Court Opinion

ID: 6561733
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:16:08.796602+00
Date Added: 2024-06-11T15:56:33.887422
License: Public Domain

ON REHEARING.
De France, C.
In the opinion announced in this case it is held that the execution sale under the Lyster judgment was irregular and void, and that the damages awarded to appellee should be permitted to stand.
It is insisted, upon the rehearing allowed, that these rulings are not correct. Upon a careful reconsideration of the questions involved, giving due consideration to the suggestions of counsel, we must adhere to- the conclusions reached. The facts are stated in the opinion of the court, and the language of the opinion should be consid*332ered and applied with reference to the facts. The mortgagee was in possession of the goods when the execution was issued and placed in the hands of the officer. The mortgagors, who were the defendants in the execution, had no interest in the goods except a mere equity of redemption. The officer levied the execution upon the mortgaged goods, and sold them as the property of the mortgagors, the same as though the mortgage had not been in existence. No garnishment proceeding was attempted against the mortgagee. The mortgagors were present at and objected to the execution sale. Upon these facts we held that the sale was irregular and void. An equitable interest in personal property could not, at common law, be seized and sold under a writ of fieri facias. This proposition is not disputed. But it is claimed that this common-law rule has been changed by statute.
We are referred to sections 1835 and 1883, General Statutes of 1883, and to the fourth subdivision of section 101, and to section 106 of the code, in support of this claim. Section 1835, and many other sections of the same chapter, relating to judgments and executions, were taken from the laws of the state of Illinois, and had received a construction by the courts of that state before their adoption by the territory of Colorado. It is there held that the equity of redemption of a mortgagor in chattels is not subject to an execution at law where the possession of the chattels has been transferred to the mortgagee. Prior v. White, 12 Ill. 261. And it is also held there that “the mortgagor of a chattel, having the right of possession for a definite period, has an interest which may be sold by the execution.” Merritt v. Niles, 25 Ill. 282. These decisions are based upon the statute, and recognize the distinction between equitable and legal interests in personal property. To the same effect are Palmer v. Forbes, 23 Ill. 301; Pike v. Colvin, 67 Ill. 227. Section 1883, referred to, has no reference to personal property.
*333The provisions of the code relating to attachments, and referred to by counsel, do not authorize the officer serving the attachment writ to take personal property from the possession of the mortgagee thereof. The proceeding there authorized to reach personal property in the hands of a third person is a proceeding by garnishment. A garnishment proceeding is a proceeding at law —a suit. Freem. Ex’ns, § 159; 2 Wade, Attachm. § 332. It reaches, as a general rule, none but assets at law, or legal interests. Freem. Ex’ns, §§ 159, 162, and authorities there cited. Also, May v. Baker, 15 Ill. 89; Webster v. Steele, 75 Ill. 544. The intention to include equitable interests should be clear; otherwise they are not included. These provisions of the attachment act speak of “debts, credits and other personal property belonging to the defendant,” or a “debt owing to him.” A mortgagee of goods who is in possession after forfeiture is the legal owner, and, if garnished under the attachment act, could well and truthfully answer that he had no property in his possession belonging to the defendant. The latter part of section 106 provides that “the court or judge may, after such examination, order personal property capable of manual delivery to be delivered to the sheriff upon such terms as may be just, having reference to any liens thereon or claims against the same.” But this may well be governed by what precedes, and refer only to property of which the defendant is the legal owner. A person may have a lien upon personal property in his possession, or a claim against the same, and not be the owner of the property. It is not clear, therefore, from these attachment provisions, that a mere equity of redemption in mortgaged goods, where the mortgagee is in possession, is intended to be included in the list of property interests authorized to be reached by such provisions. These provisions could hardly have been intended to aid an execution; for, at the time the code was adopted, our law authorized a garnishment proceeding in aid thereof (Rev. *334St. 1868, § 38, p. 381), and this continued in force thereafter until the enactment of the garnishment act in 1877 (Gen. Laws 1877, § 1439, p. 533). The garnishment act of 1879, printed in General Statutes of 1883, commencing at page 516, expressly authorizes the sale upon execution of an equity of redemption in mortgaged goods, and provides the manner in which it shall be done. In our opinion accompanying the decision of this case we referred only to one section of this act, being section 1567, General Statutes of 1883. Our reference would have been more pertinent, perhaps, had we included the whole act, or at least some other sections thereof, as well, but still the opinion in this respect cannot be misunderstood. The right to subject equitable interests to sale upon execution is conferred by this garnishment act, and hence the statutory recognition of such right, which the learned counsel says is found in said section, is but a-recognition of the right conferred by the act itself, of which said section is a part.
But it is claimed that the provisions of section 1567 are all in the interests of and for the protection of the garnishee, and that, being for his benefit, he may waive all proceedings thereunder and consent to a seizure and sale of the mortgaged goods (in a case involving a mortgage), that such sale will pass the equity of redemption to the- purchaser, and that the mortgagor may not complain. We cannot consent to the proposition that one can be deprived of his rights or property in a manner not authorized by law, and have no right to complain of the unlawful act of deprivation. It is held that a garnishee, in the absence of a provision in the statute under which the garnishment proceeding is instituted authorizing the same, may not even waive the service of the summons so as to render the judgment binding upon the defendant in the execution. 2 Wade, Attachm. § 361. The institution of such a proceeding is for the benefit of the plaintiff in the execution. The answer of the garnishee *335and “the order of the court or justice of the peace ” are likewise for the benefit of the plaintiff. None of these things could be waived by the mortgagee without the consent of the mortgagor. Hebel v. Insurance Co. 33 Mich. 400. The validity of the sale was denied by the replication in a manner, it is true, not in compliance with the rules of good pleading; but such denial was not attacked by motion or otherwise, and the question as to the validity of the sale was treated at the trial as in issue, by the introduction of the execution in evidence by the appellant, and in other respects, and we think it too late now to interpose the claim that the sale was admitted by the pleadings.
The judgment rendered in favor of James is for the full value of the mortgaged goods as found by the court. It is objected that, as Oadwell was an equal partner with James, the latter should have been permitted to recover only one-half, and that the damages are therefore excessive. We fail to see how the appellant is interested so as to raise this objection. Oadwell does not make the complaint, and he is the person mostly interested. It is said, however, that his refusal to join in the suit, the fact that he was made a party defendant, and his subsequent default operate as a waiver or release of his interest in favor of appellant. But this claim, we think, is not well founded. Oadwell was a necessary party, being jointly interested with the plaintiff in the subject-matter of the suit, and in the relief demanded. His refusal to join in the suit did not operate as an assignment of his interest to the appellant, nor could his subsequent silence have any such effect. The statutory provision under which he was made a defendant had no such object in view. The law has a more tender regard for property rights than to confiscate them upon any such ground, or for any such reason; and no one can be deprived of such rights without his consent, except by due process of law.
It is also said that, inasmuch as the judgment does *336not provide for Cad well’s participation therein, his rights are cut off by the law of estoppel. No authority is cited or referred to in support of this proposition, and we are not aware of any that is in point. On the contrary, we find that Bliss, in his work on Code Pleading, section 78, in discussing the rule by which an unwilling plaintiff may be made a defendant, uses the following language: “If the joint promisees are trustees, the fund can be recovered only for the benefit of the beneficiary; if they are partners, it must go to partnership fund.” This, we think,- is the correct rule in a case like the present. Cad-well and James are partners. The mortgaged property sought to be redeemed belongs to the partnership. No dissolution of the partnership is sought in this action; nor is a severance of interests, or a distribution of the recovery, asked by either partner. If the mortgaged goods had all been kept so that a redemption could haye been ordered, and an indebtedness had been found due to appellant upon the mortgage, she could not have -been compelled to accept a partial payment and make a partial surrender of her securities; and if Cad well had still remained inactive, and refused to furnish his share of the money necessary to be paid to secure the redemption, James would have been obliged to furnish the whole in order to recover, and in such event the court would not have undertaken to apportion the goods between the partners; nor would it, had each of the partners contributed his share of the money, especially in the absence of a request so to do from either partner. Cases may quite frequently arise in which the property to be redeemed would not be susceptible of division except by ordering a sale and division of the proceeds, and as a general rule no sale would be ordered without the request of one or more of the parties interested. Moreover, there should be no distribution of partnership assets among the partners, as a general rule, until the partnership debts, if any, are paid. The rule, therefore, that the recovery in *337this and like cases should go to the partnership fund affords but a just protection to the partnership creditors, should there be any such. The decree upon its face shows that there was no severance, and cannot operate as an estoppel upon Gadwell in this regard.
We refrained in our former' opinion from any expression upon the question of Oadwell’s present rights, for the reason that we deemed it unnecessary in the decision of the case, and for the further reason that it might appear like deciding something not before us; but, upon a reconsideration of the matter, we deem it advisable to add these views as a further reason in support of the conclusion reached.
The California case cited in our former opinion, being a case at law, is perhaps not wholly applicable, and we therefore withdraw the same, together with the reason upon which it is based.
We adhere to the conclusion reached in our former opinion.
Per Curiam.
For the reasons assigned in the foregoing opinion the judgment heretofore, on March 16, A. D. 1888, entered herein, shall be and stand as the judgment of the court on rehearing.

Affirmed.