Atherton v. Hull

Johnson, Judge, delivered the opinion of the Court: Could a suit in chancery be maintained for the purposes sought by the bill ? Syl,atas ^ In Taylor v. Ficklin et al., 5 Mun. 25, it was held that “a man indebted by bond, executed a conveyance of all his property in trust, for payment of his just debts in the first place; for his own support during life in the second, and afterwards for the benefit of his wife, &c., and died without will, or property acquired after the date of such conveyance, and no person administered on his estate; that an assignee of the bond was not restricted to his remedy at law against the assignor, but without bringing an action at law, might obtain relief in equity by a decree for the sale of the property in the hands of the trustee. In such case, if the fund in the possession of the trustee prove insufficient, the plaintiff in equity might recover the balance of his claim from a debtor of the obligor, and in default of both those funds in whole or part, he might proceed against the assignor.” From this it appears that all the persons concerned being made parties, the court might do complete justice in one suit, and make an end of the whole controversy. In this case, the obtaining of the deed to the land sold by the trustee, was within the jurisdiction of a court of equity, and to obtain that it was necessary to have before the court all the parties interested in the controversy; the assignor of the debt, as well as the grantors in the trust deed were necessary parties and were before the court, and it was proper in that suit, if all the proper allegations had been contained in the bill, and sustained by proof or confessed, to have made an end of the whole [180] controversy, by decreeing against those who ought to pay it, if any one, for the unpaid balance of the debt. Nor is there any thing in section 16 of chapter 99 of the Code, to prevent this being done in a court of equity, because, if for no other reason, the plaintiff did not have an adequate remedy at law, to make an end of the whole controversy, and being properly in a court of chancery for one purpose, the court would retain the jurisdiction for all purposes and do complete justice between the parties. Syllabus 2. But before the plaintiff could in the suit, have a decree over against any of the parties, who were assignors of the debt, he would have to show that he had used due diligence to collect the debt from the original debtor. He must either show that he has diligently pursued his remedy against the original debtor, without avail, or a reason, good and sufficient, why he has not done so. If he showed, that, at the time, or shortly after the assignment was made, the original debtor was insolvent, this would be a sufficient excuse for not pursuing his remedy against him. Thompson v. Govan, 9 Gratt. 695, and cases there cited. The bill in this case charges that the original debtor, Hull, “ is wholly insolvent,” but it appears that this bill was filed in 1864, about six years after the notes or bonds were executed, and about three years after the last one was due. Hull executed the three notes or bonds as appears by the deed of trust, filed as an exhibit with the bill, on the 26th day of October, 1858. The bonds were for $560.56$- each, and were payable in one, two and three years respectively thereafter; and the trust which was executed by Hull and wife contained this provision : “ That the said B. G. Hull, his heirs or assigns, shall remain in the possession of the said land, and take the rents, issues and profits thereof to his own use, until default be made in the payment, in whole or in part, of the said installments, as they severally fall due, and then so soon after the happening of such default as the said [181] trustee shall think proper, or as he may be required to do by the said Woods, his representatives or assigns, it shall be lawful, and the duty of the said trustee, after having fixed the time of sale, and given thirty days notice thereof, by advertisement posted at the front door of the court house of Tucker county, to sell said land at public auction, for cash in hand,” &c., and directs that after paying commisssions, &e., to pay the proceeds of the sale to Woods, or sufficient to pay the debt, and the balance pay to Hull. The deed of trust recites the assignment of Bowman to Woods, and Bowman signs the trust deed; but there is nothing in it to excuse due diligence. When Woods assigned to Atherton, the record does not show ; he admits he did so, but the assignment does not appear; the portion of the bill referring to it says: “That previous to the execution of the said deed, the said Bowman had assigned and transferred the same for valuable consideration, to said Woods, who after the execution of the said deed, assigned and transferred the said debt to said Milton C. Atherton, for val-able consideration.” There is no attempt in the bill to show any sort of diligence in collecting the said debt from said Hull, the original debtor, not even to sell the land under the trust deed, which should have been done in October 1859, as soon as the first bond became due, and then to have followed up Hull for any unpaid balance ; but the sale was not attempted until March 1861. It may be given as an excuse after that time that Bowman brought a suit to prevent the confirmation of the sale, made in March ; but before that time the bill does not show any diligence whatever, either in Atherton or Woods. It is not alleged that Hull was insolvent prior to the filing of the bill in 1864. There is therefore no equity shown in the bill, to entitle the plaintiff to recover against the administrator of the estate of assignor, Bowman • and the bill was properly dismissed as to the administrator and heirs of said Bowman j but as it appears from the answer of the trustee, Ewin, and SylM,us 3. [182] the said administrator, that there is no new reason why Atherton should' not have a deed from the said trustee for said land, and the said trustee is willing to deliver the same on payment of Ijis commissions, the complainant is entitled to have his deed when said commissions are paid; therefore for these reasons, so much of the decree of the 3d of March 1869, as dismisses the complainant’s bill as to all the defendants, except the trustee, Ewin, and gives cost, is affirmed, with costs and $30.00 damages to the appellee, James W. S. Bowman, the administrator of H. V. Bowman, deceased, the party substantially prevailing against the appellant, Milton C. Atherton ; and so much of the said decree as dismissed the said bill as to the defendant, William Ewin, trustee, is reversed, and this cause is remanded to the circuit court of Tucker county, with instructions to have said deed referred to in the answer of said Ewin, trustee, delivered to the plaintiff, Atherton, if it is in the papers of the cause, or executed, and if not, to have said trustee execute and deliver a proper deed for said land, to said plaintiff, Atherton, when he shall pay the said commissions, and in default of said trustee executing said deed within a reasonable time to appoint a commissioner to execute the same. Judges Green and Moore concurred. Cause Remanded.