Court Opinion

ID: 6595244
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:01:58.687507+00
Date Added: 2024-06-11T13:29:19.646166
License: Public Domain

BraNnoN, Judge:
Vance Shoe Company and others filed in the Circuit Court of Wetzel county a bill in equity against William Ilaught and others, alleging his indebtedness to it and various others creditors, and that he had confessed fraudulent judgments in favor of David Ilaught and one Rice, under which, by execution, a stock of goods had been sold, and purchased by David Ilaught, and that William Ilaught owned a house and lot conveyed to him by Brookover; and the bill prayed that the judgments and execution sale under them be held fraudulent, that Rice and Ilaught beheld for the price the goods brought, and that either the goods or their proceeds be subject to pay plaintiffs’ debts.
An amended bill revealed the fact that David Ilaught had sold said goods to Boy, who had executed to David *277Haught promissory notes therefor, remaining unpaid, in which Brookover was surety; and this bill also asked that said judgments and sale of goods be held fraudulent, and David Ilaught and Ifiee required to account for the sale price, and further prayed that David Ilaught he enjoined from selling the notes given him by Loy and Brookover for said goods, and that Loy and Brookover he enjoined from paying them.
Later, Sarah E. Eddy filed in the case her petition, setting up that David Ilaught had assigned her two of the notes on Loy and Brookover, asking to he made a party, and for dissolution of the injunction restraining Loy and Brookover from paying said notes, and that she be allowed to withdraw the notes filed with petition, and collect them.
A decree in the case held the confessed judgments, and the sale of the goods under them, fraudulent, as also the sale of the goods from David Ilaught to Loy, and that William and David Ilaught, Bice, Loy, and Brookover were participants in the fraudulent transaction to defraud “the creditors of William Haught, and are all therefore liable for complainants’ claims set up in the bill,” and went on to decree those debts against them, as a personal decree. The decree also declared that no necessity existed for the petition of Eddy, and dismissed it, and gave her leave to withdraw the notes of Loy and Brookover, and to proceed at law to collect them, and dissolved the injunction against their payment. Brookover alone appeals from this decree.
Now, on the basis of fraud in Brookover in the confession of judgments, the sale under them, or the sale of David Ilaught to Loy, there is no warrant for that clause of the decree branding Brookover with fraud, or in that adjudging him, for such fraud, liable by personal decree for the plaintiffs’ demands, as if lie were an original debtor for them, and for these reasons:
Nowhere do the bills charge fraud on Brookover. There can not be a decree against a man without allegation against him to render him liable. Point 3, Roberts v. Coleman, 37 W. Va. 143 (16 S. E. 482) and citations, page 152, 37 W. Va. and page 484, 16 S. E.; Bierne v. Ray, 37 W. Va. 571 16 S. E. 804). And more particularly is it necessary, if the *278object be to make one liable for fraud, thatthe fact of fraud, and the main facts constituting it, be alleged—not all the facts which are merely evidence of it, but those constituting it. Point 5, Zell Guano Co. v. Heatherly, 38 W. Va. 409 (18 S. E. 611); Pyles v. Furniture Co., 30 W. Va. 123 (2 S. E. 909). I seek in vain in the pleadings for any charge of fraud against Brookover, or the party for whom he is surely, Loy, or any notice by them of fraud in others. There is not an intimation of any fraud in them as to the judgments or execution sale. It is charged that David IIaught fraudulently sold the goods to Loy, but, while this charge does make David IIaught a worker of fraud, it alleges no conspiracy between him and Loy and Brookover; and to make a purchaser liable, it must be charged that he is an active agent in the fraud, or had notice of the vicious design of his vendor, or of the fraud rendering the transaction void. Code, c. 74, s. 1; Blackshire v. Pettit, 35 W. Va. 547 (14 S. E. 133).
As to the personal decree against Brookover, as bound for the debts: If chargeable with fraud, I do not think this is proper. He being surety, it would be proper to subject the goods first, if practicable. Treat Loy even as purchasing to defraud, or with notice of the fraud of others, unless he had sold the store—and he had not—no personal decree could go against, him; and a fortiori not against Brookover, unless he too were participant in fraud. See opinion in Ringold v. Suiter, 35 W. Va. 189 (13 S. E. 40).The decree violates this principle. If the property has been sold to a bona fide purchaser, there may be a decree against the fraudulent vendee, I presume—not for the whole of the creditor’s debt, but for the amount realized by the fraudulent vendee; and, if that be less than the value of the property, then for that value. Decree in Wright v. Hencock, 3 Munf. 521; Hinton v. Ellis, 27 W. Va. 422; Lockhart v. Beckley, 10 W. Va. 87, point 10 of syl.; Ringold v. Suiter, 35 W. Va. 186, 190 (13 S. E. 46) and citations. But, as the debts decreed to plaintiffs are less in amount than the notes of Loy and his surety, I would see no error in this feature basing the decree on the notes as below treated, except for the fact that after allowing the Eddy notes to *279her, there is not enough left to pay the debts decreed. Though David llaught paid more for the goods, Brookover became bound only for the notes, and to their extent; and though, if Loy were chargable as for fraud, it could be for the value of the goods, yet Brookover would be chargeable only for his engagment, unless a party to fraud.
There is no ground on the pleadings to charge Brookover or Loy on account of any fraudulent action of their own. Nor do I find proof of it in the evidence. But, though Brookover is not liable for fraud, be and Loy are liable for the purchase money for the stock of goods. The bill charges fraud on David llaught in the confession of judgment by his father, and in the sale to David by the execution under them, and also in the sale of the goods by him to Loy, and this allegation was taken for confessed. Thus, he was convicted of fraud in the sale to Loy, and as Loy and Brookover owe the notes given for the proceeds of the goods, the creditors can follow up the fund into their hands. Though the sale be bona fide so far as Loy is concerned, so that the creditors could not take the goods, yet they can render the debt due for them from Loy liable, as under the decisions cited above, you can take from the party what he has received, you can take what is yet coming to him from his sale of the property. If llaught still owned the goods, they could be taken. Their purchase price . due from Loy represents them. Loy holds the money as Haught’s. Heath v. Page, 68 Pa. St. 108; Lockhart v. Beckley, 10 W. Va. 87, point 10 of syl.; Bump. Fraud. Conv. 609. So clear is the right of the creditors defrauded to the purchase money unpaid, that it seems to be the law that on receiving notice of fraud, he must pmy no more. If he is a bona fide purchaser, he is protected both as to payment and his title to the property, because his right at the date of sale was good, but, with notice of the fraud, can not go on with the payment. 2 Bigelow, Frauds, 474, 496; Machine Co. v. Zeigler, 58 Ala. opinion 224. Some authorities hold that a bona fide purchaser can not hold the property unless he has paid in full. Bump, Fraud. Conv. 493. Therefore, though the wrong reason is given for holding them liable they are liable under the notes; and the giving a wrong reason for the *280decree is no error, the question being, is the decree correct? not the reason given for it. Shrewsberry v. Miller, 10 W. Va. 115. The imputation of fraud upon Brookover, though erroneous, is not error calling for reversal, as it curries no pecuniary detriment.
The decree dismisses the Eddy petition, and allows her to collect the two notes she held. It is true, it may have been thought that the debt due from Loy and Eddy is large enough to pay both creditors, over and above the Eddy notes, and that this would render her an unnecessary party; but the decree allows her lo collect her notes, which are the first ones to mature, and gives a decree against Loy and Brookover, payable at once, with costs, which would make them pay before the maturity of the notes. This is error.
As Loy and Brookover are not chargeable on the theory of their fraud, but as debtors to David Caught, the terms of their contract with him must bo regarded, and they can not be made to pay before the notes mature; and, when the decree was made, none except those owned by Eddy were due, and are not yet. And setting aside the two notes held by her, leaving only two accessible to creditors, the debts decreed against Brookover and Loy exceed the amount in their hands, as only four notes in all were executed, perhaps only three bj7 Brookover. This is error.
The Eddy petition should not have been dismissed, but, all parties being before the court, she should have had decree for her notes, if her right was superior to that of creditors, and the other notes applied, when due, as far as they would go, on the debts of creditors, according to their rights.
There was no reason to charge costs to Loy and Brook-over, they not being chargeable as for fraud. They had no overdue money in their hands, accessible to creditors, as the matured notes were Eddy’s; and the other notes were not due, even if they would be chargeable with costs if duo.
A question raised in the case is whether there could be any decree, in any view, against Loy and Brookover. The amended bill simply asked that they be restrained from *281paying the notes they executed to llaught, and contained no prayer that they be-compelled to pay them, and it is said to be a surprise on them to decree payment of the debt. I was inclined to this view at first, as prayers for specific relief are so common. Good chancery pleading gives a statement of the specific relief asked, commonly called the “prayer for specific relief,” and, besides, a prayer for general relief. Zell Guano Co. v. Heatherly, 38 W. Va. 409 (18 S. E. 611). All works on chancery pleading call for this prayer for special or specific relief, and the form in our Code contemplates it. Chapter 125, s. 37. Still, where it is omitted, is it fatal? I think not. The old form of bill did not contain it, but stated facts, and inserted a prayer for general relief, and any relief warranted by law upon those facts could he granted. This seems 1 gical. Such a bill is regarded good yet, except as to injunctions. Story, Eq. Pl. ⅜ 41; Part. Ch. Prac. 266; Sand, Eq. 58. The relief under the prayer for general relief can only be such as the facts stated warrant, but I think all relief they do warrant may be given under a general, without a special prayer. Under it a distinct or different claim from that stated in the bill can not be given. It must be based on facts alleged. Pickens v. Knisely, 29 W. Va. 1 (11 S. E. 932); Part. Ch. Prac. 265. And, if particular relief be asked, further relief, not especially asked, may be given under the general prayer, provided, always, it be justified by the facts stated, and be not inconsistent with that which is asked; for it is not permitted to tell the defendant that a particular relief is asked, and surprise him with a relief inconsistent with that asked. Bart. Ch. Prac. 266. If the general prayer be omitted, and the specific relief sought is not given, other relief can not be. Bart. Ch. Prac. 266; Daniel], Ch. Prac. 378, note a; Story, Eq. PI. § 42, note a. IIow important the prayer for general relief!
In the original bill is a prayer that the proceeds of the goods be subjected, but that is as to the proceeds of the sale under the execution, not that from David llaught to Boy. But the amended bill sets up the sale to Boy, the debt due from him and Brookover, and, the charge of fraud against David llaught being confessed, the law fol*282lows the fund into Loy’s and Brookover’s hands; and a decree for its payment, though not specially asked, is the legal results from those facts, and not inconsistent with any special prayer. It is no surprise. They and their indebtedness being brought in, they might expect to have to pay it, if the plaintiffs succeeded against David Ilaught. For what other reason were they brought before the court?
For reasons above given, the decree must bo reversed; but as to all, or only some ? The decree is that five defendants pay the debts—a joint decree—and, under the rule as generally stated, being erroneous as to some, according to joint judgments at common-law, should be wholly reversed. Arrington v. Cheatham, 2 Bob. (Va.) 492; Jones v. Raine, 4 Rand. 386; Vandiver v. Roberts, 4 W. Va. 490; Lyman v. Thompson, 11 W. Va. 427; Lenows v. Lenow, 8 Gratt. 349; Purcell v. Mc Cleary, 10 Gratt. 246; Gravy v. Stewart, 33 Gratt. 358. As a party may waive error in a decree, if he wish, the above rule seems unreasonable—certainly oftentimes, where only part appeal. Section 26, chapter 135, Code, authorizes this Court to reverse in whole or in part, and, I think changes the common-law rule, as is intimated in the opinion in Gray v. Stewart, supra. Here the rights of Loy and Brookover stand on the same ground as debtors, and they do not stand on the same ground with the others. Their causes are not the same. Where parties stand on distinct and unconnected grounds, and are not equally affected by the same decree or judgment, appeal by one will not bring up for adjudication the rights of others; but where those appealing, and those not, stand on .the same ground, and their rights are involved in the same question, the whole case will be considered, and settle the rights of parties not appealing, as I understand, if they are involved in the same question. Walker v. Page, 21 Gratt. 636. So I think as to reversal.
We therefore reverse as to Loy and Brookover, and remand the case.