims affecting in common their share of the fund and the residue in the hands of Glenn and Perine; and after suggesting, in general terms, that they were advised there were other interests represented by Glenn and Perine, connected with the claims of Dennis A. Smith, of the particulars whereof they were not informed, but which Glenn and Perine could state, and which were proper subjects ■for distribution by the court, they pray for a proper distribution of the certificate, &c., growing out of the awards aforesaid, for allowance of commissions for notice to the. persons interested as aforesaid to present their claims before the auditor, and for general relief.
Glenn and Perine filed their answers, admitting the facts set forth in the bill; expressing their willingness to have the proceeds of the awards therein mentioned distributed under the direction of the court-to the persons entitled thereto, including the award in favor of those respondents under the agreement in the bill; and joined in the prayer for a reference to the auditor.
A notice was ordered by the court, and published on the 28th of October, 1841, requiring, all persons interested in the claims of D. A. Smith and the Mexican*Company, on Mexico, to present their vouchers, properly authenticated, on or before the 1st January, 1842.
The cause was continued, from time to time, until the 23d of January, 1842, when Nathaniel Williams intervened, as the permanent trustee of James Williams, appointed in the place of George Winchester. He claimed the proceeds of the share of James Williajjas', upon the ground that the assignment to Oliver, by Winchester, was irregular and void.
It is not necessary to state the numerous claimants who presented themselves, or the grounds upon which they rested their claims.
Another order- was published on the 5th of September, 1843, giving notice to all persons having claims on the funds awarded to the Mexican Company of Baltimore and Dennis A. Smith, to file their claims, with the vouchers and proofs, on or before the 5th October, 1843, else they might be barred from the benefit of the distribution of thé fund.
On the 5th of December, 1846, the court pronounced its decree, awarding, amongst other things, that the proceeds of the share of James Williams should be paid to the executors of Oliver, claiming under the assignment from Winchester, the defects of which were cured by an act of the legislature.
Upon an appeal from this decree to the court of appeals of Maryland, the decree of the county court, in the above respect, was affirmed.
In August, 1852, John S. Williams, as administrator of James Williams, deceased, filed his bill against the executors of Oliver, in the supreme court of Baltimore city. The executors removed the cause into the circuit court of -the United States, upon the allegation that they were citizens of the State of New York. The part of the bill which brought up the quéstion in thé cause was the following: —
Your orator further states to your Honor, that the said James Williams departed this life on or about 20th day of September; in the year 1836, in Harford county; that po letters of administration were ever taken out upon his estate, until they were in due form of law granted to your orator by the orphans’ court for Harford county, on the 15th day of March, in the year 1852. That he has given bond, approved by said court, for the faithful performance of the trust reposed in him.
That neither said Williams nor your orator were ever present, or parties to, or in any manner bound by any proceeding, or order, or decree, had or passed in the aforesaid suit of Thomas White v. Dennis Smith and others, in Baltimore county court, as a court of equity, or in any appeal from -the doings of said court, to the .court of appeals for the western shore of Maryland, and that any thing done or enacted in either of said courts was transacted in the absence of the said Williams and your orator; that the settlement and adjustment of the amount of the partnership funds of the said Mexican Company, and of the charges, and commissions, and costs, to which they were liable in solido, and the distribution of the remainder of said funds by the decree of the court, into the several shares to which each member of said company was entitled, are in no manner binding upon, or even evidence against the said Williams or your orator, &c., &c.
The respondents answered the bill, setting forth various grounds of 'defence, and particularly relying upon the decree of the court of appeals, aifirming the judgment of the county court. The opinions of the judges of the court of appeals have been published, in extenso, in one of the preceding volumes of Howard’s Reports, and therefore need not be repeated here.
On the 3d of December, 1853, the circuit court dismissed the -complainant’s bill, with costs, and the complainant appealed to this court.
It was argued by Mr-. Davis, and Mr. Dulany, with whom was Mr. Martin, for the appellant, and by Mr. Campbell, and Mr. Johnsbn, for the appellees.
Only such of the arguments of counsel can be reported as related to the point upon which the decision of the court turned.
The counsel for the appellant contended: —
IL The decree of the court of appeals is not a bar.
1. It is no estoppel, as res adjudícala. For Gooding and Williams were not parties named in the bill, nor petitioners under the decree; and no notice, actual or constructive, of- the pendency of the suit is shown or averred. Hollingsworth v. Barbour, 4 Pet. 475; Aspden v. Nixon, 4 How. 467, 497, 498.
2. Both Williams and Gooding were dead before the suit was instituted; and no administration existed fill after final decree.
The decree, therefore, cannot bind them as either parties or privies.
3. The title decided on was different. The title of Gooding and Williams was never in issue. The only issue on the record was, the validity of an assignment of a prior insolvent trustee, questioned by a subsequent insolvent trustee.
No matter what the court might have thought or said, on such an issue the decree could not conclude a title paramount to both the litigants. For our title originated in the award subsequent to the insolvent assignment.
III. The decree does not bar the complainants as a final disposition of a fund in court for distribution, by reason of their failure to intervene. For,
1. The suit did not profess to be on behalf of all the claim- - ants of. the Mexican Company’s fund.
It contains no description of the fund, of the parties entitled, or of the Mexican Company; and no prayer for the administration of the fund.
Its allegations and averments look to the administration of the share and private fund of D. A. Smith, under the deed to Thomas and White, among the creditors of D. A. Smith, who are parties; and to have included in that suit the allegations requisite to enable the court to administer the whole fund of the M ;xican Company among the members, would have made the bill midtifarious and demurrable. Only a few loose phrases allude to any thing outside the trusts of the deed to Thomas and White.
Thus Williams and Gooding were neither bound nor entitled to come in under the decree. The Mary, 9 Cranch, 126; Good v. Blewitt, 13 Ves. 397; Ib. 19 Ves. 336; Hays v. Miles, 9 G. and J. 193, 197, 198; Chalmers v. Chambers, 6 H. and J. 29, 30.
2. Had the bill been expressed to be by a few on behalf of all the claimants of the fund, yet
(a) . It is not a case where a few could sue for. all; for the members of the company were only nine, were all known, and could and should have been made parties by name or by their representatives.
(b) But even if it were a case where a few may sue for all, and the bill properly framed, yet the decree in a suit by a few for distribution of a fund among' all interested is not ever, in itself, a bar to one who did not come in.
(c) Its only effect is to protect the trustee, and shift the remedy from him or the fund against the party to whom it was awarded. Gillespie v. Alexander, 3 Russ. 130; David v. Frowd, 1 Myl. and Keene, 200; Greig v. Somerville, 1 Russ, and Myl. 338,
(d) It has never been held conclusive upon the right of a party, unless the failure to intervene has been wilful, after actual notice, and without adequate reason; and even then the delay after the decree and distribution was the main ground of exclusion; and the only case going so far was reversed on appeal. 2 Danl. C. P. 1453; Sawyer v. Birchmore, 1 Keen, 391, 825.
But in these eases,
(a) Both parties were dead before the suit was brought, and so could be in no default.
(by No administration existed on the estate of either, till after final decree.
(c) No notice is shown to have been brought home to any one creditor or distributee, interested in either estate.
IV. The decisión of the court of appeals is not such an authority of a local tribunal, on a. local law, as compels the supreme court, irrespective of its own opinion, to hold Oliver’s title better than that of the complainants. For
' 1. The opinion does not declare the title of Oliver to be good, but really pronounces it invalid.
It decides the claim to be so corrupt as to be utterly void, and that, therefore, it will not pass to an insolvent trustee. Rec. Williams v. Oliver, 307, 308.
This is decisive, that Winchester- never had any interest in the fund at all; and, consequently, could assign none.
The court then say, in ■ consideration of the peculiar nature of the contest between two-trustees of the same party, hypothetically, if we are wrong in supposing the ' claim never vested, in that event, if it could vest, it was assignable; and, being so, it passed to' Oliver by the first trustee’s assignment.
But they expressly declare it did not vest in him at all; and merely add this subsidiary and hypothetical ground to show that the complainant, on his own hypothesis, had not the best title before the .court. Rec. Williams v. Oliver, 82-84. The supreme court have so construed this, opinion. Williams v. Oliver, 12 How. 111.
If it be argued,
2. That the court, in the face of this opinion, awarded the fund to Oliver, we reply: —
(a.) The question now relating merely to matter of authority, such a decision, if it really were tenable on no other hypothesis than an affirmance of the validity of Winchester’s assignment, would so contradict the opinion, as to destroy all weight of either as authority. It makes the court say one thing, and do its diametrical opposite.
(b.) But the question is not what might have been, but in fact was not held, but what, in point of fact, was the opinion of the court about Oliver’s title; nothing shows that they did hold Oliver’s title good. For,
They may have decreed Glenn and Perine to convey to Oliver, in the absence of a .better title, on their confession of a trust for them, and the language of the award, which, in the absence of any one else appearing to be concerned, declared them trustees for Oliver’s executors.
It would seem demonstrable that, whatever may be thought of its correctness, this was the only ground on which the court did, in fact, rest their decree.
For, if the court considered the question of title at all, they must be presumed to have confined themselves to those titles which alone appear on the pleadings.
Those titles are : —
1. The award and deed of trust and confession of Glenn and Perine, that they hold in trust for Oliver’s executors, not for Oliver.
2. The title of Oliver, under the assignment of Winchester, first insolvent trustee.
3. The title of Williams, second insolvent trustee.
The court, therefore, in making the decree, must have held, either
1. That the question lay between two insolvent trustees of the same man; and the fund being in the hands of trustees, confessing á trust for that trustee who had the better right of the two, the court would not take it from a better, and give it to a worse title.
This court has countenanced this view, and it is consistent with the opinion of the court of appeals.
2. That a title vested in Winchester, which passed to Oliver by his assignment.
But this could be only on one of two grounds : —
(a.) 'That the Mexican claim was assignable in 1819, and passed to Winchester, on the insolvency of Gooding and Williams.
But this they have expressly declared nor to be the law. Or,
They held that the treaty related back, and made valid what before was invalid; and the treaty and act of 1841 together gave a good title.
But this. is directly in contradiction with the very words of their opinion. For,
They turned Gill out of court, though he was assignee in 1817, prior to Oliver’s assignment, on the express ground of the original turpitude of the transaction, which would have been absurd, if that original sin had been cured by relation. Therefore,
1. They did not pass on the absolute title of any one; but only awarded the fund to the party for whom the possessors confessed a trust, and the-award itself showed a primé facie claim.
In neither aspect of the case has the act of 1841, ch. 309, any thing to do with this point.
(c.) Such an opinion is not such a declaration of settled local law, as will relieve or preclude this court from giving its own opinion fair play.
It was only a decree by three, out of a court of six; and they differed on the grounds of the decision. Rec. Williams v. Oliver, 306-308; Craig v. Missouri, 4 Pet. 427; Carroll v. Carroll, 16 How. 275.
It has never been' held, that the mere fact of a decision in a state court, on the same papers, binds the United States courts.
It is mere matter of authority; and that only when it relates to some state' statute or usage, ór real estate title, or peculiar local law: And, in all such cases, the authority depends entirely on the question actually passed on by the court, not what might have been, but in fact was not decided.
That is the exact difference between a decree operating to bind an interest, whether by technical estoppel or negligence to appear on notice, and the operation of- the opinion of the same court, in the same case, as an authority declaring the law of the State. It may be .that the pleadings' and'decree may establish, between the parties, a result in which the court never contemplated affirming, nor considered as thé law in general; for example, here the decree is binding on the trustee, whether the court be right or wrong in giving the fund to Oliver; but, for this suit, the very question is not what they did, but why — on what principle, they did it ?
(a.) If, in fact, the courf did affirm the validity of the assignment. of Winchester, it is demonstrated that the decision was not on the local insolvent law, but one directly on the laws of the United States, and so. peculiarly within the cognizance of this .court.
For a decision affirming the validity of any assignment impeaches that operation of the United States laws, which ■annuls every" contract in violation of them. Armstrong v. Toler, 11 Wheat. 258; Craig v. Missouri, 4 Pet. 410; Green v. Neal, 6 Ib. 297; Swift v. Tyson, 16 Ib. 1; Foxcroft v. Mollet, 4 How. 379; Nevins v. Scott, 13 Ib. 268; Trumbo v. Blizzard, 6 G. and J. 23.
V. There can arise no question of the effect of Winchester’s assignment as a contract, which, though not capable of being enforced, may yet protect Oliver by estoppel. For
Williams’s title is not as insolvent trustee,, but as administrator, and since the contract of Winchester, and for property never vesting in him.
No question of estoppel can exist. Fairtitle v. Gilbert, 2 Term R. 171; Pen. Del. Md. Co. v. Dandridge, 8 G. and J. 248; 1 Atk. 354.
Neither does the original turpitude of the claim bar us; for
We do not rest on the Mexican contract Our title, and our only title, is the award.
Our relation to the Mexican Company is referred to merely as matter of description. The award gave the funds to the members of that company, or those legally representing them. To insist on the original turpitude is to annul the award, and to impeach the right which it created.
VI. The death of Gooding, in 1838, and Williams, in 1839, júst before the treaty, does not oust-their title.
No treaty meant to confine a benefit thirty years old to the very persons originally claiming. Nearly all the company were dead. The personal representative stands in the place of the deceased; and the award is of a fund, in augmentation of the estate.
There is no question of relation'; the administrator taires as of the date "of the treaty or award. It is like a partnership claim, awarded to one partner after the death of another, without administration. It enures to deceased’s estate.
On fliis principle the court proceeded, when they resolved the abandonment of Stevenson’s share, and confined the division to the other nine. Campbell v. Mullett, 2 Swanst. 551; Stevens v. Bagwell, 15 Ves. 140; Murray v. East Jersey Co. 5 B. and Ald. 204.
VII. That the bar of limitation does not apply, in the absence of a personal representative. Fishwick v. Sewell, 4 H. and J. 393; Angell’s Lim. 173, 184, 185; Haslett v. Glenn, 7 H. and J. 17; Ruff v. Bull, Id. 16; 2 Salk. 421; Murray v. East Jersey Co. 5 B. and Ald. 204.
The view which the' counsel for the appellees rook of the point in question was the following: —
1. The decree of the Maryland court of appeals, in the distribution suit originating in Baltimore county court, adjudging Williams’s share in the Mexican Company to Oliver’s executors, is conclusive, as to their title, upon all. persons, in all jurisdictions.
The bill in the distribution suit (Record in Goodwin’s case, 18) prays: “ That the funds growing out of the award may be properly distributed, under the direction and authority of the court, among the persons entitled thereto, whether as cestuis que trust, under the indenture aforesaid, subscribing the same, or as otherwise interested, in the viéw of a court of equity, in the próceeds of said award.”
The answer of Glenn and Perine (Record in Goodwin’s case, 28) says: That “ they are willing and desirous that the proceeds of the awards therein mentioned may be distributed among the parties entitled thereto.”
Of the character of this proceeding this court has already expressed its opinion, in 12 How. 122, where it declined to take jurisdiction of it. It characterizes it as a suit for distribution dependent on the laws of Maryland, which involved and decided the right and title to the shares claimed in it under those laws.
. It was not, then, a proceeding simply meant to distribute the fund in court among the parties bringing it in, or those they represented; but a suit to ascertain who were really entitled to the money .in court, and to give it to those whom the court, the custodiary of the fund, should find so entitled. It was, in other words, a proceeding in rem, and the final action of the court upon the res must be, and was meant to be, conclusive on all the world, as to notice, parties, title,, and every thing else that was adjudicated by it; the court in which the proceeding took place having undoubted jurisdiction over the subject-matter of it. Tongue v. Morton, 6 H. and J. 23; 2 Maryland R. 451; 2 How. 338; 3 Wheat. 246; 9 How. 348.
The title of Oliver’s executors to Williams’s,share, which is now denied, is the same title which the court of appeals affirmed; and it is impossible for this court to deny that title, without, at the same time, affirming that the court of appeals of Maryland ought not, on the facts before it, to have decreed in favor of the executors. It is respectfully submitted, that no other court can thus impeach the decree of the court of appeals of Maryland, which, with full jurisdiction in the premises, determined Oliver’s executors to be the owners of Williams’s share absolutely, and not as between them and any one else.
The distribution of the fund was a proceeding in rem, and the presence of parties was not necessary. We could not compel administration to be taken out. Must the whole fund wait till they chose to administer ? The other side must show that they were not guilty of laches. They only know the reasons why they were not, and the bill sets forth no sufficient excuse. Although these parties may not have be eh before the court, yet their title was; because the executors of Oliver set forth the assignment to them by the trustee.

Opinion:
Mr. Justice NELSON
delivered the opinion of the court.
This1 is an appeal from a decree of the circuit court of the United States for the district of Maryland.
The bill was filed in the court below to recover of the defend- ' ants the proceeds of the share of James Williams, in what is called the Baltimore Company, which had a claim against the Mexican government, that was allowed under the convention of 1839. The claim was similar to the one under consideration in the case of the administrator of Lyde Goodwin against these defendants, just disposed of. The proceeds of the share, as charged, amount to $>41,306.41.
The main grounds of defence set up in this case are : —
1. The sale of this share in the company to Robert Oliver, for a valuable consideration, by George Winchester, permanent trustee of Williams, who had taken the benefit of the insolvent act of Maryland, in 1819, which was made in pursuance of an order of the court having jurisdiction in cases of insolvency under that act. The sale took place on the 2d April, 1825.
2. A decree of the court of appeals in Maryland, at the June term, 1849, affirming a decree of the Baltimore county court, which, in the distribution of the fund arising from this claim of the Baltimore Company, assigned the proceeds of the share in question to the executors of Oliver.
If the appellees fail to maintain their title to this fund, upon one or the other of these grounds, then the right to the share of Williams in the Baltimore Company, for aught that appears, still belonged to him at the time of his decease, in 1836, and passed to his legal representatives as a part of his estate; and although originally of no legal value, on account of the illegality of the transaction out of which the contract arose, yet, as the illegality has been waived and the money realized, we have seen, from the principles stated in the previous case of Lyde Goodwin, it belongs to Williams's administrator.
As it respects the first ground — -the sale of the share of Williams, by the provisional trustee, to Robert Oliver, under the insolvent act — we have seen, in the case of Lyde Goodwin, the court of appeals of Maryland held, that this contract of the Baltimore Company with General Mina, being in violation of the neutrality act of the United States, of 1794, was so tainted with turpitude and illegality, it could not be recognized under their insolvent laws as property; and that no right to or interest in the share passed to the trustee. And, that this being the construction of the statute by the highest cqurt of the state, and which had a right to interpret its own laws, this court felt bound by it, without inquiring whether that interpretation was correct or* not; and, consequently, as Goodwin's interest in the share did not pass to the insolvent trustee, it remained in Goodwin himself, and passed to the executors of Oliver, by virtue of his assignment to their testator, in 1829.
In this case the executors of Oliver are obliged to make title to the share in question, under the insolvent trustee of Williams ; the assignment to Oliver, their testator, having been made by the trustee, and not by Williams himself. And it is now insisted on behalf of the executors, that the court of appeals of Maryland in this case reversed their opinion delivered in the case of Goodwin, and held that the interest in the share did pass under the insolvent laws to the trustee, and consequently that the proceeds of the share vested in them under his sale and assignment to their testator in 1825.
Had this, been the decision of the court of appeals in the case of the share of Lyde Goodwin, the interest and proceeds would have passed to Gill, the permanent trustee, instead of to the executors of Oliver.
These re^ults, so contradictory and inconsistent, claimed too as flowing from the judgments of the highest court in a State, •should not be admitted unless compelled, after the most careful and deliberate consideration.
The decision in both cases was made at the same term, June, 1849 ; the one in the present case subsequent to that in the ease of Goodwin. The court in their opinion state, that the grounds upon which they affirmed the judgment in this-ease were, first, for the reasons assigned by them for their decree in the previous case of Oliver's executors against Gill, permanent trustee of Goodwin.
The grounds for that decree are stated in the record, and as far as material are as follows : " They are of opinion that the entire contract (the Mina contract) upon which the claim of the appellee (Gill, the trustee,) is founded, is so fraught with illegality and turpitude as to be utterly .null and void; conferring no rights or obligations upon any of the contracting parties, which can be sustained or countenanced by any court of law or equity in this State; that it has no moral obligation to support it, and that, therefore, under the insolvent laws' of Maryland, such claim does not pass to or vest in the trustee of an insolvent petitioner. It forms no part of his property or estate, within tjie meaning of the legislative enactments constituting our insolvent laws."
Nóthing can be more explicit or decisive against the- title of the insolvent trustee, or of those setting up a claim* under him, to a share in this Baltimore Company. The court say: " It has no legal or moral obligation to support it, and that, therefore, under the insolvent laws of Maryland, such a claim does not pass, to or vest in the trustee of an insolvent petitioner. It forms no part of his property or estate, within the meaning of the legislative.enactments constituting our insolvent system." And this opinion is reaffirmed, ipsisimis verbis, in giving the judgment against the trustee of Williams, then before the court, and with which we are now dealing; and yet it is gravely insisted that no such decision was made in this case as was made in the case of Goodwin; but, on the contrary, the court decided that the- interest in the. share of Williams did pass under the insolvent laws to the trustee ; that he became therebv invested with the title, and was competent to transfer it to Robert Oliver, the testator of the defendants.
The supposed contradiction and inconsistency of the determination of the court is founded upon the second paragraph in the opinion delivered. It is as follows: 2. " Because, under the proceedings based on or originating from the insolvent petitions of John Gooding and James Williams, and the act of assembly applicable thereto, Robert Oliver acquired a valid title to all the interest of said James Williams and John Gooding in the fund in controversy, for the reasons assigned by Judge Martin as the basis of his opinion in those cases."
Judge Martin had dissented'from the opinion of the majority of the court, in the case of Lyde Goodwin, being of opinion that the interest, in his share passed under the insolvent laws to the trustee; and had maintained the same opinion in respect to the share of Williams, in the case then before the court. And it is supposed that this opinion was adopted by the other members, in, the determination of the case.
We do not agree' that this is a proper apprehension of the judgment given by the two members of- the court; but, on the contrary, are satisfied that the opinion delivered may well warrant a more natural and consistent interpretation.
The true meaning will be apparent, we think, from the following explanation. Robert Oliver, as we have seen, had purchased the share of Williams of the insolvent trustee, in 1825, and, consequently, if the interest in his share passed under the insolvent laws to the trustee, it had become vested in Oliver, and of course, on his death, in the executors.
The.question before the court was between the insolvent trustee and the executors. The court, after reaffirming their opinion in the case of Lyde Goodwin, namely, that no interest in the share passed to the trustee under the insolvent laws, and therefore that he was disabled from making out a title to it, go on in substance to say, that if in error as to this, and the opinion of Judge Martin should be adopted, namely, that the interest did pass to the trustee; it could make no difference in the result, inasmuch as the executórs of Oliver would then be entitled to the proceeds, under his purchase of the share tom the trustee himself, in 1825. Therefore, viewing the case in either aspect, qaacmque via data, the insolvent trustee -had failed in establishing any interest in the fund.
It appears to us that this is obviously the meaning intended to be expressed, though we admit the terms used in the expression of it furnish some plausibility for the criticisms to which it has been subjected. The two opinions, the one in the case of Goodwin, and the other in the case, of Williams, were given at tlie same term, and upon the same question; and, if the interpretation of the defendants is right, are diametrically opposite to each other; and not only so, as the first opinion is incorporated in the second, the judgment rendered in the case of Williams id founded upon two opposite constructions of the same statute, in .one and the same opinion.
We prefer the explanation we have given to this extraordinary and absurd conclusion, as it respects the - proceedings of a respectable court, and one possessing the highest jurisdiction in the State; • •
The change of opinion upon a question of . law, or in the construction of a statute, is no disparagement to a-judge, or a court, however eminent or experienced. The change is oftentimes a matter of commendation, rather than , of reproach. But the ease here presented, and upon which we are asked to turn the decision of the question, is, that two opposite constructions of á statute have been given by the court in the same cause, leading necessarily to opposite results, ancrboth relied on as grounds for the judgment rendered. We 'have already "assigned our reasons for disbelief in any such conclusion, and shall not again refer to them.
It has been suggested that the- statute of Maryland, of 1841, confirming certain defective proceedings in insolvent cases, operated to confirm the sale of the trustee to Oliver, in 1825, and that the opinion of the court of appeals in the case of Williams is founded upon this statute. Winchester, the permanent trustee at the time of the sale, had' not given a bond, with - surety, for the faithful-execution of his duty,-as required by the law; and, under the decisions of the courts of Maryland, this omission disabled him from dealing with the estate of the insolvent.
The act of 1841 was passed to remedy defects of this description. It provided that all sales and transfers of property and claims, theretofore made by any permanent trustee, &c., under the insolvent laws of the State, shall be valid and effectual, notwithstanding such trustee shall not have given a bond with security, &c.; and the 3d section provides that the act shall not be so construed as to cure any other defect in the proceedings than the failure to give a bond, with security, or the want of any ratification by the court of any sale made by such trustee;.
It is quite apparent from the provisions of the act, that it was not designed to confirm all sales previously made by the trustee under the insolvent laws, and render them valid and effectual, but simply to confirm, so far as respected any (defect arising out of the omission of the trustee to give the proper security, and also as respected anjn. omission on the part of the court to confirm the sale. These two defects in any previous proceédings were cured by the statute, but in all other respects the proceedings were valid, or otherwise independently of it. It is impossible to maintain that the statute looked to any such informality in the title of the trustee, as that held by the court of appeals in the case of Lyde Goodwin, as well as in the present one. And, besides, it is inconceivable why the court should have reaffirmed their opinion in the case of Goodwin, as a ground for denying the tide to the. trustee, if they had intended to hold that it passed by force 'f the actf'of 1841.' We have no belief thqt such was the opinion intended to be expressed.
The.decree of the court affirming the judgment of the court below has been referred to as favoring the. view of the decision contended for by the appellees. This decree adjudges and decrees, that the judgment below awarding the,share of Williams to the executors of Oliver be affirmed, and that Glenn and Perine, the general trustees of the fund, pay the proceeds of the share to the said executors.
It will be remembéred that the only question before the court respecting this share was between the executors on the .one side, and the insolvent trustqe of Williams on the other; and as the executors were the apparent owners of the fund, -unless a title could be maintained by the trustee, so far as respected the pa ties before the court, the former exhibited the better titlé ; at least, the better title to take the possession and charge of the fund in the distribution among the claimants. The form of the decree, therefore, was very much a matter of course, in the aspect of the case as then presented.
This view will be more fully appreciated when we refer to a.'nother branch of this case, presently to be considered. We will simply add, in our conclusion upon this part of the case, that the opinion now expressed was the one entertained by us when the. case involving this share of Williams was formerly before the court, and which will be found in 12 How. 111, 123.
On page 123 we observed " the counsel for the plaintiff in error sought to distinguish this case from the previous one, the case of Lyde Goodwin, and to maintain the jurisdiction of the court, upon the ground that the act of the legislature of Maryland of 1841, confirming the authority of Winchester, the permanent trustee, was in contravention of a provision of the constitution of the United States, as " a law impairing the obligation of contracts."
But we observed in answer, " admitting this to be so, which we do not, still, the admission would not affect the result; for the decision of the court of appeals upon a previous branch Of the case denied to the plaintiff any right to or interest in the fund in question, as claimed under the insolvent proceedings as permanent trustee, and hence he was deemed disabled from maintaining any action founded upon that claim.
" It was of no importance, therefore, as it respected the plaintiff, in the distribution of the fund, whether it was rightfully or wrongfully awarded to Oliver's executors. He had no longer any interest in the question."
Our conclusion, therefore, upon this part of the case is, that according to the law of Maryland, as expounded by .the hignest court of the State, no title to or interest in the share of Williams in the contract of the Baltimore Company, under General Mina, passed under the insolvent 'laws of that State to the insolvent trustee; and, consequently, no interest in the same became vested in the executors of Robert Oliver, by force of the assignment from the trustee to him in 1825.
2. The next question is as to the conclusiveness of the decree of the Baltimore county court, making a distribution of the fund among the several claimants, and which was affirmed by the court of appeals, upon the rights of the administrator of Williams to the proceeds of his share in the fund. The decree in the Baltimore county court was rendered in December, 1848, and affirmed June term, 1849.
Williams died in 1836, and no letters of administration were taken out upon the estate till 1852. It appears, therefore, that Williams had been dead ten years when the first decree was made, and thirteen at the date of the second; and no representative was in existence to whom notice of the proceedings could affect in any way the interest of the estate ir> the fend.
Now, the principle is well settled, in respect to these proceed ings in chancery for the distribution of a common fund among the several parties interested, either on the application of the trustee of the fund, the executor or administrator, legatee, or next of kin, or on the application of any party in interest, that an absent party, who had no notice of the proceedings, and not guilty of wilful laches or unreasonable neglect, will not be concluded by the decree of distribution from the assertion of his right by bill or petition against the trustee, executor, or administrator ; or, in case they have distributed the fund in pursuance of an order of the court, against the distributees. David v. Frowd, 1 Miln. and Keen, 200; Greig v. Somerville, 1 Russ. and M. 338; Gillespie v. Alexander, 3 Russ. 130; Sawyer v. Bichmore, 1 Keen, 391; Shine v. Gough, 1 Ball. and B. 436; Finley v. Bank of the United States, 11 Wheat. 304; Story's Eq. Pl. § 106, Wiswall v. Sampson, 14 How. 52, 67.
The general principle governing courts of equity, in proceedings of this description, is more clearly stated by Sir John Leach, master of the rolls, in David v. Frowd, above referred to, than in any other case that has come under our notice.
That was a case where one of the next of kin, who had no notice of the administration suit, filed á bill against the administratrix and distributees to obtain her share of the estate. The' bill was filed some two years after the decree for distribution had been made and carried into effect.
The mastet of the rolls observed, that "the personal property of an intestate is first to" be applied, in payment'of his debts-, and then distributed among his next of kin. The person who takes out administration to his estate, in most cases, cannot know who are his creditors, and may not know who are his next of kin; and the administration of his estate may be exposed to great delay and embarrassment. A, court of equity exercises a most wholesome jurisdiction for the prevention of this delay and embarrassment, and for the assistance and protection of the administrator. Upon the application of any person claiming to be interested, the court refers it to the master^ to inquire who are creditors, and who are next of kin, and for 'that purpose to cause advertisements to be published in the quarters where creditors and next of kin are most likeiy to be found, calling upon such creditors and next of kin to come in, and make their claims before the master, within a reasonable time stated; and when that time is expired, it is considered that the beet possible means having been taken to ascertain the parties really entitled, the administrator may reasonably proceed to distribute the estate among those who have, before the master, established an apparent title. Such proceedings having been taken,, the court will protect the administrator against any future claim."
" But itis obvious," he remarks, " that the notice given by advertisements may, and must in many cases, not reach the parties really entitled. They may be abroad, and in a different part of the kingdom from that where the advertisements are published, or, from a multitude of circumstances, they may not see or hear of the advertisements, and it would be the height of injustice that the proceedings of the court, wisely adopted with a view to general convenience, should have the absolute effect of conclusively transferring the property of the true owners to one who has no right to it."
The master of the rolls further observed, " that if a creditor does not happen to discover the proceedings in the court, until after the distribution has been actually made, by the order of the court, amongst the parties having, by the .master's report, an apparent title, — although the court will protect the administrator, who has acted under the orders of the court,— yet, upon a bill filed by this creditor against the parties to whom the -property has been distributed, -the court will, upon proof of no wilful default on the part of such creditor, and no want of reasonable diligence on his part, compel the parties, defendants, to restore to the creditor that which of right belongs to him." The master of the rolls then applied this principle to the right of the next of kin, the complainant in the bill, and observed, " that it had been argued that the case is extremely hard upon the party who is to refund, for that he has a full right to consider the money as his own, and may have spent it; and .that it would be against the policy, of the law to recall the money, which the party had obtained by the effect of a judgment upon a litigated title. But, he observed, there is here no judgment upon a litigated title; the party who now claims by a paramount title was absent from the court, and all that is adjudged is, that, upon -an inquiry, in its nature imperfect, parties are found to have a primd facie claim, subject to be defeated upon better information. The apparent title, under the master's report, is, in its nature, defeasible. A party claiming under such circumstances, has no great reason to complain that he is called upon to replace what he has received against his right."
In the case of Gillespie v. Alexander, also above referred to, Lord Eldon observed, that, although the language of the decree, where an account of debts is directed, is, that those, who do not come in, shall be excluded from the. benefit of it; yet the course is to permit a creditor, he paying costs, to prove his debt, as long as their-happens to be a residuary fund in court, or in the hands of the executor, and to pay him out of the residue. If the creditor does not come tiff after the executor has paid away the residue, he is not without remedy, though he is barred the benefit of that decree. If he has a mind to sue the legatees, and bring back the fund, he may do so, but he cannot affect the legatees, except by suit, and he cannot affect the executor at all.
These principles are decisive of this branch of the case, as they establish, beyond all controversy, the right of the administrator to assert the title of 'Williams, the intestate, to the proceeds of the share in question, notwithstanding the decree of distribution by the Baltimore county court. There has been no laches, on his part, or, on the part of those whom he represents.
The cases above referred to relate to the rights of creditors, and next of kin; but the principle is equally applicable to all parties interested in a common fund brought, into a court of equity for distribution amongst the several claimants.
It is worthy of observation in this connection that, the decree, however conclusive in its terms, in the distribution of the fund amongst the apparent owners then before the court, possesses no binding effect upon the rights of the absent party, whose interests have not been represented on the subject of litigation. The opinion of the court given, and decree in pursuance thereof, applies only to interests of those amongst whom the fund is distributed.
These observations furnish an answer to the argument on behalf of the appellees, drawn from a reference to the terms of the decree of the court of appeals of Maryland, in this case, by which the. fund is adjudged to the executors of Oliver. As between all the parties then before the court, this adjudication was doubtless proper, and conclusive upon their rights.
It is agreed in the' case, that but five eighths of the fund in controversy is in the hands of the executors, the residue having been paid over in the administration of the assets of the estate.
If this portion had been paid over by the executors in pursuance of an order of the court in an administration suit, the defendants would be protected to that extent, and the complainant compelled to proceed against the distributees. But no such fact appears in the case.
Without saying, at this time, that an executor, in all cases, may be compelled to account to a party making title to a portion of the estate, after distribution, among the legatees and next of kin, unless first procuring an order of the court having charge of the administration, we perceive no reason, under the circumstances of this case, for exonerating them, or turning him round to a bill against the distributees.
Upon the whole, after the fullest consideration we haye been able to give to this case, we think the decree.of the court below was erroneous, and should be reversed.
Mr. Chief Justice TANEY, Mr. Justice McLEAN, and Mr. Justice DANIEL dissented.
John S. Williams, administrator of James Williams, dec'd appellant, v. Robert M. Gibbes and Chas. Oliver, ex'ors of Robert Oliver, deceased. And John Gooding, Junior, administrator de bonis non of John Gooding, deceased, appellant, v. Robert M. Gibbes and Chas. Oliver, ex'ors of Robert Oliver, deceased.
Appeals from the circuit court of the United States for the district of Maryland.