Court Opinion

ID: 6675857
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:15:49.723327+00
Date Added: 2024-06-11T16:00:42.304819
License: Public Domain

The opinion of the court was delivered by
Mr. Justice McIver.
This case has been so often before this court on previous occasions that anything like a full statement of the facts is unnecessary, as they can be gathered from the report which may be found in 19 S. C., 384, and from the reports of the master and the decree of the Circuit Judge in the “Case” as prepared for argument here.
The appeal on behalf of the City Council of Charleston seems to us to be an effort to reopen questions which have heretofore been finally adjudged, and therefore calls for no further discus*379sion than to show that the questions raised by the appeal have already been determined. The object of these appellants is to assail the validity of the judgments recovered by the plaintiffs and others against Wm. Whaley, as executor of Joseph Whaley, in actions at law, upon the ground that the notes upon which they were recovered did not hear the genuine signature of Joseph Whaley, but that his name was forged by the executor, Wm. WFaley. As we understand it, this was the very question determined adversely to the appellants by the decree of Judge Fraser of September 18, 1882, affirmed by this court in 19 S. C., 384. The fact that in this case the appellants, by their petition, ask for an order requiring the receiver to contest the validity of these judgments, cannot alter the case. The former decision was not based upon the fact that the attack upon the judgments proceeded from the wrong source, but the question was determined upon its merits. The language of Judge Fraser — “in the absence of collusion, I must regard a judgment against an executor as conclusive against the world whenever the same matter comes in question again” — conclusively shows this; and the whole tenor of the opinion of this court affirming that decree demonstrates that this court based its decision, not upon the form of the proceeding, but upon the merits. To say the least of it, therefore, it would be entirely nugatory to grant an order authorizing or directing the receiver to litigate a question which has already been determined in this very case.
The cases of Ex parte Brown and Wife (15 S. C., 519), and Ex parte Layne (18 Id., 87), which have been cited to sustain the view contended for by the appellants are not applicable. In those cases, claims which arose subsequent to the appointment of the receiver, were in controversy, and of course, therefore, the judgments which had been recovered against the railroad company were not binding upon the receiver, while the claims in controversy here arose prior to the death of Joseph Whaley, and, of course, prior to the appointment of the receiver of his estate. The other cases cited by the appellants (with the exception of Wilson v. Kelly, 19 S. C., 160, which has been sufficiently explained in the former decision refusing a motion for a rehearing of this case), relate to questions of the rank of claims *380reduced to judgment against an executor or administrator in the distribution of the assets of an insolvent estate, and have no application to the question sought to be reopened by this appeal.
Our next inquiry is as to the appeal in behalf of the simple contract creditors, together with one bond creditor, the People’s Bank, who had not reduced their claims to judgment, and whose claims have been rejected, either because they were forgeries, or because there was no evidence to establish them as debts of the testator. It is quite clear that the Circuit Judge in this case was right in saying that “all the claims which had not been put into judgment were left open as unadjudicated by the decree of September 18, 1882, as between all parties to the action, and from so much of that decree there has been no appeal,” for in that decree the same judge, after adjudging that the judgments recovered at law were valid claims against the estate of Joseph Whaley, uses this language, manifestly referring to the claims of these appellants : “The other claims presented to the referee, Q-. W. Dingle, stand on a different footing, and I prefer, in the present state of the evidence, to have more light in reference to them,” and he therefore ordered that all of the creditors (which, of course, included these appellants), except the judgment creditors, should be required to establish their claims within a prescribed time before the master, or be barred from any benefit or advantage of any judgment or decree in this cause. If there was any error in this, the proper time to correct it would have been by appeal from that decree; but when there has been no such appeal and no exception' constituting a basis for an appeal from the final decree in the cause, and, on the contrary, the same has been affirmed by this court, it has become at least the law of this case. So that even if there was error in that decree, as we do not think there was, it cannot now avail the appellants.
It is quite certain that a judgment rendered in a cause in the absence of necessary parties has no force or effect as against such parties. Hence, even granting that the very loose and informal proof of these claims, if, indeed, there was any proof at all, before the clerk or referee, Dingle, converted them into judgments or decrees in equity, inasmuch as all this occurred in the absence of parties whom this court has adjudged to be necessary *381pai’ties, they would have no validity as to such parties. And when these necessary parties were brought in, it was not only the right, but the duty, of the court to provide for the investigation of the validity of these claims, and if upon such investigation they have been shown to be no claims against the estate of the testator, they certainly cannot be allowed to participate in the distribution of the assets of the estate.
The fact that this may enure to the benefit of the judgment creditors who possibly may have been estopped from raising the question as to the validity of the claims of these appellants (though we do not deem it necessary to determine that question), cannot alter the case. The court certainly cannot order any of the assets of the estate paid, to any one claiming to be a creditor of the estate until he has established his claim in a proper proceeding, wherein all necessary parties are before the court and are allowed an opportunity to contest such claim if they see fit to do so. Even if every one of the judgment creditors had, throughout this litigation, and even yet, consented that the claims of these appellants should be regarded as valid claims against the estate, this could not make them so as long as any other party to the cause, whether legatee, or assignee of legatees, insisted upon proper proof of such claims, as has been done in this case; and in the absence of such proof this court would be bound to reject them as invalid claims against the estate, even though the effect might be to increase the dividend which the judgment creditors would receive. These appellants have no claim, and do not pretend to have any, against the judgment creditors. Their claims are against the estate, and until they are established against the estate they are entitled to nothing. The claim of Theodore D. Jervey, No. 2, is supposed to stand upon a somewhat different footing from the other claims, w'hich were rejected as forgeries. But. we do not see that there is, practically, any difference. This claim was never established as a debt of the testator in any proceeding where all necessary parties were before the court, and therefore cannot be allowed as a claim against the estate.
The exception taken by the City Council that the Circuit Judge has ordered all the judgments to be paid ratably, if there is a deficiency of assets, without regard to rank, seems to have *382been taken under a misapprehension of the facts.- The master reported that all the judgments, except that in favor of Richard Lathers, which has been paid and is out of the case, were based upon simple contract debts, and all bearing the same rank would, of course, be paid ratably in case of a deficiency of assets, as directed by the decree. For while a judgment recovered against an executor is, in the absence of proof of collusion, conclusive as to the validity of the claim, upon which it is based, as a judicial ascertainment of that fact, in a proceeding in which all proper parties are before the court, yet it has no effect in determining the rank of such claim, which, according to the well settled rule, must be determined by reference to the condition of the claim at the time of the death of the testator, or intestate, as the case may be. If it was then a mere simple contract claim, it still retains that rank, after it has been reduced to judgment, against the executor or administrator.
The appeal from so much of the decree as allows the claim of Ravenel & Co. seems to be based upon a question of fact, and in view of the concurring judgment of the master and the Circuit Judge, we see no ground which would warrant this court in interfering.
The judgment of this court is that the judgment of the Circuit Court be affirmed.