Fusting v. Sullivan

Bartol, C. J., delivered the opinion of the Court. John C. Sullivan, in 1871, instituted an action of assumpsit against Joseph P. Fusting; pending the suit the defendant died, and his executors were made parties, and judgment was recovered against them for $1524.18. This judgment, upon an appeal taken by the defendants was affirmed in this Court on the 2nd day of December 1874, ( 41 Md., 162 .) . On the 3rd day of December 1874, the judgment was assigned by Sullivan, the plaintiff, to James McDougall for valuable consideration.

This assignment was made in pursuance of a previous agreement, and was evidenced by an order of that date directing the clerk of the Court of Appeals to enter the judgment to the use of McDougall. The order was signed by Mr. Horwitz, one of the plaintiff’s attorneys, under the plaintiff’s direction. This order was afterwards accidentally mislaid, and another was prepared of the same tenor, signed by plaintiff’s attorneys and filed in the Court of Appeals on the 15th day of December 1874. A like order was filed in the Superior Court where the- judgment had been recovered.

A writ of fieri facias on the judgment was issued out of this Court, directed to the. sheriff of Baltimore City, ⁴⁹⁵ and was returned nulla bona, whereupon another writ of fi. fa. was issued out of the Superior Court directed to the sheriff of Baltimore County. The defendants in the judgment, Charles T. and Caroline Rusting, executors, claiming a right to set off certain promissory notes of Sullivan, held by them as endorsees of R. K. Cross, obtained from the Circuit Court for Baltimore County, an order temporarily staying proceedings under the fieri facias. They then filed their bill of complaint in the Circuit Court of Baltimore City, claiming the right to set off the promissory notes against the 'judgment and execution, alleging the insolvency of Sullivan, bringing into Court the balance due upon the execution, after deducting the amount of the promissory notes, and praying an injunction restraining further proceedings on the fieri facias. An injunction was issued as prayed.

The cause was heard on motion to dissolve the injunction, upon bill, answers and evidence, and the injunction was by the order of the Circuit Court dissolved. From this order the present appeal was taken. The two promissory notes which are claimed by the complainants to be an equitable set-off, were made by Sullivan, payable to the order of Richard K. Cross, each for the sum of $728.85, dated December 1st, 1871, one of them payable eleven months after date, and the other payable twelve months after date. These notes were endorsed by Cross “ without recourse,” and delivered to the complainants on the 5th day of December, 1874.

On that day an agreement in writing was entered into between Cross and the complainants, stipulating “that in case the the judgment of Sullivan against the executors, in the Court of Appeals, be set aside in any way, or in case said judgment be assigned by Sullivan, so that executors shall not be able to use the two notes of said Sullivan this day endorsed to them by said Cross, * * * ⁴⁹⁶ as a set-off to said judgment, then the said notes shall be returned to said Cross, and he shall refund any money he may have received therefor from said executors.” We think there are several insuperable objections to the set-off claimed by the complainants: 1st. It appears from the evidence that the judgment was assigned to McDougall in good faith, and for a valuable consideration before the promissory notes came into the possession of the complainants. Though the entry of the use was not made upon the record till the 15th day of December, the proof shows that the equitable assignment was made on the 3rd day of December, in pursuance of an agreement previously made by Sullivan with McDougall, to assign the judgment to him, in case it should he affirmed on appeal. At the time the assignment was made, there