Prescott v. King

Trippe, Judge. The sureties of Thweatt held a mortgage to indemnify themselves as such sureties against a certain liability due Redd. as executor of Owen Thomas, deceased. This claim was in suit, and whilst it was pending it was agreed by the parties [52] that the property — the same being personal property, and Thweatt desiring to sell — should be sold, and the proceeds placed in the hands of King, to abide the result of the litigation on Redd’s suit. This was done according to the agreement. Before Redd obtained judgment, Prescott, the plaintiff in error, obtained one against Thweatt, and served King, the depository as above stated, with a summons of garnishment. The securities of Thweatt had also sued out an injunction restraining the sale of the mortgaged property. Under this slate of facts we think equity requires the appropriation of the proceeds of the sale of the mortgaged property thus raised and specially deposited, to the payment of the judgment against the sureties. They had a prior lien on the property by virtue of the mortgage for their indemnity. It was not lost by the agreement to sell and to make a special deposit of the proceeds, to stand in lieu of the property. No fraud was charged, either as to the mortgage, or sale, or the deposit. Prescott’s judgment never had a lien on the property, for it was s.okl before his judgment was rendered. When the money was placed with King it was as a special deposit, made for the benefit of Redd, a creditor, and the sureties of his debtor. That debtor had no right to withdraw it, or to claim the fund unless Redd failed in getting judgment. Thweatt had admitted an amount to be due to Redd before the deposit was made, more than sufficient to absorb it, and Redd’s judgment is three or four times that amount. The judgment of the court below, holding that this fund should go to the judgment it was raised and specially deposited to pay, was right. Judgment affirmed.