Baltzell & Chapman v. Randolph

WALKER, J., delivered the opinion of the Court. At the Eall Term of 1854, of Gadsden Circuit Court, appellants obtained judgment vs. appellee, for $655.37, andón 28th December, 1854, execution was issued and being levied on the property of the appellee, the bill in this case was filed for an injunction, which being granted and made perpetual, appellants brought the case to this Court. In determining whether the Circuit Court erred in granting and perpetuating the injunction, two questions are to be considered. First, whether the equity of the case is with appellee ; and second, whether he has not by his negligence lost his right to come into equity. It appears from the testimony of C. hf. Harris, the only witness examined in this cause, that the judgment is based, on anote signed “ C. M. Harris & Co.,” but that appellee was not at the time said note was made, and had not been for near a year prior to that time, a member of said firm of “ C. M. Harris & Co.,” and moreover, that appellee had no con [370] nection whatever with the debt said note was given to secure, said debt being the individual debt of said O. M. Harris, contracted by him before his partnership with appellee, and in which appellee had no interest, and for which he never in any way rendered himself responsible. From this evidence we have no difficulty in concluding that the equity of the case is clearly with appellee. But why did not appellee set up these facts as a defence against the suit at law? In failing to do so, has he not been guilty of such negligence as will deprive a Court of Equity of the power to give him relief ? The rule on this subject as laid down by Judge Story, and supported by all the authorities, is as follows : “ Belief will be granted when the defence could not, at the time, or under the circumstances, be made available at law, without any laches of the party. Thus, for instance, if a party should recover a judgment for a debt, and the defendant should afterwards find a receipt under the plaintiff’s own hand for the very money in question, the defendant, when there was no laches on his part, would be relieved by a perpetual injunction in equity. So, if a fact material to the merits should be discovered after a trial, which could not by ordinary diligence have been ascertained before, the like relief would be granted.” — See 2 Story’s Equity, 894. Adopting this as the true rule, let us see whether defendant could not, at the time, or under the circumstances, without mvy laches on his part, have availed himself of the defence as now disclosed by the testimony of Harris: or whether, after the judgment, he has discovered any fact material to the merits, which he could not, by ordinary diligence, have ascertained before the judgment. The appellee in his bill says: “ Your orator further states that the reason of his not availing himself of this defence at law, was owing to his entire ignorance, at the time, of any [371] of tbe foregoing facts; ” and again : “ your orator could not ascertain, until after the judgment, what were the real facts in the case.” He of course could not avail himself of a defence of which he was at the time entirely ignorant; but the question recurs, was this entire ignorance “ without any laches on his part,” and might he not, “ by ordinary diligence,” have informed himself? To answer these questions, it will he necessary for us to revie av all the facts and circumstances disclosed by the record. It appears that in August, 1851, appellee being then “very young and inexperienced in business,” formed a co-partnership Avith C. M. Harris, at Chattahoochee, Fla., under the name, style and firm of “ C. M. Harris & Co.” This partnership lasted only a few months, when it Avas dissolved, and appellee withdrew from the business, leaving all its assets in the hands of Harris, and commenced business in Tallahassee in his own name. Whilst residing in Tallahassee, suit Avas commenced against him and Harris in Gadsden County, on 22d February, 1854. He acknowledged service of the writ, Avhich Avas sent to him in Leon County on February 25, 1854. The declaration was filed in Gadsden County on Gth March, 1854, with a copy of the note sued on, which AVTas a note for $603.95, dated October 17, 1852, and signed “ C. M. Hams & Co.” While it is certainly the duty of every defendant, so soon as he shall he served with process, to look at once and closely to his defences, yet there may he circumstances so well calculated to lull him into repose that it would he inequitable to make him suffer for yielding in some measure to their influence. What Avas the reasonable conclusion to which the mind of appellee might arrive on finding himself sued as a member of the firm of “ C. M. Harris & Co. ” ? We think he might, AÚthout Mame, have concluded that said suit was [372] brought on. some legitimate demand against said firm, and, inasmuch as ’he had left all the assets of the concern in the hands of Harris, who resided in the county where the suit was brought, that said Harris would attend to it. Under this delusion, the appellee seems to have labored until “ a short time before the term of the Court at which said judgment was rendered,” when he says he “understood” (by which we understand from other parts of his bill that he means that he suspected,) “ that said suit was brought upon a contract not made by him or by the firm of which he had been a member.” Thus suddenly aroused from a state of lethargy into which, under the circumstances of the case, we cannot condemn him for having indulged, the appellee found himself hedged round by difficulties in the way of getting correct information how to construct his defence, and evidence to sustain it. He had no access to the books. Harris, who had repeatedly put him off by telling him that all should be so managed that he should not be damaged, was then lying sick at Chattahoochee, so that no information could be obtained from him, and the confidential clerk of the firm had departed to some place unknown. It is difficult to say what the appellee could have done under the circumstances. He seems, however, not to have become entirely inactive. He filed several pleas, but what they were we can only conjecture from the replication and demurrer to them, which appear in the record, though the pleas themselves do not appear. The same cause which prevented appellee from making his defence at law, also prevented him from being able to make the affidavit required for a continuance or for a new trial. He was ignorant of the facts, and knew not where he ■could find a witness to prove them. It was urged in argument that he might have examined General Milton, but it ■does not appear that Gen. Milton knew then, or even now [373] knows the facts of the case. It was also suggested that he might have obtained by bill a discovery from Harris, but Harris being a party to the record, his testimony could not be made available at law. Nor could appellee file a bill for injunction, being unable at that time to swear to such facts in his bill as would entitle him to an injunction. Being thus powerless to defend himself, appellee withdrew his pleas and suffered judgment by default. Having done so under the circumstances hereinbefore stated, and having now produced before this Court conclusive evidence that he does not owe and never did own any part of the debt for which judgment was rendered against him, we are of the opinion that he is entitled to the relief for which he prays. Therefore let the decree of the Circuit Court be affirmed with costs.