Court Opinion

ID: 8844505
Source: CourtListenerOpinion
Date Created: 2022-11-26 16:52:17.985593+00
Date Added: 2024-06-11T17:05:18.131391
License: Public Domain

Putnam, Circuit Judge.
There is no doubt that a supersedeas bond, conditioned according to the statute for prosecuting an appeal with effect and answering all damages and costs, covers not merely compensation for the delay arising from the appeal, but also the amount of the decree appealed from, so far as the latter .directs the payment of money by the appellant to the appellee. Catlett v. Brodie, 9 Wheat. 553; Jerome v. McCarter, 21 Wall. 17.
It appears that there has been no judgment nor decree, by either tribunal, directing payment of any interest, or other damages for delay, with reference to the amount in the registry of the court. It is elementary that, in a suit on a supersedeas bond, neither the principals nor the sureties can be mulcted beyond what the courts have adjudged as the result of the appeal to which, the bond was incident. Whatever questions may be raised in some courts as to recovery in actions on injunction bonds of damages not assessed in the principal suit, none such are admitted here. If plaintiffs claim interest on the fund in the registry, they were holden to establish their claim in the original proceeding as a condition precedent to any demand for it here, though it is probable the circuit court had no authority in this suit to award such interest after the mandate was received. Ex parte Washington & G. R. Co., 140 U. S. 91, 11 Sup. Ct. Rep. 673. But, on the other hand, the decree entered June 28, 1890, expressly provided that complainants should receive interest from that (late on all sums -which the original defendants were ordered to pay them. This was authorized by Rev. lát. § 966.
The original respondents were in legal defahlt from the instant the decree was entered; and their sureties, who are also defendants in the present suit, were in actual and personal default from the instant they received (July 2, 1890) the. letter from complainants’ attorneys demanding payment of the decree, and particularly so after the expiration (July 8th) of the 10 days within which the issue of an execution was forbidden. The trustee process set up by defendants was not served till July 10, 1890. There is nothing in the case showing that either surety set apart any fund with which to discharge his liability on the supersedeas bond or in the trustee suit, or had on deposit any amount beyond what was reasonable and usual for his current business needs, or that either has *371not le opt Ins whole capital active and fruitful, with such margins only as are common and convenient for such pursuits as these sureties are shown to have been in. There is no proof nor suggestion that the other defendants have had on hand any moneys for any purpose whatever. Under these circumstances, it is difficult to see what equity any of those respondents has for disallowance of interest to the lbss of the complainants. They were all in actual personal default before the trustee process was served, and have been in such position that they profited by the delay to an amount presumably equal to the legal rate of interest.
Generally a debtor who has been trusteed does not pay interest, unless he is shown to have received interest or had expressly promised to pay it. Abbott v. Stinchfield, 71 Me. 213; Huntress v. Burbank, 111 Mass. 213; Smith v. Flanders, 129 Mass. 322; Norris v. Insurance Co., 131 Mass. 291. Yet in Huntress v. Burbank the court stated that no demand for payment had been made on the sureties; and it has not been brought to my attention that, in any of the suits cited on this point, it appeared that the debtor was in actual personal default before the trustee process was commenced, as in the ease at bar. Therefore, if necessary for .me to rule on this point, I hold that, under the particular facts of this case, the defendants are not relieved by the trustee process from payment of interest. I so hold, although the proposition of plaintiffs that interest on the decree in this case arises as on contract, and is not merely moratory, or as damages, seems to be met by the supremo court of Massachusetts in Clark v. Child, 136 Mass. 344. On page 348 the court lays down broadly the proposition that, in suits oil judgments of the courts of sister states, the plaintiff recovers interest according to the law of the forum, and not according to the law. of the state in which the judgment was rendered. This could not he so if interest on a judgment was presumed to run as by contract. It is true that the original judgment in Clark v. Child was on a tort, and that the court might on that account have distinguished it from a judgment on a contract where interest was expressly promised. But the rule laid down by the Massachusetts court was broad enough to cover every judgment on every causo of action; and, moreover, in the case at bar it appears that the decree was the result of an adjustment of partnership affairs, as to which interest is a matter only of equity and arises from no express obligation. I do not find that the supreme court has ever ruled directly on this precise proposition, although in Coghlan v. Railroad Co., 142 U. S. 101, 12 Sup. Ct. Rep. 150, it was held that interest on overdue coupons should he computed by the law of the place of payment, which for this purpose was the law of the contract, and not by the law of the forum. The same was ruled in Cromwell v. County of Sac, 96 U. S. 51, and Pana v. Bowler, 107 U. S. 529, 2 Sup. Ct. Rep. 704. In these cases, however, the suits were directly on the coupons, or for foreclosure, and none of them were on judgments rendered. Moreover, this proposition of the complainants is met, at least for Massachusetts, and therefore for decrees and judgments of the circuit court of the United States within this district, by Huntress v. Burbank, supra; which went expressly on *372the ground that interest on a judgment does not arise from contract, or certainly is not interest of that particular kind which debtors who are trusteed are presumably holden to pay.
Except for Huntress v. Burbank, supra, it would seem clear that the trustee process could not have been maintained by reason of the fourth and fifth clauses of section 34, c. 183, Pub. St. Mass., which clauses, moreover, are declaratory of the common law, and of principles broader than the mere letter of the statute. The court, however, appears not to have considered them, and it seems to have been assumed by all parties that the trustees were chargeable.
I think I must base my decision in this case on a proposition of law which relieves me from further investigating any of the foregoing questions. The original decree was of a circuit court of the United States, and against the principals in the supersedeas bond. Since July 8,1890, execution could properly issue against them, and it could not be lawfully delayed, embarrassed, or controlled by any attachment process from any other tribunal. It is true that execution could issue against only’the principals, but, so far as the question involved here is concerned, it is impossible to disconnect the sureties from the other respondents. It would be absurd to rule that the sureties might be holden by a trustee process for the debt due by force of the decree, while by simultaneous proceedings the execution of the circuit court might be levied therefor on the goods of the principal defendants.
I think the safe and true ground is that no embarrassment or restraint of the character now in question can be put on the enforcement of judgments or decrees of this court; and in this proposition I seem not only sustained, but governed, by the supreme court in Wallace v. McConnell, 13 Pet.-136. As the trustee proceedings could not in any way embarrass the decree or execution of this court, no cognizance of them is to be taken by me at this stage, whatever discretion to grant delay might or might not have been exercised on a motion for that purpose, seasonably made and properly framed. If the defendants, or any of them, are subject to double litigation, the misfortune is not unlike that which happens to many; and they had their remedy, though at some expepse and inconvenience. If they have lost it, which is not probable, especially as the suit has by removal been brought under the control of the common-law side of this court, this comes from their inattention to tire trustee process, and does not arise from the principles which must control my judgment. Damages will be assessed on the principles of this opinion, without interest on any portion of the fund which was in the registry of the court, and with interest on the full amount of the decree entered -June 28, 1890, and without any deductions on account of the trustee proceedings brought.in the state court; and execution will issue accordingly.