owners should be joined with the debtor.1 Exempt property is not liable, nor an unearned salary.

2

Against a corporation and its stockholders. In equity the capital stock of a corporation is regarded as a trust fund for the payment of debts. It is a substitute for the personal liability which subsists in private copartnerships. The creditors have a lien upon it in equity, and if diverted, they may follow it as far as it can be traced, except as against bona fide holders for a valuable consideration and without notice. 8

In New York, under a statute, it was held that where it was intended to proceed against the directors and stockholders of a corporation to charge them personally in case of deficiency of the corporate property to pay the debts, the proper course upon the return of an execution, unsatisfied, was to proceed in equity against the corporation and stockholders for the amount of unpaid stock. The rule there stated seems to be of general application. The remedy at law, however, must be exhausted against the corporation. The creditor need not join all the stockholders, nor is it necessary to adjust the accounts of the corporation nor the equities of the stockholders." A bill will also lie against the officers of an insolvent corporation who have mismanaged its affairs to the detriment of creditors.7

5

Frame of petition of creditor's bill against a corporation. A creditor's bill should set forth the judgment, the return of an execution thereon unsatisfied, together with a statement of facts showing that the corpcration has assets incumbered by a conveyance or cloud on the title, or that the stock is unpaid, or both facts, if true, or any other fact showing a liability of the defendants to the plaintiff, with a statement of the amount claimed and an appropriate prayer.

1

Creditor's bill against estate of decedent.

Ager v. Murray, 105 U. S. 126.

2 Tillston v. Wolcott, 48 N. Y. 188. 3 Sanger v. Upton, 91 U. S. 56; Hatch v. Dana, 101 U. S. 498; Crandell v. Lincoln, 32 Conn 73.

4 Morgan v. N. Y. A. R. Co., 10 Paige, 290; the rule seems to be general.

Under the

5 Tunesma v. Schuttler, 114 Ill. 156. 6 Pierce v.Construction Co., 38 Wis. 254; Ogilvie v. Ins. Co., 22 How. 380; Bartlett v. Drew, 57 N. Y. 587; 4 Am. and Eng. Ency. of Law, 579.

7 Penn. Bank v. Hopkins, 111 Penn. St. 328.

12

English chancery practice, a creditor may file a bill against an executor or administrator for the payment of his own debt out of the estate of the decedent, and pray for a discovery of assets for the purpose of such payment.' Story says, speaking of the English court of chancery, that it is the usual resort to "settle the administration of estates, so that, practically speaking, in cases of any complication or difficulty, it has acquired almost an exclusive jurisdiction. In this country the probate courts, or courts specially created exercising the powers of probate courts of the various states, are expressly authorized to settle estates, and where such is the case a court of equity would seem to have no original jurisdiction in the matter. A few cases, however, may be found in which the jurisdiction has been exercised.3 In the leading case in this country the administrators of a deceased partner had continued the partnership business with the surviving partner, and the estate had thereby suffered loss so that the question properly was not the settlement of the estate of a deceased person.* In some of the cases it is said that the creditor's claim need not be reduced to judgment, but in states where all claims against an estate must be filed in a proper court by a day named, or be barred, such filing and the allowance of the claim against the estate would seem necessary to show that the plaintiff was in fact a creditor.

A court of equity will not assume jurisdiction, except in extraordinary cases where the remedy afforded by the statute is inadequate.

Claim should be filed. The safe course is to establish the validity of the claim by filing the same in the court provided by law for that purpose, and secure its allowance, then, after the division of the visible assets, if the goods, etc., belonging to the estate have been misappropriated or concealed, a creditor's bill may be filed. A creditor whose claim has been es

11 Story's Eq. Juris. § 546.

2 Id. § 543.

3 Kennedy v. Cresswell, 101 U. S. 645; Thompson v. Brown, 4 John. Ch. 619.

4 Thompson v. Brown, 4 John. Ch.

Hagan v. Walker, 14 How. 29. 6 Harlow v. Douglas, 69 Ill. 466. 7 Reitzell v. Miller, 25 Ill. 67; Paschall v. Hailman, 4 Gilman, 285; Turney v. Gates, 12 Ill. 141; Clingman v. Hopkie, 78 Id. 152.

tablished as valid against the estate of a decedent, but not paid, may, after the assets in the administrator's hands are exhausted, bring an action in his own behalf and all other creditors, to set aside fraudulent conveyances of property made by the decedent in his lifetime, if, under the statute, the administrators refuse to bring such action.1 In the absence of a statute, the right of a creditor to bring an action for the purpose indicated is undoubted.

Frame of ordinary creditor's bill. First. The plaintiff should allege the recovery of the judgment, stating the parties, court, etc., and amount thereof, and, if necessary to docket the judgment, allege that fact.

Second. Allege the issuing of an execution on the judgment and the delivery thereof to the sheriff and his return of nulla bona, and state the amount still remaining due on the judgment.

Third. Allege the fraudulent conveyance of certain property (describing it) to a third party, either without consideration or for the purpose of hindering and defrauding the plaintiff and others.

Add an appropriate prayer.

If the object of the action is to remove obstructions from the title, so that the property can be sold to advantage, the plaintiff, in the second paragraph of the petition, instead of alleging the return of an execution unsatisfied, may allege that the sheriff, being unable to find any goods and chattels of the debtor whereon to levy, indorsed on the writ, "no goods," and, after diligent inquiry, being unable to find any property of the defendant held in his own name, levied said execution upon (describe property), etc.

Third. State facts showing that the property levied upon is in fact the property of the judgment debtor, but has been fraudulently conveyed.

Frame of petition against fraudulent grantees of an

1 Harvey v. McDonnell, 21 N. E. R. 695. The statutes and decisions of the state where the action is brought must be followed. The general rule is as stated by the Court of Appeals of New York in the case cited, that "when, as

in this case, it (the property) is actually claimed by them, or the trustee unreasonably refuses to sue, the creditors or other persons interested may themselves bring an action for or reclaim the property fraudulently transferred.

estate. The petition should show the filing and allowance of the plaintiff's claim. The amount allowed is conclusive against the estate, unless an appeal is taken, and is, in effect, a judgment.

Second. It should be alleged that the assets in the hands of the administrator were exhausted, and that there still remains due to the plaintiff, on his claim, the sum of $-.

Third. State the facts as to the fraudulent transfer of the property, and that the administrator has been requested by the plaintiff to bring the action, but refuses to do so. If the action is on behalf of all creditors, it will be necessary to set out the entire amount of the debts and assets, with a statement of the entire amount still unpaid, and the amount still due the plaintiff. Add an appropriate prayer.

CONTRIBUTION.

Where the liabilities of two or more persons are joint, he who has paid more than his share is entitled to contribution from the rest. One of the fundamental principles of the law of suretyship is that co-sureties are bound to contribute equally, as between themselves, to the discharge of the common burden; and another is that if one surety pay the whole debt for which they were jointly bound, he is entitled to an assignment of the rights and remedies of the creditor not only as against the principal debtor, but also against his cosureties. In equity, the surety, upon the payment of the debt, is subrogated to all the rights and remedies of the creditor for the recovery of his debt against the principal debtor, or his property, or against the co-sureties, or their property, to the extent of what they are equitably bound to contribute. 1

The creditor is entitled to the benefit of all the securities held by a surety, and the latter will not be discharged until he has accounted for all the property, or assets, received from the principal debtor on account of the debt. 2

1 Cuyler v. Ensworth, 6 Paige, 32; Bunn v. Boyer, 2 Neb. 268; Story's Eq. Juris. 327; Clason v. Morris, 10 John. 524; Curtis v. Tyler, 9 Paige, 432; Heath V. Hand, Id. 329; Ontario Bank v. Walker, 1 Hill, 652; Cheesebrough v.

Millard, 1 John. Ch. 409; Sandford v. McLean, 3 Paige, 117; Wilkes v. Harper, 2 Barb. Ch. 338; Willard's Eq. III.

2 Moses v. Murgatroyd, 1 Johns. Ch. 119; Curtis v. Tyler, 9 Paige, 432; Bibb v. Martin, 14 S. & M. 87.

Surety of a surety. As a general rule the surety of a surety is not liable to contribution in an action by the party for whom he is surety. 1

Right against co-surety.

As a general rule a surety has

no greater right against a co-surety than the creditor had against them all; therefore, if a surety, knowing all the facts, should pay an obligation not binding on his principal, he will not be entitled to contribution, 2 And a voluntary act of one person in spending money for the benefit of all, will not make such persons legally liable, hence he can not recover. 3

The general rule may be stated thus, that while the creditor is entitled to payment of his debt, yet if he collect from a party who is not primarily liable, he must give to such party every means of indemnity possessed by himself. 4

Between wrongdoers. The general rule is that, as between wrongdoers there is no contribution. Some of the courts have sought to modify and limit this rule to cases where the party seeking contribution knew, or is presumed to have known, that the act was unlawful. 5 This modification of the rule has much to commend it.

In all cases where there is a joint undertaking of principal and sureties, a promise of contribution is raised in favor of the surety who pays the entire debt or more than his proportion against his co-obligors.

The plaintiff may

Frame of petition for contribution. set forth in his petition either the obligation upon which the suretyship arose, or the substance of it.

Second. That at the maturity of the instrument, if it was for the payment of money, he was compelled to pay the same. If on a bond or undertaking, allege the facts showing a default.

1 Brandt on Suretyship, § 230. 2 Id. § 232.

3 Watson v. Wilcox, 39 Wis. 643; Webster Appeal, 86 Penn. St. 409.

4 Eddy v. Traver, 6 Paige, 521. It is said (p. 524): "It is an established principle of equity that sureties, or those who stand in the situation of sureties for those who pay a debt for them, are en

titled to any fund, lien or equity which he may have," etc.

5 Acheson v. Miller, 2 O. S. 203; Moore v. Appleton, 26 Ala. 633; Sherner v. Spear, 92 N. C. 148; Horback v. Elder, 18 Penn. St. 33; Armstrong Co. v. Clarion Co., 66 Id. 218; Bailey v. Bussing, 28 Conn. 455; Jacob v. Pollard, 10 Cush. 287; Adamson v. Jarvis, 4 Bing. 72; Labeaume v. Sweeney, 17 Mo. 153.