Williamson v. Oklahoma National Bank

Opinion of the court by McAtee, J.: The errors assigned were argued in the-brief of the plaintiff in error, in the first place, upon the-proposition -that the court had no power under the-evidence, to instruct the jury that they might return a money judgment, nor to enter up the judgment after the-verdict, for a specified amount of damages, and that it-had no power to enter up the judgment upon such a verdict. ' The statute, Code of Civil Procedure, sec. 213, Statutes-of 1893, provide that: “From the time of the service of the summons upon the garnishee he shall stand liable to the plaintiff to the amount of the property, moneys, credits and effects in his possession or under his control, belonging to the defendant or in which he shall be interested, to the extent *626 of his right or interest therein, and of all debts due or to become due to the defendant, except such as may be by law exempt from execution. Any property, moneys, credits and effects held by a conveyance or title, void as to the creditors of the defendant, shall be embraced in such liability.” * * The court properly instructed the jury that they could not find a verdict against the defendant for any indebtedness he may have ■ owed the said .Dowden on negotiable promissory note or notes. The jury could not have rendered any verdict against the garnishee except upon the supposition that the transfer of stock of August 17, 1895, was in fraud of creditors, that Williamson was in collusion with it, that the transfer then made was not valid, and that the stock remained the property of E. W. Dowden. Upon the supposition that this was true, Dowden’s right would have been to the ownership of the 125 shares of stock, and the possession and ownership of those shares of stock would have been, in the language of the statute, “the extent of his right or interest therein,” and no further or other; and the finding of the jury, under the evidence, and in the absence of any evidence showing any indebtedness from Williamson to Dow-den, other than that which has been stated, would have been to ascertain and state what property, if any, the jury found to be in the possession of Williamson, which was the property of Dowden. The issues which were formed by the affidavit in garnishment of the plaintiff, and the affidavit of the garnishee filed as an answer, are (1) whether the garnishee was indebted to the defendant, Dowden, and (2) whether he had property in his possession or under control, belonging to the defendant, and in the absence of evidence tending to show indebted *627 ness under the first averment, and the evidence having been confined to the question of the possession and ownership of the shares of stock only, which passed into the possession of Williamson on the 17th day of August, 1895, the finding of the jury should have been confined, by proper instructions, solely to the point whether the garnishee had, or had not, any property in his hands at the time the garnishment was served upon him, which was not liable to execution, and which was sufficient or insufficient to satisfy the plaintiff's demand. And this has been the holding of the courts. It was said in Rasmusser v. McCabe, 43 Wis., 471, that: “Where a justice finds that the garnishment holds the property of the defendant, to be delivered at another date, the judgment should be that he deliver the property to the court on such date, for the plaintiff's benefit, and on his failure to do so, judgment should go against him for the value.” And it was said in Poland v. Blackan, 94 Tenn. 596, that a garnishee found to have in his possession for collection a promissory note, belonging to the defendant, cannot be subject to a personal judgment, and that where the only issue in the garnishment proceding is whether or net the garnishee has in his possession personal property belonging to the defendant, it is error to enter either a general or a money judgment against him. (Ency. of Pl. and Pr. 9 Vol. p. 848.) And that the judgment against a garnishee must be so framed to leave him in the position no worse than if he had been proceeded against by his own creditor, and must protect him against claims of third parties. (9 Ency. of Pl. and Pr. 848.) *628 And since tlie creditor could have no other right than to the stock itself, a finding by the jury could have been no other in the case than that shares of stock in the Dow-den Williamson Grocery company were in the hands of Williamson as garnishee, and that they were the property of the defendant, Dowden. It was said in Howell v. Leafgreen, (Colo.) 82 Pac. Rep. 80, that: “It is a well settled rule of law that the garnishee is not chargeable unless the defendant could recover of him what the plaintiff seeks to secure by garnishment.” Citing, Wap. on Attachment, 202, and Drake on Attachment, sec. 458. It is the rule in the federal courts and has been so held in most of the state courts. It was said in Armstrong Company v. Culbert, (Tex.) 36 S. W. Rep. 139 that: “The process also runs against the property of the debtor that may be in the hands of the garnishee at the time of the service of the writ and answer, and such process creates a lien of the creditors upon such property.” (Vock v. Blenn, 82 Tex. 436.) And that: “The logic of the rule is, as between the garnishee and the creditors of the lien, that the law will take such property in his hands as is belonging to the debtor.” And it was said in Campbell v. Simpkins (Wash.) 38 Pac. Rep. 1039, that: “The issue in garnishment being whether a sale of goods by defendant to the garnishee was in fraud of creditors, a money judgment cannot be rendered against the garnishee, as on the finding by the plaintiff, the court must, under the statute, order the goods turned over.” And it was there said, that: “It is only where the *629 debt in due from tbe garnishee, that the money judgment can be entered as a result of the proceeding.” And it was further said, that: “Where property subject to execution is found in the possesion of the garnishee, the only order which the court makes is a decree that the garnishee deliver up to the sheriff, on demand, such personal property, or so much of it as is necessary to satisfy the plaintiff’s claim.” In that case the supreme court of Washington, interpreting a statute of that state which embodied, as we understand it, the uniform rule, held that the lien or garnishment fixes itself upon such property or assets as may be at the time in the hands of the garnishee, belonging to the debtor, and entitles the garnisheeing creditor to such remedy as the debtor in the cross-suit would have against the garnishee, and the court there added, that: “The object of the proceeding is to ascertain the title and right of personal property, and not to recover money.” In Parson v. Holman, (Wis.) 12 N. W. Rep. 394, it was held, that: “Property in the hands of the fraudulent purchaser is held by him in trust for the creditors of his fraudulent vendor, and where the property is converted into money, the money is embraced with the same trust.” And the court there declared, that the holding there would be that no title would ever pass from the fraudulent debtor to the garnishee who was aware of and colluded in the fraud, and that the property itself would he held for the creditors, unless the fraudulent garnishee had sold and received the money, in which event he' would be responsible for the money for the benefit of the creditor. *630 And in a garnishment proceeding in Pennsylvania, Judge Sharswood, in Poor v. Culberland, 57 Pa. St. 417, held that a verdict which found a specific amount of money was erroneous, and that no judgment could be entered upon it, and that the verdict should have found how much money was in the hands of the garnishee, belonging to the defendant. It was said by the supreme court of that state in Bonafen v. Thompson, 83 Pa. St. 462, that: “A verdict by a jury in garnishment for a specific sum of money for the plaintiff, under the garnishee’s plea of nulla bona, without stating that the garnishee had money or effects belonging to the defendant, in his possession, was bad, and the judgment founded thereupon was erroneous.” The instruction which was requested by the garnishee, .to the effect that “a person” is not precluded, under the law, from purchasing property from one who is involved deeply in debt, and unable to meet his obligations, notwithstanding the purchaser may have knowledge of such indebtedness, provided the purchaser buys in good faith for a valuable consideration and pays a reasonable value therefor, and without knowledge that the sale was made for the purpose of defrauding the just creditors of the “grantor,” was a correct statement of the law, applicable to the facts adduced in the case, and not covered by any other instruction which was given by the court. The refusal to give this instruction to the jury was, we think, material error. The judgment below will be reversed and the cause remanded for further proceedings. Burwell, J., who was of counsel, not sitting; all of the other Justices concurring.