Citizens Fire, Marine & Life Insurance Co. v. Wallis

| Md. | May 30, 1865

Bartol, J.,

delivered the opinion of this Court:

This appeal was taken from the judgment of the Superior Court, rendered upon an agreed statement of facts. On this statement, two objections are presented to the appellant’s right to recover: 1st. The deed of trust- made by the defendants Gfittings and Allnutt. 2nd. The prior attachment issued on the judgment of E. K. Howard, and laid in the hands of the garnishees.

1st. As to the deed of trust. Since the decision of-the cases of Malcolm vs. Hodges, 8 Md. Rep., 427; Rosenberg vs. Moore, 11 Md. Rep., 376; Barnitz vs. Rice, 14 Md. Rep., 24; and Bridges vs. Hindes, 16 Md. Rep., 101, the law may be considered as settled in Maryland, that a deed of trust, like the one before us, is void. To be free from the imputation of fraud under the statute of Elizabeth, such deeds must, on their face, convey all the property of the debtors, as well their individual estate as their partnership effects. This deed of trust professes only to convey the property held by G-ittings and Allnutt, jointly as partners, without including their individual property. It is therefore inoperative and void, and presents no obstacle to the recovery by the .appellant.

2nd. We have next to consider the effect of the attachment issued upon Howard’s judgment. This being prior to the appellant’s attachment, and it being admitted to be for a larger sum than the garnishees have in hand, must defeat the appellant’s attachment, unless, for some reason, it be inoperative and void

The judgment of Howard was confessed for $8,000, and simultaneously entered for the use of certain parties, creditors of Grittings and Allnut. In the statement of facts, it was agreed that Howard was not personally, and in his own right, a creditor of Grittings and Allmitt, hut was the agent and attorney duly authorised, of the parties, for whose use his suit was entered, and that he sued and recovered judgment, and issued his attachment, for the use and "benefit of said parties only, his name being used for convenience. ” By this we understand, that Howard was legally constituted as agent, to take the judgment in this form. These parties had executed releases in conformity with the terms of the deed, and, at the time of executing such release, were admitted to be bona fide creditors of Grit-tings and Allnutt, to the amount of $40,000, and upward.

Ho valid objection can be made to the judgment, on the ground that it was voluntarily confessed, and secured to the creditors, in whose favor it was rendered, a preference over the appellant and other creditors. Such preference being made bona fide, it was lawful for the debtors to give.

It is objected, that the suit being brought, and the judgment recovered, in the name of Howard, it is inadmissible to show by proof, aliunde, that the debts, which formed its consideration, were due to other parties, and that it was recovered for their use and benefit. To allow this, it is said, would be to contradict the record.

This objection, even if the appellant had the right to urge it in the face of the agreed statement, is answered by the decisions in Harris vs. Alcock, 10 G. & J., 226, and Groshon, Garnishee, vs. Thomas, 20 Md. Rep., 234. The judgment was a collateral security for the debts due the cestuis que use. But it is said, the cestuis que use in the judgment had ceased to be creditors, having executed releases under the deed; and that having accepted the terms of the deed, they are bound by it, and are estop-ped from impeaching it.

(Decided May 30th, 1865.)

It will l>e observed that they are not here impeaching the deed, that is done hy the appellant, who is claiming against it, and cannot therefore hold them hound by it as an estoppel. Estoppels, wherever they exist, are mutual. Nor is it true, as argued by the appellant, that the deed is valid and binding upon them, until it is declared void by a competent Court. The deed being void in law upon its face, no title passed under-it to the grantees, but the property remained in the grantors.” Bridges & Woods vs. Hindes & Davis, 16 Md. Rep., 104.

The deed being void, the releases must fall with it; the consideration, upon which they were executed, having wholly failed, they were inoperative, and the debts remained due at the time the judgment was rendered.

We affirm the judgment of the Superior Court.

Judgment affirmed.