Willson v. Williams

Worthington, J., delivered the opinion of the Court. The object of this proceeding is to obtain the benefit of an equitable set-off. In order that the precise nature of the controversy involved ⁵²⁴ in this appeal may be understood, it will be necessary to review the proceedings in the case of Willson v. Williams, which was before this Court at the October Term, 1907, and out of which the present controversy arose. The proceedings in the earlier case are substantially as follows: On February 10th, 1905, W. Eason Williams, the appellee in this case, filed in the Circuit Court No. 2, of Baltimore City, a bill of complaint against Tyson Willson and Mary D. Willson, his wife, and against William B. Willson, the appellant herein, praying that a deed from W. Eason Williams and wife to Tyson Willson, dated April 2nd, 1904, and a mortgage from Tyson Willson to William B. Willson, dated May 4th, •1904, be annulled and set aside by a decree of said Court, on the ground that said deed was procured and recorded by fraud, and that the same was without consideration, and that said William B. Willson had knowledge that said deed was without consideration, and that the recordation of the same was fraudulent; and also that the mortgage to said William B. Willson was likewise fraudulent and void.

Subsequently, on March nth, 1905, by an order of the complainant, W. Eason Williams, the case was entered to the use of Joseph N. Ulman, attorney and legal representative of a certain Allan M. Hirsh, a non-resident, who was a creditor of the complainant in a sum exceeding $10,000. Subsequently the case was entered to the use of Allan M. Hirsh himself. A great deal of testimony was taken in this earlier case, and the lower Court after argument dismissed the bill as to William B4 Willson, but annulled and set aside the deed of April 2nd, 1904, from the complainant and wife to Tyson Willson. In dismissing the bill as to William B. Willson, the Court in its decree provided that .he should have such costs to be paid by the plaintiff, W. Eason Williams, and the equitable plaintiff, Joseph N. Ulman,“as maybe properly taxable in this case as incurred by the said defendant, William B. Willson, in defending the bona jides of his mortgage.” From that part of the decree, annulling and setting aside the deed, an appeal was ⁵²⁵ taken, and this Court, in an opinion byJJUDGE Burke, filed December 6th, 1907, 106 Md. 657 , reversed the same, and dismissed the bill of complaint, “with costs to, the appellants above and belozv.” The amount of the costs above and below, was $914.15.

It must be remembered that the appellants in this earlier case, to whom these costs were awarded, were Tyson Willson and his wife, Mary D. Willson, the defendants in this case, and that the appellees against whom these costs were adjudged,' were W. Eason Williams, Joseph N. Ulman and Allan M. Hirsh, the plaintiffs in this case. On December 19th, 1907, the solicitors for the above named appellants, Tyson Willson and wife, mailed from Baltimore to the Clerk of the Court of Appeals an order .directing him to issue the writ of fieri facias upon the decree of the Court of Appeals in that case, for costs above and below, against Joseph N. Ulman, one of the appellees therein, said writ to be directed to the Sheriff of Baltimore City and to be returnable to Circuit Court No. .2 of that city. On the same day that this order for a fieri facias was received by the Clerk of the Court of Appeals, a motion for a reargument was received by him from the solicitors for the appellees, and filed. The motion for a reargument was denied and this Court, in an opinion by Chief Judge Boyd, in disposing of the questions presented by the filing of the motion and order at the same time, held that , the motion for a reargument did not operate as a stay of execution, and that the writ of fieri facias could be issued against Joseph N. Ulman, the appellee, to whose use the case had been entered on March nth, 1905.

This opinion of the Court of Appeals was filed on January 15th, 1908, and on Jannary 22nd, 1908, the bill of complaint in this present case was filed, setting forth the aforegoing facts, and further alleging that the complainants had instituted suit in the Superior Court of Baltimore City against Tyson Willson and Mary D. Willson, his wife, for the sum of $19,262.22, which they claimed to be due them by the defendants; that ⁵²⁶ said defendants, Tyson Willson and wife, were absolutely insolvent, and the complainants were without remedy in the premises, unless the Court of equity would interfere, and the complainants be permitted to set off their indebtedness for costs to Tyson Willson and wife, against the indebtedness of the latter to the complainants above mentioned. The prayers of the bill were for an equitable set-off, against the defendants; for an injunction restraining the issuance of the writ oí’fieri facias for costs in the earlier case, and for general relief. Upon the filing of this bill with an affidavit of the truth of the matters and facts therein set forth,, the Court on April 22nd, 1908, passed an order directing an injunction to issue as prayed, provided' the complainants would deposit the sum of $914.15, the amount of the costs, in bank to the credit of the cause. In substantial compliance with this provision of the decree, the above mentioned sum of $914.15, was deposited with the Clerk of Circuit Court No. 2.

The defendants, Tyson Willson and wife, have not appeared to the bill of complaint thus filed against them, nor have they, so far as the record discloses, been summoned to appear, but William B. Willson, the father of Tyson Willson, having obtained leave of Court to come in as a party defendant, has filed an answer setting forth that he has paid or assumed to pay the sum of $632 of said costs and praying that the order of injunction granted as aforesaid, be so far modified as to enable him to obtain said sum of $632, out of the fund of $914.15, on deposit with the Clerk of the Court. Exceptions were filed to this answer by the solicitors for complainants, suggesting that William B. Willson was not a proper party to the proceeding and that by the decree of the lower Court in the earlier case to which William B. Willson, was a party defendant, it had been provided in dismissing the bill of complaint as to him that he should have such costs to be paid to him by the plaintiff W. Eason Williams, and the equitable plaintiff, Joseph N. Ulman, as should be properly ⁵²⁷ taxable against them as incurred by William B. Willson in ' defending the bona fides of his mortgage. The exceptions further averred that the proportion of costs thus awarded to William B. Willson had never been taxed or paid, and it was proposed that such costs be taxed and paid out of the fund of $914.15, then in the hands of the Clerk of the Court to the credit of the case. In accordance with this suggestion a petition was filed by William B. Willson, on April 4th, 1908, setting forth that the amount of costs to be paid him on account of the expenses incurred by him in defending the bona fides of his mortgage in the earlier case had been “fixed by agreement of all the parties concerned at $40,’’ and praying that the Court would pass an order directing the Clerk to pay the petitioner the said sum of $40, to which he was entitled in his own right, out of the fund of $914.15, above mentioned.

The complainants assented to the passage of such an order and the same was accordingly passed by the Court on April 4th, 1908. It was agreed for the purpose of hearing the application of William B. Willson for a modification of the order of injunction above mentioned, with the understanding that the rights of Tyson Willson and wife, should not be affected thereby, that said Tyson Willson and wife are insolvent and have been so since January 1st, 1902, and that they are indebted to the plaintiffs herein in an amount exceeding the sum of $914.15, on an indebtedness due by them to the plaintiffs prior to February 10th, 1905. The prayer of the appellant for a modification of the order of injunction was heard by the lower Court upon the bill, answer, exhibits and agreed statement of facts, and the learned Judge refused to modify said order. - From this decree refusing the application of William B. Willson for a modification of the order of injunction, the present appeal was taken. The only question in the case for this Court to decide is, therefore, whether the lower Court was right in refusing the ⁵²⁸ modification for which the appellant prayed, or to state the case differently, the question is, whether the equitable rights asserted by William B. Willson in his answer, are superior to those asserted by the complainants in their bill of complaint filed in this case.

Willson asserts the equitable right to be reimbursed, out of the costs awarded to the appellants in the earlier case, the whole sum laid out and expended, or assumed by him, for costs and expenses in that case, to wit, the sum of $632 less of course the sum of $40 already received by him as his share of the costs incurred in defending the bona ftdes of his mortgage. The complainants claim that, as they were the appellees in the earlier case, against whom the costs were decreed by this Court, they are entitled to set-off the whole amount of- these - costs (less the sum of $40 paid William B. Willson) against the indebtedness due them. by the appellants' in that case, Tyson Willson and wife. It should be understood that the rights of Tyson Willson and wife are not involved in this appeal. While they are the only original parties défendants to the bill of complaint, they have not been summoned and have not voluntarily appeared.

But as their potential rights are necessarily involved in this appeal, and as it will conduce to clearness to consider them separately, we will give them consideration preliminary to the consideration of the rights of.the appellant. • Courts of equity act independently of the statutes of set-off and are accustomed to order a