Harrison v. Shaffer

The opinion of the court was delivered by Allen, J. :

A very elaborate brief has been filed by the plaintiff in error, and numerous questions are discussed at great length. Such only as seem essential to a determination of the case will be mentioned. The third division of the plaintiff’s reply alleges, in substance, that Shaffer presented his claim to McAfee as assignee and obtained its allowance as a claim against the estate in his hands ; that the assignee then had $20,000 of assets, and that Shaffer was estopped and precluded from maintaining another action against the assignor for the recovery of the same debt. A demurrer to this portion of the reply was sustained, and of this complaint is made. The question presented is not an open one in this state. It was held in the case of Limbocker v. Higinbotham, 52 Kan. 696 , 35 Pac. 783 :

“A creditor may maintain an action upon the original claim against an assignor who has made an assignment for the benefit of creditors which is still open and recover a personal judgment against him for the amount due, notwithstanding such creditor has presented and had allowed in full a claim against the estate upon which no payment has been made.”

This decision was followed in Smith v. Higinbotham, *181 53 Kan. 250 , 36 Pac. 336 . There is no inconsistency in the remedy pursued in this action and in obtaining an allowance from the assignee whereby the creditor seeks payment from the estate in his hands. In suing the assignor he still seeks payment, but from other sources, and without denying the validity of the assignment. The assignee does not appear to have ever asserted any claim to the property in controversy. Whether he might have done so it is not necessary to determine.

The question as to the validity of Shaffer’s attachment is discussed at great length. It is contended that no sufficient levy was made ; that copies of the attachment were not posted in a conspicuous place, and that no copy was served on the occupant of the land. It is said that this is in the nature of a direct attack on the attachment proceedings, and that the plaintiff may take advantage of any defect in them. It must be borne in mind that Shaffer’s action against Knox and wife was prosecuted to final judgment before Henderson obtained any lien on the land. The judgment in favor of Shaffer was rendered on the 14th of March, 1892, and the attached property was then ordered sold to satisfy the plaintiff’s claim. There can be no question that this judgment bound John D. Knox and wife and was a complete adjudication, so far as they were concerned, not only as to the amount of the claim but as to the validity of the attachment. The sale subsequently made, and the deed based thereon, passed to Shaffer whatever equitable or legal title Knox and wife had in the property. The subsequent actions brought against John D. Knox, jr., and Martha P. Knox were also'prosecuted to final judgment rendered therein on the 21st of December, 1892. By this judgment it was determined that neither Martha *182 P. Knox nor John D. Knox, jr.,had any real interest in the property, but that Shaffer was entitled to a conveyance from them of the apparent legal title which they held. All this occurred before the judgment in Henderson’s favor was rendered against Knox and wife. This judgment did not become a lien on the land for the reason that the judgment debtors'then had no title to it, nor had the fraudulent grantees even the apparent title remaining in them. Irregularities in the proceedings in the attachment case are not available to the plaintiff in this action, for the final judgment and confirmation of the sale under it were adjudications by which all the right and title of Knox were divested.

The- plaintiff cannot build any rights on the deed made by Martha P. Knox to Henderson, for in his original petition, filed long before the execution of the deed, he had asserted that the conveyance to her was without consideration and made in fraud of the creditors of Knox, and this has been the theory of both of the parties to this action from tho inception of the actions under which they sought to subject the property to the payment of their claims. If the land had been taken in satisfaction of Henderson’s claim or a part of it equal to the value of the land, and this had been with the consent of the debtors, a different question would be presented ; but no credit was given by Henderson on his claim against John D. Knox & Co. . He prosecuted his action to the end and took judgment for the full amount of his claim. The deed executed by Martlia P. Knox recited a consideration of $5500. This sum, however, was> not credited to John D. Knox & Co.

It is urged that the action instituted by Harvey Henderson against McAfee, as assignee, created a Us *183 pendens from the time of filing the petition in March, 1891, and that no priority could be gained by their creditors through legal process thereafter issued. The record shows that McAfee, as assignee of John D. Knox & Oo. and of John D. Knox, was the only party to that action as originally brought, but a summons was, in fact, served on John D. Knox. Whether this made him a party to the action or not we deem unimportant. It was not instituted for the purpose of subjecting this property to the payment of the plaintiff’s claim, but was a suit seeking to have the plaintiff’s debt paid as a preferred claim out of the assets in the hands of the assignee. It did not take the form of an action to subject this specific property to the payment of Henderson’s claim until after judgment had been rendered against John D. Knox and Mary D. Knox and execution thereon issued and returned unsatisfied. Then for the first time the petition was so amended as to make it in effect a creditor’s bill to reach the land which had been fraudulently conveyed. But long before this amendment was made the whole title to the property had passed to Shaffer by virtue of the proceedings before mentioned. The action does not become a lis pendens so' as to charge others with notice of the plaintiff’s rights to the property in controversy until a pleading is filed asserting his rights and seeking their protection. Henderson never at any time acquired any lien on this property and never had any interest in it which he could protect by a suit. The mere fact that he was seeking to obtain a judgment on his claim gave him no right to withhold any of the debtor’s property from other creditors. Whatever the rule may be elsewhere, it is settled in this state that before a creditor can interfere with a transfer of the debtor’s property he must *184 reduce his claim to judgment or at least in some manner obtain a lien on the property. ( Bank v. Chatten, 59 Kan. 303 , 52 Pac. 893 ; Tennent v. Battey, 18 Kan. 324 .) In this we but follow the great weight of authority. Finding no error in the record the judgment is affirmed.