Troxall v. Applegarth

| Md. | Mar 13, 1866

Goldsborough, J.,

delivered the opinion of this Court.

The appellants, the.plaintiffs below, obtained a judgment against Samuel R. Dunnock, in 1859, for $1,015, and by way of execution issued an attachment out of the Superior Court of Baltimore City on the 20th of January, 1860.

This attachment was, on the 21st of January, 1860, laid on certain alleged rights and credits of the defendant Dunnock in the hands of William Applegarth one of the appellees. He appeared as garnishee, and pleaded nulla hona. At the trial, the plaintiffs moved the Court to order a non pros, as to John Whittington ; the same was ordered and the cause conducted against Applegarth as sole garnishee. At the trial it appeared hy the evidence that Applegarth on the 24th of September, 1859, contracted with Dunnock to purchase his interest in the brig “Union State” for $7)500. This interest Dunnock designed to convey by a bill of sale executed on the day of the contract, and embracing three-fourths of said brig.

The bill of sale was signed by James Hooper, A. R. Wallace and Samuel R. Dunnock. It was however not recorded in the Custom House in conformity with the Act of Congress, until the 22d day of February, 1861, and upon the prayer of the appellants, the Court ruled that no title passed to the appellee, Applegarth, by said conveyance as against the attachment.

Besides the bill of sale which the plaintiffs produced by order of the Court, they read in evidence a deed of trust from Dunnock to the appellees, acknowledged on the 20th day of January, 1860, by which he conveyed all his property for the benefit of his creditors according to the terms therein expressed, the plaintiffs stating that they offered it in evidence with the declaration that they would impeach it afterwards. They then proved by Mr. Abbott that the trustees had done nothing towards the execution of said deed of trust.

They further proved by Abbott, that the whole $7,500 stated in the bill of sale, was due to Dunnock for his interest in said vessel, which was really three-fourths thereof, none of which was to be paid by Applegarth to Dunnock, but to be applied by the garnishee to certain debts of Dunnock ; that on the day of the date of the bill of sale, Dunnock owed Sterling & Ahrens $4,311.29 on account of said vessel, and had previously given therefor four notes endorsed by W. Applegarth & Son for different amounts at different periods of payment. And also that a note dated 14th. of September, 1859, for $676.13, endorsed by Applegarth & Son, was given for materials supplied to said vessel, and was also paid out of said purchase money, and that the garnishee was to pay out of the $7,500 any other-debts due by Dunnock on account of the vessel. The plaintiffs then proved by Mr. Skinner, that about the time of said sale, Applegarth told him he had a claim against the “Union State” of from $4,800 to $5,000, and held her as collateral security for that amount, and when that was paid, Dunnock was to resume possession, and the brig was chartered at $600 a month, and that he had assumed Dunnock’s debts to the amount of $4,800 or $5,000 at that time. The garnishee then proved by Samuel R. Dunnock, that he was the owner of three-fourths of the “Union State” previous to his sale to Applegarth. That the sale took place on the 24th of September, 1859, and on the same day he gave the bill of sale referred to, and at the same time handed over to him all the papers connected with her. That at the time of the sale the brig was in the port of Baltimore, held and navigated by Captain Foxwell, who was one-fourth owner, and master for a voyage then about to commence under the direction of Applegarth, as three-fourths owner, and after that voyage, Captain Martin was put in charge as master by Applegarth.

That the consideration for the sale was $7,500, to be applied by Applegarth in payment of certain debts which witness owed on account of the brig, and the balance to be applied to such debts due by Dunnock and Weatherly to Applegarth as witness had assumed ; and being shown a statement of sums paid by Applegarth & Son, amounting to $7,451.58, he was asked “if the debts in the said paper enumerated, were those which Applegarth was to pay under the agreement aforesaid, between them?” replied that they were, and that each and all of said debts had been passed upon by him as debts to be paid by Applegarth under said agreement, and in addition thereto, the tax bill amounting to $352.22, chargeable to the brig, was to be paid as part of the consideration of sale. That 'all the bills due upon the brig so to -be paid by Applegarth, were mentioned to him at the time of the sale, but the precise amount thereof not.being known at that time, was only approximated; and that although the witness was owner of three-fourths of the brig, all the bills for her were charged to him, yet after the sale he was never called upon to pay them.

The witness further stated, that there was a verbal agreement between him and Applegarth, that if Mr. Campbell should return from Venezuela and pay him what he owed him, he would be able to buy bach the brig for $7,500, in which case he would allow Applegarth 2-| per cent. That on the day of sale, witness went with Applegarth, canceled the insurance in his own name, and Applegarth took out one in his own name. This change of insurance is also proved by Montague, as taking place on the day of sale. Dunnock further testified, that at the time of the service of the attachment, Applegarth did not owe him on account of the brig, or on any account, but that he owed Applegarth. That when the sale was made he handed to Applegarth such bills of lading for the cargo as he had signed.

The garnishee further proved by Mr. Didier that he had sold to Dunnock one-fourth of the brig in September, 1859, for $2,250, and took a mortgage on the brig to secure the payment of $766.08 ; this claim as appears by the evidence, was paid by Applegarth.

The garnishee proved by his clerk, Mr. Mitchell, that debts of Dunnock to the full amount of the consideration named in the bill of sale, were paid by him.

He then read in evidence the permanent registration of the vessel in his name as three-fourths owner, and Foxwell as one-fourth owner, dated the 26th of September, 1859. We now proceed to dispose of the questions arising upon the appellants’ exceptions.

1st. The language in which the first exception is stated is somewhat obscure, but we suppose it was designed to raise the question whether the Court below erred in requiring the production of the bill of sale. In our opinion the action of the Court was correct. The witness having stated that the appellee, Applegarth, had taken possession under a bill of sale, it was proper that the paper should be produced, but if this were not so, the appellants were not prejudiced by the Court’s action, inasmuch as by their first prayer which was granted, the jury were instructed that the bill of sale passed no title to the grantee, as against the attachment. The correctn ess of the first prayer depends upon the true construction of the Act of Congress of 1850, upon which able and elaborate arguments have been made, but in our opinion its determination is not material in the decision of this appeal, and therefore without meaning to express any opinion upon that question, we shall assume that the ruling on this point, which was favorable to the appellants, was correct and shall decide the other questions in the case upon the theory that the bill of sale was inoperative to pass the title as against the appellants attachment.

The second prayer of the appellants which was granted, gave to them the full benefit of Skinner’s testimony, the effect of which was by that prayer properly submitted to the jury.

The appellants’ third prayer. — The effort of the appellants to show fraud in the conduct of Dunnock, because of the bill of sale and the deed of trust is not sustained. Indeed we see nothing in the evidence from which-it would he competent for the jury to find any fraud in the conduct in the appellee, nor is there any evidence to show that if Dunnock meditated a fraud upon his creditors, the appellee had notice of it, without which he could not he affected. See Waters, lessee, vs. Riggin, 19 Md. Rep., 536. The third prayer of the appellants was therefore properly rejected. We have said there was no evidence of fraud to justify that portion of the prayer, and the other proposition that if “no actual, open and visible possession accompanied and followed the bill of sale, then the interest of Dunnock in said vessel remains chargeable, and liable under this attachment,” is without evidence to support it. The appellants" own witness, Abbott, testifies that Applegarth went into possession. Dunnock testifies that he delivered up the papers connected with the vessel on the day of sale; that on the same day the insurance was changed, and that the appellee had placed Captain Eoxwell on board as master, for the voyage about to be commenced. In fact the appellants cannot sustain the attachment without conceding the sale to, and possession of the appellee. They have not laid the attachment upon the vessel, but on the proceeds of sale, and for the same reasons the fourth prayer of the appellants was properly rejected. In granting the fourth prayer of the appellee, and his sixth prayer with the modification, the Court below, in our opinion, correctly announced the law of the case. There was evidence to go to the jury to prove that at the time the vessel was sold and delivered to the appellee, there was a bona fide agreement between Dunnock and the appellee, that the latter should, in consideration of the price agreed on, pay certain debts due by Dunnock, which were designated by him, amounting in the aggregate to the whole purchase money, and that this agreement was performed by the appellee, and if the jury so found, this was a good defence to the attachment.

In this view of the case, it is quite immaterial whether the hill of sale was under the Act of Congress, ineffectual to pass the legal title as against the appellants ; the agreement would he binding upon Dunnock and protect the fund from attachment by his creditors. Here the attachment was laid on the fund in the hands of the appellee, and the right of the appellants to recover, must necessarily depend upon the state of accounts between Dunnock and the appellee, and the effect of the agreement between them at the time the attachment toas laid. In tlie case of the Balt. & Ohio R. R., garn. of Cen. Ohio R. R., vs. Wheeler, 18 Md. Rep., 378, this Court said “the liability of a garnishee in respect of property of a defendant in his hands, is to be determined, ordinarily, by bis accountability to the defendant on account of the property. If, by any pre-existing bona fide contract, that accountability has been removed or modified, it follows that the garnishee’s liability is correspondingly affected, for it is well settled, that garnishment cannot have the effect of changing the nature of a contract between the garnishee and the defendant, or of preventing the garnishee from performing a contract with a third person.”

( Decided March 13th, 1866.)

Judgment affirmed.