Tuck v. Calvert

Maulsby, J., delivered the opinion of the Court. The appeals in this ease, in one record, present three questions, which will be treated in the following order: First: As to the right of Washington J. Beall, Executor of Wm. Z. Beall, to an allowance, out of the fund to be distributed, of the amount paid by him for purchase money, for which his testator was responsible as security for Thomas F. Bowie, the purchaser. In 1855 Thomas F. Bowie bought of J. A. Osbourn a tract of land in Prince George’s County, called Brookefield, and gave him his two single bills, with Wm. Z. Beall and Fielder Bowie as securities, each in the sum of four thousand seven hundred and seventy-seven dollars and thirty-six cents, for the purchase money; the vendor retaining the legal title to the land. At the April terms of 1860 and 1862, respectively, Osbourn obtained judgments on these single bills against Thomas E. Bowie and Fielder Bowie, surviving obligors of Wm. Z. Beall, who was then dead, and also judgments against Washington J. Beall, Executor of the said Wm. Z. Beall. Writs o £ fieri facias were issued on these judgments and levied on the property of Thomas E. Bowie. In 1865 sundry creditors of Thomas F. Bowie filed a bill alleging that he was possessed of a large amount of property, was greatly in debt, that the said judgments were for said purchase money, that fi. fas. were issued on said judgments against Thomas F. Bowie and .Fielder Bowie, surviving obligors, and levied on sundry property of Thomas F. Bowie, and amongst the rest on Brookefield; that the same was about to be sold to satisfy said judgments, that, in consequence of the involved condition of the estate of the said T. F. Bowie, a sale of his property by the sheriff would be disastrous to the interests of his creditors, and that it would be better for all parties interested therein that the same be sold under a decree of a Court of Equity, and the proceeds distributed amongst the creditors according to their respective rights, liens, priorities and equities; and praying for an injunction to restrain a sale to satisfy said executions, which was — 220 — granted. The allegation of the bill on which the injunction was asked was that “ the interests of the creditors, and especially of the junior judgment creditors, will be sacrificed, owing to the various characters of the said judgment liens, and encumbrances on the same, and the cloud thereby thrown around the title to said property,” if the same be sold under the fieri facias. A decree for a sale was finally had, the property sold by trustees, and the purchase money brought into Court. That for which Brookefield sold was distributed by the auditor in account F, to the payment of these judgments; being part of the proceeds of sale of the property sold by Osbourn to Bowie, to the payment of the purchase money due. The judgments obtained by Osbourn had been entered to various uses, and after the proceedings had depended for several years, the judgment creditor, or his cestui que trusts, tired of waiting; and, as the record discloses, about, or after the time the auditor filed his report, they issued fieri facias, for the same money, on the judgments against the Executor of Wm. Z.. Beall, and compelled him to pay the judgments; those against Bowie and Bowie remaining enjoined at the instance and for the benefit of the other creditors of T. F. Bowie. The auditor’s report was filed 16th January, 1869, and on April 21st, 1869, the Executor filed his petition, alleging that he had been compelled to pay the money. These amounts were by the account F assigned to Jesse A. Osbourn’s use, Ac., Ac., and by, the final order, filed 12th July, 1869, were directed to be paid to Washington J. Beall, Executor of Wm. Z. Beall, the surety on the single bills, he, the Court says, “appearing to have paid the said judgments, and to have received an assignment thereof from the National Rank of Baltimore.” There is in the record no proof that Beall, the Executor, paid the judgments. . The only proof is an order of the plaintiff’s attorney to enter the judgments of Osbourn, use, Ac., against W. Z. Beall’s Executors, and against Thomas F. — 221 — Bowie and Eielder Bowie, survivors of Beall, to the use of Washington J. Beall. Washington J. Beall in his petition states that he has paid “ the entire amount due on the judgments for the purchase money of said land, as executor of W. Z. Beall, who was one of the sureties of the vendee, as is stated in the proceedings in the cause.” It is on this allegation, in the view we take of this case, that the right of the executor to be indemnified out of the proceeds of sale of the land, “ Brookefield,” depends, and not on his right as assignee of the judgments. His right to be indemnified, as executor, is an equity growing out of all the circumstances disclosed by the record. The complainants in the cause, amongst whom are the parties excepting to the allowance to him as executor, and appealing from the order making a partial allowance, set out in their bill that the purchase money is due from Thomas E. Bowie, the purchaser from Osbourn, and that Wm. Z. Beall was security for the payment of said purchase money; that executions have been issued against Bowie and Bowie, survivors, and they seek to restrain these executions, not on the ground that they are not proper in themselves, or that there is any inequity in them, but in order that they, the other creditors, may be benefitted by a sale other than by the sheriff. If the fi. fas. had been executed, the bill discloses that they would have been fully paid from the property of the principal debtor, and the estate of the security, Beall, would have been relieved from all loss; and having induced a Court of Chancery to prevent this on the ground stated, they now seek to throw the executor on the pursuit of his right to the money as assignee of the judgment creditor, or as assignee of the lien of the vendor for the purchase money, and to apply to him all the rules which would apply if he were assignee, by purchase, of the single bills, and were here claiming as assignee of the lien of the vendor. We think that this would be inequitable in this case. The rules established by Courts of Equity to regulate the pursuit — 222 — of vendors’ liens, as such, contemplate and apply to cases of conflicting equities, and are designed to give effect to that equity which is the strongest. In this case all equities combine in favor of the right of the executor of Beall, the surety. As stated, the bill concedes that the purchase money is unpaid, and that it is about to be made out of the property of the purchaser, and sets up no equity against its being done, but simply appeals to the clemency of the Court to sell the property in a different mode, for the benefit of the complainants; and goes on the ground that when the property shall be sold in the mode prayed, the liens and encumbrances on it shall be discharged out of the proceeds, as if the bill had not been interposed. The complainants allege in their bill that they arc creditors of Bowie by judgments which are liens only on his equitable estate, which by the Act of 1810, ch. 160, is liable to these liens only after the purchase money due shall have been first paid." If they could defeat the right of the security to indemnity, the effect would be that they would appropriate to themselves, not only the vendee’s equitable interest in the property, on which only they have, any legal or equitable claim, but the entire estate, of which their debtor never was seized, thus forcing their debtor’s security to contribute, to the amount of the unpaid purchase money, a fund for their use, to which they had, neither in law nor in equity, any pretence of right. The only right they acquired by. their judgments was to the property, after the payment of .the purchase money due. If they could force the surety to pay the purchase, money due, to that extent they would derive a benefit in excess of that to which their judgments gave them any claim, and under the form of enforcing liens against their debtor’s equitable estate, they would obtain, really, not only their debtor’s interest, but in addition, the money which the security had been compelled by a Court of Law to pay. Before the complainants can have the equity claimed by their bill, the distribution of the fund brought into Court by the sale of the property, they must do equity, and the first step is — 223 — to ask only so much as their debtor really owned, and that all purchase money due by him be paid to whomever it may be due. There can be no doubt that if no bill had been filed, and all parties had been left to their legal rights, and Beall, the security, had paid the purchase money to Osbourn, he could have compelled Osbourn to assign to him not only his judgment against the principal debtor, but also his lien for the purchase money. All the parties, and the fund, being in this Court, and all the equities of all the parties being disclosed, it is hard to see how a Court of Equity could refuse to indemnify the security, and appropriate the money, which really belongs to the purchase money, to the benefit of other parties. On the proof appearing in the record, which consists of the order of the plaintiff’s attorney to enter these judgments which had been obtained for the purchase money of “ Brooke-field” to the use of Washington J. Beall, it would seem that he is claiming as assignee, by purchase, of the judgments, and his position might be very different from that shewn by his petition. That avers that he, as executor, paid the amount due for the purchase money, for which his testator was bound as security, and it is just to give him an opportunity to furnish proof of that fact. The cause will be remanded, and on such proof being furnished, we think that he will be entitled to an allowance, out of the fund for which “ Brookefield ” sold, of the whole amount of purchase money which was paid by him as executor of the security in the single bills given for the purchase money. It is immaterial whether he paid the money under the judgments obtained against him as executor, de bonis testatoris or de bonis propriis. - The only question is as to the fact whether he paid the money as executor, and because judgments against him, as executor of W. Z. Beall, the security, compelled him to do so. If he did not, in fact, pay the money as purchaser, in his own right, of the judgments against himself as executor, the entry of the judgments to — 224 — his use places him in a false position, and ought to be struck out. It is in contradiction to the allegation of his petition, and to give him an opportunity to prove that allegation, is what is intended. The case of Ghiselin & Worthington vs. Ferguson, 4 Har. & John., 522, is not identical with this case, but the analogies are strong in many respects, and we think that the decision of that case may be relied on to sustain, generally, the views expressed in this opinion. Secondly: As to the claim of Edward H. Calvert. The facts shown by the record are, that Calvert sold a tract of land, “ Cheltenham,” to Thomas E. Bowie, taking the single bills in question for part of the purchase money, and retained the legal title until the purchase money should be paid. In November, 1865, Calvert obtained judgment on these single bills, and in March, 1866, entered the judgment to the use of Henry Boyle, as security for a debt due by Calvert to Boyle. Afterwards, Calvert paid the debt to Boyle, and the latter ceased to have any interest in the judgment. He had no interest at any time other than as .cestui que use. The entry of the use to Boyle was not struck out, as it ought to have been, when Calvert paid him his debt; but Boyle is not here asking the protection of the Court. The claim stands, purely and simply on Calvert’s lien for unpaid purchase money, and we can perceive no ground on which it can be denied. It will be found that the bill, answers, and all the proceedings in the cause, in express terms, reserve all liens for unpaid purchase money, and seek to apply to the uses of the general creditors of Bowie only the surplus proceeds of sale of the property, after the payment of all purchase money due. This claim was properly allowed. Thirdly: As to State and county taxes allowed. The Court is bound by the distinct language of Article 81, section 71 of the Code of Pub. Gen’l Laws, and cannot, by construction, avoid its provisions. “Whenever a sale of either real or personal property shall be made by any — 225 — ministerial officer, under judicial process or otherwise, all sums due and in arrear for taxes from the party whose property is sold shall be first paid and satisfied.” (Decided 1st July, 1870.) The Act of 1843, ch. 208, sec. 7, which is codified in section 71 above mentioned, was passed upon by this Court in Fulton, et al. vs. Nicholson, et al., 7 Md., 104, which was a case strongly appealing to equitable interposition, if it were possible, and the Court held that all taxes, for personal and real, must be paid out of the mortgaged realty, although personal assets were in the hands of the administrator. The Code, in some of these provisions, is certainly indulgent to delinquent collectors, and the results are sometimes, as in this case, onerous upon the equities of innocent creditors, but this Court has no power to correct the evil, if such it be. The order of the Court below, in respect of the allowance of taxes, must be affirmed. So far as any rights involved in these appeals are concerned, the order appealed from in these cases will be affirmed, and the cause remanded, in order that the fund, reserved for further order by the Court below, in the matter of the claim of Beall’s Ex’r, may be distributed to him on production of the proof before mentioned. The costs will be paid out of the fund. Order affirmed, and cause remanded.