Court Opinion

ID: 3587324
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:36:55.635954+00
Date Added: 2024-06-11T13:46:46.767482
License: Public Domain

When property is subject to an execution, and a fraudulent obstruction is interposed to prevent the sale, a judgment creditor may have his action to remove the obstruction, as soon as he has obtained a specific lien upon the property, by the issuing of his execution; and the obstruction being removed, he may proceed to enforce the execution by the sale of the property, although, as Chancellor WALWORTH says, an actual levy is probably necessary to enable him to hold the property against other execution creditors or bona fide purchasers. (Beck v.Burdett, 1 Paige, 305.) In the case just cited, the object of the bill was to set aside an assignment of personal property, on the ground that it was fraudulent as to creditors. The bill contained the proper allegations of the issuing and return of execution unsatified, but it turned out that, in fact, the bill was filed a day or two before the execution was returned, and it was dismissed. If the plaintiff had levied upon such of the assigned property as was the subject of seizure by execution, and then filed his bill impeaching the assignment, the court would have entertained jurisdiction as to the property seized, in aid of the execution; but such suit would not have reached any property of the debtor, whether assigned or not, which was not the subject of seizure, and sale on execution. As to such property, a court of equity gives no relief until an execution upon the judgment has been properly issued and returned unsatisfied, when a judgment creditor's suit may be instituted to obtain satisfaction of the judgment out of the property of the defendant, which cannot be reached by the execution at law. SeeBrinkerhoff v. Brown *Page 251 
(4 Johns. Ch., 671); Wigins v. Armstrong (2 id., 144);Hendricks v. Robinson (id., 290); Hadden v. Spader (20 Johns., 554), in which the jurisdiction of the Court of Chancery, in aiding the collection of judgments, when the remedy at law has been exhausted, is fully considered. I am not aware of any case where that court has aided an execution against the land of the debtor, upon which the judgment was a lien, in the absence of a sale made to defraud creditors, or an incumbrance created or suffered for the like purpose. The lien of the judgment creditor being perfect, in the absence of fraudulent obstruction, his remedy at law is ample, and, in the language of Chancellor KENT, the court will not assume jurisdiction, in taking execution upon judgments at law into its own hands. Such power would be oppressive to the debtor and to the court. (4 Johns. Ch., 676.)
In Clarkson v. De Peyster (3 Paige, 322), Chancellor WALWORTH, in some general remarks, says, among other things, that the complainant might have filed his bill to clear the real estate of the judgment debtor from a mortgage fraudulently interposed, at any time after the docketing of his judgment, without suing out execution. (1 Atkyns on Conv., 513; 1 Paige, 305; 4 Johns. Ch., 677.) I have not been able to consult Atkyns on Conveyances. In the case referred to in Johnson's Chancery Reports, the Chancellor says, the rule has been long and uniformly established that "to procure relief in equity by a bill brought to assist the execution of a judgment at law, the creditor must show that he has proceeded at law to the extent necessary to give him a complete title." "If he seeks aid as to real estate, he must show a judgment creating a lien upon such estate; if he seeks aid in respect to personal estate, he must show an execution giving him a legal preference or lien upon the chattels." The Chancellor then proceeds to collate authorities, referring to 1 Vern., 399; 1 P. Wms., 445; 3 Atk., 200; 8 East, 467; and 6 Ves., 786; in all of which there had been an execution at law, or, for want of such execution, the bill was dismissed. In the case in Vernon, the bill was for discovery and to reach a surplus in the hands of the *Page 252 
defendant, and as no execution had been issued, the bill was dismissed. The case in 3 Atkyns, 200, was a bill by a judgment creditor to redeem a mortgage of leasehold estate, and it was dismissed because the creditor had not sued out a fi. fa., for it was said "until then the plaintiff had no lien on the freehold estate." In the other cases in Atkyns, executions had been issued creating liens upon leasehold property, and the bills were sustained. Seeing that the judgments in these cases created no liens on the leasehold property, and that the liens were by virtue of the executions, we have no difficulty in understanding what Chancellor KENT meant by saying, if the judgment creditor seeks aid as to real estate, he must show a judgment creating a lien upon such estate. It was liens enforceable in equity that he was speaking of, and not a general lien, enforceable at law. This is very clear from the two cases in Atkyns to which he refers. In the one, at page 192, the debtor had mortgaged the leasehold estates after judgment and before execution, and the plaintiff was only allowed to redeem. In the other case, at page 739, the Chancellor said, if the debtor, subsequent to the execution, assigned the leasehold estate, the creditor may proceed at law and sell the term. Of course, he would not require any aid from the Court of Chancery, the lien being legal, as contradistinguished from equitable.
The case referred to in 1 Paige, by Chancellor WALWORTH, is not authority for the particular remark upon which I am commenting. The case (Clarkson v. De Peyster, supra,) in which the remark is made, is more nearly in point; but it is not authority for the broad position of the Chancellor, which embraces legal liens, whereas, in the case then under consideration, there was no lien upon the real estate, alleged to have been fraudulently mortgaged, until the execution was issued. It was upon a decree in chancery, which did not bind the land, but upon which, by 1 R.L., 1813, page 487, an execution was authorized against the land of a defendant, and the lien attached when the execution was delivered to the sheriff. This execution was in the hands of the sheriff when the bill was *Page 253 
filed. There was another judgment, upon which the bill was also filed, and upon which an execution had been issued and returned unsatisfied.
This case may be authority for the position, that where the proper remedies at law, to collect the judgment from personal property, have been exhausted, and the judgment is a lien upon real estate which has been fraudulently incumbered, to an amount which, if the incumbrances were valid, would prevent the realization, by the judgment creditor, of the amount of his judgment, the judgment creditor may issue his execution, and then bring his action in aid of it, in a court of equity. And he may, perhaps, bring his action to remove the fraudulent incumbrance, solely with a view to an execution thereafter on which to sell the land, having previously exhausted his remedy at law, as to the other property of the debtor liable to be seized and sold on execution.
By the statute, every conveyance or assignment of an estate or interest in land made, and every decree or judgment suffered, with intent to hinder, delay or defraud creditors or other persons, are declared void, as to such creditors or other persons; hence, a creditor, having a judgment, which is a lien upon such land, may sell it upon his execution, or he may have his execution returned unsatisfied, and then go into a court of equity and there litigate the question of fraud, and, if successful, subject the land, in that event, to the payment of his judgment. (Chautauque Co. Bank v. While, 2 Seld., 236.) Or he may, perhaps, issue his execution and then commence his action to obtain a judgment, declaring the conveyance so made, or decree or judgment so suffered, void, as to creditors, and then sell the land upon his execution.
The debtor having made a fraudulent conveyance, or suffered a fraudulent judgment to be taken against him, with intent to defraud his creditor, a court of equity, resorted to in a proper manner, will give the proper relief.
The present, however, is not such a case. The judgments were not suffered with intent to defraud creditors. They were entirely valid as to all the creditors of St. John, and good *Page 254 
liens upon his lands, so long as they remained unpaid, and, when paid, the judgments and the liens, as such, ceased to exist. They were of no force or effect against any one, nor were they available for any purpose. The power to sell under them was extinguished by payment. (Swan v. Saddlemire, 8 Wend., 676, and cases there cited.)
As I have said, the action was not for the purpose of collecting the plaintiff's judgment; and the only judgment given by the Supreme Court is, that the judgments in favor of Dwight, describing them, be forthwith canceled and satisfied of record, and that the plaintiff have judgment against Dwight for $432.63 costs, and allowance of $100; in all, $532.63.
It is not an action in aid of an execution, nor would the facts stated justify such action. It is an action by one having a junior judgment, which is a lien upon the lands of the debtor, against one having prior judgments, apparently constituting liens upon the same lands, alleged by the plaintiff to be paid; the sole issue joined and tried being that of payment, and the only relief asked and given being a judgment that such judgments should be canceled and satisfied of record, and for costs.
The case, I think, has no precedent. The learned and diligent counsel for the respondent has referred us to no case in point, and I have found none. His position is, that the plaintiff, as a junior judgment creditor, was entitled to maintain the suit, to remove a cloud upon the title to the lands of St. John, which was inequitably kept on foot by Dwight, to the prejudice of the rights of the plaintiff; and he cites several cases, in which it appears that the action was by the party who had or claimed title to the land from which it was sought to remove the cloud. (Kimberly v. Sells, 3 Johns. Ch., 467; Apthorp v.Comstock, 2 Paige, 482; Pellett v. Shepherd, 5 id., 493;Van Doren v. Mayor of N.Y., 9 id., 388; Cox v. Clift, 2 Cow., 118; Burns v. Morse, 6 Paige, 108.) The last case was a creditor's bill, filed after the execution was returned unsatisfied, and in which the judgment was attacked, as fraudulent as to the complainant.
It may be well to remark, that there is no allegation in the *Page 255 
complaint, and there was no proof on the trial, of any combination or collusion between St. John and Dwight to keep the judgments on foot to hinder, delay or defraud the creditors of St. John, nor is there any allegation of a refusal by St. John to adopt measures to procure a satisfaction of the judgments upon the records, nor is there any allegation of difficulty in showing the payment of the judgments, or of danger of the loss of evidence to prove such fact.
If this judgment is sustained, it will be authority for any junior judgment creditor to come into court, and compel a prior judgment creditor to litigate with him the question whether such prior judgment has been paid, and that, too, without claiming, in such action, the collection of his own judgment. Indeed, he may never resort to the land to collect his judgment.
Courts of equity do not entertain jurisdiction for purposes so idle and unnecessary, and when an ample remedy exists in the court of law in which the judgment is, upon motion by the debtor upon whose land the cloud is.
The counsel for the appellant referred to the ancient action ofaudila querela, not as a remedy for the plaintiff in this case, but for St. John, who had the legal title, and for which remedy a motion, in modern times, to be made in the court in which the judgment is, has been substituted. The cases are numerous in which the defendant in the judgment has moved the court that the judgment be satisfied of record, upon the ground that it had been paid. This remedy, in the same court, is simple and ample, and if the fact of payment be denied, the court may decide the fact on the affidavits, or award an issue; but the usual practice now is, in case the affidavits are so conflicting as to render a decision difficult, to refer such question to a referee, to hear the proofs, and report them and his opinion to the court, which then decides. (Code, § 271, subd. 3; Briggs v. Thompson, 20 Johns., 294; McKinsley v. Thurston, 12 Wend., 222.
No case was referred to, upon the argument, nor have I found any, in which one judgment creditor has moved that *Page 256 
the judgment of another creditor, or apparent creditor, should be satisfied; nor, as I have already said, is there any precedent for such an action as the present. I think the judgment should be reversed, and the complaint dismissed.
EMOTT, J., expressed no opinion.
Judgment affirmed.