This is an action of assumpsit by the appellant against the appellee — the declaration containing six common counts, including one for money had and received by the defendant's testator for the use of the plaintiff. With the declaration was filed an open account by which the defendant is charged with various items, amounting with interest thereon to $45,637.95. The contention of the plaintiff is that he transferred to his father in the autumn of 1899 his merchant tailoring business, including the merchandise, cash, furniture, fixtures and accounts, and assigned a lease to secure an indebtedness due by him to his father, that it was not intended to be an absolute transfer, and, inasmuch as his father was paid in full what he owed him, he was entitled to be repaid the above amount. General issue pleas, together with one of payment and one of the Statute of Limitations, were filed. Issue was finally joined and a trial of the case resulted in a verdict for the defendant. The Court granted a prayer to the effect that *Page 238 a decree passed by the Circuit Court of Baltimore City on November 12th, 1900, in a case wherein the appellant was plaintiff, and the defendant's testator was defendant, was conclusive against the right of the plaintiff to recover.
The appellant filed a bill in equity against his father to have the bill of sale, which he had given to secure as he alleged what he owed his father, annulled and set aside, to require an accounting by the defendant, and to compel him to pay over to the plaintiff all sums received by him, and to restore and to deliver unto him the lease, the possession of the premises, and all goods and property of every description taken possession of under the bill of sale. It is conceded that the matters involved in the equity proceeding were the same as are now sued for, and the principal question is whether the decree passed in that case was a final adjudication of the controversy. The appellant contends that the bill was dismissed simply for want of prosecution, while the appellee claims that it was such a final disposition of the case as to make the defense of res adjudicata an absolute bar to this suit.
The decree was as follows: "The above cause standing ready for hearing and being considered on bill and answer, and the plaintiff not appearing in Court, and no evidence being offered to sustain the allegations of the bill, and the answer of the defendant denying the equities of the bill, it is this 12th day of November, 1900, by the Circuit Court of Baltimore City, adjudged, ordered and decreed, that the bill of complaint in this cause, be and the same is hereby dismissed and that the plaintiff pay the costs."
As it is not denied that the bill in equity was intended to recover the money and property sued for in this case, there is no such question before us as is frequently presented in cases of this character, but it is simply whether that decree was dismissed for want of prosecution, or whether it was an adjudication by the Court of the questions involved, on the pleadings. There can be no doubt that a decision of a case on the pleadings may be as effective a bar, as one on testimony. *Page 239 If, for example, a case is submitted on bill and answer the averments in the answer are taken as proven, and hence there can be no logical distinction made between the effect of a decree rendered on bill and answer and that of one entered after testimony is taken.
There are certain general principles on the subject of resadjudicata well established in this State, as well as elsewhere, which should be kept in mind in considering the case. InRoyston v. Horner, 75 Md., on page 565, as well as in other Maryland cases, the rule as stated by JUDGE STORY in his EquityPleading, sec. 793, has been approved, that: "A decree or order dismissing a former bill for the same matter may be pleaded in bar to a new bill, if the dismission was upon the hearing, and was not in terms directed to be without prejudice. But an order of dismission is a bar only where the Court has determined that the plaintiff had no title to the relief sought by his bill; and therefore, an order dismissing a bill for want of prosecution is not a bar to another bill." In Martin v. Evans, 85 Md. 8, the subject was discussed at some length by CHIEF JUDGE McSHERRY, who stated the general rule to be that: "Whenever a decree dismissing a bill in equity fails to restrict its own scope, the presumption, according to the great preponderance of decided cases, is, that the issues raised by the proceedings have been disposed of on their merits, and they therefore become resadjudicata." Amongst other authorities cited by him was 6 Ency.of Pl. and Pr. On pages 992 and 993 of that volume the principle is thus stated: "A dismissal or non-suit may be upon the merits. It then concludes the parties as to all matters involved in the issue, whether they were actually decided or not. * * * At law the presumption is that a non-suit is merely formal unless it be affirmatively shown to have been upon the merits. The same rule appears to apply generally to judgments of dismissal at law. In chancery the opposite rule obtains, and a general decree dismissing a bill will be presumed to have been upon the merits, and a final settlement of the controversy unless the decree was collusive, although *Page 240 the decree was pronounced by a divided Court. The presumption attaches unless the statements of the record show that the dismissal was for some cause not going to the merits; and of course the whole record may be examined to find out what was actually decided or might have been decided. * * * To obviate the general presumption of dismissal upon the merits, the dismissal should be stated in express terms to be made `without prejudice.' Wherever it is not actually upon the merits, the term is used in order to reserve to the parties the privilege of enforcing their rights by subsequent proceedings and to destroy the effect of dismissal as a bar. An absolute dismissal where the dismissal should have been without prejudice is reversible error; and the appellate Court will either reverse and render a decree `without prejudice' or modify and affirm, or remand the cause with instructions to dismiss without prejudice."
An order was passed on May 21st, 1900, on the bill filed by the appellant against his father, that a receiver be appointed, unless cause to the contrary be shown on or before the 16th day of June, 1900. That was duly served on the defendant, who filed in due time an answer to the bill of complaint, which also showed cause why a receiver should not be appointed. On September 7th, 1900, a general replication was filed, and on the 10th of that month the defendant filed a petition stating that he desired to examine witnesses in open Court and asking an order for that purpose. An order was passed granting leave to take testimony as prayed, and that it be taken as required by the thirty-fifth rule of the Court. which prescribes the method of taking such testimony. On October 6th, 1900, the defendant filed another petition to the same effect, and the Court passed an order granting leave to take testimony under that rule, and added: "It is further ordered that the taking of said testimony and the final hearing be and the same are hereby set for the 12th day of November, 1900." That order was served on the plaintiff's solicitor on the 9th of October. The docket entries also show this entry: "12 October, 1900. Rule hearing for November *Page 241 12, 1900. Order fd., copy issued (served on William Colton, solr.)." The next docket entry is that of the decree above set out.
Rule 3 of the lower Court is as follows: "After the general replication has been entered to the answer of the defendant, or if any issue be joined upon a plea, either party may apply to have the case set for hearing; and unless within five days after service of notice of such application leave to take testimony be asked by either party, the case shall be placed upon the trial calendar and be heard upon the pleadings." The solicitors for the respective parties differ widely as to the proper construction of that rule, and also as to whether it is applicable at all, and, if so, how far applicable to the facts of this case.
The record shows that a general replication had been entered, and apparently that the defendant did apply to have the case set for hearing. While the petition of October 6th did not ask to have the case set for hearing, the Court did, on the application to take testimony in open Court, order that it be taken, and that there be a hearing on November 12th. But if there is any doubt about the effect of that, the entry of October 12, above set out, would seem to establish that it was set for hearing for November 12. It is true there is no written application for that in the record, but the entry of the rule on October 12th — which was three days after the copy of the order of October 6th was served on the solicitor — is there, and the decree itself states that the case was ready for hearing. If we treat the application to have the case set for hearing as of October 12th, then leave to take testimony was not asked within five days after service of notice of such application, and if we treat it as made on October 6th, application to take testimony was made at the same time. As either party has the right to ask leave to take testimony, while it might be somewhat irregular, it is not perceived how injury is done the other party, if the one who applies to have the case set for hearing at the same time asks leave to take testimony. *Page 242
The appellant must take one horn or other of the dilemma — either that neither side asked to take testimony, as provided under Rule 3, or that the application of the defendant was sufficient. Accepting the latter view, the next question is as to the construction of the rule as applicable to those conditions. If a case is set for hearing, and leave to take testimony is asked by either party, and neither party takes any, can the Court proceed to hear the case on the pleadings without further delay? We are of the opinion that must be answered in the affirmative. It never could have been intended by the framers of that rule that a party could gain time, simply by asking leave to take testimony and then not taking it. The object of the rule manifestly was to prevent unnecessary delay, but if it must be construed to have such effect as is contended for it, the result would be the very opposite of what was intended. The rule, we think, was intended to give either party the opportunity to take testimony, but if not taken, then to dispose of the case on the pleadings.
But after all, are we not to be governed by the construction placed on the rule by the judge who passed the decree, if we can ascertain that from the decree, and not by what we may think is a proper construction of the rule? If that judge erroneously construed the rule, and passed a decree which was not authorized, then the remedy of the plaintiff was an appeal. Barrick v.Horner, 78 Md. 259; State, use of Brumer, v. Ramsburg,43 Md. 333. If he passed a decree which would bar the plaintiff from bringing another suit, when he was only authorized to pass one that would be equivalent to dismissing the bill for want of prosecution, the remedy was likewise an appeal. "An absolute dismissal, when the dismissal should have been without prejudice, is reversible error." 6 Ency. of Pl. and Pr., 993. See alsoGriffith v. Fred Co. Bank, 6 G. J. 424; McElderry v.Shipley, 2 Md. 37; McDowell v. Goldsmith, 24 Md. 230, andMiller's Eq. Proc., 332.
We must therefore ascertain what the judge did by the decree, as what he had the right to do is not now the question. *Page 243 If the statement "and the plaintiff not appearing in Court and no evidence being offered to sustain the allegations of the bill," had not been inserted there would be but little room to question the effect of the decree, under the decisions in this State. It would then have read: "The above cause standing ready for hearing and being considered on bill and answer, and the answer of the defendant denying the equities of the bill," it is adjudged, ordered, etc. Whatever may be said in Rosse v. Rust, 4 John. Ch. 300, and other cases cited by the appellant, the case ofRoyston v. Horner, supra, would seem to be conclusive of that question in this State. The Court quoted from that decree: "This case being submitted on bill, answer and exhibits by agreement of counsel," and went on to say: "This can mean but one thing, that it was submitted for decision in that way. And, when submitted in that way, the Court upon the answer of the defendant denying the allegations of the bill could do nothing but dismiss it; for when a case is submitted on bill and answer, all the averments of the answer, whether responsive to the allegations of the bill or in avoidance of it, are to be taken as true." And then after indicating that the reason the assent of the parties was referred to in the decree was because the costs were disposed of differently from what is usual in a decree on bill and answer which denies the equity of the bill, the Court said: "It may have been without argument, and it is reasonably inferable that it was; but argument is not necessary to make it a hearing, for itis being heard when what the parties say in the bill and answeris considered by the Court."
In the decree now under consideration, the Court not only said the case was "standing ready for hearing," but, "being considered on bill and answer," "and the answer of the defendant denying the equities of the bill." It was therefore declared that it was ready for hearing, that it was considered on bill and answer and that the Court found that the answer denied the equities of the bill. Finding those facts the Court was required to dismiss the bill, just as it was in Royston v. *Page 244 Horner. If, as we said in that case, "it is being heard when what the parties say in bill and answer is considered by the Court," how can it be said in view of the recitals in this decree, that there was no hearing? There would seem therefore to be no room to doubt, that unless the omission we made above, in reciting the decree, shows the contrary, the judge intended to make it final, and was passing on the merits as he found them from the bill and answer, and of course he knew the effect of deciding the case on bill and answer to be that he must accept the averments in the answer as true.
But of course in considering the decree, we cannot ignore the statement referred to — "and the plaintiff not appearing and no evidence being offered" — and must give it its proper effect. Was not that inserted because the judge considered the action already taken as sufficient to authorize testimony to be taken, and hence, as the plaintiff neither appeared nor offered testimony to sustain the allegations of the bill, under the rule of Court, he was required to decide the case on the pleadings? There was perhaps no necessity for referring to the fact that the plaintiff did not appear, but it may have been that it was inserted in the decree to show that the plaintiff did not ask for further time, or that he was not there to attempt to sustain the bill by his testimony. But whatever the reason, if the presumption is as we said in Martin v. Evans, then the mere statement that the plaintiff did not appear in Court cannot overcome the presumption raised by the other terms of the decree. If the bill was dismissed because the plaintiff did not appear, then there was no occasion to consider the case on bill and answer, and particularly not to refer to the fact that they were considered. It would only have been necessary to have said, "the above cause standing ready for hearing, and the plaintiff not appearing in Court, it is adjudged," etc. Or if the judge had supposed that he must dismiss the case for want of prosecution, because the plaintiff did not appear and no testimony was taken, there was no reason to say that he had considered the bill and answer, *Page 245 for if he treated those reasons as a cause of default simply, there was no occasion to consider the bill and answer.
It was argued, however, by counsel for appellant that the judge could properly examine the bill and answer, to see whether there was anything in them to require him to retain the bill, but that could only be necessary on a hearing on the bill and answer. If, for example, he had found that the answer admitted such allegations of the bill as entitled the plaintiff to relief he could have granted the relief, although the plaintiff did not appear. If a plaintiff is in such default for not appearing as requires or authorizes the Court to dismiss his bill, he has no right to require the Court to examine the pleadings to see whether he is entitled to relief on them. A defendant in a suit at law may file a plea, which admits the right of the plaintiff to recover something, but if the plaintiff does not appear when the case is called, the defendant may ask to have the case non-prossed. The Court would not examine the papers to see whether the plaintiff was entitled to judgment, but would dismiss the case for the default, if his failure to appear was a default under the rules or practice of the Court. One of the cases relied on by the appellant illustrates the point: In Baird v.Bardwell, 60 Miss. 164, the decree was: "This cause coming on this day to be finally heard, and the said complainant in person or by counsel failing to appear, after being duly called, on motion of counsel for defendant, it is ordered," etc., that the bill be dismissed. The Court said: "The absence of the complainant in no degree affected the right of the defendants to submit the case for final hearing. They had the right to do this, or to have it dismissed for want of prosecution."
So it seems clear to us that the decree shows on its face that the judge did not intend to dismiss the cause because of the default of the plaintiff, either in not appearing or not offering testimony, but he thought that under his construction of the rule he had the right to decide the case on the pleadings, and did hear it on bill and answer, and having so heard it he decided it on the merits, just as much as if the *Page 246 allegations in the answer had been sustained by proof. The case of Royston v. Horner, is conclusive of the latter statement, as it was submitted on bill, answer and exhibits, and the decree was held to be a bar to another suit. Indeed, if that were not so, hearing a case on bill and answer would be of little use.
It may be that the plaintiff could have appeared and dismissed the bill, and thereby relieve himself of the effect of a decree by the Court, but he did not adopt that course, and it is not necessary to decide that question. If he supposed that if he did not appear the case would be dismissed without prejudice, or for want of prosecution on account of not appearing, and not be precluded from bringing another suit, he could have had this decree reviewed on appeal, and, if his present contention had been held to be correct, could have had the decree reversed or modified, but not having done that he is bound by it, as passed.
The only remaining question is the effect of the alleged promise by the defendant, after she qualified as executrix. It is contended that as there is evidence tending to show that after the decree was granted, the appellee acknowledged that the debt sued for in this case was due, and promised to pay it, the decree is not a bar to this suit, even if it would otherwise be so. It cannot be doubted that a party in whose favor a decree or judgment has been rendered can waive the defense he would be authorized to make, against another suit for the same cause of action. That may be done by not offering the record of the former case in evidence. And we do not deem it necessary to deny that a party who has thus had a decision in his favor may be liable on a subsequent promise to pay the debt. The case of Cook v.Vimont, 22 Kentucky (6 T.B. Monroe).284, is a direct decision in favor of the proposition, although we do not mean to adopt it in all respects. But we have been cited to no case which has gone to the extent of holding that the promise of an executor or administrator, to pay a claim which had been adjudicated and determined in favor of his testator, or intestate, in his lifetime would bind *Page 247 the estate. This case is as good an illustration of the danger of such a rule as could be given. The testator denied under oath any indebtedness or obligation to the appellant, on account of the claim then and now in controversy, and died on the 27th of January, 1908, — over seven years after the decree was rendered, but the second suit was not brought until after his death. The appellant claims that after his mother became executrix, and while she was living with him, he repeatedly told her about the claim and she said she knew that his father owed it to him, and promised to pay it. He admitted that he had filed a bill of complaint against his mother, asking that she be removed as executrix, and that a receiver be appointed to take charge of the estate. He said: "I filed that bill, but I didn't swear that she was insane. I only meant that she was not capable of taking care of her money and she is not, and she does not know any more than that book about taking care of finances. My mother is wholly incompetent of taking care of her money." Again he said: "I never thought she was insane. I never made such a statement in my life. I meant she was mentally incompetent, and does not know anything about business matters or money matters, and is not able to take care of her money, and I was doing that to try and protect her money." He persuaded her to renounce the will of his father, and the testimony shows that while she lived with him he had considerable influence over her, although at the time of the trial she had nothing to do with him. Of course we are aware that such matters would not necessarily prevent his recovery, if the defendant could be held on her alleged promise, but they strikingly illustrate the danger of permitting an executor to thus bind the estate of the testator. If a party can wait for over eight years after a decree of this kind has been entered before bringing another suit, and then, when the other party to the controversy is dead, rely on a promise of the executor to pay what the testator had declared under oath he did not owe, and what had been adjudicated by a decree of the Court in his favor, there would be no protection to the estate of any decedent, but *Page 248 especially would that be so when it is admitted by the party seeking to establish a claim that the executrix, upon whose promise he relies, is utterly incapable of attending to business, and could not even take care of her own money. The alleged admission that the debt was due would not only contradict the testator, but in effect would prove him guilty of perjury. It is inconceivable that any jury would believe that the appellee would make such a promise if she understood what it meant, and if the testimony of the appellant as to her competency, was accepted, a jury could not believe she did so understand it, but if there be no other reason for not permitting a claim to be established by the admission or promise of the personal representative of the decedent, when it had been determined to be invalid in his lifetime, public policy would prevent it. In Miller, Admr., v.Dorsey, 9 Md. 317, LeGRAND, C.J., said: "It cannot be pretended that if an administrator should, after acknowledging a claim against the estate of his intestate, discover that it had been paid, he would be debarred from setting up such fact to defeat the claim." In Webster v. LeCompte, Exr., 74 Md. 249, a prayer was offered that if the jury believed that one of the plaintiffs presented the claim to the executor and requested payment of it, and that the defendant promised to pay it if said plaintiff would have it proven and passed, and thereupon he did prove it and have it passed by the Orphans' Court, then the defendant was bound to pay it, and the jury must find for the plaintiffs. The Court in passing on it, after saying that the alleged promise that the executor would pay it was made before he became executor, added: "But an admission or promise by an executor or administrator is not under all circumstances to be regarded as binding and conclusive as against the estate. For though an executor or administrator may recognize a claim as proper to be paid, yet if he afterwards discovers that the claim has no legal foundation, or that it is such as ought not of right and in justice to be charged upon the estate represented by him, no previous recognition or admission by him ought to or can preclude him from making the proper defense, *Page 249 and with the same effect as if no such previous recognition or admission had occurred. This plain principle of right and justice is fully recognized by this Court in the case of Miller, Admr., v. Dorsey, 9 Md. 317, 323; and applying it here, the Court below could not do otherwise than reject this third prayer of the plaintiffs." That applies with much greater force to a claim such as this which had been adjudicated in favor of the testator, when he was alive and able to defend himself.
It is true that executors and administrators may revive claims barred by the statute of limitations by promises to pay or acknowledgments of them, but that it is a different question. The claim still exists, and oftentimes justice requires that it be paid, and so with one affected by a discharge in bankruptcy or insolvency. But when a case has been tried on its merits, in the lifetime of the decedent, and decided in his favor, there is no principle of justice which would require or permit his personal representative to bind his estate by admitting the claim to be due or promising to pay it. No estate would be sufficiently protected by the law, if it was permitted. The law does not favor stale claims, especially when made after the death of an alleged debtor, and when one has been passed upon in his lifetime and determined in his favor in such way as to bar further suit upon it, there could be no possible reason why his personal representative should be allowed to become in effect a Court of review, determine that it was a valid claim and then bind the estate on his judgment of its validity. The interests of creditors and distributees of estates should not be jeopardized by establishing such a doctrine, and they, and not the executor, would generally be the sufferers.
So, without further discussion of the questions involved in this case, we will affirm the judgment.
Judgment affirmed, the appellant to pay the costs above andbelow. *Page 250