| W. Va. | Dec 10, 1881
announced the opinion of the Court:
The questions of law really involved in this case are, first: Upon what property is a writ of fieri facias, which has been issued under chapter 218 § 2 p. 634 of Acts of 1872-3, alien? and secondly: What is the proper mode of enforcing such lien, when there is no actual levy of the fieri facias, and when by reason of the lien there is a liability on any person other than the judgment-debtor under the provisions of sections 10, 11, 12, 13 and 15 of chapter 218 p. 638 and 639 of Acts of 1872-3? The second section declares, that it shall be a lien on “ all the personal estate of or to which the judgment-debtor is possessed or entitled (although not levied on or capable of' being levied on under chapter 140 of the Code,”) with certain exceptions and qualifications specified in the latter part of said section. With these exceptions it is a lien on all the personal estate of the debtor, whether it be in his possession or not. It therefore includes choses in action, whether they are capable of being enforced in a common law court or only in a court of equity. This is rendered still more apparent by the 15th section of chapter 218 of Acts of 1872-3 p. 639, which provides for the enforcement of this lien by suit either at law or in equity.
The next enquiry is: What is the proper mode of enforcing this lien ? This must, we think, obviously depend on the character of the personal estate, upon which the lien is proposed to be enforced. Section 10 of chapter 218 of Acts of 1872-3 pp. 637-638 provides: “On a suggestion by a judgment-creditor, that by reason of the lien of his writ of fieri facias there is a liability on any person other than the judgment-debtor, a summons may be sued out of the office of the clerk of the court of the county in which such person resides against such person to answer such suggestion. The return-day of which summons may be the next term of said court.” This section
Sections 11, 12 and 13 of this chapter show, that no order can be made by the court against the garnishee, except where he owes a debt to the defendant in the execution, or has estate of such defendant in his Rands. Now it is obvious, that the lien of the fieri faeias under the second section of this act, which covers “ all the personal estate of the defendant in the execution, which he is possessed of or entitled to, ” extends to many cases, where the garnishee could with no propriety be said either to owe a debt to the defendant in the execution or to have any of his estate in his hands. As for example, if the garnishee by a written contract not under seal has bought such estate of the defendant in the execution, he does not owe a debt to him, nor has the garnishee any estate of his in his hands. But the defendant in the execution has a right to bring a suit in a court of equity for the specific execution of the contract, and on making him a good deed for the land, if he can do so, has a right to enforce of the garnishee the payment of the purchase-money. This right of suit in equity is a chose in action included in the broad term, personal estate, and the lien of the plaintiff in the execution under this 2d section extends to and covers it. But it is obvious, that no judgment can under the garnishee-process be rendered against him for this purchase-money. It is neither a debt due the defendant in the execution, nor is any estate of his in the hands of the garnishee. It is simply a liability, which may be enforced in a court of equity, provided the plaintiff can
The 15th section of chapter '¿18 of Acts of 1872-3, page 639, provides an efficient mode perfectly suited to all such cases. It is as follows : “For the recovery of any personal estate, on which a writ of fieri Jacios is a lien, or the enforcement of any liability in respect to any such estate a suit may be maintained at or in equity in the name of the officer, to whom such writ was delivered. And any person interested may bring such suit at his own costs in the officer’s name.” The obvious remedy given by this section in such cases is for the plaintiff in the execution to bring the necessary suit in equity in the name of the sheriff to enforce the liability. "Where the garnishee owes a debt to the defendant in an execution or has estate of his in his hands, the character of his liability is such, that it might be enforced in a common law suit by an action of debt, detinue or some other appropriate personal action; and when this is the character of his liability, it can be appropriately enforced by the garnishee-process ; and in all such eases this process may be used for that purpose by the plaintiff in the execution. But when the liability of the garnishee is such, that it can only be enforced in a court of equity. The garnishee-process is obviously entirely unsuited to enforce it; and in such case the plaintiff in the execution is authorized in the name of the sheriff to bring a suit in equity, wherealone such a case can be disposed of, to enforce the liability for his own benefit. If the liability of the garnishee was of such a character, that it could have been enforced at law or in equity, then the plaintiff could, if he chose, enforce it by the garnishee-process or by a suit in equity in the name of the sheriff.
If we assume, that the garnishees in this case or any of
The. James River and Kanawha Company was chartered March 15, 1832, as a’ joint-stock company for the purpose of connecting the tide-water of James River with the navigable waters of the Ohio. See supplement of Revised Code ch. 377 p. 474. The State of Virginia owned a considerable portion of the stock of this corporation. By an act passed February 15,1858, Sessions Acts of 1857-1858, ch. 117 p. 91, the directors of this company were increased, six of whom appointed by the Board of Public Works of Virginia and two appointed by the stockholders were to be residents of the Kanawha Valley and with the president of the company were to constitute a board known as the Kanawha Board, who were to be entrusted with the supervision of the Kanawha improvement, subject however to the instructions of the stockholders of The James River and Kanawha Company. On February 9, 1860, see ch. 18 of Acts of- 1859-1860, pp. 116, 117, there was directed to be issued to be placed under the control of this Kanawha board of directors $300,000.00 of six per cent, registered stock of the Commonwealth, to be used by said Kanawha Board for the improvement of the Kanawha river from its mouth to Loup creek shoals; and this Kanawha Board was made independent of the president and directors of The James River and Kanawha Company, which was known as the “ Eastern Board.” But The James River and Kanawha Company were first to execute a mortgage to the Commonwealth upon the works, property and net revenue of the said Kanawha line of improvement for the payment of the principal and interest of said $300,000.00. On the 25th of May, 1860, this mortgage was executed to the State of Virginia, as proven in this case. See statement of the case.
By the 13th section of said act, chapter 21 Acts of 1859-60
On March 3, 1869, see Acts of 1869, chapter 114, page 75, the Legislature of West Virginia reciting this act of the Virginia Legislature passed March 23, 1860, and also the fact, that the James River and Kanawha Company had accepted the provisions of this act, and also that so much of the property, rights, franchises and privileges of said company as are situated within the limits of West Virginia became and were vested in this State by virtue of the act of the Virginia Legislature at Wheeling passed on the 3d day of February, 1863, and that the James River and Kanawha Company having failed within six years from March 23,1860 to complete the canal to Covington or the western terminus of the Virginia Central
Money was under the authority of this act borrowed by the Kanawha Board and a deed of trust given to secure the same, as set out in the statement of the case, and a sinking fund has been and is being raised to pay oft this debt. A portion of this fund has been borrowed by the garnishees, Lewis Summers and the Kanawha Valley Bank respectively, and a portion of it is in the hands of the treasurer of the Kanawha Board. Since April 5,1871, the Board has been in the undisturbed possession and control of the Kanawha River.
Section 35 of article VI of our present Constitution (Acts of 1872-3, page 17,) provides: “The State of West Virginia shall never be made defendant in any court of law or equity.” Very different views are taken by the counsel for the plaintiff in error and the counsel of the defendants in error with reference to the relations, which by reason of these legislative
This act, the counsel for the garnishees insist, did not amount to a declaration, that the charter of this company was forfeited; as this State could not declare a charter granted by the State of Virginia to be forfeited; and in point of fact this company after the passage of this
These fundamental views of the counsel of the garnishees are utterly denied by the counsel of the plaintiff in error. He insists, that the act of the Virginia Legislature of March 23, 1860, was not a contract, by which the James Eiver and Kanawha Company agreed to transfer all its property and franchises for a valuable consideration to the State, if the canal was not completed in six years. But if the canal was not completed, the charter of the company was liable to forfeiture at the end of that time ; but that such forfeiture could not be declared by the Legislature, but must be judicially found, which has never been done ; that the act of March 3, 1869, of West Virginia made the Kanawha Board the successor of the James Eiver and Kanawha Company, and it holds the franchises, revenues, &c., of the James Eiver and Kanawha Company in trust as a trust-fund first for the payment of the debts of the company. The whole object of this act was to give this State dominion over the old Kanawha Board, its property and franchises, but not to appropriate its revenues to the State in prejudice of the creditors of the James Eiver and Kanawha Company. If it had attempted to do so, the act would have been unconstitutional as violating the obligation of contracts. It would, if so construed, be a mere attempt at legislative robbery. It is like the case of a corporation organized in a new name or divided in its line or jurisdiction, and in such case the corporation in its new name or if divided, each division is liable for the debts of the original corporation. A suit against the Kanawha Board
These conflicting views of counsel have been elaborately argued ; and numerous authorities are cited by the counsel respectively to sustain their respective positions. I do not think, that any of these questions are fairly presented by the record for it is in this case immaterial which of these views is correct. If those of the counsel of the defendant in error are correct, the judgment of the circuit court would have to be affirmed because there is no liability of the garnishees or any of them to the plaintiff in error, which could be enforced in any court or in any manner. If the views of the counsel for the plaintiff in error are correct, while there might be a liability on the part of the garnishees or at least one of them, the Kanawha Board, which might be enforced in a court of equity, yet there is no such liability on any of the garnishees, as could according to the law, as we have stated it above, be enforced by a garnishee-process; and therefore the judgment of the circuit court in this case would have to be affirmed. If it were true, as claimed by the counsel for the plaintiff in error, that this case comes within the influence of the principles laid down by the Supreme Court in Mumma v. The Potomac Company, 8 Pet. 281" court="SCOTUS" date_filed="1834-03-12" href="https://app.midpage.ai/document/mumma-v-potomac-co-85878?utm_source=webapp" opinion_id="85878">8 Pet. 281, Curran v. The State of Arkansas et al., 15 How. 304" court="SCOTUS" date_filed="1853-12-29" href="https://app.midpage.ai/document/curran-v-arkansas-86834?utm_source=webapp" opinion_id="86834">15 How. 304, Bacon et al. v. Robertson et al., 18 How. 480" court="SCOTUS" date_filed="1856-05-14" href="https://app.midpage.ai/document/bacon-v-robertson-87035?utm_source=webapp" opinion_id="87035">18 How. 480, it could only show, that plaintiff in error might have a right in a court of equity to subject the Kanawha Board or its assets to the payment of its debt; and as this claim according to these cases, as I understand, could only be set up in a court of equity, it would follow on the principles we have stated, that the circuit court properly in this case refused to permit any enforcement of this supposed liability by this garnishee-process.
In Mumma v. The Potomac Company, 8 Pet. 281, where by an act of the Virginia Legislature the charter of the Potomac Company was vacated and annulled, and its powers and rights were vested in a new company then incorporated, viz: the 'Chesapeake and Ohio Canal Company, this act was held constitutional, and it put an end to the Potomac Company; but the obligation of its contracts survived, and the property of the company must be regarded, when it has not passed into the hands of a bona fide purchaser, as held by the Chesapeake and Ohio Company for stockholders of the-Potomac Company and its creditors. In that case an effort to enforce a judgment at law by reviving it was held to be an erroneous mode of proceeding. As showing in what court in every case of this character the creditor must seek his redress, see Mount Pleasant v. Beckwith, 10 Otto (100 U. S.) 514. So in the case of Curran v. The State of Arkansas et al., 15 How. 311 the court say: “The property of an insolvent trading corporation while under the management of its officers is a trust-fund in their hands for the benefit of creditors. It follows that a court of equity, which never allows a trust to fail for want of a trustee, would see to the execution of that trust, although by the dissolution of the corporation the legal title to its property had been changed.”
In Bacon et al. v. Robertson et. al., 18 How. 488, the court after showing, that the law in-such cases affords no redress says: “ It is a case therefore, in which courts of chan-
If it be true, as contended by the counsel of the plaintiff in error, that the Legislature of West Virginia by the act of March 3, 1869, transferred all the property and franchises of the James Diver and Kanawha Company in the Kanawha river to the Kanawha Board to be held as a trust-fund for the creditors of the James River and Kanawha Company, no creditors can make any demand on this trust-fund except in a court of equity. This property when so transferred was subject to a mortgage of $300,000.00 to the State. To ascertain what is proper to be done, if there be, as claimed, really any such trust, troublesome and lengthy accounts must be settled of the actings and doings of the trustees of the Kanawha Board, which could be settled only in a court of equity. The garnishees, Lewis Summers, The Kanawha Valley and C. C. Lewis obviously owe no debt to the James River and Kana-wha Company, nor have they any effects of the company in their hands. They owe debts to and have effects of the Ka-nawha Board in their hands. But these can never be reached by a garnishee-proeess ; for this, the statute expressly says, can be done only when they owe debts to the defendant in the execution or have personal estate of his in their hands. The whole proceeding against these garnishees is based on the idea, that the Kanawha Board and the James River and Kanawha Company are the same party. However this may have been prior to Marcl\ 3, 1869, the Kanawha Board as then organized is obviously not the same as the James River and Kanawha Company. As to the garnishee, the Kanawha Board, if there' be any liability on it either to the James River and Kanawha Company or to a creditor of that company, it is only as a trustee ; and it could be held liable, if at all, only in a court of equity ; and therefore it could not be held liable, as we have seen, by a garnishee-proeees.
But on the theory of the counsel of the plaintiff in error it is claimed, that it might be held liable in a court of law, because the trust-fund has been perverted. To sustain this position he refers to The United States v. State Bank, 6 Otto (96
The circuit court in this case in its judgment expressed this opinion : “ That the said Stewart Eagle is not entitled to recover, and that he has no lien upon ttie moneys admitted to be in the hands of the Kanawha Board, the said Lewis Summers, the said Kanawha Valley Bank or said C. C. Lewis or any part thereof." We have declined to enquire in this case, whether he has any such lien, as might be enforced in a court of equity; and for the purposes of this case the above opinion, though we do not say it is incorrect, is not proper to be announced in this case. The only opinion proper to be announced is, that he is not entitled in this case to recover anything of any of said garnishees.
The judgment being in this respect amended must be affirmed ; and the defendant in error must recover of the plaintiff in error to be levied out of the assets of his intestate in his hands to be administered their costs in this court expended and $30.00 damages.
Judgment Amended and Confirmed.