Fox v. Merfeld

Roberts, J., delivered the opinion of the Court. This appeal is taken from an order of the Court of Common Pleas of Baltimore City, passed in the case of Charles Coblens, an insolvent. The facts are substantially as follows: On the 22nd day of December, 1893, Charles Coblens filed his petition in the Court of Common Pleas to obtain the benefit of the insolvent laws of the State 01 Maryland. On the same day Louis Merfeld was appointed preliminary trustee, to whom the petitioner conveyed all of his property., in trust, for the benefit of his creditors. At the time of filing his said petition, the petitioner was occupying, as tenant of Moses Fox, certain premises on Wilson street, in said city, and was then over four months in arrear for rent due and unpaid. The petitioner, at the time of his assignment, [81] was conducting on said premises a livery stable, and engaged in the business of boarding horses, and had in his possession a number of horses and carriages belonging to his customers, as well as certain property belonging to himself. The preliminary trustee, on the day of his appointment, filed his petition in said Court, calling the Court’s attention to the facts just stated, and to the further fact that Coblens was in arrear for unpaid rent, and requested an order of Court authorizing him to return to the respective owners their several horses and carriages and to remove from the demised premises all property belonging to the insolvent; which order the Court passed, authorizing the trustee to deliver the horses and carriages to the owners thereof, and directing the removal of the property of the insolvent estate and hold the same subject to the further order of the Court. On the day .following, Moses Fox, the owner of the premises on Wilson street, issued a distraint under which he seized all the property remaining on the premises at the time of levying the distress, which consisted of a horse, buggy and dayton. Fox, on the same day, issued another distress under Art. 53, sec. 18 of Code, for the purpose of reaching the property which had been removed from said premises, and seized certain other property of the insolvent. Subsequently it was agreed between the parties to this controversy that the trustee in insolvency should sell all the property of the insolvent, subject to any lien which the Court might find Fox had acquired by virtue of his two distresses. The property was accordingly sold by the trustee, and the question was then argued and determined by the Court below that Fox had acquired no lien by the levy of the distresses, and that he only stood in the position of a general creditor. The question now to be decided is one free of serious difficulty. In no material respect does it differ from the case of Buckey v. Snouffer, 10 Md. 149, which settled the law in this State, and has only recently been approved by this Court in Gaither v. Stockbridge, 67 Md. 228. It is the declared doctrine in this State that when a debtor applies [82] for the benefit of our insolvent laws, his property passes in custodia le gis for the benefit of his creditors, and it being well settled that goods in custodia legis are not liable to be distrained upon, it follows necessarily that the distresses, or either of them, cannot be sustained, as the property, at the time when the warrants were issued, had passed beyond the reach of any legal right to distrain. It is also clearly settled law in this state, that rent is not per se a lien on goods found on the demised premises, unless the same have been seized under a legal distress. In this case the rent had been due since the 15th of December, 1893, but Fox slept upon his rights and allowed Coblens to apply for the benefit of the insolvent law before he issued his first distress. He was then without a remedy, as the property of the insolvent had passed into the custody of the law, subject only to such liens or incumbrances as had been acquired before Coblens’ application. Of course the second distress, under the provisions of Art. 52, sec. 18 of Code, occupies no better position than the first, and both are without authority of law to sustain them. It was contended at the hearing in this Court, that Buckey v. Snouffer, supra, was decided when the Act of 1805, ch. no, sec. 7, was in force, and that the then terms of the Act were wholly different to the provisions contained in the Act of 1854, ch. 193, which is now codified as sec. 11 of Art. 47 of Code, and reads as follows : “ The estates of the insolvent shall be distributed under the order of the Court according to the principles of Equity, and no creditor shall acquire a lien by fieri facias or attachment, unless the same be levied before the filing of his petition.” It is insisted that this section provides another and entirely different method for the distribution of the estates of insolvents. We have not, however, been referred to any authority sustaining this view, nor are we aware that distribution of estates in the insolvent Courts has at any time, either in England or in this country, been made, save " according to the principles of equity.” [83] (Decided March 26th, 1895.) A quarter of a century before the decision of Buckey v. Snouffer, it was announced by this Court, after a most careful examination of the English and American cases, that the proper rule for the distribution of the estates of insolvents was ‘‘according to the principles of equity.” McCullough v. Dashiell’s, Admr., 1 Harris and Gill, 96. We find no error in the order of the Court below, and therefore affirm it. Order affirmed with costs.