JAN. TERM, 1857. KING V. PAYAN. No proceding can be bad, either at law or in equity, by way of garnishment (except upon the statute of attachments), until after judgment bas been rendered at law against the original debtor; and so, upon a bill in equity against the debtor and a garni„shee, the court will have no jurisdiction un-t oss it appeared that the complainant had obtained judgment against his debtor. Where a defendant submits to answer a bill in equity without reservation, and without . ' exception to the jurisdiction of the court, he will not be permitted to make that objection, for the first time, in this court. (Mooney v. Brinkley, 17 Ark.) The answer of a defendant, admitting the indebtedness originally, as charged in the bill, but alleging its payment, if responsive to the allegations and interrogatories, is at least prima _facie evidence for the party making it, if nofabsolute proof of the facts stated, so as to require the usual countervailing proof in cases necessary to ontweigt an answer in chancery. Appeal from the Circuit Court of Mar ion County in Chancery. TTON. BEAUFORT H. NEELY; A--I" Circuit Judge. C. Williams, for the appellants. 'q 1Artt.,v, J. This was a bill r584- brought by th e appellees against the appellants and William Coker and William C. Mitchell, in the Marion circuit court in chancery. The substance of the bill, as far as is material, is as follows: That the appellees are merchants and co-partners in the city of New Orleans; that, as such, they sold and delivered to the appellant, King, merchandise to the amount of ten hundred and eighty-tive 66•100 dollars, for which King, the appellant, made, executed and delivered to them his promissory note, bearing date 19th April, 1854, payable twelve months from date, with interest at 8 per centum 583l KING ET AL., per annum after maturity, which said V. note was exhibited with the bill, and PAYAN & CO. asked to be taken and considered as a The jurisdiction of courts of chancery to enforce part thereof: that at the time of the the remedy by garnishment or sequestration, is not exhibition of the bill, the note re-divested by the statute conferring jurisdiction in mained wholly unpaid and due the. such case, upon courts of law. The remedy by appellees; that a short time after King, judicial garnishment, under the statute, and the proceeding in equity having the same effect, are the appellant, purchased the goods aincurrent. question from the appellees, he brought
KING V. PAYAN VOL. 18 them to Arkansas and sold them col-of the appellants. King admitted his orably to the appellant, Owens, with indebtedness to appellees as stated in the view and intention of hindering the bill; that he had sold his stock of and delaying the appellees and others' merchandise, including the goocTh his creditors, in the collection of their bought of appellees, to his co-appel-just demands and debts against him; lant, Owens; states how Owens had that to accomplish this the more effect-paid him for the same; answers posi-ually, the appellant, King, put all his tively that Owens did not owe hint one property, consisting of personal and cent, but, on the contrary, that the real estate and choses in action, into balance was in favor of Owens; that he the hands of divers persons besides the owed Owens over one hundred dollars appellant Owens; that appellees are on a fair settlement and adjustment of uninformed as to the kind, value or accounts; denied that he had sold to amount of property so disposed of, and Owens for the purpose of hindering or of the names of the persons implicated delaying his creditors; admits his in-therein; that the appellant King, pie-solvency and declares that he was pos-tends to be possessed of no property sessed of no property whatever, except whatever, and declares his utter in-a "homestead," and that he knows of ability to pay the debt due to the ap-no one that holds any property in se-pellees; the bill * charges that, if the cret trust for him. sale from King to Owens of the The answer of Owens admits the pur-merchandise bought of them, was chase of the merchandise from King; not colorable and fraudulent, intend-states its amount and value; that a pored to hinder r,nd delay credit-tion of the amount was paid at the ors in the collection of their time of the purchase; that the rest, and 585*] *just debts against King, the residue was paid at divers and different appellant, Owens, still owes and is in-times between then and the com-debted to King in the amount of the mencement of the suit; that he did not value of the merchandise so bought; then owe King a cent, but, on the con-say, in the sum of fifteen hundred dol-trary thereof, that King was indebted lars: that beside the amount thus due to him over one hundred dollars; de-from Owens to King, the appellant, nies that his purchase from King was Owen s , has in his hands or possession, colorable, or intended by him to aid property or choses in action belonging *King in hindering or delaying [*586 to King, which he holds in secret trust his creditors, if such was really and for him to enable him to accomplish truly his design in making the sale to his designs to hinder and delay his him; that if such was the design on the creditors to colkct their debts: that the part of King, he, Owens, was not aware appellees have no means of ascertain-of the fact at the date of his purchase, ing or knowing the facts aforesaid, ex-or when payment was made to him in cept by discovery from the appellants. the manner stated; denies broadly and The bill prays a discovery upon all the flatly that he has or holds any prop-facts charged; and that appellants be erty, moneys or effects in his hands or required to answer immediately as to possession, colorably, or under a secret such facts, setting forth names, dates, trust in favor of King, and, in a word, amounts, etc.: the special relief de-denies the whole bill and the allegations manded against appellants is, that they therein, except as above shown, so far be decreed to pay appellees the amount as they pertain to him. of the debt, with interest, etc. The cause was put to issue by repli-Separate answers were made by each cations to the answers and was set
.TAN. TERM, 1857. KING v. PAYAN. down for hearing on the bill, the an- pellant, King. If no attachment could swers, replications and proof to be tak- have been issued against King, no gar-en. After the cause was taken up for nishment against the other appellant, hearing it was agreed by the parties Owens, could have been issued until that the testimony of one witness the appellees had sued King at law might be taken ore terms; which it and obtained judgment against him seems was done by consent of the court. for a judiciat garnishment, under our This evidence was reduced to writing statute, is only authorized after judg-and filed in the cause, but does not ment against the debtor. See Dig., ch. bear upon the merits of the case, in the 78, p. 558-'9. By the statute, the writ view that we shall take of it. of garnishment does not operate upon On this state of facts, the court be- the debt due by the garnishee to the low decreed in favor of the appellees judgment debtor, or the credit or effects against both the appellants for the in his hands, except from the time it is amount of their debt exhibited with executed on him under the laW, so that their bill, and interest thereon from he may pay the debt, or turn over the its maturity at 8 per centum per an- property or effeets to the judgment num, and directed that the same might debtor at any time before the writ of be enforced by execution as upon a garnishment is served on him. But, it judgment at law. From this decree, a court of chancery has jurisdiction in both appellants appealed, upon which such case for any purpose, so as to au-the cause is now pending in this court: thorize that court to entertain the suit, It is insisted that the bill of appel- such would not be the privilege of the lees should have been dismissed at the person standing in the suit in the rela-hearing, for want of equity. tion of a garnishee in a proceeding Two points are relied on by the ap- under our statute to which we have repellants, upon which to reverse the de- ferred; for so soon as the subpceua in cree rendered in this cause: 1st. That chancery should be served on him, he the remedy of the appellees was com- would be fixed with notice of the mat-plete at law, and a court of chancery ter of the bill, and the debt or effects had no jurisdiction. 2(1. That upon in his hands would be chargcd, depend-the merits of the case the decree was ent upon the result of the suit. He wrong. could not pay the debt, or dispose of 1. There can be no doubt, we think, the effects to the prejudice of the corn-but that the appellees had a remedy at p'ainant; in doing so, he would be held law, so far as the appellants are con- to do so at his peril, as in other chan-cerned, but whether the remedy exist- cery causes, where the doctrine of ing at law was as complete and ef- pendens is applied. But th■s is rather a fective as that which might be af- matter of argument or speculation, forded by a court of equity, in case of than a judicial determination of the jurisdiction in that court to take cog- question at hand. To accomplish this nizance of the suit, of which we will it will be necessary to lay down some herea 1 fter enquire, is not so clear or cer- of the rules or principles by which 587, "tain. We are rather inclined courts of chancery are ordinarily gov-to the opinion that such was not the eraed in the assumption and mainte-case. The remedy by attachment was ance of the jurisdiction which rightful-not open t o the appellees, for the reason ly, or by concession, belongs to them. that the oill does not show that any of Judicial garnishment at law is a the grounds existed authorizing the is- creature of the statute which author-suing of an attachment against the ap- izes it; but the remedy by garnishment
KING V. PAVAN. VOL. 18 or sequestration, is one which has urged above, aud we have shown that been exercised by the courts of chan- the jurisdiction cannot be maintained cery, we may say, immemorially, or on that ground, for the reason that the at least from a very remote period. bill, independent of the answers and 588*] *The remedy by judicial gar- proof, shows that no judgment at law nishment under the statute in this had been rendered in faVor of the ap-State, and by the proceeding in equity, pellees against King, the debtor, but, having the same effect, are concurrent. on the contrary, it is manifest from the The conferring the jurisdiction or pow- face of the bill, that the proceeding was er upon courts of law did not divest an original one, and independent of any the ancient jurisdiction, which had other suit or proceedings whatever. It been exercised by the courts of chan- the proceeding could be upheld, it woud cery, anterior to the passage of the act be, virtually, doing indirectly what in question, hence, this court, in the could not directly be done by a court case of TValker v. Bradley, 2 Ark. R. of chancery; for we have shown that 678, have said that: 'The proceedings *the indebtedness of Owens, the [*58 9 in this case" (which was one of ju- appellant, to the other appellant, King, dicial garnishment) "are partly accord- would be fixed from the time of the ing to the practice of courts of chan- service of the subpcena upon him, so cery, and partly according to the prac- that he could not pay the debt to tice of courts of law." If the party King, so as to discharge himself from being entitled proceeds against a per- the effect of the suit against him, in-son, liable as a garnishoe, whether he volving the question of indebtedness proceeds at law or in equity, he must to King, which, by the bill, is asked to do so under the circumstances pre- be appropriated to the payment of the scribed by the statute. The fact is, the debt due by him, King, to the appel-statute, so far as the remedy in equity lees. It would be as effectual to the is concerned, is but declaratory of what appellees in securing their debt against the law was before its passage, as ad- King, in the hands of Owens, as if the ministered by the courts of chancery. appellees had proceeded by injunction No proceeding can be had, therefore, to yestrain him from paying over his either at law or in equity by way of indebtedness, setting up the same facts garnishment, except, possibly, in the which the bill charges in this instance. solitary instances authorized by our at- It is well established that a creditor tachment statute, until after judgment at large, or before judgment, is not en-has been rendered at law fixing the in- titled to the interference of a debtedness of the debtor. When that court of chancery, by injunc-is done, the two forums are alike open tion, to prevent the debtor from dis-to the demand of the party seeking the posing of his property in fraud of his remedy,—in law, by proceeding accord- creditor. See Wiggins v. Armstrong, 2 ing to the statutory requirements; in J. Ch. R. 144, citing Angell v. Draper, equity, by adopting the course pre- 1 Verm. 399; Shirley v. Watts, 3 Atk, 200; scribed by the ancient precedents, and Bennett v. Musgrave, 2 Ves. 51; Balch the rules adopted by the judges who v. IVartall, 1 P. Win. 445; Mitford 115; have adorned the benches of those Cooper Eq. Plead. 149. See also courts. In the case before us, if the Rand. R. 190; Meaux v. Anthony et al., jurisdiction exercised by the chancel- 11 Ark. 411. lor can be sustained or upheld upon any In Wiggins v. Armstrong, Kent, pretext whatever, it must be in con- chancellor, said: "The reason of the sequence of the reason which we have rule seems to be, that until the creditor
JAN. TERM, 1857. KING V. PAYAN. has established his title, he has no to grant the relief which the complain. righ t to interfere, and it would lead to ant sought by the bill." Citing Lud-an unnecessary, and perhaps a fruit-low v. Simonds, 2 Caine's Cases in less and oppressive interruption of the Error 40, 56; Underhill v. Van Cort-debtor's rights. Unless tie has a cer-landt, 2 J. Ch. R. 369; Hawley v. Cra-tain claim upon the property of the mer, 4 Cow. R. 727;2 Grandin v. Leroy, debtor he has no concern with his 2 Paige Ch. R. 509. frauds." In Underhill v. Van Cortlandt, cited If it is a rule of equity jurisprudence, by English, C. J., in Mooney v. Brink-that a creditor at large cannot inter-ley, Kent, Chancellor, said on the sub-fere with his debtor until he shall have ject: "It would be an abuse of justice established his title at law, we see no if the defendants were to be permitted good reason why his remedy should be to protract a litigation to this extent, enlarged when the proceeding is and with the expense that has attended against both debtor and creditor to this suit, and then, at the final hear-such debtor, nor is it true by an in-1ng, interpose this preliminary -objec-junction, but by a proceeding which is tion." a virtual injunction as to both; for the In the case at bar it does not appear restraint upon Owens in this case from the record, that any objection would be a virtual restraint upon was interposed, at any time, question-King, as heretofore shown.' ing the jurisdiction of the court, whilst We hold, therefore, in this case, that the cause was progressing in the court 5901 upon the face of the *bill, as below. The questioni seems to have well as on the whole record before us, been ma& and urged for the first time, there is nothing which could give the by the counsel for the appellants, in court hetow the jurisdiction of the sub-this court. We may say, therefore, in ject matter, and as to the relief prayed. the language of Chancellor Kent, that But the inquiry arises whether, the it would be "an abuse of justice" to al-appellants having omitted to avail low the objection to prevail here. Hav-themselves of the want of equity in the ing thus disposed of the first point made bill, as well as the jurisdiction of the by the counsel for the appellants and court over the subject matter of the those incidently growing out of it, as-suit, but submitting to answer without *they severally occurred to our Ps591 reservation, those objections can be minds, we will, therefore, proceed to heard for the first time in this court. consider and determine the only reIn Mooney v. Brinkley, 17 Ark. R. maining one. this court, by English, C. J., said: "The 2. Is the decree, which was ren-defendant having submitted to answer dered by the court below, warranted by the whole bill, and did not, by his an-the case made by the bill, the answers swer, object to the jurisdiction of the and replications, as to either or both of court of equity aver any of the matters the appellants ? set up in the bill, or otherwise demur As to King, we think there can be no for that cause, and having thus sub-doubt of the fact. He admits his in-mitted the cause to the cognizance of debtedness to the appellees as charged. the court, it was too late . for him, and by computation of the interest upon the hearing, and it is too late upon the amount, we find the sum de-now, to object to the jurisdiction, un-creed against him to be made up. The decree, therefore, as to King, will be less the court was wholly incompetent affirmed. I. See Meaux v. Anthony, 1 1 -421, on procedure 2. This court will retain jurisdiction. Stroud Y to set aside fraudulent conveyances. Vanzants, 30-89; Hicks v. Hogan, 36-303.
VOL. 18 But as to Owens the case is different. The fact is, we are at a loss to conceive lie admits the purchase of the stock of upon what ground, in point of fact or merchandise from the appellant, King, law, the court below could have pro-and in response to a question or inter- ceeded, to authorize the decree. against rogatory propounded in the bill, in Owens. We, therefore, hold the de-which he was required to make the cree, as to him, erroneous and unwar-atatement, he states that at the time of ranted. The decree is, consequently, the purchase he paid a large part of the hereby reversed, and the bill dismissed purchase money for the goods bought, as to Owens, at the costs of the appel-and that since then and before the lees in both courts as to him. vommencement of the suit against The decree is affirmed as to King, at, him, he paid the residue, aud in con- his costs as to himself in both courts. lusion, answers broadly and fully, that Let the judgment of this court be so he was not indebted to King, in any entered. amount, at the time of the commence- Absent, Hon. C. C. Scott. ment of this suit. We apprehend the Cited:-26-23 ; 30-91 ; 34-300 ; 36-303 ; 44-381. answer made under such circumstances would be at least prima facie evidence for the party making It, if not absolute proof of the facts stated as to the payment, so as to require the usual coun-tervailing proof in cases necessary to -outweigh an answer in chancery. See Britt v. Bradshaw, 18 Ark. 530 ; 1Iheat et al. v. Moss et al., 16 Ark. R. 241 ; Green v. Vardiman, 2 Black!. R. .-328, and the eases cited. In this latter ease, the court say : "That the answer, so far as it is strictly such, being directly responsive to the bill, is to be taken as true. For where the bill requires a disclosure of such matters as may discharge the defendant, he is compelled to answer and disclose those matters; and if the disclosure amounts to a discharge, he is entitled to the full benefit of it.' The court below, therefore, having no proof before it to coun-tervail the evidence afforded by the answer of Owens, was unauthorized to render the decree against hint, for any amount whatever, as a debtor of King. 5929 There *being no proof of the purchase by Owens from King of the ,tock of merchandise, being fraudulent or colorable on the part of either King or Owens, but the reverse thereof as to Owens appearing by his answer, the court below was unwarranted in decreeing against him on that account.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.