Wood v. Mitchell

Headnote

Judgment—Fraud.

Where the judgments confessed were founded on just and legal' debts, they are not rendered fraudulent by the fact that they were confessed pending an extension of time to answer obtained by defendants” attorneys. Under such circumstances the action of the attorneys cannot be held to be a fraud on the plaintiff in the action in which the extension was obtained.

Appeal from judgment dismissing the complaint.

Action to set aside certain judgments confessed by defendant. Mitchell on the ground of fraud.

The following opinion was delivered at special term

Barrett, J.—I cannot accede to the proposition that confessions of judgment, given for honest debts, are to be set aside merely because they were so given after the plaintiff had extended, the defendant’s time to answer in the action then pending. Mitchell had a right to prefer these creditors, and so long as they were-not parties to a fraud, their vested rights cannot be taken from, them. But it was not a fraud, even upon Mitchell’s part, to. pay or secure his honest debts, and though he obtained the extension for that specific purpose, the confessions were but the exercise of a legal right. Whether the time necessary to prepare and execute the confessions was obtained by judicial order, by consent or by interposing a frivolous answer, is immaterial. There was here no agreement, express or implied, that, pending the extended time, the existing status should not be changed by any act of the defendant. The case, therefore, is not analogous to Jaques v. Greenwood, 12 Abb., 232 . It is more like Hauselt v. Vitmar, 2 Abb. N. C., 222 , affirmed 76 N. Y., 630 , where Jaques v. Greenwood was analyzed and shown to rest upon the fact of an express agreement that no assignment would be made pending the stay of proceedings. There judgment had actually been entered, and, by means of the stay secured upon the agreement, that no assignment would be made, the creditor was deprived of the benefit of a levy. The other point made upon the plaintiff’s behalf is even less tenable. There is nothing whatever in the facts testified to by the plaintiff to warrant his claim of an equitable lien upon or assignment of any portion of what was coming to Mitchell from the United States. There was nothing in the nature of an appropriation of the funds, nothing which would have authorized the United States to pay directly to the plaintiff. There was no assignment, pledge or order. Mitchell merely promised to pay when he was in funds from his contract with the government, and this promise was purely personal. There should be judgment for the defendants, dismissing the complaint upon the merits, with costs to the defendants Patterson Brothers, Theodore Smith and Henry Smith, jointly, to the defendants Hobby and Doody, and to the defendant E. B. James.