105 Tenn. 448 | Tenn. | 1900
This is a garnishment proceeding. Wright obtained a judgment against Hogan for about $200. Parker became stayor of execution. When the stay expired Hogan borrowed $247 and executed for it- his note with Parker as indorser. It was agreed between Hogan and Parker that enough of the money so borrowed should he used to pay off the judgment on which Parker was bound as stayor. Hogan used $26.98 of the money for his private purposes, and, not being able to find. Wright, deposited $220.02 in the Third National Bank of Knoxville. This deposit he made in his name' as executor and trustee. In the afternoon of the same day he gave Wright a check for $220.02, the amount of the judgment and costs. This cheek ivas not presented by Wright until the next day, and before it was paid or presented and before banking hours the bank was garnisheed by Orudgington, a judgment creditor of Hogan. When the money was borrowed by Hogan he pledged a note which he held ns executor and trustee as collateral for its payment.
The question is whether the funds in the hands of the bank can be held under the garnishment proceeding by complainant Orudgington. The Chancellor held that they could; the Court of Chancery Appeals modified the decree of the Chancellor and held the fund liable only to the extent of $8.00, dividing the costs between the parties-
It appears that Parker gave his indorsement upon the note in consideration and upon ' a previous promise that a sufficiency of the funds raised on it should be applied to the judgment on which he rvas stayor. After he obtained the - money Ho- • gan sought for Wright 'in order to pay off the judgment, but not finding him he deposited the money, not to his OAvn credit, but to his credit as executor and trustee. "Why this Avas done does not distinctly appear, but it is fair to infer that it was in order to keep the same separate from his own funds or to impress it vdth some sort of trust, so that it could not he taken
This does not at all militate against the idea . that he approprited and set apart the $220.02 as a fund to pay off the judgment in pursuance of his agreement with Parker.
The case is practically the same as that of McGuffey v. Johnson, 9 Lea, 555. See also Stockard v. Stockard, 7 Hum., 303; Wharton v. Lavender, 14 Lea, 178-190.
The creditor of Hogan can 'occupy no higher ground than Hogan himself, and the question of notice is not involved, as the complainant does not assume the attitude of an innocent purchaser or transferee, hut of a creditor.
■ It is said Parker is not before the Court and a trust in his favor cannot therefore he set up. This
.But, in addition, his rights can he set up and protected hy Iiogau, who holds the fund under the agreement in trust for Parker’s indemnity and benefit. The check was given to Wright and accepted bv him before the garnishment proceedings were instituted, and he accepted the same ns a payment of his judgment.
We arc of opinion that the fund was a trust fund for the payment of the judgment to Wright, so as to save Parker harmless, and the check given to Wright was an equitable appropriation of it according to the agreement and the decree of the Court of Chancery Appeals is affirmed.