Foster v. State Bank

PARSONS, J. The bill does not allege fraud in obtaining the judgment, but it states that it was entered by mistake. This is, however, neither admitted by the answer nor proved. The judgment at law, so far as appears, was duly recovered against. Brown & Foster, upon a bill of exchange, to which they were both parties, the latter as accommodation endorser for the former. Foster, by his bill, seeks to be relieved of the judgment upon the ground that Brown, the principal in the bill of exchange, had shipped cotton to the agents of the Bank, sufficient to discharge the bill of exchange or nearly so, and that this-was done pursuant to an arrangement between Brown-and the Bank, under which the Bank received the bill of exchange, and by its agents, the cotton — that, according to the arrangement, the cotton or its proceeds, was taken to secure the payment of the money mentioned in the bill of exchange; that the cotton was accordingly sold by the agents of the Bank, or if lost by them, that the Bank under one of the stipulations, was to be accountable for it. This is briefly the substance of Foster's defence against the judgment at law, as stated by the bill. The principal objection to the relief sought by the bill is that the matters which it presents were all cognizable in the court of law, and that they might and should have been urged there in defence of the action on the bill of exchange. If true, they made a good legal defence to the action, but in fact, no defence was made. We do not understand Mr. F’s. council to contend that this matter of defence was not available at law, but he contends, among other things, that as Foster was an-accomodation endor-. ser for Brown, and as the matter of defence arose out of a trust, he had an equitable right to have the trust funds applied in discharge of the bill of exchange; or if lost by the negligence of the Bank’s agents that he should be relieved on that ground. All this may bfe admitted and then it follows, as an admitted conclusion, that the matters of defence were cognizable at law or in equity, — that as to them the jurisdictions were concurrent.’ The question is therefore, whether Mr. Foster is not precluded from seeking relief in equity, because he had an unobstructed de 675 fence to the action at law and should there have made it. It is our opinion that he is precluded upon this ground. It was so expressly held in Le Guen v. Governeur & Kemble, 1 Johnson’s Cases, 491. There as here, the plaintiff"in equity had suffered a judgment to go against him at.law, without defending as he might have done upon a particular ground which was cognizable at law or in equity, and by his bill he sought to be relieved upon it in equity. But tbe court held that the judgment at law was conclusive and final as to the matter actually determined, and as .to every other matter which the parties might have litigated in the cause and which they might have had decided. And it is said by Judge Story that “Courts of equity will not relieve against a judgment at law, when the case in equity proceeds upon a defence equally available at law, buttheplaintiff ought to establish some special ground for relief.” — Story’s Eq. 207, § 894. These authorities are precisely in point, because they relate to defences of which the jurisdictions are concurrent, and which might have been made to the actions at law, but were not. This was the case here, and as there are no special circumstances established as a ground for relief, the case is within the general rule. A party cannot be permitted to decline all defence to an action against him in a court having full jurisdiction, whether exclusive or concurrent, of the demand and of the defence, and after j udgment, to establish his defence elsewhere. This must be admitted as a general rule, though it might not exclude the defence of set-off upon which he could have his action, nevertheless. If a party may split an entire case and devide it between different courts, there .Would be no end to litigation. “In all cases of concurrent jurisdiction, the court which first has possession of the subject must decide it.” — Smith v. McIver, 9 Wheat. Rep. 532.- Hence it is clear on authority and principle that there is no difference in this respect between a defence which is exclusively legal and one which is cognizable at law or in equity. They are both finally precluded, in general, by a decision of the cause at law, in which théy were or might have been established. In either case the court of law, after taking possession of the subject, has it exclusively. Of course, the jurisdiction of the Chancellor in such matters is gone. Butin both, and equally, he may relieve after judgment, if sufficient special circumstances are alleged and established. It is not necessary 676 at present to state any of these circumstances, as none are established in this case. But it is clear that they must be such as to form a ground of jurisdiction. But our opinion is to be confined to the case before us! We do not mean to extend it to cases in which the defence is exclusively equitable; nor to cases of defence in which the jurisdictions are concurrent, but where the defence arose out of some matter, distinct from and subsequent to the original contract; nor to defences to which the jurisdiction of the courts of law has been extended in recent times under the authority of a statute or otherwise. In the first of these cases a trial at law, as has been held here, is no bar to relief in equity. It will be in time to decide the others when they may arise. The plaintiffs’ counsel insists, in addition to the trust character of the transaction, that an account here is necessary and that this circumstance authorizes the chancellor to give the relief which was originally equitable as well as legal. Lord Redesdale gives the answer to this, by stating the true rule to be that equity will relieve after judgment at law, in cases of complicated accounts, where the party has not made defence, because it was impossible for him to do it effectually at law. — Bateman v. Willoe, 1 Sch. & Lef. 201. But this is not a case of complicated accounts. We think there was no error in dismissing the bill. Let the decree be affirmed.