Prudential Investment Co. v. Connor

The opinion of the Court was delivered by Mr. Justice Fraser. There are a great many parties in this case, and to state the interest of each party would produce confusion and obscure the questions involved. Only such facts will be stated as are necessary to understand the questions. The appellant Smoak took title to a certain lot of land in the city of Columbia. This land was subject to the liens of certain mortgages and judgments. The mortgage executed by A. J. Bethea was assigned to Prudential Investment Company. Mr. Bethea was the president of this company and .also owned the large majority of the corporate stock. The judgments set up were judgments against Bethea. The plaintiff foreclosed its mortgage. The judgment of foreclosure provided for a sale of the mortgaged premises, the payment of the mortgage debt, and out of the surplus the payment of the judgments. After the decree was taken, Mr. Bethea, claiming to act for the plaintiff, gave his individual checks to the judgment creditors and took an assignment of the judgments of the plaintiff corporation. The appellant Smoak objected to the payment of the judgments out of the Surplus, on the ground that Mr. Bethea had paid for the assignment of the judgments with his own money, that the judgments were paid, and the assignment was a mere pretense. The appellant was the owner of the equity of redemption and claimed the surplus freed from the liens of the judgments, which he claims had been paid by the judgment debtor, Mr. Bethea. [45] The Master took testimony in the case, attended by the attorneys for both sides; but the attorneys for the plaintiff withdrew from the references and applied to the Court of Common Pleas for ian order requiring the Master to pay the judgments to the plaintiff, as assignee of the judgments. The trial Judge granted the order on the ground that the matter was res adjudicata, inasmuch as the payment of the judgments had been decreed by the judgment of foreclosure. The only question proper for decision at this time is: Was the matter res adjudicata? Stripped of the unnecessary facts, the question is a very simple one. Conditions had changed since the judgment was rendered. That there had been a change of conditions since the judgment was rendered is admitted by both sides. The judgment of foreclosure could not have provided for the payment of the judgments to the plaintiff, because the plaintiff did not .at that time own the judgments. The order (appealed from) to pay the judgments to the plaintiff included necessarily the fact that there was a valid assignment of the judgments to the plaintiff. If the Court had jurisdiction to declare the assignments valid, it had also the jurisdiction to declare the assignments invalid. The appellant claimed that the assignments were invalid because Mr. Bethea had paid the judgments with his own money and that the assignment was practically to Mr. Bethea himself. Mr. Bethea was the judgment debtor. Was the money paid Mr. Bethea’s own money? Was the assignment only pretensive? The order appealed from practically decides that question adversely to the appellant, but does so on the theory that the matter is res adjudicata, and he is not at liberty to decide the question at all. The judgment is reversed, and the case remanded to the Court of Common Pleas to try the question of the validity of the assignments of the judgments to the respondent. Mr. Chiee Justice Gary and Mr. Justices Watts and Cothran concur.