Gillespie v. Creswell

Buchanan, C. J., delivered the opinion of this court. The original bill was filed by Samuel C. Hall and Robert Evans on the 16th of February, 1819, in behalf of themselves — 47 — and other creditors who might become parties, to subject the real estate of which John Creswell the elder died seized to sale, for the payment of their respective claims against his estate, the personal property being insufficient. It has been urged in argument by the counsel for the appellees, that at the time of filing the bill the claims of the appellants were barred by the act of limitations, which is pleaded and set up in the answers; and on that ground the bill was dismissed by the Chancellor. It has therefore, on this appeal, become necessary to examine that, among other questions presented by the record. Evans had been surety for Creswell in a bond executed by him as the sheriff of Cecil county, dated the 9th of October, 1810. On that bond suits were brought against him and Reuben Reynolds, a co-security, and judgments rendered, which were discharged by them, one on the 8th August, 1815, by Evans, and the other by Reynolds and Evans on the 5th April, 1816. The amount of the payments by Evans of his proportion, being one-half of the whole amount paid, constitutes his claim, which, as the bill was filed on the 16th of February, 1819, more than three years after the payments, except what was paid on the 5th of April, 1816, would have been barred by the act of limitations. But it appears from the proof in the cause, that John Creswell the younger, the son and devisee of Creswell, the principal in the bond, acknowledged the existence of the claim of Evans after he had attained the age of twenty-one, saying it was one that he would have to pay, and intended to pay; which acknowledgment took the case out of the statute of limitations, Philip Thomas, another of the creditors, was, together with Creswell the elder, a surety for Baxter in a bond given by him to the President and Directors of the Elkton Bank, on the 20th of April, 1811, as the cashier of that institution; and took from Creswell, on the 15th of February, 1813, a bond of indemnity. The President and Directors of the Elkton Bank instituted a suit against him, and obtained a judgment on the 11th of September, 1816, upon which a fi. fa. was sued out, — 48 — and his property sold to satisfy the judgment, on the 1st of April, 1820. On the 10th of March, 1825, he exhibited his claim, and filed a petition to be let in as a creditor under the bill then depending; and as his claim commenced on the 1st of April, 1820, and was only exhibited on the 10th of March, 1825, more than three years afterwards, it would, by the established rule and practice in the Chancery Court of this State, adopted by this court, “that the statute of limitations runs against a claim or debt up to the time it is exhibited,” have been barred, but for the bond of indemnity executed to him by Creswell, which saves it. By that act it is provided, that no bond, &c., shall be good and pleadable, &c., after the principal debtor and creditor have been both dead twelve years, or the debt or thing in action above twelve years standing. Here the debt or claim, the thing in action, had been standing only from the 1st of April, 1820, when Thomas, as surety for Baxter, was made to pay the money, until the 10th of March, 1825, when the claim was exhibited — less than five years. Before he had been made to pay the money he had no right of action, no claim for which he could have sued upon the bond of indemnity. It was by his having been made to pay as surety for Baxter, that he was damnified. It was then that the “debt or thing in action” first arose, against which the act of limitations only began to run from that time, and from that time he had twelve years allowed him for bringing suit on the bond of indemnity. It appears that on the 10th of March, 1814, two notes, negotiable at the Elkton Bank and payable sixty days after date, were drawn by John Reynolds and endorsed by Samuel C. Hall and John Creswell. Those notes it is in proof were discounted for the benefit and accommodation of Creswell, the second endorser, who received the proceeds and paid -the discounts, and that Hall, the first endorser, was only his security. On these notes suits were brought in the court of Cecil county, by the President and Directors of the Elkton Bank, on the 8th of August, 1815, against Hall, and judgments rendered on the 2nd of September, 1816. Judgments were also rendered in — 49 — suits upon the same notes against Joseph Cowden, executor of Creswell, one at the September term, 1816, and the other at the September term, 1818. Two writs oí fi.fa. were sued out on the judgments against Samuel C. Hall, who was thus coerced to discharge the amounts then due, on the 20th or 21st of August 1818, with the aid, as it appears to us, of Washington Hall. The judgments were on the 20th of August, 1818, assigned by the President and Directors of the Elkton Bank, to Samuel C. Hall, in consideration, as stated in the assignments, of the payment being made by him, and afterwards by him to Washington Hall, in consideration of the same amount with a covenant in the assignment, that as a further security, a mortgage before made to Washington Hall, should stand charged with that amount, in addition to the sum recited in the mortgage. By which it sufficiently appears that the assignment to Washington Hall was made to him, not as a purchaser of the judgments, but as collateral security for the re-payment of the amount advanced or lent by him, for the purpose of satisfying the judgments, whereby Samuel C. Hall became his debtor to that amount, otherwise the covenant for securing the repayment of it, by tacking it to a pre-existing mortgage, would not have been made. For if, as has been urged by counsel, he was a mere purchaser of the judgments for the consideration stated in the assignment, which is just the amount paid in satisfaction of the judgments, he could not by such purchase of Samuel C. Hall, have become his creditor for that amount, entitled to security for the re-payment of it. The payment by Samuel C. Hall, with the aid of Washington Hall, on the 20th of August, 1818, was made, it is true, more than three years after the notes became due and payable. But in any view of the subject, the running of the act of limitations was arrested by suits against him on the 8th of August, 1815, and the judgments on the 2nd of September, 1816; and the payment on the 20th of August, 1818, made under the coercion of the writs of fi.fa. issued upon the judgments, gave him a right to be reimbursed out of the real estate, the personal estate being insufficient, to which the act of limitations opposed no — 50 — bar; the original bill being filed on the 16th of February, 1819, less than one year after the payment from which his claim as surety of Creswell and right to sue, arose. But it has been contended, that at the time of instituting the proceedings in Chancery, neither he nor Washington Hall, who came in as a party under the amended bill, had any claim or right to the relief prayed, on the supposed ground, that as by an entry in one of the books of the bank, the payment appears to have been made not by him, but by Washington Hall, which could vest in Samuel C. Hall no right or claim; and that the payment by Washington Hall, as a mere volunteer, and therefore without authority, could clothe hipa with no right to subject the real estate of which Creswell died seized, to sale, for the amount of the unauthorised payment so made by him. It is true, that from the evidence in the cause, such an entry does appear to have been made. But it is equally true, that in the assignment by the President and Directors of the Ellcton Bank to Samuel C. Hall, the payment is stated to have been made by him; and from the whole of the proof, and character of the transaction as disclosed in the record, it is sufficiently clear, that whether the payment was made in part by the hands of Samuel C. or Washington Hall, (which is not material,) it was made for and on account of Samuel C. Hall, with money lent or advanced by Washington Hall. Hence the recital in the assignment of the judgments by the President and Directors of the Ellcton Bank, where the whole of the transaction was known, and understood, that the money was paid by Samuel C. Hall, and known too, the covenant in the assignment by Samuel C. to Washington, that a pre-existing mortgage should, as a further security, stand charged with the amount paid. If, indeed, Washington Hall did, as a mere volunteer, without any authority and on his own account, discharge the judg.^ ments, that would have given him no claim, which could be enforced against the real estate of Creswell. But that does not appear to have been the case. It has also been urged, that supposing the payment have been made by Samuel C. Hall, — 51 — and that he thereby acquired a right to proceed in Chancery against the real estate of Creswell, he by his assignment of the judgments to Washington Hall, divested himself of that right and transferred it to Washington Hall, who could alone enforce it; and that he having only come in as a party claimant under the amended and supplemental bill, which was filed on the 6th of May, 1829, his right was barred by the act of limitations. But not so as it seems to us. Samuel C. Hall having paid the money, the legal right was in him, subject to the equitable interest of Washington Hall, in respect of which only, he was brought in by the amended and supplemental bill. The claim was in before, and in time to protect it against the running of the act of limitations, having been exhibited with the original bill, the object of which was to enforce the payment of it. The claims exhibited by other creditors, and not already commented upon, are clearly barred by the act of limitations, not being filed in time. The claim of the defendant for the amount of rent reserved in a lease from Creswell the elder to Samuel C. Hall and others, pleaded by way of set-off against his claim, cannot we think be allowed. The right of set-off is reciprocal, and mutual claims, and such as are in the same right, can alone be set off Here Creswell the elder devised the whole of his estate, after certain other dispositions in his will, to his wife Elizabeth, during the minority of his son John. The whole of the rent claimed accrued (if at all,) during the minority of John Creswell the younger; the right to which was in Elizabeth Creswell, and if not paid, is in her representatives, she being dead. John Creswell, junior, (the devisee of his lather John Creswell the elder,) who is also dead, devised the whole of the real and personal estate derived from his father, to his wife Rebecca E. Creswell, one of the defendants, who claims to set off the rents so accruing to Elizabeth Creswell. If Elizabeth Creswell, before her death, or her executor or administrator since, had brought suits against Hall to recover the rents to which she was thus entitled, it is very clear that he could not have set off against that demand, his claim grow — 52 — irig out of his responsibility for John Creswell the elder, for which she was in no way answerable, and for which she could not have sustained a suit against her or her representatives, nor would she in this proceeding have been permitted, had she lived, to avail herself of her award for rent accruing in a different right, and upon covenant by way of set-off against Hall’s claim, and much less can Rebecca E. Creswell, who has no right to, or interest in the rent claimed to be due, for which Hall is responsible (if at all,) to the representatives of Elizabeth Creswell. The amount, however, due on the judgment obtained by Creswell the elder, against him as security of Lightner, should be deducted from his claim. And it appearing to us that the judgments by the President and Directors of the Elkton Bank against Samuel C. Hall, were discharged in the notes of that Bank at their par value, when they were at a depreciation of twenty cents, at least, in the dollar; and that the amount given for them is all that can b.e properly claimed on account of the payment to the Bank, that being all that was paid, and as a reimbursement only of the amount that Hall was compelled to pay as the security for Creswell, is all that can be rightfully insisted upon, we are of opinion that twenty cents in the dollar should be deducted from the nominal amount paid to the Bank, that being the amount of the depreciation at the time on the paper in which it was paid, according to the evidence in the record most to be relied upon. In this view of the case the claims of four of the creditors being established, and not barred by the act of limitations, the bill should not have been dismissed. DECREE REVERSED AND CAUSE REMANDED.