133 A. 642 | Pa. | 1926
Plaintiff filed a bill in equity, averring that he was a creditor of one of two defendants: that this defendant had conveyed, through a strawman, real estate possessed by him to the other defendant, his wife, for the purpose of defrauding his creditors. The bill prayed that the wife be decreed to hold the property in trust for plaintiff to the extent of his claim, that a trustee be appointed, *452 and that defendants be restrained from encumbering or disposing of the premises.
When the case came to hearing on pleadings and proof, the court below, at the end of plaintiff's testimony, dismissed the bill for want of required evidence, in accordance with Equity Rule 66. No exceptions were taken to this action, but plaintiff subsequently filed another bill in the same court, with averments like those in the first bill and praying that the deed from husband to wife be set aside, defendants restrained from disposing of the property in question, and decreed to hold the income therefrom in trust for the benefit of plaintiff until the suit should be determined.
Mrs. Nouskajian, referred to above as the "wife," answered this second bill, saying that it raised "the same questions of fact and law [as contained in the former bill, and therefore] the whole controversy [was] res adjudicata."
The record contains no stenographic report of what occurred when the second bill came before the court below, but two opinions filed by that tribunal indicate, first, that the only evidence offered was to contradict testimony given at the hearing on the original bill, and, next, that the testimony offered was "identical with that given at the former trial, with the exception of a witness called at that trial who desired to change his testimony as to values." These two statements may appear inconsistent, and both of them are at variance with the statement of counsel for appellant as to the tenders of proof; but whatever the facts may be in this regard, the court plainly said, in disposing of the second bill, that it was dismissed because "it contains no new facts and no new issue," and because "the matter having been [previously] disposed of by the court [was] res judicata." This state of affairs shows the necessity for making a proper official record of all court proceedings. Our jurisprudence contemplates both trial and review; the latter requires a record, the making of which has *453 been rendered comparatively easy in Pennsylvania by our court-stenographer legislation, and this should be taken advantage of in cases such as the one now before us. In the absence of a proper record, we, of course, accept the statement of facts made by the court below; but where a bill is dismissed there should be a formal record to show warrant for the court's action. Here neither testimony nor offer of testimony, on the second bill, are shown, and it is quite impossible to know whether the controlling rules have been complied with.
Equity Rule 66 provides: "If the judge . . . . . . upon the close of plaintiff's evidence shall be of opinion that the case made in the bill has not been sustained, he shall have power, without hearing evidence on behalf of defendant, to enter a decree of dismissal which shall have the effect of a nonsuit at law. If exceptions are filed to it, however, and the court . . . . . . refuses to change it, it shall become a final decree for all purposes, and subject to appeal as such exactly as if it had been entered after a hearing of both parties."
Since the original bill was dismissed under circumstances such as stated in the first sentence of the above rule, and no exceptions were filed to the decree of dismissal, the action of the court below had the effect only of a nonsuit at common law; hence it did not make the issues in any sense res judicata or prevent the filing of another bill (Cleary v. Quaker City Cab Co.,
We have repeatedly held that the established way to test the question of whether real property has been conveyed in fraud of creditors is for one claiming to be a creditor to obtain a judgment and issue execution against the premises in question as the property of his debtor, this to be followed by an ejectment at the suit of the purchaser at sheriff's sale: Hyde v. Baker,
It appears that, shortly after plaintiff filed his second bill in the court below, defendant Dziadzan A. Nouskajian petitioned that tribunal, reciting the dismissal of the first bill, because of a lack of proof that the other defendant was insolvent when he conveyed the property to her, the petitioner; reciting, further, that plaintiff had obtained a judgment against the first-named defendant in another court of common pleas, that execution had been entered on this judgment and the real estate involved was about to be sold thereunder, and praying that plaintiff be restrained from so proceeding. On this petition, an order was entered restraining plaintiff from proceeding with the sheriff's sale, and this is assigned as error. The method which plaintiff sought to pursue, of obtaining a judgment against his debtor and then taking in execution the property alleged to have been fraudulently conveyed by the latter, was the usual, and, prior to the passage of the Uniform Fraudulent Conveyance *455
Act, 1921, P. L. 1045, the exclusive method of procedure in Pennsylvania (Hyde v. Baker,
Before the Act of 1921, it was held that the power of equity to restrain an execution creditor from proceeding in due course to sell real estate alleged to belong to his debtor was limited to rare cases where "the hardship or inadequacy of the common law procedure [was] manifest": Kreamer v. Fleming,
This statute gives an additional remedy to the creditor, but none to the alleged owner. In other words, it gives the creditor his choice between a procedure in equity and the old common law remedy; and, perhaps, an adverse party could compel an election on the part of the creditor as to which remedy he would pursue. Here, for instance, the defendant in the equity suit who holds title to the real estate in controversy, after properly showing that plaintiff was pursuing his common law remedy in another court, might have asked the court below to make plaintiff elect between that remedy and *456 his bill in equity, and had the election been in favor of the remedy at law, it would have been proper to dismiss the bill on that ground. Again, the defendant in the common law suit might have petitioned the court in which that action was pending for a stay of execution on the ground that plaintiff had instituted and was pursuing a proceeding in equity against him in the court below to accomplish the same result that he sought by the execution in the common law suit, and this would have put plaintiff to his election between the two remedies. Neither of these courses was pursued, however, and there is nothing upon the present record to warrant the restraint of execution granted by the court below. The mere fact that plaintiff had proceeded in equity as authorized by the Act of 1921 would not affect his legal right to sell real estate alleged to belong to his creditor, which right is also recognized by that act; particularly is this so when we remember that his first equity suit had not reached any definitive conclusion and his second had not come to a hearing at the time of the order staying the sheriff's sale.
In addition to what has already been mentioned, appellant claims that the action of the court below in undertaking, in effect, to restrain the process of another court of common pleas was contrary both to general rules of law (for discussion of this general subject see Kane . Elk R. R. v. R. R.,
The order enjoining the sheriff's sale and the decree dismissing the bill are both reversed at cost of appellee.