Bobbitt v. Brownlow, 62 N.C. 252, 1 Phil. Eq. 252 (1867)

June 1867 · Supreme Court of North Carolina

62 N.C. 252, 1 Phil. Eq. 252

SAMUEL BOBBITT and others v. TIPPOO S. BROWNLOW and another.

A bill had been filed by a creditor not scoured in a deed-in-trust, to subject the surplus of the property so conveyed to the payment of his debt, and under an order in the cause the clerk had reported that such, property was amply sufficient to pay all tho debts, including that of the plaintiff; Held that a decree that the trustee should pay to the plaintiff his debt, was erroneous; and that the proper decree would have been that the trustee should sell enough of the property to satisfy the judgment.

By Pearson, Q. J., arguendo. If the report had stated that the trustee had on hand cash “amply sufficient,” &e., a decree against the trustee individually would have been proper.

Also, If the plaintiff had been secured in the deed-in-trust the decree might have been correct.

Bill, to review a decree in this court, filed to January-Term, 1867.

The complainant alleged that the defendant Brownlow had filed a bill in the Court of Equity for Warren, at Spring Term, 1860, showing that he had been co-surety with T. I. Judkins for T. H. Christmas, and afterwards had been compelled to pay the whole debt, that Christmas ivas totally insolvent, and Judkins had conveyed his property to the present complainant in trust to secure certain claims which were just, but were not largo enough to exhaust the property conveyed, and thereupon prayed that such surplus should be applied to the satisfaction of so much of that debt as was due from Judkins. The complainant also alleged that after answers had been filed and proofs taken, the suit was transferred to this court; that under an order the clerk, at December Term, 1864, reported that, “the trustee, Samuel Bobbitt, admits that the property belonging to the trust fund is amply sufficient to pay all the debts including that of the plaintiff Brownlow,” and that thereupon a decree was made at that term ordering “that the defendant, Samuel Bobbitt, pay to the plaintiff, Tippoo S. Brownlow, the sum of $815.07,” &c.

This decree was alleged to be erroneous, so far as it subjected the present complainant individually, and the prayer of the present bill was, that it might be reviewed, reversed, and set aside.

To this bill the defendants demurred.

Bragg and Baton, for the complainants.

The decree constituting Bobbitt personally a debtor to Brownlow is erroneous, as his only connexion with the latter» was as an innocent holder of a fund to which he might resort for satisfaction. Bobbitt was a mere stake-holder, and is not charged with fraud or laches. The rule that decrees in equity act in personam is not true in this sense; but means no more than that this court originally compelled a compliance with its orders by acting on the persons of the parties (by notice, process of contempt, &c.,) instead of seizing upon property through the medium of writs directed to officers. Harr. Ch. 668 — ’4, Adams 393-’^. Decrees for money are made only where a party owes it in his own right, or as executor, or where the trust fund is in money, or perhaps in some cases of fraud.

The decree here should have been, that the trustee sell the property, or deliver it to an officer of the court for sale by him, which decree would have been enforced against Bobbitt in personam, if he had refused compliance Adams 394. See Dozier v. Dozier, 1 Dev. & Bat. Eq. 96, and the decress in Mebane v. Mebane, (4 Ire. Eq. 13.) Dec. Term, 1845, Records p. 226; Brown v. Godsey, (2 J on. Eq. 417.) Dec. Term, 1856, Records p. 351; McKimmon v. Rogers, (3 Jon. Eq. 200,) June Term, 1857, Records, p. 491.

Moore, for the defendants.

■ The act of 1787 was the first in this State which modified the old doctrine, that Courts of Equity enforce their decrees simply in personam, and after reciting that process by contempt, &c., frequently failed of effect, it authorized executions ag’ainst the body, or the goods and chattels, &c., of defendants wherever there was a decree rendered against them for money. Ever since then the practice has been to make decrees against trustees admitting assets individually, just as against executors, &o., in the same condition.

Pearson, C. J.

Brownlow’s debt was not secured by the ¿eed of trust, and the object of the original bill was to obtain a decree to authorize and require the trustee to sell property and pay his debt, on the allegation that there was more than enough property convéyed in the deed to discharge all of the debts secured by it.

If the Master at June Term, 1864, had reported that the trustee had in hand cash sufficient to pay the debt of Brown-low, after discharging all of the debts secured by the deed, a decree against the trustee individually, that he pay the debt, would have been proper; for as he had the money in hand an individual liability would be implied, on the same principle as in an action at law for “ money had and received.”

As the Master reports not that the trustee has money in hand, but that he had property belonging’ to the trust fund sufficient to satisfy the judgment of Brownlow, after discharging all of the debts secured by the deed of trust, the decree is erroneous; for there was nothing to create an individual liability, and the decree ought to have been as in Harrison v. Battle, 1 Dev. Eq. 537, that the trustee sell enough of the property to satisfy the judgment.

It was the duty of the trustee, after selling enough property to pay off the debts named in the trust, to reconvey the rest to Judkins, and a decree of the kind indicated was necessary to authorize the trustee to sell enough of the surplus to satisfy Brownlow’s judgment.

It is otherwise in regard to debts named in the trust, for in respect to them the trustee is fully empowered and has undertaken to make sale and pay them; and if he neglect to dp so he is in default, and a decree will be made against him individually, that he pay the debt. So in the case of executors and administrators. All of the personal estate is vested in them for the payment of debts, and to that end they have ample power and it is their duty to make sale and discharge the debts, and a neglect to do so creates an individual liability, and the decree is “ to pay,” and it will be enforced de bonis propriis.

The decree in this case was framed without adverting to the distinction; indeed but for the political death of the slaves it would have made no difference, and we presume the error never would have been noticed. As it is, however, the difference may be very great, and the plaintiff is entitled to have the error corrected at the cost of the defendants. The decree is reversed and the defendant in the original bill may have therein a reference for an account of the trust fund, and the amount that has been received or ought to have been received by the trustee on account of sales, profits by way of hires and interest, &c., and what amount, if any, is in the hands of the trustee applicable to the judgment of Brownlow.

Per Curiam.

Decree accordingly.