Currie vs. Jordan et al.

JOHN CURRIE vs. ALLEN JORDAN ET AL.

CIRCUIT COURT.-NORTHERN DISTRICT OF ILLINOIS.—APRIL, 1869.

REDEMPTION-FRAUDULENT CONFESSION OF JUDGMENT.-Where a judg ment creditor, to protect his interest, has purchased the property on foreclosure of a prior mortgage, and the debtor had fraudulently confessed a judgment to enable a third party to redeem the property for his benefit, this court has jurisdiction of a bill for relief filed by the creditor.

The only

DRUMMOND, J.-This is a demurrer to a bill. question in the case is whether the demurrer is well taken, and I think it is not.

The facts in the case, briefly stated, are that in 1865 the plaintiff recovered a judgment against Allen Jordan, upon which judgment an execution was duly issued and delivered to the marshal, and a levy made on the property in controversy in this case, but it was not sold,in consequence of Jordan having made a mortgage upon it prior to the time the judgment was obtained. A bill was filed in the state court to foreclose the mortgage, and upon the decree of foreclosure this plaintiff and another party became the purchasers, and after this was done Allen Jordan confessed a judgment in favor of a certain person, and that person came in and redeemed from the decree of foreclosure. Thus it will be seen an attempt was made to cut off the judgment which the plaintiff had obtained in this court, and to prevent it from operating upon the property. The object of the plaintiff in purchasing the property, in this foreclosure suit, being, as he says, simply to protect his interest therein.

The bill alleges that this judgment confessed was fraudulent, and for the benefit of Jordan, to whom the property really belonged.

Northwestern Distilling Co., vs. Corse.

Whatever might be the legal conclusion, as to the right of redemption, if this judgment were for a bona fide debt, it is clear where it is a fraudulent judgment, given for a fraudulent purpose, that the party affected by that fraud can file a bill in a court of equity, and ask for relief. That is the claim set up here. I have no doubt, therefore, that a court of equity has jurisdiction of the case to determine the rights of the parties.

The demurrer must be overruled, with leave to the defendant to answer.

NORTHWESTERN DISTILLING COMPANY vs. JOHN M. CORSE, COLLECTOR, &c.

CIRCUIT COURT.-NORTHERN DISTRICT OF ILLINOIS.-APRIL, 1869.

IN EQUITY.

An injunction issued by a state court is dissolved by the removal of the cause into the Federal Court.

This was one of several similar bills, originally filed in the Superior Court, to restrain the Collector from paying over money deposited by distillers for Tice meters, which had not been furnished, and which the parties did not desire to take and had no use for. The question was raised whether the injunction issued from the Superior Court was still subsisting

Northwestern Distilling Co. es. Corse.

as against the Collector to prevent him from paying over the sums involved in the litigation. The cases were removed from the state court under Section 67 of the act of Congress of July 13, 1866, which provides that any suit or prosecution against internal revenue officers, etc., in a state court may be removed to the United States Circuit Court at any time. before trial, upon petition, etc.:

"And the cause shall thereupon be entered on the docket of said court, and shall be thereafter proceeded in as a cause originally commenced in that court; and it shall be the duty of the clerk of said court, if the suit were commenced in the court below by summons, to issue a writ of certiorari to the state court, requiring said court to send to the said circuit court the record and proceedings in said case," &c., "and thereupon it shall be the duty of the said state court to stay all further proceedings in such cause, and the said suit or prosecution, upon delivery of such process, or leaving the same as aforesaid, shall be deemed and taken to be moved to the said circuit court, and any further proceedings, trial or judgment therein in the state court, shall be wholly null and void. ** All attachments made, and all bail and and other security given upon such suit or prosecution, shall be and continue in like force and effect as if the same suit or prosecution had proceeded to final judgment and execution. in the state court."

*

It was argued for the United States that the removal vacated the bond and dissolved the injunction.

DRUMMOND, J.-The only difference in the language of the laws of 1789 and of 1866 is that in the law of 1866, the words are: "All attachments made, and all bail and other security given upon such suit or prosecution, shall be and continue in like force and effect as if the same suit or prosecution had proceeded to final judgment and execution in the state court."

1

§67, Act July 13, 1866. 14 Statutes at Large, 171.

Northwestern Distilling Co. vs. Corse.

If the word "attachments" did not apply to the case of an injunction as is conceded, do the words "bail or other securities" apply?

There was a very serious question connected with this originally, and good deal of doubt, at the time, in the minds of the profession, I think, as to the correctness of the decision of Judge McLean, upon the point. The profession was not inclined to acquiesce altogether in that decision, and I recollect that it struck the profession with some surprise. They had taken it for granted that the injunction was not necessarily dissolved; but the more that they reflected upon it, I think, the more they became convinced that, on the whole, the decision was sustainable. It has now been generally acquiesced in and followed in this court, and even if there is a doubt as to its correctness, I should not feel inclined at this time to change the practice unless upon directions from a higher court. The principle of that decision, under that law and under this, is applicable to the particular point. All attachments and all bail or other securities given upon the suit or prosecution shall be and continue in like force, etc. Judge McLean, it is clear, did not think that the term attachment was sufficently comprehensive to include injunction. The question is, whether if "attachment" did not include injunction, "bail or other securities" did. I do not see upon what principle.

GEO. C. BATES, Esq.-Suppose there had been a hearing on the motion to dissolve the injunction and a hearing on testimony taken and the court had made it final, and the case was then brought here, would the injunction be dissolved?

THE COURT.-I do not without a final hearing.

see how there could be such a case There would be a trial quoad hoc,

and this law requires that it should be removed before trial. The language is "at any time before trial." That is, the trial

'McLeod vs. Duncan, 5 McLean, 342.

Campbell vs. Barclay.

must not have commenced for the final disposition of the cause. If it is, it is too late under this law.

I have to treat the injunction as ipso facto dissolved by the removal of the case.

See further Hatch vs. Chicago, R. I. & P. Railroad Co., 6 Blatchford, 105.-[Reporter.

ANDREW J. CAMPBELL vs. DANIEL BARCLAY. CIRCUIT COURT.-NORTHERN DISTRICT OF ILLINOIS.-APRIL, 1869.

This court will not allow parties to be injured or prejudiced by any misunderstanding between their counsel.

Motion to set aside a judgment entered on default, it being alleged that the default was taken and entered in violation of an understanding between counsel.

DRUMMOND, J.-This is the rule that I have always adopted in these cases, that where there is any agreement, understanding, negotiation, or any thing of the sort, as to the disposition of a case, and there is a difference of opinion between the counsel as to what actually took place, that, as it arises from the fact of the negotiations pending between the parties, although there may be a difference of opinion, or misunderstanding, I will not allow the party to be prejudiced by the misunderstanding. Where counsel deal with each other at arm's-length, each standing on his own rights, of course there need be nothing of that sort; but where