Streety & Co. v. McCurdy

104 Ala. 493 | Ala. | 1894

McCLELLAN, J.

It may be admitted in this case that, upon the death of G. M. Reese, the lien of Streety & Co.’s registered judgment at once attached to the land which thereupon descended to Perry Reese, the defendant in that judgment, and that no lien under the decree of 1873 in favor of G. M. and against Perry Reese existed at that time in favor of the administratrix of the former’s estate.. But granting all this, it is the opinion of the court, that the other heirs of G. M. Reese had an equitable lien upon said land for the debt which Perry Reese owed the estate, the debt which is evidenced by the decree referred to, which lien was and is in equity superior to any right Perry Reese, or persons claiming under or through him by operation of law or otherwise, might otherwise have had in the descended lands, and, of course, superior to' the title acquired by Streety & Co. through the sale of his interest in the land. under their judgment. This view, which is apparently at war with the current of authority in other States, (See Towles v. Towles, 1 Head, 601; Mann v. Mann, 12 Heisk. 245; Proctor v. Newhall, 17 Mass. 81; Hancock v. Hubbard, 19. Pick. 167 ; Dearborn v. Preston, 7 Allen 192) finds support in the language of opinions delivered by this court in the cases of Brown v. Lang, 14 Ala. 719 ; Goodman v. Benham, 16 Ala. 625, and Nelson, Extr. v. Murfee, 69 Ala. 598, 604, though the question was really not involved in the two first cases, and its decision was expressly pretermittedin the third. In this last case, Nelson v. Murfee, however, there is a direct ruling upon a collateral question which, carried to its legal consequences, must be taken as in effect an adjudication on the point involved here. The court in that case would not decide “whether, when the heir is insolvent and owes the estate of the ancestor, the administrator has any prior right to demand payment out of the lands descended, or whether it becomes a mere race of diligence between him and the other creditors of the heir ; ’ ’ but it did decide that where it became necessary to sell the descended lands for the payment of the debts of the estate, and a balance -of the purchase money remained in the hands of the administrator after paying the debts, this balance could be retained and, to the extent of the debtor heir’s original share therein, applied to the debt of the heir to the estate, not only as against the heir, but also as against a purchaser from the heir of his interest in the land even prior to the intervention of the administrator for the purposes of a sale for the payment of debts of the estate. This conclusion is, it is true, rested on the consideration that ‘ ‘however much money, thus acquired and held, will be treated as having the qualities of land for certain purposes of administration and sucession — Teague v. Corbitt, 57 Ala. 529 — still, for all other purposes, it is only money, and money in the hands of an administrator ; ’ ’ that any process to get it out of his hands must be that adapted to the recovery of money as money, and that, therefore, when the heir, or .one who has purchased from him before the land is intercepted, seeks to recover such balance, the' administrator may set off against the demand any. debt which the heir owed the intestate. It is clear to us that this conclusion must be rested upon a broader ground than that stated in the opinion. As the proposition is there stated, the right .of the administrator' to the surplus pr,Or ceeds of land of the intestate sold f.or the payment of debts is rested upon the mere fact of his possession thereof, which results from his having, and having exercised, the right to sell the lands and to devote such part of the proceeds as is necessary to the payment of the decedent’s debts. This end being subserved and abalance remaining in the administrator’s hands, he would obviously have no more right to it because of his mere possession of it than a mortgagee who sells under a power for an amount in excess of his debt, interest and charges would have to the surplus as against the mortgagor or purchaser from him. To the retention of such surplus by either there must be some right to it other than can be evolved out of, or rested upon, the mere fortuitous circumstance of possession. And hence we say that Nelson v. Murfee can be sustained only upon the theory, and must be taken to have determined, that the administrator has a right to subject lands of his intestate to the payment of a debt due by the heir to the estate in priority and preference to the claims of a purchaser from the heir and also, of course, to the lien of a creditor of the heir attaching to the land on the death of the ancestor. That such right exists in respect of personal property of the decedent all authorities agree. It was clearly the opinion of this court, as evidenced by dicta in the cases of Brown v. Lang, 14 Ala. 719 ; Goodman v. Benham, 16 Ala. 625, and Nelson v. Murfee, 69 Ala. 598, supra, that under our statutes realty is upon the same footing as personalty in this respect, and that all the property of an estate — land, chattels and choses in action alike — constitute a fund, first for the payment of debts of the estate by the subjection thereto of the personalty and realty in the order stated, and next, for distribution to or division among the heirs of the residue ; and, as we have seen, the point decided in Nelson v. Murfee must be rested on this consideration. And where an heir or distributee was indebted to the ancestor in his lifetime and continues indebted to his estate, this debt to, this chose in action held by, the estate is assets in the hands of the administrator both for the payment of the debt of the decedent and for the purposes of distribution; and both personalty and realty, including in the case supposed the debt of a distributee to the estate, being a common fund for equal distribution, either by allotment or a sale and division of proceeds among all the distributees, those not indebted to tbe estate are entitled to have the sum due from one who is so indebted collected from him, or, failing this, they have a right to.share in the assets as if such collection had been made; and the debtor distributee shares in the estate only upon the like assumption of payment by him. So that if his debt is equal to or greater than the value of one share in the distributable estate, including the claim against him, and that claim is not paid by him, he is never entitled to anything from the estate. Of course, a purchaser of his interest, or one holding a judgment, the lien’ of • which would attach to any interest he would have had in the property of the estate but for his indebtedness to it, is in no better plight than he : such purchaser or lienor would acquire nothing because his vendor or judgment debtor had and was entitled to nothing.

It can not be doubted that this right of the administrator in behalf of the heirs, and of such heirs themselves, to set off the distributive interest of the debtor heir in the lands of the ancestor, or to subject such interest to the payment of the debt to the estate as against third persons claiming as judgment creditors of the heir, is of equitable cognizance. — Nelson v. Murfee, 69 Ala. 598.

Of course the existence of a debt from the heir to the estate must be alleged and px'oved : this fact is the basis of the x’elief sought. If the contest is between the estate and the debtor heir, a judgment obtained by the ancestor in his lifetime against the heir is proof of the debt, unless it is attacked in a direct proceeding by the heir and vacated. Hence it is, that in such case the validity of the judgment could not be assailable by the heir in the answer to the bill, but he would have to exhibit an original bill or a cross-bill setting up the facts upon which the claim of invalidity is rested and praying affirmative relief against the judgmeixt. But not so when the attack upon the jxidgment is made by a stranger to it as are the respondents, Streety & Co., in this case, on the ground of fraud or collusion. Such strangers may attack the judgment, when it is soughhto be made the basis of relief against them, collatei’ally, at least when it has resulted from fraud or collusion between the parties to it. And hence it is, that they are not put to the exhibition of an original or cross-bill praying that the judgment be vacated; but they are free to deny the existence of the debt by plea or answer, and, where the alleged debt has been reduced to judgment, the validity of such judgment because of fraud or collusion in its rendition, because they are not estopped as a party or privy would be, and it is a fact alleged against them as a ground for the relief prayed. — Christmas v. Russell, 5 Wall. 290, 306; Atkinsons v. Allen, 12 Vt. 624; Story Eq. Pl., § 394, note; 2 Freeman on Judgments, § 336.

This issue of fraud vel non in the judgment recovered by the intestate against Perry Reese is properly presented in this case, therefore, by the answer of Streety & Oo., and must be determined in the further progress of the cause in the court below. Until this issue is determined there can properly be no decree granting the relief prayed in the bill or adjudging that complainant is entitled to any relief, as is the effect of the decree from which this appeal is prosecuted. The chancery court erred in the decree rendered, in so far as it found and declared that complainant was entitled to relief and referred it to the register to ascertain and report the amount of the debt due from Perry Reese to the estate of George M. Reese, without first ascertaining and adjudging that the judgment was valid and that there was an indebtedness from said heir to said estate.

Reversed and remanded.