Bergman v. Hutcheson

Chalmers, J., delivered the opinion of the court. The only question of law presented is this: can a grantee of property which is sought to be subjected to a judgment against his grantor controvert the consideration of the debt on which the judgment was based, or is the judgment conclusive of the fact that it was based upon a valid and existing indebtedness? John Bergman conveyed his property to his brother, A. C. Bergman. After the execution of the deed Hutcheson recovered a judgment against John upon a cause of action existing prior to the deed and caused execution to be levied upon the property. A. C. Bergman hied this bill to enjoin a sale upon the ground, among others, that John owed Hutcheson nothing; that the note upon which the judgment was recovered had been fraudulently obtained and was wholly without consideration ; but that John, having no property, was indifferent about defending it, and had instructed his attorney to make no defence. To this portion of the bill the court below sustained a demurrer. The authorities are much divided upon the question whether a judgment under such circumstances is conclusive upon a previous grantee of the property as to the fact of indebtedness evidenced by it, or is only prima facie evidence of that fact. Those courts which make the judgment conclusive say that the Chancery Court cannot relitigate questions of fact already adjudicated in the Circuit Court. Those which hold the judgment to be only prima facie evidence of the existence of a valid debt deny that the grantee can in any manner be conclusively bound as to any matter which may affect his title by a litigation to which he was not a party. All agree that the grantee is not bound by a confessed judgment, and the decided weight of authority favors the idea that he is not bound where there has been no actual contention in the Circuit Court, and no real adjudication there of the question of indebtedness. [876] There is a partial collection of the authorities in Bump on Fr. Conv. (2d ed.) 557, et seq. Without committing ourselves upon the general question, we think that, under the allegations of the bill in this case, complainant was clearly entitled to show that no valid debt existed from his brother and grantor to the holder of the judgment to which it was sought to subject the land. The decree of the chancellor dismissing the bill on the facts was warranted by the evidence. It was not clearly shown that the note upon which Hutcheson’s judgment was based ante-dated the deed from John Bergman to his brother; but this was manifestly a mere oversight, which may be remedied in the'further progress-of the cause. Decree reversed and cause remanded to be proceeded with in accordance with this opinion.