People ex rel. Manning v. New York C. P.

[651] By the Court, Savage, Ch. J. “ Opposite demands arising upon judgments, may upon motion be set off against each other whenever such set-off is equitable, though the judgments are in different courts, and though the parties to the different records are not the same.” Montague on Set-offs, 6. 1 H. Black. 217. 2 Str. 891. 8 T. R. 69. 2 Black. 896. 3 Wils. 396. 4 T. R. 123. In setting off’judgments in the English courts, there is a difference between the king's bench and common pleas, in regard to the attorney’s lien for his costs: the former holding that the costs are not to be set off but only the balance of the judgment after the costs are paid ; the latter, that costs may be set off, the lien of the attorney being subordinate to the equities of the parties. This practice was considered in Hall v. Ody, 2 Bos. & Pal. 28, by Lord Eldon, when chief justice of the common pleas, inconsistent with principles of justice ; but it was answered by Rooke, justice, that the practice was not unfair, for the attorney looks in the first instance to the personal security of his client, and if beyond that he can get any further security, it is a casual advantage; and it was rema-ked by Lord Eldon, that as the attorney had acted with a knowledge of the settled practice he could not claim the benefit of what the learned judge con652 a more just principle. This Court has long since adopted the principle oí the Bnglish court of common pleas : that the equities of the parties are superior to those of the atErnies. The practice of setting off judgments does not all depend on the statute of set-offs, but upon the jurisdiction of the courts over the parties and over their own process. It is true, indeed, that it is in pursuance of the policy of the statute, and, as was said by De Grey, chief justice, in Baker v. Braham, 2 Black. 869, 3 Wils. 398, S. C. the courts have gone a little farther than the letter of the statutes, by the rule of analogy, in cases within their power ; costs have been set off against costs, and also against debt and costs. As far back in the history of our own court as in Schermerhorn v. Schermerhon, 3 Caines, 190, a judgment in the common pleas was allowed to be set off against one recovered in this court. In the case of Brewerton v. Harris 1 Johns. R. 144, this court refused to interfere, because the motion should have been made in the common pleas ; the execution to be stayed or reduced in amount was one to be issued, if at all, from the common pleas ; and therefore it was held the motion should be made in that court, particularly as such an order must be enforced by attachment. In the case now before us, if both parties were living and solvent, there could be no difficulty; it would be a matter of compe to order the set off. The attornies would have no lien-for their costs. We interfere to protect attornies from the frauds of the parties to the suit. In such cases, the attorney must give the opposite party notice of his claim for his costs, or a bona fide payment of them to the party will not be considered fraudulent. But that doctrine has po direct applipa» tion in a case like this: as was said by Spencer, justice, in Martin v. Hawks 15 Johns R. 407, a different rule has been adopted by this court in such a case. Here we consider, as I have before observed, the equities of the parties superior to those of'their attornies. The attornies in this case have not given notice of their liens for their costs, nor was such notice necessary; they present themselves as the assignees of the judgments in favor of their respective clients. Before notice pf the motion for a set-off, no notice was given by either^ of [653] the assignment held by him: nor is notice at all important, as its only effect is to protect the assignee against the improper act of the assignor after the assignment. In these motions, the court regards the rights of assignees, j and protects them; but where a party is only nominally an assignee, without any interest, the court will not consider him an assignee. The rights of an assignee came before the court distinctly in the case of Chamberlain v. Day,3 Cowen. 353. There C. recovered a judgment against D. in August,1824, which was assigned to Wiley. D. had previously purchased a judgment against 0. For aught appearing in the case, both assignments were bona fide, and without notice ; but we said that Wiley took the judgment which he purchased, subject to the prior right of D., to set off the judgment which he had previously purchased. There no actual notice of the assignment was given, nor was that fact considered at all important. Day was assignee in fact, and his right to set off had attached before Wiley became the purchaser, and the set off was made. The case of Bradt v. Koon, 4 Cowen, 416, is much relied on in opposition to this motion. In the report of that case dates are not given, which are sometimes very important. Bradt had recovered a judgment in this court upon a stipulation to pay costs to Mr. Van Vechten, the attorney of Bradt. These costs were due to Van Vechten, and that known to Koon when he purchased the judgment of Lawrence against Bradt. It must have appeared that Koon had received notice, which constituted Vau Vechten the assignee, before he purchased Lawrence’s judgment; this must have appeared to bring the case within that of Martin v. Hawks. In that view, the case of Bradt v. Koon is in perfect accordance with all the cases of assignees. Van Vechten was the assignee, and that known to Koon ; and yet, with a knowledge of that fact, the latter purchased a judgment against Bradt, who he knew had no interest in the judgment against which he proposed to set off the one he had purchased; in other words, he proposed to set off a judgment, which he had purchased against Bradt, in payment of one belonging to Mr. Van Vechten against himself. A judgment, to he set off must be owned absolutely by the person who asks to set it [654] off; and if purchased conditionally, the set-off will be refused. 7 Cowen, 469. It seems that a party may purchase a judgment for the purpose of set-off, if it be done bona fide ; but it cannot be done where the nominal assignee is a mere trustee ^ another. 7 Cowen, 480. The questions, then, in the case before ns are, whether the judgments were fairly purchased, and are actually owned by the parties in interest. As to the purchase by Mr. Garr, of Whitehead’s judgment, no question has been made ; but as to the purchase by Mr, Manning, of the judgment of Strang against Whitehead, two objections are interposed: 1. That it was made after the verdict in favor of Whitehead; 2. That it was without consideration. As to the first objection, it is answered, that the agreememt for the purchase was made some time previous to the'trial, though not completed until afterwards; but in reality it is no objection to the set-off, though the purchase was made expressly for the purpose of set-off. Such was the case of Chamberlain v. Day. There Day had purchased the judgment, which he set off apparently for that purpose. In the case of Bradt v. Koon, the objection was not .that Koon had purchased Lawrence’s judgment for the purchase of set-oil; but that before the purchase, Bradt had assigned his judgment to Yan Yechten, in contemplation of law. The defendant in such judgment cannot object to it; a judgment must be paid, and it is indifferent, in point of law, whether the original plaintiff or an assignee is in fact the owner. So, as to Whitehead, it was a matter of no moment to him whether the judgment was ownedby Strang or Manning; it was a debt which he was bound to pay. And when the assignment was made, Whitehead was the owner of the verdict in his favor, against Manning, and had power to discharge it, together with the costs of his attorney. As to the consideration: part of the judgment consistedof a bill of costs in the suit, which, as between attorney and client, belonged to the attorney. It also appears, from Manning’s affidavit, that Strang was indebted to him for costs to about $500. This is consideration enough, certainly, as between the parties ; and as to Whitehead, lie cannot object the want of consideration on the ground of his own insolvency. As to Mr. [655] Garr's assignment, he t~ok it subsequent to the assignment to Manning, and as was said in chamberlain v. Day,subject to all the equities existing against Whitehead’s judgment, at the time of the assignment to him; at that time Manning’s right of set off had attached. It is contended, however, that Manning’s assignment was in fraud of Garr’s lien for his costs. It is an answer to this allegation, that as between the parties to a suit, an attorney has no lien for his costs ; the equities of the parties are superior to those of the attorneys, and the only ground on which the court, in Martin v. Hawks, considered the attorney the assignee as to his costs was, that the attorney, Mr. Jordan, had given notice to the defendant that the judgment was for costs, and belonged to him. No 'such notice was given to Mr. Garr. It is not sufficient to say that Mr. Manning, being a lawyer, knew that Mr. Garr owned the costs. The same is true of every defendant, for every man is presumed to know the law. Mr. Manning also knew that without such notice the costs were a proper set off against the party; as without, it the attorney could not be considered the "assignee. The costs of opposing the motion for the reversal in this court were improperly taxed: A party is never entitled to costs of a trial or motion in which he was unsuccessful. Alternative mandamus granted as to set-off* Footnotes [*] The writ of alternative mandamus issued in this cause was tested on thé twenty-fourth day of January, 1835, and made returnable at the first special term of this court, after service of th.e same. A motion wa.s made by Mr. Garr, to set it aside for irregularity, on the grounds, 1. that it was notified on any day within the two first weeks of the January term; and 2. was not made returnable on any day in the same term, or the next term, 2 R. S. 197, § 5, but was made returnable in vacation,as special terms or motion days can be held only in vacation,statutes of 1830, p. 208. The Chief Justice, in deciding this motion, said: *• The alternative writ of mandamus is not pro-- “ cess, within the meaning of the statute regulating the teste and return of “process; it is in the nature of a rule to show cause, 4 Own., 403,1 Johns “ R. 64, and liable to be moulded, by the discretion of the court, according “ to its practice, in such manner as shall best promote the cause of jus> tice”&emdash;and accordingly denied the motion.