Stilwell v. Carpenter

which that judgment was founded, were, in fact, owned by the defendant Carpenter. If he did not own them it would be difficult to say who did. The claim was originally held by Harris Wilson, as security for a debt due to him by Carpenter. While the claim was so held Carpenter caused it to be assigned to Gilbert to secure a debt of his to the latter. This debt Carpenter subsequently settled, and thereupon, at his request, Gilbert assigned the judgment to one Curtis. Gilbert-expressly disavows any claim of ownership, and Harris Wilson never claimed any interest after Carpenter caused the assignment from him to Gilbert. Hnder these circumstances, Carpenter’s denial of any legal or equitable interest in the judgment or in the claim on which it was founded until long after the assignment, which he himself procured from Gilbert to Curtis, is certainly remarkable, and in view of his subsequent use of the judgment (by means of an assignment from Curtis) in settlement of certain stock transactions between himself and the defendant Markham, it is a serious question, whether further action should not be taken on such plainly unveracious testimony. It appears, that before the assignment to Curtis, and while Gilbert still held the legal title to the judgment, Carpenter and Stilwell came to a settlement of their differences. Stilwell was the owner of a large number of judgments against Carpenter, and Carpenter had large claims then in suit against Stilwell. One of these was for the very rents claimed by Gilbert in his suit. It was agreed to off set the judgment held by Stilwell against Carpenter’s claims, and accordingly Carpenter, formally and by a proper instrument, released Stilwell from all claims, legal or equitable, Stilwell, upon his part, delivering to Carpenter proper assignments of the judgments, which he held against him, with the assignee’s name in blank. All this was conceded by Carpenter, except as to the formal release, as to which he plead want of recollection, and then added, that if he did execute such an instrument, “ it was never intended to include the Gilbert judgment.” The only reason which he offers for the latter statement is his alleged want of ownership. That is, that he could not have intended to include what was not his. He doeajiot pretend that it was not included, provided it was his, and we have seen that his ownership was undoubted. Nor do we doubt that Carpenter fully understood, that the claim for rents, which was the foundation of the Gilbert judgment,-was intended to be and was covered by the release.

The conduct of Carpenter, therefore, in concealing the fact of the release from Gilbert and in inducing the latter to assign the judgment to Curtis, was clearly fraudulent. Instead of procuring that assignment, his plain duty was, as soon as he had settled with Gilbert, to procure from the latter a formal satisfaction piece for the benefit of Stilwell’s legal representatives.

As a matter of law, the subsequent sale tinder the execution issued upon this paid judgment was without any valid subsisting power and the sheriff could convey no title thereunder. Carpenter v. Stilwell, 11 N. Y. 61 , and cases there cited. Besides, the special term has found, and upon sufficient evidence, that neither Curtis, who claimed to have purchased at the sheriff’s sale, nor the assignees of the bid, were tona fide purchasers, but in reality the mere instruments of Carpenter. The plaintiff, therefore, was not estopped from setting up the invalidity of the execution for the reason, that no innocent person was influenced by any act, declaration, or omission of her’s nor did any such person take any action in the matter in reliance thereon. Malloney v. Horan, 49 N. Y. 111 ; Carpenter v. Stilwell, supra. Apart from that, the plaintiff was not aware, at the time of the issuing of the execution, of all the facts which would have justified her in claiming that the judgment had been absolutely extinguished.

The bid at the sheriff’s sale having been less than the amount of the judgment, an effort was made to recover the balance from Stilwell’s estate. The result was a decree of the surrogate in favor of the pretended holder of the judgment. This proceeding was also a fraud upon the part of Carpenter, and was properly set aside by the special term. The surrogate, from want of equitable jurisdiction, held that he must necessarily be governed by the legal title to the judgment, which was claimed to be in Markham, and the plaintiff was thus prevented from setting up her equities as against Carpenter. Yet, at this very time, Carpenter held an assignment of the judgment from Markham, which was fraudulently concealed, and it was asserted as boldly then as now, and with equal truth, that the judgment never 11 belonged to Carpenter.” The fact is that every step which was taken from the time Carpenter procured the assignment of the judgment to Curtis, down to the final decree of the surrogate was fraudulent and void. There is nothing in the point with respect to the statute of limitations. The action was not to set aside the old judgment, but the sale and sheriff’s deed

under the execution issued in January, 1863, and the surrogate’s decree made in 1866. The judgment of the special term should be affirmed with costs.

Judgment affirmed.