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Mahoning Circuit Court.
sum per ton for the rolling of the iron, and was to select his own assistants. In every other respect it was in accordance with the general terms of employment of servants. From the evidence and by authority it seems to us that there can be no question but that the relation of master and servant obtained and not that of contractor and contractee. See also Rummell v. Dilworth, 2 Atl. Rep., 355 [111 Pa. St., 343].
We, therefore, find no error in the charge of the court, and that the verdict was supported by the testimony, and these two assignments being the only ones urged by plaintiff in error, and upon which the question was made, the judgment of the court of common pleas must be affirmed.
[Wayne Circuit Court, February Term, 1901.]
Douglass, Voorhees and Donahue, JJ.
ANTHONY WRIGHT V. SARAH SNELl et al.
FRAUDULENT JUDGMENTS ASSIGNED TO INNOCENT PURCHASER ENFORCIBLE, WHEN.
Where a person made and delivered judgment notes to another, for the purpose of having such other person take judgments thereon and have executions issued, thereby creating liens upon his real estate, with the intent and purpose of defeating or hindering the collection of apprehended judgments against him, and judgments were accordingly taken on said notes and executions levied on his real estate, and afterwards the judgments were assigned for a valuable consideration to an innocent purchaser, a court of equity will not aid or relieve such judgment debtor from the payment of the judgments to such purchaser.
2. A STRANGER to such Judgments CANNOT ATTACK THEM.
It is only persons whose rights are interfered with, those who are injured by the transaction alleged to be fraudulent, that have the right to interfere to set it aside. Strangers have no interest, and, therefore, no right to question its validity. Between the parties and their privies it is valid.
8. SUFFICIENT CONSIDERATION FOR THE Assignment.
On an issue of want of consideration for the assignment of a judgment, il there were benefit to the assignor received from the assignee, viz: by getting means to stop the forced sale of this farm, or if there were benefit or possible detriment to the assignee in the transaction, in either event there is a suffi cient consideration shown.
4. NOTICE TO AN ATTORNEY-When not NOTICE TO CLIENT.
When an attorney, while conducting a transaction for his client, acquires such knowledge as would be a breach of professional confidence for him to disclose and he is subsequently employed by another person, the latter is not charge. able with the knowledge thus acquired and possessed by the attorney.
5. RIGHTS OF PURCHASER OR ASSIGNEE¡AGAINST STRANGERS OR THIRD PERSONS. In an action between a bona fide purchaser or assignee of a judgment and a stranger to the judgment, such purchaser stands unaffected by frauds of which he had no knowledge, express or constructive.
6. JUDGMENT DEBTOR ESTOPPED FROM ATTACKING JUDGMEnt—When. Where a person procures or assists in procuring a judgment to be taken against him, and a lien is thereby obtained upon his property in favor of another, with intent to cover his property with liens, so as to defeat an anticipated oi apprehended judgment, that may be recovered against him, and the person in whose favor such judgment is taken, for a valuable consideration, assign
Wright v. Snell.
such judgment to an inuocent purchaser, without notice of the fraud in its inception and rendition, such judgment debtor is estopped from assailing the judgment as against such innocent purchaser.
7. ESTOPPED BY NEGLIGENT ACTS AND CONDUCT WHEN.
If such judgment debtor should be innocent of any fraud in the obtaining or rendition of such a judgment, but by permitting the judgment to remain of record as subsisting and valid, and in permitting the judgment creditor to appear of record as the owner of such judgment, he is estopped by such acts and conduct from setting up any defense which would affect the rights of a bona fide purchaser or assignee from such creditor. The rule of equity, that, where one of two equally innocent persons must suffer, the loss must be upon him who has put it in the power of another to do the injury, applies.
Capt. J. B. Taylor and C. A. Weiser, for defendants.
That the action was one in equity to remove a cloud on title to enable sale to be made; that the proceeding was not under Secs. 6343 and 6344, Rev. Stat., and that such action was clearly maintainable in Ohio: Gormley v. Potter, 29 Ohio St., 597, 598; Beaumont v. Herrick, 24 Ohio St., 445, 455, 456; Knox Co. Bank v. Lloyd, 18 Ohio St., 353, 362; Bates Plead. & Pract., 454; Maxwell Code Plead., 642; 5 Ency. Pl. & Pr., 397.
Judgments by confession not collaterally impeachable: Callen v. Ellison, 13 Ohio St., 446 [82 Am. Dec., 418]; Hammond v. Davenport, 16 Ohio St., 178, 181; Ingham v. Lindemann, 37 Ohio St., 218, 221; McCurdy v. Baughman, 43 Ohio St., 78, 82 [1 N. E. Rep., 93].
Even, though, fraud is alleged: Knapp v. Thomas, 39 Ohio St., 377, 387 [48 Am. Rep., 462]; Anderson v. Anderson, 8 Ohio, 108, 109; Cliver v. Sanders, 8 Ohio St., 501, 508; Robinson v. Robinson, 17 Ohio St., 480, 484; Coates v. Bank, 23 Ohio St., 415; Conway v. Duncan, 28 Ohio St., 102.
Such judgment is conclusive of the debt: Key v. Vattier, 1 Ohio 132, 146; Starr v. Starr, 1 Ohio, 321; Bump on Fraudulent Conveyance, 558; 12 Am. & Eng. Ency., (1 ed.) 149 (u).
Consideration of judgment not inquired into: 4 Wait's Action & Defenses, 195.
Wright claimed an interest by assignment of judgment to him-How judgment assigned: 2 Black on Judgments, Sec. 945, note 18; Gaullagher v. Caldwell, 22 Pa. St., 300 [60 Am. Dec., 85].
The levy of the execution upon the real estate of Mrs. Snell created a specific lien, and John N. Mowery, a stranger and a subsequent purchaser, would not only be bound by the lien but would acquire no rights as against Wright, assignee of the judgment, for a valuable consideration and in good faith without knowledge of infirmity in the judgment or Coal Co. v. Bank, 55 Ohio St., 233, 255 [45 N. E. Rep., 630]. There is no evidence showing any knowledge on the part of Wright as to any infirmity in the judgment in favor of Thomas Mowery and against Mrs. Snell. But, it is claimed that one, A. J. Thomas, an attorney, originated, or, at least, participated in the execution of the notes subsequently reduced to judgments on which executions issued and levies made. And, that Thomas was also attorney for Wright, and that whatever knowledge Thomas had in respect to the notes and judgments would be imputable to Wright. We contend this is not the law of the case under the facts as they are developed: Pomeroys' Equity, Secs. 674, 675.
Wayne Circuit Court.
We contend under the pleadings and evidence it clearly appears that Mrs. Snell clothed Thomas Mowery with apparent ownership of notes and judgments, and all such rights as legally pertained to such ownership: Rosser v. Darden, 14 Am. St. Rep., 152, 154 [82 Ga. 219]; Versian v. Lewis, 3 Am. St. Rep., 184, 201, 202n. [15 Or. 539]; Williams v. Merle, 25 Am. Dec., 604, 611, 612n. [10 Wend. 80]; Bennett v. Williamson, 6 Circ. Dec., 59 (9 R. 110); Cincinnati, N. O. & T. P. Ry. v. Bank, 56 Ohio St. 351 [47 N. E. Rep., 249].
Wright had the right to rely on what the records disclosed when he acquired an interest in the judgments by assignment: Dav v. Brenton, 63 Am. St. Rep., 460, 471n. [71 N. W. Rep., 538; 102 Ia. 482]. VOORHEES. J.
The pleadings in this case are numerous and lengthy. It will be sufficient, however, for the purpose of presenting the questions of law and fact involved to state the following:
Plaintiff, Anthony Wright, on May 2, 1894, filed his petition against Sarah Snell, Thomas Mowery, John Mowery, Jacob Suell, Alfred J. Thomas and W. A. Mackey, setting forth in substance; that at the November term, 1893, of the common pleas court of this county, he recovered a judgment against Sarah Snell for $540.00 and costs, which judgment at the time of the filing of the petition was unpaid and unreversed; that on December 8, 1893, execution was issued on the judgment and was levied on the real estate of Sarah Snell, described in the petition; that the defendants, Thomas Mowery, John Mowery, Jacob Snell, Alfred J. Thomas and W. A. Mackey, claimed to have some liens or interest in the premises as against Sarah Snell; and that the action was brought for the purpose of marshalling the liens, and to clear said premises from any cloud upon the title by reason of any adverse claim of the defendants, and to enable plaintiff to effect a sale of the premises. to satisfy his said judgment; and that the defendants be required to set up their claims that the validity thereof might be determined.
The defendant Thomas Mowery on June 4, 1894, filed his answer and cross-petition in said action, in which he averred: That he had read the answer and cross-petition of Alfred J. Thomas, filed in said action, and that he admitted the same to be true, and adopted their allegations as a part of his answer.
The defendant Alfred J. Thomas in his answer and cross-petition, filed June 4, 1894, set forth the judgments in favor of Thomas Mowery against Sarah Snell, which had theretofore been recovered in the counties of Stark and Ashtabula, this state, and that Thomas Mowery was indebted to him (Alfred J. Thomas) in an aggregate sum of $1,600; that by virtue of said judgments against Sarah Snell and the levy of executions issued thereon upon the premises described in plaintiff's petition, Thomas Mowery secured a lien on said premises; that said judgments were assigned by said Thomas Mowery to him, the said Alfred J. Thomas, to secure his said indebtedness of $1,600. These allegations, Thomas Mowery adopted as a part of his answer.
After Thomas Mowery's answer and cross-petition was filed, Sarah Snell and John Mowery, in September, 1894, filed their answers, alleging that on June 23, 1894, Sarah Snell sold the real estate in the petition described to John Mowery, and on the same day executed a deed to him. The deed was recorded in July, 1894. Mrs. Snell, in her answer, alleged that the judgment of the plaintiff (the judgment for $540.00) had been fully paid.
Wright v. Snell.
Plaintiff Wright, on September 7, 1894, filed a supplemental petition in said action, in which he set up that he held a note against Thomas Mowery for $867.00 and one for $1,000.00; the latter was made by him, Thomas Mowery, and Sarah Snell in July, 1893; that on June 22, 1894, Thomas Mowery, for a valuable consideration, assigned as security for these last mentioned notes the said judgments against Mrs. Snell to the plaintiff; that by the assignment of these judgments, he, Wright, secured a lien on the premises described in his original petition, for the payment of said two notes. The assignment of these judgments is entered on the appearance docket of the court of common pleas of this (Wayne) county The assignment bears date June 22, 1894, and the judgments were assigned to Wright to secure said notes, and for other considerations then existing and passing between the parties at that time.
The cause has been submitted to this court upon the pleadings and evidence. From the evidence and exhibits submitted, the court finds, as the material facts bearing upon the issue between the parties, and which are summarized as follows:
The assignment of said judgments by Thomas Mowery to the plaintiff Wright, was made on the day it bears date, to-wit: June 22, 1894, and was entered upon the appearance docket of said common pleas court on June 23, 1894. On June 23, 1894, Thomas Mowery was the owner of a farm of 160 acres, known and designated in the testimony as the "Baum Farm." This farm was to be sold on execution June 23, 1894, in a foreclosure proceeding against Thomas Mowery.
To save this farm from forced sale Mowery secured the aid and assistance of the plaintiff Wright, who furnished him means to pay off the judgment on which the farm was to be sold June 23, 1894. On the morning of June 22, 1894, Wright informed Mowery, through Mowery's agent and attorney, Alfred J. Thomas, that he would advance the money to Mowery to pay off the judgment against the "Baum Farm," provided Mowery would pay him $50.00, and secure said other claims, namely, that of $867 and the $1,000 notes on which last note Mrs. Suell was surety. Thomas Mowery agreed to do so, and accordingly, to secure these two notes and as part consideration for the money so advanced by the plaintiff to pay off said claim against his farm, Thomas Mowery did on June 22, 1894, assign to Wright the Snell judgments.
When this arrangement was made John Mowery and Mrs. Snell had knowledge of their brother Thomas Mowery's situation, as to the pending sale of the "Baum farm" under said foreclosure proceedings, and that the farm would be sold on said day, June 23, unless said claim against it was in some way adjusted.
On the same day. June 23, 1894, Mrs. Snell sold to her brother, the said John Mowery, said premises on which said judgments were liens, and which were the day before assigned by Thomas Mowery to the plaintiff, as herein before found.
The contract of sale between Mrs. Snell and her said brother is in writing, and among other things it provides that Wright's interest in the farm resulting from the assignment of said judgments, should be deducted from the purchase price thereof.
At the time Mrs. Snell and John Mowery filed their several answers to the answer and cross petition of Alfred J. Thomas and the answer of Thomas Mowery, wherein he adopted the allegations of Alfred J. Thomas' answer, they make no complaint or attack upon these judgments against Mrs. Snell therein set up. It was not then claimed or
Wayne Circuit Court.
averred by either of them, that these judgments were fraudulent, or that the notes upon which the judgments were obtained were without consideration and were fraudulent in their inception; but their contention then was that Thomas Mowery held the claims and the judgments rendered thereon in trust for Mrs. Snell for the purpose as expressed in a contract between her and her brother Thomas, made at the time the notes were executed. The contention as made in their answers was, that as against Alfred J. Thomas, that he was not entitled to have his claim paid from the proceeds of Mrs. Snell's land, as these judgments were held by Thomas Mowery in trust for her.
It was long after these answers were filed, and after the death of Thomas Mowery, and of the plaintiff Wright, that they, Mrs. Snell and John Mowery, changed their contention and claim as to the nature and character of these judgments. Now these judgments are attacked by them for the first time, as being fraudulent in their inception; and that Thomas Mowery obtained the notes and the judgments thereon by fraud participated in by Alfred J. Thomas.
It is claimed by Mrs. Snell and John Mowery, that Thomas Mowery and Alfred J. Thomas, by fraud induced Mrs. Snell to execute these notes upon which said judgments were afterward taken, on the pretext that the same were necessary to enable her to cover up her property, and save it from judgments she was then anticipating, and was threatened with, that might be rendered against her in favor of her husband, and her son-in-law, Mackey.
As questions of fact the court find from the testimony: That said notes and judgments were fraudulent in their inception; that the transaction between Thomas Mowery and his sister Mrs. Snell, participated in by Alfred J. Thomas, was entered into for the purpose to enable Mrs. Suell to cover up her property and to create liens thereon for the purpose and with the intent to defeat any judgment or judgments that were then threatening her, in suits and controversies then pending and existing between her and her husband Jacob Snell, and her son-in-law W. A. Mackey. That for the purpose of saving her property from such anticipated judgments, the said notes were made; and said judgments were obtained and executions levied on her land in favor of said Thomas Mowery, for the sole purpose of having said judgments appear as liens upon her said property, with the secret understanding between them, that said judgments were to be owned and held by Thomas Mowery in trust for her benefit, and that of her daughter, the wife of said W. A Mackey. That the plaintiff Wright, at the time said judgments were assigned to him by said Thomas Mowery had no knowledge, directly or constructively, of the fraudulent purposes existing between said Thomas Mowery and his sister, Mrs. Snell, or of Alfred J. Thomas, in the execu tion of said notes, or in obtaining said judgments and levy of execution thereon; and that said Wright obtained said judgments by assignment in good faith on June 22, 1894, for a valuable consideration, and without any knowledge that the same were fraudulent in their inception, or were intended to enable said Sarah Snell to cover up her property or save the same from said anticipated judgments. That by the judgments and the levy of executions brought about by the active participation of Mrs. Snell, liens were put upon her property (the real estate here in controversy), and in the name and in favor of Thomas Mowery under a secret trust to avoid apprehended judgments against her.