Hoge v. Fidelity Loan & Trust Co.

Harrison, J., delivered the opinion of the court. The bills, original and amended, in this case seek to enjoin a final judgment at law in favor of the appellee company against the appellant, Lizzie G. Hoge. The material allegation, and that relied on as the ground for the injunction, is that the debt, which was reduced to judgment, was secured by deed of trust upon certain real estate ample for its payment, and that appellant was induced by the appellee to release the lien for its security by representations that the debt had been arranged, and that appellant would be no longer personally responsible therefor — in brief, that appellant was induced to release the security by fraud and deceit, which operated as an equitable estoppel in pais; that appellant was advised and believed that whatever might be her rights in a court of law, her remedy in a court of equity was clear, and would be more adequate, and hence that she had allowed the judgment to go by default, and set up her defense by bill in equity. These bills were demurred to, which is practically a demurrer to the jurisdiction of a court of equity to interfere by injunction with the judgment at law. The demurrer was sustained, and the bills dismissed, and from that decree the case is before this court. That the defense of equitable estoppel is as available at common law as in equity is well settled. Dickenson v. Colgrove, 100 U. S. 578; 25 L. Ed. 618; Kirk v. Hamilton, 102 U. S. 68; 26 L. Ed. 79; Barnard v. German-American Seminary, 49 Mich. 444, 13 N. W. 811; Dickerson v. Board of Commissioners, 6 Ind. 128, 63 Am. Dec. 373. — 12 — In Kirk v. Hamilton, supra, Mr. Justice Harlan, in speaking of equitable estoppels, says: “The remedy in sunk, cases lay originally in an application to chancery, and no redress could be had in a merely legal tribunal, except under rare and exceptional circumstances. But the common law has been enlarged and enriched under the principles and maxims of equity which are constantly applied at this day in this country, and in England. The doctrine of equitable estoppel is, as its name indicates, derived chiefly, if not wholly, from courts of equity. . . . There would seem to be no reason why its application should be restricted in courts of law. . . . Whatever may be the wisdom of the change through which the law has encroached on the jurisdiction of chancery, it has now gone too far to be confined within any limits short of the whole field of jurisprudence. This view is maintained by the main current of decisions.” In the case of Barnard v. German-American Seminary, supra, injunctions were sought to restrain the prosecution of certain actions at law. The ground upon which the injunctions were asked was that the defense of equitable estoppel might be made, which, it was contended, was not available at law. Judge Oooley, delivering the opinion of the court, says: “Estoppels in pais are called equitable estoppels, not because their recognition is peculiar to equitable tribunals, but because they arise upon facts which render their application, in the protection of rights, equitable and just. Courts of equity recognize them in cases of equitable cognizance, but the courts of common law just as readily and freely. Sebright v. Moore, 33 Mich. 92; Maxwell v. Bay City Bridge Co., 41 Mich. 453, 2 N. W. 639; Kid v. Mitchel, 1 Nott & McC. 334, 9 Am. Dec. 702; Dezell v. Odell, 3 Hill, 215, 38 Am. Dec. 628; Horn v. Cole, 75 Ill. 516; and it is never necessary to go into equity for the mere purpose of obtaining the benefit of an equitable — 13 — estoppel when the case is not otherwise of equitable jurisdiction. There was consequently no necessity whatever for these suits. They performed no office except to take the questions from the court of law, which was already fully possessed of them and was entirely competent to do complete justice.” This case is directly in point, except that the case at bar is stronger for the application of the doctrine announced, in that the injunction is -here soug’ht against a final judgment at law, whereas in the case cited the actions at law sought to be restrained were pending and undetermined. In the light of these authorities we conclude that the defense of equitable estoppel was as available to the appellant in the action at law as in a court of equity, and the only remaining-question is whether or not it was her duty to make the defense in the forum first acquiring jurisdiction of the subject. The general doctrine undoubtedly is that when courts of law and courts of equity have concurrent jurisdiction over the same subject matter, and each can give as full and adequate relief as the other, the court which has first taken jurisdiction will hold it until the purpose- of the litigation has been accomplished. Courts of equity will not for slight cause interfere with or set aside judgments at law. To entitle a party to such relief he must be free from all fault or negligence on his part. The rule of the best considered and most recent cases upon this subject is that the party must have failed in obtaining redress in the suit at law by the fraud of the opposite party, or inevitable accident or mistake, without any default of the party or his counsel. See note to Oliver v. Pray, 19 Am. Dec. 603, and the numerous authorities there cited. The consideration alleged that appellant was advised and believed that she could stand by and let the judgment go by default, and then open again the litigation in a court of equity, does not avail. Parties are presumed to know. They have had — 14 — their day in court. That a party has mistaken his rights and so failed to make his defense at law does not entitle him to relief in chancery. Dickerson v. Board of Commissioners, supra; Meem v. Rucker, 10 Gratt. 506. . In the case of Haden v. Garden, 7 Leigh, 157, it is held that though courts of equity and courts of law have a concurrent jurisdiction in cases of fraud, yet if a suit be first brought in a court of law, in which the question of fraud may be tried and determined, the party injured by the fraud must make his defense there, and if he neglect to do so the court of equity has no jurisdiction to relieve him. In that case Judge Oarr says: “Ho excuse has been stated for the failure to make the defense at law. If it be said that the courts of law and equity have concurrent jurisdiction in such matters of fraud, that is true; but it is equally true that in all such cases the court which first gets possession of the case will make an end of it; and any defense which a party, according to the rules of that tribunal, can make must be made there. This is a settled rule.” In the same case Judge Tucker says: “As little tenacious as I may seem to be on the subject of jurisdiction, yet I am decidedly of opinion that when a party has a full, perfect and unembarrassed defense at law, of which he fails to avail himself, without even the pretense of an apology, he cannot be relieved in equity. . . . Hor does the consideration that equity has concurrent jurisdiction make any difference. The jurisdiction of equity to relieve against fraud is no excuse for the omission to make the defense when the party is already before a court having full cognizance of it, in a case depending before that court. Garden was sued at law, and might there have had redress. Shall he, without even a pretext, multiply litigation by instituting this second suit in equity? Shall he be permitted to shrink from the jury trial which must have decided the case at law, and bring his adversary into equity, — 15 — where he may escape, and actually has escaped, that ordeal? I think not, and am, therefore, of opinion that he was not entitled to any relief.” This case is conclusive of the question under consideration, and the rule there announced is sustained by the discussion of the same subject in many other Virginia cases, among which may be cited Warwick v. Norvell, 1 Rob. 326; Perkins v. Clements, 1 P. & H. 141; Allen, Walton & Co. v. Hamilton, 9 Gratt. 255; Hudson v. Kline, 9 Gratt. 379; Meem v. Rucker, supra; Haseltine v. Brickey, 16 Gratt. 116; Green & Suttle v. Massie, 21 Gratt. 356; Holland v. Trotter, 22 Gratt. 136; Goolsby v. St. John, 25 Gratt. 152; Wallace v. Richmond, Assignee, 26 Gratt. 67; Penn v. Engles, 82 Va. 65; Barnett v. Barnett, 83 Va. 504, 2 S. E. 733; Virginia M. Co. v. Wilkinson, 92 Va. 98, 22 S. E. 839; Hancock v. Whitehall Tobacco Co., 100 Va. 443, 41 S. E. 860. In the light of these authorities and many others that might be cited, it may be stated to be an established rule that though, as in the case at bar, courts of equity and courts of law have a concurrent jurisdiction, yet, if a suit be first brought in a court of law, in which the defendant can make his defense as fully and adequately as he could in a court of equity, he must make his defense there, and if he neglect to do so a court of equity has no jurisdiction to relieve him, except in those cases where the jurisdiction of the law court is conferred by statute which provides otherwise, as in cases of equitable set off under section 3299 of the Code; or in cases of usury, as in White v. Washington, 5 Gratt. 645; Woodson v. Barnett, 2 H. & M. 80, 3 Am. Dec. 612, and Skipwith v. Skipwith, 3 Rand. 215. In the nature of things, this should be the rule. Rot only should there be an end of litigation, but, were the rule otherwise, it would make the court of equity an appellate court, reviewing the final judgments of a court of equal dignity and concurrent jurisdiction; or put it in the — 16 — power of that court to usurp the whole field of litigation and destroy entirely the concurrent jurisdiction of the law courts- The learned counsel for the appellant has invoked with great earnestness the doctrine that equity once having jurisdiction of a subject matter, because there was no remedy at law, or because the remedy at law was inadequate, does not lose such, jurisdiction merely from the fact that courts of law afterwards, give the same or similar relief, and that this original jurisdiction to grant relief by courts of equity is neither impaired by the assumption of the same powers by courts of law, nor by the extension to those courts of such powers by the Legislature,, unless the statute conferring such jurisdiction uses restrictive or prohibitory words. The doctrine contended for is as well established as that we have been discussing. Pom. Eq. Juris., (1st Ed.), Vol. 1, sec.. 182; Barton’s Ch. Prac., Vol. 1, sec. 16, p. 60; Steinman v. Vicars, 99 Va. 595, 39 S. E. 227; Kelly v. Lehigh M. & M. Co., 98 Va. 405, 36 S. E. 511, 81 Am. St. 763; Hull v. Watts,. 95 Va. 10, 27 S. E. 829; Filler v. Tyler, 91 Va. 458, 22 S. E. 235; but it has no application to a case where the jurisdiction of the court of law and the court of equity is concurrent, and where the litigant has been first impleaded in a court of law, and the machinery of that court is as adequate to afford the-defendant a full and unembarrassed defense as a court of equity would be. In such a case, as already seen, he must, make his defense in the court of law, and his failure to do so does not entitle him to relief in a court of equity. The doctrine contended for by appellant, and under which she insists that equity has jurisdiction to interfere with the judgment at law, is applied in those cases where the court of equity has first obtained jurisdiction, and the defendant seeks to oust its control of the case upon the ground that the remedy' of the plaintiff is complete and adequate at law. In such a-. — 17 — case the jurisdiction of the court of equity cannot he disturbed, if the subject matter of the litigation formed a part of its original jurisdiction. The cases cited in support of each doctrine illustrate the circumstances under which each is invoked and applied, and show that there is no conflict between the two doctrines. There was no error in sustaining the demurrer and dismissing the bills, and the decree appealed from must be affirmed. Affirmed.