Court Opinion

ID: 5502004
Source: CourtListenerOpinion
Date Created: 2022-01-10 03:01:49.776766+00
Date Added: 2024-06-11T08:33:57.727916
License: Public Domain

Learned, P. J.
This is an appeal from a. judgment on report of a referee in proceedings to establish a claim against the estate of a decedent. The plaintiff’s claim is based upon what is claimed to be a judgment in the common pleas of Bradford county, Pa., in favor of plaintiff’s assignor, Joseph Trebilcox, against the defendant’s testator, Rebecca Benedict. This judgment was entered, December term, 1880, on what is called a “judgment note” filed September 27,1880, dated August 31,1880, and payable five years after date. The note was signed by Rebecca Benedict and another, and was payable to Joseph Trebilcox. There was no appearance by the deceased in that proceeding, and no process was served on her. The judgment was entered as by confession; and, as appears above, it was entered some five years before the note became payable. Upon this trial the plaintiff proved the statute of Pennsylvania, which is claimed to authorize such entry of judgment. He also proved by the testimony of a counseloi of that state that under the law of the state such judgment might be entered at once, and before the maturity of the note. The judgment becomes a lien then, and may be enforced by execution after such maturity. It was also proved that at the time of the execution of the note Rebecca Benedict was a resident of Pennsylvania, .and that the note was executed and delivered in that state.
The case of Teel v. Yost, (N. Y. App.) 28 N. E. Rep. 353, involved the consideration of a judgment similar to that above described; and the whole subject of such confessions of judgment is discussed so fully that it is useless to examine the matter further as to anything there decided. That decision affirmed one reported in 8 N. Y. Supp. 552, and from an examination of the opinion in both courts the decision appears to be that such judgment eonsti*222tutes a valid confession of judgment in Pennsylvania, and is enforceable here. As this was a judgment on the note, the note is merged. Therefore the claim is no longer negotiable, and the transfer gives the plaintiff here no better rights than Joseph Trebilcox had. Furthermore, the transfer to the plaintiff was to pay an old debt, and no new consideration passed. Therefore the whole question of the validity of the claim is open, as much as if Joseph Trebilcox were the plaintiff. The question then arises whether the defendant can attack this claim on the ground that the note was obtained without consideration and by threats. The principle that a judgment imports, as the phrase is, absolute verity, or that it is conclusive on all parties thereto, rests on the fact that all such parties have been heard, or have had an opportunity to be heard. When a defendant has been duly served with process, and has defended unsuccessfully, or has failed to defend, or has, after such service, admitted the plaintiff’s claim, then he is bound. Stillwell v. Carpenter, 59 N. Y. 423. After the party has thus had an opportunity to be heard before a lawful tribunal, then he must be bound conclusively by the judgment, unless there was a fraud of which he could not have availed himself in the court giving judgment, or a fraud which prevented him from availing himself of his defense. 2 Abb. N. C. 263; Ward v. Town of Southfield, 102 N. Y. 292, 6 N. E. Rep. 660. But it is manifest that the ground of this sound principle does not exist in the case of such a judgment as the one in question. The defendant had no opportunity to defend in the court of Pennsylvania. She had no notice of the action. She therefore has not neglected to make her defense when she could do so. The authority which she gave for the entry of the judgment was given at the time of signing the note and was a part of the note. If the note was void for want of consideration or for duress, so was the power of attorney contained therein. Yet the defendant has never had, nor has her executor had, until this time, an opportunity to allege such fraud or want of consideration. This may be illustrated by the case of Wilcox v. Howell, 44 N. Y. at page 402, where a mortgagor, at the time of executing the mortgage, gave a certificate that the mort-' gage was given for a good consideration and for full value. The mortgage being in fact tainted with fraud, the certificate did not estop, the party from showing such fraud. In Dobson v. Pearce, 12 N. Y. 157, one Olney had recovered in this state a judgment against Pierce, which had been assigned to the plaintiff. Olney had previously sued this judgment in Connecticut, whereupon Pierce had brought an action in chancery in Connecticut, alleging that the judgment had been obtained by fraud, and he had thereupon obtained a decree declaiming the judgment fraudulent, and perpetually enjoining the action commenced thereon. Such action was thereupon discontinued. Then Olney assigned to Dobson, who brought this action. The court hold that, “ whether fraud or imposition in the recovery of a judgment could heretofore have been alleged against it collaterally at law, it may now be set up as equitable defense to defeat a recovery upon it.” And they held also that the decree in Connecticut was conclusive in this state on the question of fraud. Thus it will be seen that the court recognized two principles: First, that in an action on a judgment fraud may now be set up as an equitable defense; second, that the court of one state, having jurisdiction of the parties, may adjudge that a judgment in another state is void because recovered by fraud. Hence it follows that it would have been competent for Rebecca Benedict to bring an action in this state against Joseph Trebilcox to declare the judgment void for fraud; and it also follows that in an action on that judgment the equitable defense of fraud in ay be set up as a defense.
Plow, it is true, as above stated, that where a defendant has been duly served with process, and a judgment thereupon has been recovered, the kinds of fraud on which such judgment can be attacked are few. But we have already pointed out that such a limitation cannot be applicable where a judgment has been entered, as in this case, without either the appearance of the defendant *223or the service of process on him. If a plaintiff, by duress, compels a defendant to execute what is called a “judgment note,” and then enters a.judgment thereon without service of process, to say that such a judgment is absolutely binding on the defendant is to sanction a wrong and to deprive the injured party of the opportunity for redress. It is argued that the only remedy of the defendant is to take proceedings in Pennsylvania to vacate the judgment. We have only to refer to the case last cited. ' That shows that when the plaintiff in a judgment fraudulently obtained in one state comes into another to enforce the same, the courts of the latter state may redress the fraud according to the system of practice prevailing there; that is, by an injunction action, if law and equity are kept distinct, or by an equitable defense if the two systems are united. The plaintiff has come into this state to enforce in these proceedings the collection of this judgment alleged by defendant to be fraudulent. Under our present practice it is not necessary that the defendant should bring an equitable suit to restrain these proceedings on the judgment. He may show in these proceedings the fraud which he alleges, which neither he nor his testatrix has had an opportunity before of proving in court. The referee found as a fact that the note was wholly without consideration; and that at the time it was given no demand was made upon the makers of any existing indebtedness from them, and that the makers were not indebted to the payee at all. Abigail Van Deusen, one of the signers of the note, testified on the trial that Trebilcox, the payee, came to her when no one was present but herself, Mrs. Benedict, and Trebilcox, and told her he would “roll the balls” upon her; that what she had done was fraud, and he would “break it all up;” and made other threats. She testified that she and Mrs. Benedict signed the note under fear, and in consequence of threats made by him. There is no contradiction of this testimony. The referee, however, refused to find that the note was signed solely through fear, and in consequence of these threats; and it seems that he refused to find that these threats were made. We do not understand this refusal. The testimony of Mrs. Van Deusen was corroborated by evidence showing that Joseph Trebilcox was dissatisfied with a will made by the deceased husband of Mrs. Van Deusen, and brother of the present plaintiff. Mrs. Van Deusen was perhaps a prejudiced witness, as she was a signer of the note. But the undoubted facts that there was no consideration for the note, and that the two signers were over 70 years old, give force to her testimony. It seems to us that in this refusal to find, the referee must have been influenced by the view that the judgment had a controlling effect which we cannot give to it. We are of opinion that the judgment must be reversed, a new trial granted, referee discharged, costs to abide event. All concur.