Bayer v. Lovelace

Knowltoe, C. J. The plaintiff, an inhabitant of another State, sued a non-resident partnership by trustee process, and summoned as trustee a foreign corporation, having a usual place of business in this Commonwealth, serving the writ on' the commissioner of corporations under the authority of the St. 1903, c. 437, § 58. The trustee owed Krugel, one of the defendant partners, $2,000 upon an accepted order. The first question in the case is whether this debt could be attached effectively by a process of this kind. The case falls exactly within that part of the R. L. c. 189, § 1, which permits a foreign corporation to be summoned as a trustee of the defendant, if it has a usual place of business in the Commonwealth of Massachusetts. Jurisdiction is thus obtained over the debt due a defendant, and it matters not whether the plaintiff or defendant, either or both, are or are not inhabitants of this Commonwealth. This is the doctrine which prevails generally, although not universally, in the courts of this country, and which is held by this court and the Supreme Court of the United States. Rothschild v. Knight, 176 Mass. 48. Biggert v. Straub, 193 Mass. 77. Chicago, Rock Island & Pacific Railroad v. Sturm, 174 U. S. 710. King v. Cross, 175 U. S. 396. Harris v. Balk, 198 U. S. 215. It is definitely decided that a judgment of this kind, charging a trustee, upon which he makes a payment, completely protects him, under the Constitution of the United States, against a suit by his creditor in another State. Louisville & Nashville Railroad v. Deer, 200 U. S. 176. While in none of the cases are the [330] facts exactly like those now before us, we think the principles and doctrines laid down in the cases above cited, when applied to the statute already referred to, fully cover the fundamental question in the present case. The fact that the debt was due to only one of the defendant partners, and that the direction in the writ was to attach the property of these two persons as copartners, does not affect the plaintiff’s rights. Stevens v. Perry, 113 Mass. 380. The words “ as copartners ” are not a limitation of the right of attachment, but merely a description of the relations of the defendants to each other and to the plaintiff’s claim. The trustee relies upon the fact, set up in its supplemental answer, that since the commencement of this case, its creditor, the defendant Krugel, has brought a suit against it in the court of Cartagena, Colombia, for this debt, and has recovered judgment for it, and the trustee has paid it upon the judgment. On this answer, unless there are undisclosed facts which will qualify the ordinary effect of what has been done, a judgment charging the trustee will compel it to pay the debt twice. Such a result, unless brought about by the trustee’s own misconduct or negligence, would be deplorable. It is admitted that, so far as appears by the record, the trustee did not inform the court of Cartagena, Colombia, of the trustee process against it .in the court in Massachusetts, and the court there had no knowledge of the pendency of this suit. The trustee, by its managing director, being examined upon interrogatories, admitted that it owed the debt to the defendant Krugel, and a decree was entered ordering payment to him. It was the duty of the trustee to make such disclosure as would protect the rights of the plaintiff in this suit, and would also protect itself from a liability to double payment. It is a fair inference that, if the facts had been made known to the court in Colombia, the lien acquired by the plaintiff here would have been recognized and respected. We are not informed as to what the law of Colombia is, in reference to such conditions as appear in this case, but there is no reason to think that it is different from that of this country. If the trustee asks to be discharged by reason of what occurred in the Republic of Colombia, it is its duty to show that it was [331] compelled to pay, after such presentation of the facts as the rights of the present plaintiff required. It has failed utterly to show this. The judgment in Colombia was such as any court would have been obliged to render upon the case there presented. The trustee cannot take advantage of it here to prevent such a judgment as our law requires; for it is not a judgment founded on the facts, but it is a judgment rendered in ignorance of facts which the trustee ought to have made known. We are therefore of opinion that this action of the foreign court should not be permitted to affect the rights of the parties under the law of Massachusetts, in its application to the undisputed facts. Motion denied; trustee charged.