Court Opinion

ID: 6655557
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:57:30.549268+00
Date Added: 2024-06-11T15:59:53.616825
License: Public Domain

The following opinion on second rehearing was filed February 9, 1905. Judgment of affirmance adhered to:
Holcomb, C. J.
It is our purpose, at this time, only to examine further into the question of the proper basis of recovery or. true *493measure of damage sustained by the plaintiff and which he is entitled to recover, and whether the peremptory instruction of the trial court, under which a verdict was directed, stated the correct rule. While other questions are presented and urged upon our attention by counsel for plaintiff in error, we are of the opinion that they have been correctly disposed of and sufficiently considered in the opinions heretofore handed down. Ante, pp. 483, 489. The action is one against the sheriff and the sureties on his official bond for alleged damages because of the former’s failure to file, within the time required by law, a deed of assignment of an insolvent company, executed and delivered to him with the possession of the-property thereby assigned, in pursuance of the assignment laws of the state. Because of the sheriff’s failure in this respect to perform the duties of his office, the insolvent’s property was seized by some of the creditors, to the exclusion of others, and the attempted assignment rendered nugatory and wholly void. There is no substantial conflict in the evidence regarding the question now under consideration. The plaintiff as the assignee of certain of the creditors of the insolvent company, in his petition, alleges, among other things, “that the following persons were the only creditors of the said Muir-Cowan Co. (the insolvent) at the time of the execution and delivery of said deed of assignment, as aforesaid, and the only persons entitled to participate in said assigned estate.” Then follows the names of thirteen alleged creditors, and the amount due each respectively, aggregating the sum of $3,516.15, which were, it is further averred, “the only claims against said estate.” It is also alleged, “that, by reason of the failure of the defendant Fred A. Miller, sheriff, as aforesaid, to file for record said deed of assignment, as required by law, and faithfully to perform the duties of the office of sheriff in that regard, said assignment was avoided as to all said property, and the said creditors were, thereby, deprived of all interest in said property and of all right to have the same applied to the *494payment of their said debts, and the said creditors were each damaged to the amount of their said claims.” The answer as to the number of creditors, and the amount of the debts owing by the insolvent, consisted of a general denial. There is no controversy regarding the value of the property of the insolvent company that the sheriff lost by reason of the wrongful acts complained of, which, it is agreed, was worth the sum of $1,800. During the trial, the plaintiff filed a disclaimer of any interest or right to recover for certain creditors set forth in the petition, and dismissed his action as to said claims, which were five in number, and aggregated the.sum of $908.69. At the conclusion of the trial, by a peremptory instruction, the jury were directed to return a verdict for the plaintiff, and, accordingly, a verdict was returned, fixing the plaintiff’s damages at the full value of the insolvent estate as proved, with interest from the time the alleged damages accrued. The question, therefore, is, can the plaintiff, under the allegations of his petition, as an assignee of debts of the insolvent, aggregating a sum in excess of the value of the estate, recover for the loss of the whole of it and for its full value, as his true measure of damage.
1. The plaintiff’s petition, in the first instance, was draAvn upon the theory that no creditor of the insolvent Avould have the right to prosecute an action, and recover damages, unless his claim had been first filed in the county court, and alloAved as a just debt due from the insolvent company, and to be paid out of the insolvent estate. On the defendant’s motion, this allegation Avas stricken from the petition, and it Avas, thereupon, recast in the form as heretofore quoted. It is still insisted by plaintiff’s counsel that no creditor can maintain an action against the sheriff, or recover damages for his breach of duty, unless his claim against the insolvent company had been duly presented and alloAved by the county court, as though the insolvent estate Avas being administered under the assignment laws of the state, by that tribunal. It is con*495tended there is no competent evidence of any lawful claims existing against the insolvent, save those held by the plaintiff, as assignee, and there being no proof of the filing of any claims in the county court and their allowance, this having been prevented by the defendant’s objections, the plaintiff, as the case is made up, is the only one shown to be entitled to maintain an action for the damages occasioned by, and recoverable because of, the sheriff’s neglect. If this contention is sound, then the peremptory instruction, which permitted a recovery, as damages, of the full value of the property included in the void deed of assignment, is correct. In the case at bar, the assignment was avoided in toto because of the act complained of. The property Avas all seized by some of the creditors of the insolvent. The assignment was 'invalidated at its very inception. The county court obtained no jurisdiction over the insolvent estate. There was no property of the insolvent, which passed by the void assignment, for it to administer. The filing and the alloAvance of claims against the estate, under the circumstances, Avas an idle ceremony, and a useless waste and expenditure of time and money. The law does not require vain and useless things. The only possible advantage that could be gained, by going through the form of filing and allowing claims against the insolvent, would be to qualify the creditors, thus securing the allowance of their claims, to sue the sheriff on his bond, in an action for damages for failure to perform his official duties, and this, it seems to us, is, under the circumstances, wholly unnecessary. The statute gives a right of action to the creditors avIio have been damaged by reason of the failure of the sheriff to discharge the duties thus cast upon him. It is not, therefore, in our judgment, a prerequisite to the enforcement of such liability, and the recovery of the damages sustained, to go to the unnecessary expense of having the county court approve the claim as a lawful demand against the insolvent in a proceeding carried on, in form only, under the assignment law. This can be *496done in a direct action to recover the damages sustained. What the creditors lost, in such a case, would he what they were entitled to receive out of the insolvent estate, had the attempted assignment proved valid and effective. Had the assignment not been invalidated, the insolvent estate would have been administered for the equal benefit of all creditors of the insolvent. A creditor’s pro rata share in the property of the insolvent, had it been legally impounded, is all that is lost by the wrongful act of the sheriff and this, of course, would be the just and equitable measure of his damage. This case is to be distinguished from those where, under assignment laws, an insolvent estate is being administered by the proper tribunal, and its proceeds distributed among those who prove themselves entitled to participate therein. The pleadings in the case at bar, as finally framed, went upon the theory that all the creditors could maintain an action and participate in a recovery of the damages sustained, according to their pro rata share, as evidenced by the amount of their respective demands against the insolvent, and to which they would be entitled from the proceeds of the estate, had the assignment been valid. This does not mean that a creditor could, by his action, seize the property, appropriate it to the satisfaction of his own demand, and then maintain an action for damages against the sheriff. This, of course, could not be done, but this does not, necessarily, affect the rule as to the true measure of damages of those creditors who secured nothing out of the insolvent estate, because of the sheriff’s negligence.
2. The plaintiff, in making his case, proved that he was the assignee of creditors having valid claims against the insolvent, in sums aggregating $2,017.96. He also alleged in his petition that there were other claims against the insolvent estate, the holders of which were entitled to ■maintain an action, and recover damages from the sheriff and his sureties, which aggregated the sum of $908.69. The plaintiff, therefore, according to the allegations of his own pleading, had been damaged to the extent of *49768.9 per cent, of the value of the estate lost by the negligent action of the sheriff. It is, however, contended that the plaintiff having dismissed and disclaimed any right to recover as to creditors representing $908.69 of the indebtedness against the insolvent, that amount can not be considered, in determining what is the measure of the damages sustained by the plaintiff. All that was done by the dismissal, was a disclaimer of any right, on his part, to recover for the damages sustained by these several creditors. The dismissal was not equivalent to an amendment, withdrawing from the petition allegations to the effect that they were creditors, the amount due each, and that they were entitled to participate in the recovery of damages, occasioned by the act of the sheriff complained of. The fact that they were creditors still stands as a solemn admission in the pleading of the plaintiff. It thus, so far as the plaintiff is concerned, became an established verity in the trial of the cause, as is unquestionably the fact, that, at the time of the wrongful act complained of, there existed creditors of the insolvent estate, who were entitled to share in the assets, having debts due therefrom, in the aggregate sum of $2,926.65, of which $2,017.96 were owing the plaintiff. It follows, from what has been said, that the plaintiff can recover only his ratable proportion of the total damages accruing to him and the other creditors, and that his recovery should be limited accordingly.
3. The defendants contend that the evidence shows that there are yet other creditors of the insolvent, and that the plaintiff’s recovery should be further reduced. Relative to this contention, it is proper to observe that it is quite doubtful whether there is to be found in the record any competent evidence showing other creditors than those of whom mention has been made. It is sufficient, however, to say, as was said in the former opinion, this fact, if it existed, was a matter of defense, which could be urged in mitigation of' the damages sustained by the plaintiff. To be available as a defense, however, it is neces*498sary that the same should be pleaded in the answer, in which, as we have seen, touching this issue, it consisted only of a general denial. Maxwell, Code Pleading, 481. The defendants, therefore, are not in a position to complain of the judgment of the court below, in respect of this phase of the case. Our conclusion is that, because of the error in fixing the measure of the damages assessed as the amount of plaintiff’s recovery, the judgment of the district court, and the judgment of this court heretofore entered, affirming the same should be reversed, vacated, and set aside, and a new trial awarded, unless the plaintiff shall, within thirty days, file a remittitur of all in excess of 68.9 per cent, of the amount recovered, with interest on such excess from the date of the rendition of the judgment. If such remittitur is filed, the judgment of affirmance will be adhered to.
Judgment accordingly.