Court Opinion

ID: 3386589
Source: CourtListenerOpinion
Date Created: 2016-07-05 18:41:54.388117+00
Date Added: 2024-06-11T12:54:52.428644
License: Public Domain

John J. Phare and wife, Elizabeth Gregory Phare, brought their bill in equity against Frances Lindsley, Alfred R. Baxter and Hattie E. M. Baxter, the object of the bill being to attack and have decreed void, the title that had been acquired by the said Frances Lindsley in and to a certain note and mortgage sold by a special master of the Circuit Court under a final decree that was subsequently reversed on appeal to this court in the case of Phare v. Randall, 97 Fla. 858,122 Sou. Rep. 217. It was further prayed that the mortgage be foreclosed against the said Frances Lindsley, and the property covered by its lien sold to satisfy the decree. Upon motion in the court below, the Court on rehearing reversed its previous ruling sustaining a demurrer to and dismissing the bill. So the proposition now before this Court is whether or not the bill stated a cause in equity for the relief prayed, or any part of it.
The situation we have here as I see it is as follows:
Warner Randall in 1925 brought a suit in equity against the Phares (husband and wife) to foreclose a mortgage and in that foreclosure suit obtained against John J. Phare a personal judgment for a deficiency of $9,075.54. The mortgage was a purchase money mortgage given for property sold to John J. and Elizabeth Phare, his wife. The *Page 468 
Chancellor, however, further decreed that the deficiency judgment should constitute a lien against a certain promissory note in the sum of $1300.00 dated April 1, 1924, executed by Frances Lindsley, widow, payable to the order of John J. Phare and his wife, Elizabeth Phare, the theory being that inasmuch as said note and mortgage was held by the Phares in an estate by the entireties and inasmuch as the deficiency judgment was rendered for a deficiency in the purchase price of an estate by the entireties, that the note and mortgage should be subjected to a lien and sold to satisfy the demand of the deficiency judgment creditor. This Court reversed that part of the decree (Phare v. Randall, 97 Fla. 858) ordering the $1300.00 note and mortgage to be sold, but the reversal did not take place until after the master in chancery had executed the reversed decree by offering for sale and selling the affected note and mortgage constituting the estate by entireties which this Court held not to be subject to sale under the decree. At that sale the note for $1300.00 so sold by the master was bought in by the appellant, Frances Lindsley, and the sale to her was duly confirmed before the reversal of the decree by this Court. Mrs. Lindsley was not a party to the reversed decree. Neither was there any supersedeas as to the reversed decree outstanding when the sale was made. The sale was for $1200.00 in cash, a fair price, and was in good faith. It occurred in May, 1927, two years before this Court reversed the final decree under which it was made.
To hold that the special master's sale made in 1927 under a final decree rendered in a case wherein the Circuit Court had obtained and held jurisdiction of both the parties and the subject matter, can be now collaterally attacked and set aside by an independent bill solely because the decree under which the sale was made has been reversed by the Supreme *Page 469 
Court, where the party who became purchaser at the master's sale was not a party to the reversed decree, is to establish in this jurisdiction a rule that prevails in no other jurisdiction either in the United States, England or Canada, that I have been able to find.
One of the questions presented for decision by the Chancellor in Randall v. Phare was whether or not a deficiency decree rendered in a foreclosure suit for the purchase money of property constituting an estate by the entireties, could be impressed as a lien upon an estate by the entireties held by the deficiency decree debtors. That question was a justiciable one and as such was presented in a case wherein the court called upon to decide it was the only court competent to do so, and after it had acquired and still held jurisdiction over the defendants, John J. Phare and Elizabeth Gregory Phare, at the time its decree was rendered. If the Circuit Court had jurisdiction of the subject matter (the question involved) and of the parties (the Phares), it had jurisdiction to decide the question presented to it, and the fact that it decided the question erroneously, did not oust its jurisdiction. Power to decide includes a power to commit error. So the fact that the decree entered was erroneous, and that it was later so found on appeal to this Court, is immaterial to the validity of the erroneous decree so long as it stood unvacated, unmodified and un-reversed on appeal.
A collateral attack can be successful only where and to the extent that it discloses a want of power, as distinguished from error in the exertion of a power that was possessed. Johnson v. Manhattan Ry. Co., 289 U.S. 479, 53 Sup. Ct. 721,77 L.Ed. 1331. This is a collateral attack on a sale made by a special master in chancery under a decree which, at the time the sale was made, was in full force and effect, *Page 470 
although erroneous. If there was power to enter the erroneous decree there was likewise power to make the sale under it at any time prior to its reversal. And insofar as parties to that sale who were not parties to the erroneous decree are concerned, their rights must be tested by the same rules that would apply if the decree had been affirmed, instead of having been reversed. Purchasers under valid, but erroneous decrees, do not take their rights charged with the contingency that they will be lost if the decree is reversed. If that were the rule, supersedeas orders would be unnecessary, since no decree could be carried out except at the risk of losing everything on reversal. That such is not the law in this State has been affirmatively settled already by this Court in the case of Johnson v. McKinnon, 54 Fla. 221, 45 Sou. Rep. 23, wherein this Court said:
"Upon the reversal of a judgment after a sale has been made under execution to a stranger to the suit, the defendant must seek redress from the plaintiff."
In this case, Mrs. Lindsley was a stranger to the suit in which the erroneous decree was rendered, under which the sale herein attacked was made to her for $1200.00 which she has paid out and which no one in this case, or in any other case, offers to refund to her.
On the other hand the Phares were parties to the suit in which the erroneous decree was rendered and so long as that decree stood unvacated, they were bound by it and what was done under it. They failed to apply for supersedeas to stop the execution of the erroneous decree prior to reversal. And while they are entitled to relief for what they have lost by reason of the execution of the decree before it could be reversed, they are not entitled to relief against Mrs. Lindsley, who was not a party, but a stranger *Page 471 
to the suit, and not only a stranger, but one who has put out $1200.00 upon the faith of the decree.
Upon the reversal of an erroneous judgment the law raises an obligation in the party to the record (not a stranger) who has received the benefit of the judgment, to make restitution to the other party for what he has lost. Bank of United States v. Washington, 6 Peters (U.S.) 8, 8 L.Ed. 299. A party against whom an erroneous decree has been carried into effect is entitled, in the event of a reversal, to be restored by hisadversary to that which he has lost thereby. Arkadelphia Mill Co. v. St. L. S.W. Ry. Co., 249 U.S. 134, 39 Sup. Ct. 237,63 L.Ed. 517. The reversal of a judgment or decree gives a new right or cause of action against the parties to the judgment or decree and creates a legal duty to restore what the other party has lost. Bank of U.S. v. Bank of Washington, 6 Peters (U.S.) 8, 8 L.Ed. 299.
If a judgment or decree is reversed after money or property has changed hands by force of it, it is the duty of the inferior court, on the cause being remanded, to restore the parties to their rights. O'Hara v. McConnell, 93 U.S. 150,23 L.Ed. 840. At common law, where the plaintiff had judgment and execution, and the defendant afterward sued out a writ of error, it was regularly a part of the judgment of reversal that the plaintiff in error "be restored to all things which he hath lost by occasion of the said judgment" and thereupon, in a plain case, a writ of restitution issued at once. Arkadelphia Mill Co. v. St. Louis S.W. Ry. Co. supra. Proceedings for restitution are in the control of the court reversed, and all parties should be heard. Northwester Fuel Co. v. Brock,139 U.S. 216, 11 Sup. Ct. Rep. 523, 35 L.Ed. 151.
In the case of Bank of United States v. Bank of Washington, *Page 472
6 Peters 8, 8 L.Ed. 299, supra, it was held that where defendants in execution paid a judgment after giving notice of their intention to seek its reversal, they could not recover the moneys from third parties, not a party to the judgment, after reversal of the judgment, because the payment under an unreversed judgment is made under a legal obligation, and the subsequent reversal of the judgment cannot have a retrospective effect so as to make void that which was lawful when done.
It seems to me that the authorities are not only conclusive, but unanimous, to the effect that in a case like that now before us, the remedy of the Phares for recovery of what they lost under the reversed decree is not to collatrally attack the sale by bringing a suit against the purchaser at the master's sale, who was a stranger to the record of the reversed decree, but to bring a restitution proceeding against Warner E. Randall, the opposite party to the record, at whose instance the sale was made and who received the benefit of the $1200.00 which Mrs. Lindsley paid over to the master when she purchased from the master her note and mortgage now being attempted to be foreclosed in this case in the court below.
I therefore disent from affirmance of the order.