73 W. Va. 197 | W. Va. | 1913
Lead Opinion
After the Central Banking & Security Company, surety in one of the bonds of Amnon Taylor, administrator of Tasriel
In the cross-assignments of error, the validity of the two subsequent bonds is denied on account of lack of authority in the clerk of the county court of Calhoun county to take them. As is shown by the report of the decision in Taylor v. Taylor, these two bonds were taken by the clerk in the vacation of the court, and he had no authority, under the statute, to take them as substitute bonds, each releasing the preceding one. The contention in that cause wias that they were such bonds and that there was no liability except upon the last one, the one in which the Citizens Trust & Guaranty Company was the surety. In the rejection of this claim and contention, the question of the validity of the two subsequent bonds as additional ones was left open and undecided. As the statute nowhere confers upon the clerk authority to take a new bond
That they were not substitute, release or indemnity bonds as matter of law or by force of the statute, was decided in the case of Taylor v. Taylor. It is said, however, the parties ex
Being valid obligations and yet not substitute bonds, and having been given for the same principal as the one for whom the first bond was given, and to guarantee faithful execution of the same trust, the two subsequent bonds are mere cumulative or additional bonds, and-the sureties-therein aré co-cureties with the surety in the first one. Brandt, Surety-ship & Guar. sec. 707. “Successive bonds given by guardian are cumulative sureties for the faithful performance of the duties of the office, and the liabilities of the sureties are- in proportion to the penalties of the several bonds in which the respective sureties bound themselves.” Jones v. Hayes, 3 Ired. Eq. 502, 44 Am. Dec. 78. “In all these cases the sureties have a common burthen; they are joined by the common end and purpose of their several obligations, as much as if they were joined in one instrument, with this difference only, that the penalties will ascertain the proportion in which they are to contribute, whereas if they had joined in one bond, it must have depended on other circumstances.” Dering v. Winchelsea, 1 Cox’s Ch. Cas. 318.
That the dismissal of the bill in the cause of Taylor v.
In Taylor v. Taylor, there was no decision of any question between the sureties. There was one between the plaintiffs in that suit, the distributees of the Taylor estate on the one hand, and the principal and sureties on the other. The cause of action therein comprehended two things, the right to a proper accounting and distribution of funds by the principal
The limited application of the first proposition, namely, that everything the parties to the first action could have litigated between themselves is deemed to ' have been determined, in other words, is merged in the judgment, is sometimes overlooked by the courts and the principle regarded as if it were general in its application. It is for this reason more than any other, that courts sometimes fall into error in applying the principles of res judicata, and the doctrine is so often invoked under circumstances not justifying its application. The rule or principle by which to test the conclusiveness of former ligtigation between parties seems to have been first deduced and clearly stated by Mr. Justice Fields in Cromwell v. County of Sac, 94 U. S. 351, decided in 1876. Since that time, the rules and principles governing the doctrine have been much better understood than they were before, and there have been fewer misapplications of it. Prior to that time, many courts perceived the difference between a former judgment between the same parties upon the same cause of action as that involved in the subsequent suit, and a judgment between the same parties upon a cause of action different from that involved in the subsequent suit, and correctly applied the principles without defining the standard or test of applicability.
An attempt is made here to show identity of the present cause of action with that involved in Taylor v. Taylor. It is said the principal in the bond is the representative of the sureties, and the latter are bound by his action in all respects, so long as he acts in good faith, wherefore a judgment either
That the demand of a co-surety for contribution is a new and distinct cause of action from that founded on the contract between the creditor and the promisors or obligors in the instrument has been decided and clearly demonstrated by
To make the former judgment in such cases conclusive puts the surety at a fearful disadvantage. As shown by Judge Minshall, he has no control of the action on the bond and is at the mercy of the creditor whose sole object is to get his
Our conclusion harmonizes with other principles. Until he has paid, the surety has no cause of action. How then can he be said to have asserted it in the action on the bond ? He had not then paid and had none to assert. If he can be said to have had an equity, a court of law in which he may have been sued, would not recognize that; and in a court of equity it is an incomplete cause of action, and a man is not bound to sue until his cause of action is complete. Trustees v. Siers, 68 W. Va. 125.
Only two decisions declaring the contrary of the conclusions here stated, have been found, Cross v. Scarboro, 6 Bax. (Tenn.) 134, and Hood v. Morgan, 47 W. Va. 817. In neither of them was there any effort in the opinion to apply the principles of res judicata. In other words, the principles were not stated nor was there any effort to demonstrate their application. The conclusions are certainly not sustained by the application of those principles. Hood v. Morgan erroneously assumes that the right of contribution arises by sub-rogation only, and it is upon that proposition it declares the former judgment in favor of the sureties against the creditor conclusive. The decision in that ease may not be wrong. Possibly it can be sustained upon the doctrine of estoppel. As to whether it can or not, it would be useless to enter upon any inquiry now. It suffices to say it makes an erroneous application of the doctrine of res judicata, and no element-of estoppel appears in this cause.
As the costs paid and expenses incurred in the litigation in the cause of Taylor v. Taylor by the plaintiff in this bill were the result of its effort, not to refuate liability in general to the distributees of the estate of Taylor, but to be relieved from the liability on the bond, as a result of the execution of the subsequent ones, the court did not err in refusing to enforce contribution against the defendants as to costs and expenses. In the main, the defense was purely personal.
Affirmed.
Dissenting Opinion
(dissenting):
I think the decree in Taylor v. Taylor, sustaining the demurrers of the United States Fidelity and Guaranty Company and the Citizens Trust and Guaranty Company, and dismissing the hill as to them, is an adjudication against the Central Banking and Trust Company of any right to contribution. The principal and all the sureties were there sued, and a decree rendered holding the principal and- one surety only liable, and releasing the other two. What is the effect of that final and unreversed decree? In the absence of fraud, or collusion between the obligee and the discharged sureties, is it not conclusive- upon the co-sureties as well as upon the creditor? If not, why so? There is a privity of relation and obligation between principal and surety; and it is out of regard,to that relation that a judgment against a principal, bound for a collateral undertaking, is conclusive of the amount for which his surety is liable. Crim v. England, 46 W. Va. 480; State v. Nutter, 44 W. Va. 385; Turner v. Stewart, 51 W. Va. 493. No one, I imagine, will question that a judgment recovered against a principal and all the sureties, in a subsequent suit for contribution by the surety, who paid it, would be conclusive of liability to the creditor. They would be estopped to deny liability. Why? Because the right of contribution rests on liability to the obligee, and that liability was an issue adjudicated by the judgment. Why then is not a judgment of discharge as to some of the sureties, equally conclusive? It will not do to say that a judgment against them has one effect, and a judgment for some of them and against others, on the same issue, has another effect. The judgment must have the same force in either ease. The right of contribution is not a primary right; it depends on a common liability to a third person. The sureties must occupy toward the creditor exactly the same attitude. The right to have contribution springs out of a common burden resting on two or more persons occupying the same position in relation to the creditor., 27 A. & E. E. L. 483. Therefore, if a surety
“Two co-sureties were sued jointly, and judgment was rendered in favor of them both. The creditor appealed to the supreme court from the judgment in favor of one of them, and such judgment was as to such surety reversed, and judgment in the supreme court was rendered against such surety for a large amount, which he paid. Held, he could not recover contribution from the other surety. The judgment which as to him remained in force in the court below established the fact that he was not liable to the creditor, and consequently not liable for contribution.” 1 Brandt on Suretyship & Guaranty, sec. 267. The author cites Ledoux v. Derrive, 10 La. Ann. 7, which is not in the library. But I have no doubt he correctly states the principle decided.
Mr. Black, a very eminent law writer, in his work on Judgments, see. 591, says: “'Where, in a suit against one of two sureties, judgment is fairly obtained against him, and no collusion existed between him and the party recovering the judgment or the principal obligor of the bond, if notice of the pendency of such suit has been given his co-surety, the latter stands virtually in privity with him against whom the judgment has been obtained. The co-surety in such case is bound to avail himself of any defense which he may have, and he will not be permitted afterwards, in a suit for contribution brought against him by his co-surety who has paid and satisfied the judgment, to set up any defense which he ought to have pleaded in the original suit upon the bond, by becoming a party for that purpose. It was his duty to join in the defense to the action. Having failed to do so, though he had full notice of the pendency of the action, he waives all defenses he might have had, and in the suit for contribution the matter is res judicata. ’ ’ The author here states a proposition even stronger than the one I am contending for, but he is supported by Love v. Gibson, 2 Fla. 598, and other authorities.