Perkins v. Peninsula Trust Co.

Briscoe, J., delivered the opinion of the Court, On the 13th of April, 1913, the Maryland Insurance Agency Company, a body corporate, was declared to be, insolvent and its assets, were placed in the hands of receivers for distribution. In the course of its liquidation and settlement, two auditors’ accounts were stated and filed in the Circuit Court for Baltimore City by the receivers. The first account was filed on the 22nd of July, 1914, and in this account there was distributed to the appellee, the Peninsula Trust Company, the sum of sixteen hundred and twenty-eight dollars and eighty cents as a dividend upon claims, represented by certain promissory notes of the Maryland Insurance Company held by the appellee company for money borrowed and loans made by it to the Agency Company. There were no exceptions filed to the allowance of the claims of the appellee company, and the first account except, as to the items specifically excepted to, was finally ratified and confirmed on the 3rd day of August, 1914, and the receivers shortly thereafter paid over1 to the appellee company the amount allowed it.

A second report and account was filed by the receivers on 16th of October, 1915, and a second dividend, amounting to ²²² the sum of three thousand three hundred and seven dollars and thirty-two cents, was allowed the appellee company on the same claims or notes on which the first dividend was based. The.second dividend w.as contested by á stockholder of the Agency 'Company, and certain exceptions filed to- the allowance of the claim, were sustained by the Court below, and by order of Court dated the 29th of December, 1915, this claim was disallowed. On appeal to this Court, we held, that the transaction upon which the appellee’s claim was based was illegal and invalid and the order of the Court below, in disallowing the claim, was affirmed. Peninsula Trust Co. v. Johnson, 128 Md. 540 .

On the 3rd of January, 1916, the appellant on behalf of the creditors of the Agency Company, filed a petition in the Circuit Court of Baltimore City, -asking that the enrollment of the order ratifying the first account be vacated and set aside, and the cause reopened for certain reasons alleged therein, and these will be hereafter stated and considered by us. The appellee in its answer relies upon a single defense and that is, that the enrollment of the final order of ratification, directing the distribution and the payment of the dividend to the appellee, “was conclusive and res adjudícalaas to all matters which were available to the petitioners or to creditors,” and could not be called into question upon the petition of the appellant. ' The Court below sustained the appellee’s contention and dismissed the petition. Erom that order this appeal has been taken. It would answer’ no useful purpose to review the many decisions in this 'State, announcing the rule or practice, as to when a decree or decretal order, which has become enrolled can be discharged, revised or annulled, upon a petition and not by a bill of review or original bill.

In the recent case of Whitlock Cordage Co. v. Hine, 125 Md. 103 , Chief Judge Boyd, after an elaborate review of ²²³ a long line of cases and authorities, said, while it was not always an easy matter under the authorities to determine the question, yet, the general rule as supported by authority undoubtedly was that a decree or decretal order, after enrollment, can be revised or annulled only by a bill of review or original bill and not by a petition. But there are exceptions to the rule, equally well established as the rule itself, which are generally classified as follows: (1) In cases not heard upon the merits. (2) Where the circumstances are such as to satisfy the Court that the decree should be set aside and (3), where the decree was entered by mistake or surprise. Foxwell v. Foxwell, 118 Md. 471 ; Straus v. Rost, 67 Md. 465 ; Mallery v. Quinn, 38 Md. 38 ; Gechter v. Gechter, 51 Md. 187 ; Primrose v. Wright, 102 Md. 109 .

Under the admitted facts and circumstances disclosed by the record in the case now under consideration, wo think, that the appellant’s caso plainly falls within the exceptions stated to the general rule by the authorities cited, and that he was entitled to the relief sought by his petition. The promissory notes upon which the dividend in the first audit was declared it will be seen, are the same claims upon which the appellee was allowed .a distribution in the second audit. In Peninsula Trust Company v. Johnson, 128 Md. 535 , this