99 Tenn. 732 | Tenn. | 1897
On January 24, 1893, the cross-complainant, J. L. Thomas, secured a judgment against M. E. and S. O. Thompson, which was a prior and superior lien on all their real estate in the county of Knox, as well as that lying in the counties of Jefferson and Campbell. Soon thereafter these defendants began to convey, by trust deeds made to secure other creditors, distinct portions of their real estate. The first of these instruments was executed on February 1, 1893, and conveyed certain lots in Thompson’s addition to Knoxville, for the purpose of securing the cross-complainant, V. Klein; a second was made on March 7, 1893, on a house and lot in still another addition to Knoxville, to secure one Lieber, trustee; a third on April 10 following, on a tract of land lying in the twelfth civil district of Knox County, to secure the Central Savings Bank; a fourth on April 18, to secure Joseph Meek, and conveying certain lands in Campbell County and thirty-three lots in Thompson’s addition (but exclud-the Klein lots) to Knoxville; a fifth on April 27, 1893, conveying lands in Jefferson County, to secure one Gillespie in a note, which he afterwards assigned to the City National Bank; a sixth and seventh deed executed on the same day, one of . them to secure Joseph Meek, and conveying the same property em-.
On May 22, 1893, Steele & McMillan recovered a judgment against the Thompsons, upon which an execution issued, that was levied on still other parts of the real estate of these debtors; and on May 26, 1893, Allen Stephenson & Co., having recovered a judgment against the same debtors, caused an execution issuing thereon to be levied on yet other distinct lots of their land.
These properties have all been sold under decrees pronounced in this cause, and the funds are now under the control of the Court. It is conceded by all the junior lienors that Thomas, by virtue of his judgment, had a prior lien on all these tracts, and is entitled to be first satisfied out of the proceeds; the question in controversy is, how is he to be satisfied, and at whose expense? The Chancellor held that these junior lienors should contribute ratably to the discharge of the Thomas judgment, and the Court of Chancery Appeals has affirmed his holding. From this last decree V. Klein and the City National Bank have appealed and assigned errors.
In Jobe v. O'Brien, 2 Hum., 34, it was held that there was no marshaling of assets as between junior incumbrancers, but the loss would fall exclusively
It will tints be seen that, though adopted by the
This rule has been adopted by a large majority of the Courts of this country, so that they enforce execution for the protection of the first grantee, from a common burden, in a proper case, by requiring the property subject to such burden to be applied in the inverse order of its alienation, upon the application of the first grantee, even before- he has discharged the debt, this being done on the principle of quia timet.
But it is insisted that the contrary view was taken by this Court in Gilliam v. McCormack, 85 Tenn., 598, and that case is cited as authority for the decree of the Court of Chancery Appeals in the present cause. It may be said that it would be a matter of astonishment if the Court should have intended to
The result is, the decree of the Court of Chancery Appeals, in this respect, is reversed.