Fisher v. Wineman

Grant, J. {after stating the facts). The contention on the part of the defendants that the judgment of the justice of the peace is conclusive against the plaintiff has no foundation either in law or in justice. An insolvent debtor has no interest to prevent or establish preferences [645] among his creditors. It does not concern him. He has no power to bind them by concessions in suits to which they are not parties. The title to this property had passed from the electrical company to the plaintiff, and he was lawfully in possession thereof. To make such a judgment conclusive upon the plaintiff would be in direct violation of the constitutional provision that “no person shall be deprived of his property without due process of law.” Plaintiff was entitled to his day in court. He had not had it. His property was seized under an execution in a suit to which he was a stranger. If this be the proper construction of this statute, it is absolutely void. Two facts must be established in order to create the preference: (1) That the debt is for labor; and (2) that the debtor is insolvent. The statute makes no provision for bringing in lienors who are so by mortgage, attachment, or otherwise. In somewhat analogous proceedings against partnership associations, the law providing for a levy upon the unpaid stock of the members contains suitable provision for giving the partner his day in court. It was held that the statute provided for due process of law. Rouse, Hazard & Co. v. Wayne Circuit Judge, 104 Mich. 234 (62 N. W. 359, 27 L. R. A. 577, 53 Am. St. Rep. 457). It is significant that, during the 13 years since this act was passed, no attempt has been made, until the one [646] now before us, to proceed in a suit at law under it. Evidently the profession has recognized the difficulty, if not impossibility, of proceeding under it at law. Several cases have been brought under the first and third sections, and all upon the equity side of the court. The title to the act, as well as the language of the first section, leads to the inference that proceedings were contemplated against the estates of debtors, and not against the debtors themselves. Counsel for plaintiff states that he has made diligent search, but is unable to find a law similar to this in any other State, and neither counsel has cited any such law or authorities upon the question. If it be held that the question of insolvency and of preference can be raised in a collateral suit, which plaintiff was forced to begin or abandon his rights, it would result (1) that the determination by the justice of insolvency and of preference is useless, for it would bind nobody; and (2) that the issues of insolvency and preference must be tried again in every such collateral suit. It must result that these questions would be in issue in every such case, and one jury might decide in favor of insolvency, and another, upon the same state of facts, might not. Section 2 of the statute (Act No. 94, 'Pub. Acts 1887) makes no provisions and provides,no methods for determining questions of insolvency and preference between those who alone are interested in those issues. • We are therefore of the opinion that it is inoperative and void. The judgment is reversed, and new trial ordered. The other Justices concurred.