Rittenhouse v. Levering

The opinion of the Court was .delivered by

Rogers, J.

The declaration contains four counts; first, money had and received, and special counts claiming a distributive share of the personal estate and a distributive share arising from the real and personal estate. The monies arising from the real estate were not taken into the calculation of the jury, and a verdict was rendered for the plaintiff’s share in the personal estate only. The principal questions are raised by the charge on the Act of Limitations and the conclusiveness of the decree of the Orphan’s Court. On the 17th September 1792, Joseph Rittenhouse and Jacob Rittenhouse gave a bond to John Johnson in the penal sum of £1000, conditioned to pay £500, with interest. Afterwards, viz. on the 1st February 1794, Joseph Rittenhouse, the father of the plaintiff’s intestate, and Martin Rittenhouse, the defendants’ intestate, executed a bond to Jacob Rittenhouse in the sum of £1000, conditioned to indemnify and save harmless Jacob, who was the surety, from the payment of the above-mentioned bond. Martin, who was the father of Jacob, paid the bond for Joseph, under whom the plaintiff claims, and this constituted one of the items of defence.

This case has been twice tried, and on the first trial the plaintiff’s claim was met by the plea of the Act of Limitations. The Supreme Court, to which the case was taken by writ of error, decided that if a surety pays the debt of his principal after the death of the latter, and where no letters of administration have been taken out upon his estate, the Statute of Limitations does not begin to run until letters of administration are taken out. 4 Whart. 130. Under this direction the p.arties went to trial, and, it is insisted, that the first point was intended to raise the same question which had been already ruled. The District Court would seem to have been of this opinion, and, as we think, on good grounds; for the prayer of the defendant, fairly construed, embraces that point only, and it is conceded that no new view was taken on the argument. Indeed, the point appears to have been submitted to the court without any argument whatever. It looks very much like an experiment to test the decision on the first trial. It is, however, now said, that no new position is taken, but an additional argument is urged, bearing directly on the plea of the Act of Limitations. Conceding this to be as stated, we will examine the question on the position taken by the defendant. The allegation, as I understand it, is, that by the payment of the bond the surety is ipso facto subrogated to all the rights of the obligee, and by that operation, without more, he becomes a specialty creditor. From this it follows that the Act of Limitations does not apply, as the administrators, on this hypothesis, are only barred by presumption of payment arising from lapse of time. The defendants allege that the right of substitution is everything, and actual substitution is nothing. The general proposition in Fleming v. Beaver is conceded, with certain limitations which we have been compelled to make in subsequent cases. Thus in Fink v. Mahaffy, (8 Watts 384), it is held that the doctrine of substitution being one of mere equity and benevolence, will not be enforced at the expense of a mere legal right: a surety, therefore, whose claim against his principal for money paid on a judgment against them has been defeated at law, cannot be substituted for the plaintiff in the original judgment. This case is recognised in The Bank of Pennsylvania v. Potius, (10 Watts 152), and must, therefore, be considered as settled. Where the surety has done no act before his claim is barred at law manifesting his intention to put himself in the place of the original creditor, and thereby subrogating himself to his rights, the remedy is only for money paid. Where he has omitted to bring suit in proper time, or to do some acts equivalent thereto, he cannot afterwards be subrogated to the rights of the creditor. It is a general principle that equity follows the law, and where right does not exist at law, a Court of Chancery will not afford the party equitable relief.

In addition to this ground, an insurmountable difficulty arises from the cancellation of the bonds by the erasures of the signatures of Jacob and Martin. By whom the erasures were made, does not appqar, nor is it material. That such an erasure destroys the validity of a bond, has been repeatedly ruled; and this is a conclusive answer to the attempt, to subrogate the surety to the right of the creditor ; and this results from the act of cancellation, independently of the intention of the parties. When a deed is a joint one, or both joint and several, the defendant, who is sued, may show that the seal of one of the obligors has been torn off, for the manner of the obligation becomes different, and a presumption arises that the obligee has been satisfied. But it is otherwise where the obligation is entirely several. 2 Stark. Ev. 379, 380; 2 Show. 29; Bac. Ab. title “ Evidence,” 652; Bul. N. P. 268. The case of Seaton v. Henson, (2 Show. 29,) where this principle was first applied to a joint and several obligation, was this. Four persons were bound in a joint and several bond, and did each of them seal and deliver the same. The seal of one was broken off. The obligee sues the defendant whose seal was still affixed to the bond. He pleads the special matter, and concludes non est factum. The question was if the bond hereby became void as to all the obligors, or only to him whose seal was torn off. The court decided it entirely destroyed the bond.

If the bond is null and void, it is difficult to imagine what remains on which the subrogation can operate. By a subrogation, the surety is placed in no better situation than the obligee; and as he could recover nothing, the surety is placed in the same predicament. Subrogation of a surety, where he has paid the money and the original security remains intact, has been so repeatedly ruled that it is not now an open question; and although the surety in the case in hand was one remove from the original creditor, yet in a proper case we see no objection to subrogate him to the rights of the obligee. Having paid and discharged the obligation, he has the same equity as the surety to whom he was bound. A payment by him can in no case be considered voluntary; for a payment by a person who can be compelled to pay is not voluntary, so as to debar the party paying from a right of action. It may be his only mode to save himself, and from the moment the money is paid, the right of action against the obligor is compléte. Why, therefore, the benefit of a principle which is based in equity should be denied to him, it is difficult to perceive. It throws the obligation on the person bound to pay, by placing the surety in the situation of the original creditor. But.in this case, so far as appears, the surety did no act manifesting any intention whatever to avail himself of the equitable principle which is now invoked for the protection of his administrators. The reverse would indeed seem to be the case. He took no assignment of the bond; commenced no suit upon it. On the contrary, the bond itself is destroyed by the erasure of the name and seal of one of the co-obligors. If the obligation had been in a perfect state, ánd a suit had been brought upon it in proper time, the principle asserted in Fleming v. Beaver would apply. ; The fact that there was no assignment or actual substitution on the bond, would in such a case be disregarded; for while the legal right remains, (that is, as ruled in Fink v. Mahaffy, and The Bank v. Potius, for six years,) the right draws to itself all the consequences of an actual substitution in a court of equity.

Although I am not aware that this precise point has been elsewhere so ruled, yet it is inconceivable to me that a court of chancery would undertake to decree a substitution at any distance of time, and after all remedy in a court of law was barred; for there would be ofte rule of property in one court, and a different rule in another court. But rules of property are the same in all courts; for the well-settled principle is that, except as to the remedy, equity follows the law. The error on this head arises from the assumption that ipso facto on payment of the money, the surety is subrogated to the rights of the creditor; whereas the remedy is not prima facie on the bond, but for money paid: although the surety may, if he chooses, invoke the aid of the equitable principle of subrogation. A contrary doctrine, and particularly in the case of judgment creditors, would be inconvenient, if not productive of injustice. It would be a manifest hardship in many cases to destroy the lien of a junior judgment creditor, who may know of the actual payment of a prior judgment and act on that knowledge, and to subrogate a surety to the rights of the prior judgment creditor at any time before the expiration of twenty years. In the distribution of money arising from sheriffs’ sales, we have difficulties enough already without superadding another, rendering it almost impossible to know when junior judgment creditors are secure. There is neither injustice nor hardship in putting sureties on the same footing as others. A surety may lose a right by his neglect, and more especially'where by his supineness he jeopards the rights of others.

But is the decree of the Orphan’s Court conclusive? In the inventory, Joseph Rittenhouse is returned as a debtor to the estate of $4465.75. The accountants charge themselves with the amount of inventory, and the account as settled shows a balance in the hands of the administrators to be distributed according to law of $13,437.99. Appended to the administration account is a statement headed “Nicholas Rittenhouse and Jacob D. Rittenhouse in distributive account with the heirs of Martin Rittenhouse, deceased.” An administration account properly settled shows nothing more than the general balance due the heirs after a reduction of the personal estate into cash or its equivalent, and the payment of the debts. Into that account the monies paid to the distributees, or the advancement to one or more of the children, do not enter. They form no part of an administration account. A total disregard of this obvious distinction causes most of the perplexity which attends such settlements. After a final adjustment, the practice is to .decree a distribution among the heirs according to law. It is a general decree; for the court do not undertake to ascertain who are the heirs, or what proportion each is entitled to. And it would be most dangerous to do so, and more especially when the only matter which is properly before them is to settle and adjust the general balance due from the administrator, and to ascertain the nett proceeds of the personal estate to which the distributees are entitled. The administrator may annex a statement of the monies paid to each of the heirs, so that it may appear that the apparent is not the real sum due. But this he is not bound to do. It. constitutes no part of the decree, nor does it bind any human being, except, perhaps, the administrator himself. After the decree, however, the Orphan’s Court may proceed to enforce payment, and where this is required by any of the parties interested, in order to do justice, it is necessary to investigate the state of the account of the administrator with each of the heirs; and it is plain that justice only can be done by keeping the accounts of each separate and distinct; for one may have received his whole share, another part, and a third nothing. In Purviance v. The Commonwealth, (17 Serg. & Rawle 31), it is held that the Orphan’s Court has jurisdiction of the matter of distribution, and is bound to decree distribution on the petition of any one interested, though the usual mode, as is truly said, is by an action at common law. But before making this distribution, the Orphans’ Court should require that such notice should be given to all the parties not before the court, as the nature of the case admits of. And this is necessary; for a final distribution of the estate requires great circumspection, and sometimes involves most interesting, doubtful and perplexing questions; and hence the propriety of avoiding to confound it with a proceeding so entirely different, and intended for an entirely different purpose.

But in this essential respect how lamentably deficient is that part of the account which is palled by the plaintiff a distribution of the estate among the heirs! It' in fact is part of the administration account blended with it, a,nd it is very evident that no other notice to the parties was ever given, except the notice of the settlement of the administration account. No one petitioned the court for that purpose, nor has any notice been given of the specific object, viz., to ascertain and decree the amount to which each was entitled as his distributive share of the estate. This is so plain on the face of the account itself, that it cannot admit of any doubt whatever. But to bind the'heirs-as a conclusive decree of distribution, the general balance of the estate in the hands of the administrator for distribution must in the first place be ascertained. After this is done, if any one of the heirs wishes a distribution to be made by the court making the decree, he may petition the court for that purpose, have the parties before the court, and a decree made adjusting the^sum due to each. Besides, in the distributive account, as it is termed, the real estate, as valued by a jury of inquest, is blended with the personal estate. For these reasons I throw out of view the distributive account, as it is called, and also the proceedings on the writ of partition. The case, therefore, comes down to this. An administration account is settled in due and regular form,-and the Orphan’s Court decrees in the hands of the administrator for distribution 113,866.11. Is this, the decree of the Orphan’s Court.on this state of facts, conclusive? or, in other words, is the plaintiff, notwithstanding the decree, he being returned in the inventory as a debtor and charged in the administration account with the samé, at liberty to controvert the alleged debt by proof that he owes the estate nothing?

That the decree of the Orphan’s .Court is conclusive, is an elementary principle not now open to doubt; but of what it is conclusive, and whether it concludes a party from alleging the truth to the extent claimed by the plaintiff in error, is not so clear. That it is conclusive of every itém,or thing in the account as against the whole world, will not be pretended. For example, the debts due the estate form part of every inventory, and are brought into the administration account; and yet no person has ever supposed that although they are treated as part of the assets by the administrator, the debtor is prevented from proving that no debt existed, and that he owed the estate nothing. In whatever manner or with what solemnity and regularity the account is settled, yet the debtor is not precluded from any defence which he may have against the claim. This is conceded; but it is alleged that a distributee, who is a debtor, is placed in a different situation; that he is governed by different principles; because, as is said, being a party to the decree, his time to object is before the decree made, and being silent then, he cannot afterwards collaterally question the decree by a denial of the existence of the debt in another forum. It must be confessed, there is great force in the position; but, on the most anxious and deliberate reflection, I incline to the opinion that although evidence, it is not conclusive evidence of indebtedness. In the case of an ordinary debtor, it would be no evidence whatever; but where the debtor is at the same time distributee, it will best subserve the purposes of justice to consider the decree in that particular as prima facie, but not conclusive evidence of the debt. The debtor, although distributee, should be at liberty to rebut the primñ, facie proof by evidence that destroys the claim. Although the legal presumption is that the parties to the decree examine the account, and are acquainted with each item of which it is composed, yet in practice, and especially where some of the heirs reside out of the State, it is far otherwise. In forming an opinion on such a question, we must have regard to the known habits of doing business; and unless we sometimes yield to circumstances, the most glaring injustice will be the inevitable result; for frequently absent distributees may find themselves deprived of their patrimony by omitting a particular examination of an account in which they may be falsely charged as debtors to the estate. At any rate, before they can be precluded from alleging the truth, they have a right to require that all the forms of law intended for their protection should be pursued. In relation to distribution, the District Court has a concurrent jurisdiction with the Orphan’s Court; and I can hardly suppose that if the parties had thought proper to proceed in the latter instead of the former court, they would have thought themselves prevented from inquiry into the indebtedness of a distributee, merely because he had been returned in the inventory as a debtor, and that had formed one item of the administration account.

The remarks already made dispose of the third and fourth errors. There was a final settlement of the accounts of the defendants as administrators, and a clear balance, viz., $13,866.11, ascertained. From this it results that the District Court had jurisdiction of the subject-matter of the suit.

It remains to consider the fifth error: that the several counts in the declaration, particularly the third and fourth, are utterly incongruous and inconsistent with each other, and the verdict on which the judgment below was entered being general, is erroneous. This error is not entitled to much favour, as we are aware that the evidence on the exceptionable counts, I mean those relating to the real property, was thrown out of the calculation by the jury. But the error is not sustained, because the counts are not incongruous’and inconsistent with each other. Several counts may be joined in the same declaration. The plea and judgment are the same. It would be useless, particularly after a second trial, to send the cause back on such an objection. It is usual, particularly in assumpsit, debt on simple contract, and action on the case, to set forth the plaintiff’s cause of action in various shapes in different counts, so that if the plaintiff fail in the proof of one count, he may succeed in another. 3 Blac. C. 395; 1 Chitty P. 399. The error assigned must be taken as a whole; and as the counts are not incongruous and inconsistent, although the verdict is general, we would not feel ourselves justified in reversing the judgment on that ground.

Judgment affirmed.