| U.S. Circuit Court for the District of Eastern Michigan | Sep 18, 1883
This is in substance a bill to charge certain real estate in the hands of heirs with the mortgage debt of their ancestor. While it would seem that an action at common law will lie against an heir for broach of an express covenant of the ancestor, contained in a sealed instrument, provided the ancestor expressly bound himself “and his heirs” by the obligation, and provided the heir has legal assets by descent from the obligor, there can be no doubt of the jurisdiction of a court of chancery to entertain a bill on behalf of a creditor and all others who may choose to make themselves parties, to charge the real estate in the hands of the heirs with payment of the ancestor’s debts. Story, Eq. Pl. 99-102; Adams, Eq. 257; Skey v. Bennett, 2 Younge & C. 405; Stratford v. Rilson, 10 Beav. 25; Ponsford v. Hartley, 2 Johns. & H. 736; Riddle v. Mandeville, 5 Cranch, 822; Payson v. Hadduck, 8 Biss. 293" court="N.D. Ill." date_filed="1878-10-15" href="https://app.midpage.ai/document/payson-v-hadduck-8635620?utm_source=webapp" opinion_id="8635620">8 Biss. 293.
The chief difficulty in this case arises from the fact that proceedings to settle the estate in the probate court were taken, commissioners to receive proof of claims appointed, a time limited within which creditors should present their claims, the estate closed, and the administrator discharged before the filing of this bill. Complainant did
It is conceded that, under the federal authorities, complainant was not bound to appear before the probate court, but was at liberty to take the proper proceedings for the collection of her debt here. The jurisdiction of the federal court cannot be ousted or impaired by any provision of a state law requiring creditors to appear before a state .court and present their claims. Suydam v. Broadnax, 14 Pet. 67" court="SCOTUS" date_filed="1840-02-26" href="https://app.midpage.ai/document/suydam-v-broadnax-86125?utm_source=webapp" opinion_id="86125">14 Pet. 67; Hyde v. Stone, 20 How. 170" court="SCOTUS" date_filed="1858-02-15" href="https://app.midpage.ai/document/hyde-v-stone-87140?utm_source=webapp" opinion_id="87140">20 How. 170; Union Bank of Tennessee v. Jolly's Adm'rs, 18 How. 503" court="SCOTUS" date_filed="1856-05-12" href="https://app.midpage.ai/document/the-union-bank-of-tennessee-v-jollys-admrs-87038?utm_source=webapp" opinion_id="87038">18 How. 503; Payne v. Hook, 7 Wall. 429.
It is claimed, however, that complainant has been guilty of laches in not proving her claim before the probate court, or at least in not instituting proceedings here within the time limited by statute, and before the estate was settled and the administrator discharged. We are referred to the ease of Board of Public Works v. Columbia College, 17 Wall. 521" court="SCOTUS" date_filed="1873-11-24" href="https://app.midpage.ai/document/board-of-public-works-v-columbia-college-88765?utm_source=webapp" opinion_id="88765">17 Wall. 521, in support of the proposition that a court of equity will not exercise its jurisdiction to reach the property of a debtor applicable to the payment of his debts, unless the debt be clear and undisputed, and there exist some special circumstances requiring the interposition of the court to obtain- possession of and apply the property. In this case, the debtor had died in 1861, leaving a will which was insufficient to pass real property, but sufficient to pass personal estate. His estate was administered in the orphans’ court, but complainant’s demand was never presented to it for allowance. In 1867 its bill was filed against the executor, heirs at law, and legatees, to reach the real property of the deceased which did not pass under the will, but which vested in his heirs. The object of the bill was to charge the executor for the assets which came into his hands, which he had distributed to the legatees under a decree of the supreme court of the district, on the ground that he was informed of the debt of the complainant, and failed to bring it to the notice of the court, directing a distribution, and to compel the legatees to refund the amounts received by them. In their answer defendants claimed that the distribution under the decree of the court afforded a complete protection to the executor and legatees. Upon the argument, the only question really controverted was the liability of the legatees to refund the amounts received by them to be applied on the demand of the complainant. The court held that to sustain a bill of this description the debt should be clear and undisputed, and that some satisfactory excuse should be given for the failure of the creditor to present his claim in the mode prescribed bylaw to the representatives of the estate before distribution. I think this case disposes of defendant’s claim that this court has no jurisdiction to entertain a bill by reason of a failure of complainant to present her claim to the commissioners for allowance, or to prosecute this suit before the time allowed by law for the presentation of such claims had expired.
We think, too, that this ruling may be justified upon the broader ground that courts of equity are bound by statutes of limitation in general only by analogy, and may relieve against them in cases of manifest injustice. Thus, in Story, Eq. Jur. § 1521, it is said:
“ Courts of equity not only act in obedience and analogy to the statutes of limitation in proper cases, but they also interfere in many cases to prevent the bar of the statutes, where it would be inequitable or unjust. Thus, for example, if a party has perpetrated a fraud, which lias not been discovered until the statutable bar may apply to it by law, courts of equity will interpose, and remove the bar out of the way of the other injured party. A fortiori, they will not allow such a bar to prevail by mere analogy, to suits in equity, where it would be in furtherance of a manifest injustice.”
Instances of the application of this doctrine are not unknown even in this state. Thus, in Michigan Ins. Co. v. Brown, 11 Mich. 265" court="Mich." date_filed="1863-05-12" href="https://app.midpage.ai/document/michigan-insurance-v-brown-6632947?utm_source=webapp" opinion_id="6632947">11 Mich. 265, it was held that a remedy by foreclosure of a mortgage in equity was not lost by an action at law upon the debt becoming barred by
“The statute of limitations is confined to"actions or suits to enforce payment of the contract as a personal demand. Equity follows the analogies of the law in all cases where an analogous relief is sought upon a similar claim. But where the relief sought is in its nature one of equitable, and not of legal cognizance,, and the remedy is of a.purely equitable nature, equity follows its-own rules. * * * In regard to mortgages, equity, although raising presumptions from lapse of time, has not made these presumptions conclusive. * * * The rule fixing such presumptions at twenty years was adopted, undoubtedly, in accordance with the limitations of real actions in the common-law courts, but it differs from that in not being an absolute bar to the remedy.” See, also, Powell v. Smith, 30 Mich. 451" court="Mich." date_filed="1874-10-27" href="https://app.midpage.ai/document/powell-v-smith-7927883?utm_source=webapp" opinion_id="7927883">30 Mich. 451.
The case of Johnston v. Roe, 1 McCrary's Cir. Ct. Rpts, 162" court="None" date_filed="1880-04-09" href="https://app.midpage.ai/document/johnston-v-roe-8309101?utm_source=webapp" opinion_id="8309101">1 McCrary, 162, [S. C. 1 Fed. Rep. 692] presents features very similar to those of'the case under consideration. This was a bill to subject certain property in the hands of the heirs of a debtor to the payment of the plaintiff’s demand. It was contended by the defense that the statute of Missouri, concerning the administration of estates of deceased persons, required the presentation of all claims against the estate within two years from the time of the publication of a notice of the administration to creditors, and declared that all demands not thus exhibited should be forever barred. It was held that the federal court, sitting in equity, was not bound by this statute, inasmuch as the court, in the exercise of the chancery jurisdiction conferred by the constitution and laws of the United States, was not governed by the state practice. It was averred in the bill that certain entries, showing the payment of the notes in suit had been fraudulently made, and that in fact the notes had been paid. The court held that the statute in question was no bar to the prosecution of the demand. So, in the recent case of Tice v. School-dist. No. 18, 16 Chi. Leg. News, 1, [S. C. 14 Fed. Rep. 886,] it was held that the federal court,, sitting in Nebraska as a court of equity, was not bound by a state law requiring all petitions for new trials to-be filed in one year from the date of the judgment.
As no question is made regarding the validity of complainant’s debt in this case, it only remains to consider whether she has been guilty of laches in not filing this bill before the estate was settled. It appears from the bill that the mortgagor, Desnoyei, died in March, 1880; that in June of the same year an administrator was appointed and commissioners designated to receive proof of debts, six months only being allowed to creditors within which to present their claims for examination and allowance. The commissioners reported prematurely in October, 1880, and in April, 1881, the probate court allowed the final account of the administrator, discharged him, and closed the estate. In August, 1880, and January, 1881, the administrator paid two installments of interest upon the mortgage, and the mortgagee was thereby led to believe that the. mortgage would be assumed by
The demurrer must be overruled.