Hovey v. McDonald

Headnote

I. LIEN ON CLAIM.

1. Trover against lienor.

(a) Where the lienor obtains possession of the proceeds resulting from the claim, and converts them to his own use, lie is liable to the lienee as for a conversion, to the extent of the lien.

1. Receiver of proceeds, effect of paying over to lienor under order of court.

(a) Where the order is reversed, and the lienor directed to repay, the fact of liis having obtained possession from the receiver is no defense to the action of trover.

II. RES AD JUDICATA.

1. In an action commenced by a lienee against a lienor, to have liis lien adjudged valid, and enforce payment thereof, the lienor appeared and answered; his answer was struck out by the court, and final judgment given in favor of the plaintiffs, directing the lienor to pay to the plaintiffs the amount claimed by them, and adjudging that plaintiffs have a lien, as claimed by them.

in an action by the lienee against the lienor, for a conversion of the subject of tilo lien, that the judgment in the action to have the lien adjudged valid, barred the lienor from contesting the existence of the lien or the validity of the contract under which it was claimed.

(a) Submitting to jurisdiction. After a party submits himself to the jurisdiction of a court, it is too late for him to question its jurisdiction in another tribunal.

3H. Supreme Court of District of Columbia, is a court of general jurisdiction.

Appeal from an order denying a motion to vacate an order of arrest.

Defendant had a claim pending before the British and American Claims Commission, for cotton destroyed by the United States during the late civil war. Strictly speaking, under the treaty of Washington, this was a claim of the British Government against the United States, and defendant’s claim was against his own government. But, in common parlance, the claims which, under that treaty, were presented to the commisssion for property destroyed, were known and spoken of as the claims of the individual owners of the property. Plaintiffs were employed by defendant to prosecute this claim, under a written agreement showing they were to be paid one-quarter of the amount which should be allowed in respect of the claim, and were given a lien therefor on said claim, and any draft, money, or evidence of debt which should be paid or issued thereon. The services were rendered by plaintiff, a.s agreed on, and an award was made in respect of the claim of $197,100, in gold.

After the allowance of the award, Mr. McDonald, in order to defraud the plaintiffs, made an assignment of it to one William White.

The plaintiffs then, on October 2,1874, began a suit against McDonald and White in the supreme court, of the District of Columbia, to set aside such fraudulent assignment, to have their lien adjudged valid, and to enforce payment of their claim from the award. McDonald and White were personally served, ap

pea,red and submitted to the jurisdiction of the court, and an injunction was issued restraining either of them from collecting the money.

About the same time, one Thomas J. Phelps, claiming the award as assignee in bankruptcy of McDonald, also began an action in the same court against him and White, in which action another injunction was issued.

February 16, 1875, an order was entered by the consent of all the parties to both suits, vacating both injunctions, permitting White to collect half the award from the British Government, and directing George W. Riggs, of Washington, to collect the other half, and hold it, subject to the claims, liens and rights of the plaintiffs herein, Hovey and Dole, and of the assignee, Phelps, to be determined by the further decree of the court. It was further ordered that Riggs, the receiver, should invest the money in the bonds in the District of Columbia.

Riggs drew the money, and invested it in bonds of the District of Columbia.

McDonald and White demurred to the plaintiff’s bill in equity ; the court at special term {sustained the demurrer, dismissed their bill, and, on June 28, 1875, made an order directing the receiver to pay over the funds in his hands to McDonald and White. Upon receiving this order, the receiver handed the bonds over to McDonald, assigning the certificates to him. McDonald then requested the receiver to sell the bonds for him. This was done. He received the money, and, leaving Washington hurriedly, secretly, and by unusual conveyance, took it to New York.

The plaintiffs appealed to the general term from the order sustaining the demurrer to their bill, and there it was reversed, and an order1 was made directing McDonald to repay the money into the registry of the court, which he refused to do.

McDonald and White then interposed an answer, and a large amount of testimony was taken upon the merits. Meantime the plaintiffs applied to the courts to have McDonald punished for contempt, and finally, the general term, having ordered his answer to be struck out for his contempt in April, 1878, gave final judgment in favor of the plaintiffs.

This judgment, after reciting the inception of the lien, the fraudulent assignment to White, &c., directed McDonald and White to pay to the plaintiffs $49,297.50, and further ordered, adjudged and decreed that the complaint have a lien upon the claim of McDonald, and upon any draft, money evidence of indebtedness or proceeds thereof.

Upon this state of facts, McDonald being found in New York, this action was begun. The plaintiffs claim that when the receiver invested this money in the bonds of the District of Columbia, their liens attached to them at once, and that, when McDonald sold these bonds and appropriated their proceeds to his own use (no matter how they came into his possession), he was guilty of conversion, and is now guilty of a wrongful detention of personal property, namely, $49,297.50, belonging to the plaintiffs.

Defendant, having been arrested upon an order of arrest, moved at special term to vacate the order, the motion was denied, and defendant appealed from the order entered on such denial, to the general term of this court.

submitted an elaborate brief, and, among other things, urged strenuously that defendant, having obtained possession under the order of the supreme court of the District of Columbia, had rightfully obtained possession, and had full right to make any subsequent

disposition or appropriation. that he pleased, without incurring thereby any liability to the plaintiff.