Milne's Appeal

Mr. J ustice Gordon delivered tbe opinion of the court, February 20th 1882. The appellant, Fz'ancis F. Milne, is a creditor of A. J. Bucknor, Jr., and on the 2ist of January 1878, levied two writs of attachment on the distributive shares of the debtor in the hands of William A. J ames, administrator of the estate of A. J. Bucknor, Sr., and it is thus that Milne becomes interested in the distribution of this estate, and in the decree made by the court below. On settlements of the accounts of the administrator, the last one audited January 21st 1879, the distributive shares of the younger Bucknor were found to be $17,129.72, and so adjudged. At the time of the death of A. J. Bucknor, Sr., which occurred December 13th 1877, he held two several claims against his son; one a due-bill, payable on demand, for $10,000, dated Januazy 1st 1867, the other a claizn against the fizan of Bzzclmor, MCcamzzzazi & Co., made up of a note for $3,895.46, due October 5th 1870, and azi accouizt for money loaned, in the suzn of $9,807.93, dzze Septeznber 12th of the sazne year. This finn went into bazzkraptcy, October 14th 1870, frozrz which, as yet, there has been no dischaz’ge, and the claizn above stated was, aznozig others, duly proved. Ozi the settleznents izz the Orphans’ Court, through sozne inadvertence or mistake, the effect of these claims, as off-sets to the distz-ibzztive shares of the younger Buckzzoz’, was zzot passed upon, and on a petition of tlze adznizzistratoz’, dated June 21st 1879, setting forth this? mistake, which is not deziied, the court opened its forzner decrees and proceeded to a readjudication. To both the above mezztiozzed claizrzs against A. J. Buelmor, Jr., the appellant izztez’posed the plea of the statzzte of limitations, which was overruled by the Orphans’ Court, and the set-off as claizned by the adzziiizistz-ator was allowed. We have, tlzez’efore, two pz’izzcipal questions presezzted for our eozzsideration : — The power of the Orphans’ Court to open and correct its deez*ee, and the effect of the statute of liznitatiorzs upozi the claizns of the estate agaiizst A. J. Bucknor, Jr. As to the first qziestiozz, we answer it by sziying that we have zzo doubt about the power of the Orplzazzs’ Court to revise and cozuect its forzner adjudications, if izz those adjudications it discovez’ed a palpable mistake, produced either by its owzz inadvertence or by tlze blzmder of tlze parties. A sense of fair dealizzg and justice wozzld bo authority enough, izz the absence of any other, for so holding. Nevertheless, other azithoz-ity will be fouzid, and that diz’eetly in point, in George’s Ap., 2 Jo. 260, where the subject is so fully discussed, [490] that further argument from us is unnecessary. This out of the way, next in order comes the question involving the statute of limitations. If this statute is operative under the circumstances of this case, then both the claims above referred to are barred thereby, and the appellant is entitled to a reversal of the decree of the court below. But, as we have seen, if it is not operative it is not for the want of time, for the due-bill as well as the claim against Bucknor, McCammon & Co., were more than six years old at the time of the death of the elder Bucknor. But it is urged that the statute does not apply to a distribution in the Orphans’ Court, where there is an exercise of the right to retain from a distributee’s share, his indebtedness to the estate. To support a doctrine such as this, nothing has been produced from our own books but the dictum of Mr. Justice Bead in Thompson’s Ap., 6 Wr. 345, and that is based solely on English authorities. On the other hand the contrary was held in the recent case of Reed v. Marshall, 9 Nor. 345, where on a suit for a legacy an attempt was made to set off a claim of the estate against the legatee, which had been barred by the statute prior to the death of the decedent. Nor is the attempted distinction between equitable and common law proceedings, as respects the statute of limitations, well founded. As was said in Hoch’s Appeal, 9 Harris 280, a case where the Orphans’ Court, on objection of a legatee, refused to allow an executor to retain a debt due himself which was barred by the statute in the life of the testator, a court of equity will not pass upon a claim bad at law. Neither has the argument for a contrary doctrine a sound premise. It is urged that the statute does not pay the debt; that it only operates on the remedy. It is true that the statute operates only upon the remedy, or action for the collection of the debt, but it thus operates because of the presumption that the claim has been paid or otherwise extinguished, if its collection has not been insisted od within six years, and that, therefore, it would be inequitable, after that time, to compel its payment. Hanger v. Abbott, 6 Wall. 538. Again, the court below thought that as the ten thousand dollar claim was a due-bill, payable on demand, the statute did not commence to run from its date, but only after demand made. This was a mistake. Taylor v. Whitman, 3 Gr. 138, holds that the statute begins to run, on a note payable on demand, from its date, and that no demand is necessary before suit brought. The cases of the Girard Bank v. The Penn. Township Bank, 3 Wr. 92, and Finkbone’s Appeal, 5 Nor. 368 are not in point. Those were suits for the recovery of depos [491] its, and tbe contracts were in the nature of bailments for safe keeping ; moreover, in the case last named, it was expressly said that the obligation sued upon was not in the nature of a due-bill but that it had rather the character of a deposit. As to the claim against Bucknor, McCammon & Oo., we'cannot agree with the court below that the running of the statute was suspended by the operation of the United States Bankrupt Act. The probate of the claim, under that Act, is like the prosecution of any other suit; if it is successful all is well and the account is secure, but if not, if the creditor is in the end obliged to resort to a new process in the state courts for the recovery of his debt, we cannot see upon that principal, in order to avoid the running of the statute of limitations, he can count out the time consumed by his first abortive attempt. He is not compelled to prove his claim ; but if ho does, it is a voluntary surrender of it, and in this it is altogether unlike those cases where a condition of war, as in Hanger v. Abbott, supra, or public policy, as in Hutchinson v. The Bank, 5 Wr. 42, leaves the creditor without remedy. But under such circumstances his will is not consulted; the courts are closed against him, hence, of necessity, the running of the statute is suspended until the public emergency has passed, and he is again clothed with the power of asserting his rights. In the case now being considered, Bucknor had two methods of redress presented for his consideration and acceptance; he might prove his claim in the bankrupt court, or he might sue in the state court. If he adopted the first method he voluntarily abandoned all other remedies, and made an absolute surrender of his claim, and it is only by virtue of the Act of Congress of June 22d 1874, that ho could be restored to his former condition in case a discharge was refused to the bankrupt, or the proceedings were determined without a discharge. Now Bucknor’s claim against the firm of which his son was a member, was proved some seven years before his death, and had there been no unwonted delay a discharge would have been had long before the date of his decease; but in that* event, the indebtedness now sought to be used as an off-set would have been fully cancelled, and the use of it as now intended, against the after-acquired estate of the younger Bucknor, would have been out of the question. But as yet there has been no discharge, neither have the proceedings in bankruptcy been determined without a discharge, hence, the act of 1874 does not apply to the claim in controversy, and it may be that it never will so apply. How then can this surrendered claim be interposed as a set-off ? or must the distribution await indefinitely for the happening of a contingency, now rendered exceedingly remote by tbe death of both the principal parties 2 We think it will not subserve the [492] purposes of either law or equity thus to suspend the running of the statute on the mere expectation of an event that mjiy never come to pass. If, however, the second method were adopted, the bar of the statute would be effectually prevented, and the creditor might prosecute his claim to judgment, subject only to such delay as might result from the interposition of the court having jurisdiction of the proceedings in bankruptcy. "We conclude, then, that the. delay in this case having arisen from no legal or political necessity, but from the voluntary act of the creditor, the bar of the statute is effective to defeat the appellee’s claim. The decree of the court below is now reversed and set aside, and the former adjudications restored and affirmed at the costs of the appellee.