Shaw v. Coster

The Chancellor. The vice chancellor was clearly right in supposing this was not a proper case for a bill of interpleader ; even if the complainant’s allegations had left it doubtful whether he was entitled to the property in question under the execution in favor of the Chesters, or whether it belonged to the defendant Dey in his character of receiver in the suit of Jump against Coster and Artiguenare. Judge Story, in his very valuable treatises on — 345 — Equity Jurisprudence and on Equity Pleading, has so fully and so correctly stated the law on the subject of inter-pleader, that it is only necessary to refer to those works, in a judicial opinion. In the first place, the complainant in a bill of interpleader must annex an affidavit to his bill that there is no collusion between him and any of the other parties. And if the bill is filed in relation to moneys in his hands, he must either bring the money into court, or at least must offer to do so by his bill; so that the court may by its order compel a compliance with that offer, upon the application of either of the defendants. (2 Story’s Eq. 116, § 809. Story’s Eq. Pl, 237, § 291.) The complainant must also show that he is in the situation of a mere stake-holder, having no personal interest in the controversy between the defendants, and that their respective claims against him are of the same nature or character. (2 Story’s Eq. 118, § 812. Story’s Eq. Pl. 239, §294, 297.) In the case under consideration, there was no privity between the complainant and the defendant Coster, in relation to the property in Washington Hall. And if the deputy sheriff ever in fact levied upon that property, by virtue of the execution in favor of the Chesters, the complainant claimed title to the property, as sheriff, adverse to the title of the defendant Coster under- his mortgage. Frequent attempts have been made by sheriffs to sustain bills of interpleader where the property levied on by them has been claimed by third persons, adverse to the claim of the sheriff and the creditor under the execution. But I have not been able to find any case, in which the question has been deliberately examined, where a court of equity has decided in favor of such a proceeding. Indeed it would be contrary to every principle of justice to perpait a sheriff to seize property, claimed by a third person, under an execution against a judgment debtor, and then to compel such third person to come into a court of equity and liquidate the question of right to such property with the creditor in the execution, instead of trying the ques — 346 — tion at law, against the sheriff himself as the wrongdoer. In Slingsby v. Boulton, (1 Ves. & B. Rep. 334,) where the goods seized and sold by the sheriff were claimed by trustees under a settlement, who brought an action of trover therefor against him, Lord Eldon refused an injunction, upon a bill of interpleader filed against the trustees and the creditor in the execution. He said the sheriff acted at his peril in selling the goods, and was concluded from stating a case of interpleader, in which the complainant always admitted a title in all of the defendants against himself. That a person could not file a bill of interpleader who was obliged to put his case upon this; that as to some of the defendants he was a wrongdoer. From the marginal note of the reporter to the case of Stoors v. Payne and others, (4 Hen. & Munf. Rep. 506,) it would appear that the chancellor had decided that a bill of interpleader might be filed by a sheriff to settle the question between the claimant of the property and the creditor in the execution. But upon looking at the case itself, the decision appears to be the other way. It is true the chancellor says the plaintiff may file his bill if he pleases ; but he does not intimate an opinion that he can succeed in such suit. As I understand the case, it was an ex parte application for an injunction, upon a bill of interpleader ; which application was denied on the ground that the Virginia statute had made ample provision for the protection of the sheriff without the necessity of resorting to a court of equity for relief. And the -permission to file the bill was nothing more than saying, "If you wish to have this question as to your right to proceed by a bill of interpleader more deliberately settled, and in a manner in which you can have the benefit of a review by the court of appeals, you can file your bill and proceed in your suit; though I will not grant the injunction in the meantime.” The case of Nash v. Smith, referred to in the opinion of the vice chancellor, from the Connecticut reports, is not an authority in favor of the sheriff’s filing a bill of inter-pleader in a case like the present. In that case neither of — 347 — the defendants in the bill of interpleader claimed title to the property adversely to Silliman against whom the process in the hands of the constable was issued. The constable therefore had no interest adverse to the claim of either party, as each had put into his hands process against the same property : the one claiming it as the individual property of Silliman, and the other as the partnership property of Silliman and Cook. There was therefore a privity between the constable and each of the defendants. And the only question was whether the proceeds of the sale which had been rightfully made, should be applied to the payment of the individual debt of Silliman, which belonged to the defendant Mitchell, or of the partnership debt of Silliman and Cook, which belonged to the other defendants. That was clearly a proper case for a bill of inter-pleader ; if the complainant, instead of paying the money over to one of the parties in satisfaction of the execution against Silliman individually, had retained the proceeds of the property which he had rightfully sold, and had offered to bring it into court to abide the decision upon the bill of interpleader. In the case before me, whatever may be the rights of the several defendants upon the case as stated by the bill, I am inclined to think the bill itself was defective in attempting to state the whole facts on which the legal rights of each depended ; instead of stating that the defendant Coster and the receiver claimed them under an alleged mortgage which had become due previous to the issuing of the execution, and which mortgage had been given up after the return day of such execution, and another one given in its place by the assignees of Bailey. This is what Lord Rossylyn probably meant as “ suggesting a case,” in Dungey v. Angove, (2 Ves. jun. 311;) which he says an inter-pleading bill never does. As I understand the law, the complainant in a bill of interpleader must show that he is ignorant of the rights of the respective parties who are called upon by him to interplead. Or that at least there is some doubt, in point of fact, to which claimant the debt — 348 — or duty belongs; so that he cannot safely pay or render It to one, without risk of being made liable for the same debt or duty to the other> And therefore if the complainant states a case in his bill which clearly shows that one defendant is entitled to the debt or duty, and that the other is not, both defendants may demur. The one upon the ground that the complainant has a perfect defence at law, against his claim ; and the other on the ground that- the complainant has neither a legal or an equitable defence to his claim, and has therefore no right to call upon him to inter-plead with a third person who claims without right. The vice chancellor, upon any view I have been able to take of this case, was clearly right in dismissing this bill as to all the defendants. It should, however, have been dismissed without prejudice to the rights of the complainants in any future litigation with either of the defendants ; so as not to conclude him upon the merits of their respective claims, which could not be legally adjudicated in this form of proceeding. Upon the question of costs, I see no good reason why Coster and Dey should not have their costs to which they had been necessarily subjected by the filing of this bill. But as the bill upon its face was not a proper bill of inter-pleader, and the rights of the parties could not be settled under it, I think all of the defendants should have demurred ; instead of subjecting themselves to the useless expense of putting in answers and going into proofs, and at the same time precluding the possibility of having the case settled upon its merits, by insisting in their answers that the bill was improperly filed. The decree dismissing the bill as to all the defendants must therefore be affirmed, but without prejudice to the complainant’s rights in any future litigation with either of the defendants. But it must be modified as to costs, so as to allow to Coster and Dey the same costs which they would have been entitled to if they had demurred to the bill and the same had been dismissed upon the allowance of the demurrer. And the Chesters, instead of being al — 349 — lowed full costs, must only be allowed their costs to the same extent. Neither party is to have costs as against the other upon these appeals.