affirmed and the cause remanded for further | fraud of their rights. To this bill Mrs. Place proceedings in conformity to this opinion. and Place himself, and many others, including Phipps & Co., were made defendants. Phipps & Co. were creditors holding heavy obligations of the bankrupt firm, for which they had recovered a judgment about the time the proceedings in bankruptcy commenced. Mrs. Place had also given a mortgage to secure this debt, on the real estate mentioned, some time before that, in which her husband had joined. The district court held that the conveyance of the lots by Place to his wife was but a reasonable provision out of his estate at the time it was made, and dismissed the bill. The circuit court, on appeal, held that the conveyance was a fraud upon the creditors of the firm; that it should be set aside and held for naught; and that the proceeds of the property, which had been sold by order of the court pending the proceedings, should be paid to the assignee. In the finding of facts by the circuit court, embodied in its decree, it is recited that the mortgage to Phipps & Co. was made in fraud of the provisions of the bankrupt law, and with a view to prevent the property from coming to the assignee, and that Phipps & Co. had rea APPEAL from the Circuit Court of the Unit-sonable cause to believe Place insolvent when it ed States for the Southern District of New was made. York. On motion to correct mandate. The case, which is a sequel to the preceding, is fully stated by the court. Mr. J. H. Ashton, in support of motion. Mr. Justice Miller delivered the opinion of the court: This case was argued and decided at the last Term of the court, and the mandate sent in due time to the circuit court. The circuit court has also entered its decree in conformity to the mandate, and the case having originated in the district court, sitting in bankruptcy, has remanded it to that court for further proceedings. A motion is now made in this court to correct the mandate which we sent to the circuit court, on the ground that it does not convey correctly to that court the decree which this court in tended to make. A very serious question is raised in limine as to the power of this court to recall its mandate and make the modification suggested, after the Term has ended in which the judgment of the court was rendered. It is not necessary, how ever, to decide this question, because we are of the opinion that the decree and mandate of this court and the decree of the circuit court entered on that mandate, do correctly represent what this court decided, and what it intended to decide, and we are quite sure that if the district court has misapprehended this, and shall in consequence, in any future action of that court, in jure the parties here moving in the matter, it will be corrected by a second appeal to the circuit court, or, if necessary, finally to this court. The case originates in the bankruptcy of J. K. Place and James Sparkman, and a bill in chancery brought by Sedgwick, assignee of of these bankrupts, in the district court. The main object of that suit was to have certain valuable real estate, conveyed by Place to his wife some time before the bankruptcy, subjected to the claims of the creditors as being made in Phipps & Co. and the executors of Mrs. Place, who had died, appealed to this court. On final hearing this court made the following decree: "On consideration whereof, it is now here ordered, adjudged and decreed by this court, that so much of the decree of said circuit court in these causes as directs the payment of the proceeds of the sale of the Fifth Avenue property, to wit: the sum of $93,161.42, to the assignee, John Sedgwick, is affirmed; but this affirmation is without prejudice to the right of any person now holding the debt growing out of Phipps & Co.'s commercial debt against James K. Place & Co., to present it for the purpose of having it allowed as a claim against the bankrupt estate, and without any determination of that right. And so much of that decree as directs that the complainant recover from the executors of Susan A. Place, the sum of $22,160, and interest, be and the same is hereby reversed. In all other respects the decree is affirmed." The circuit court, on receiving the mandate which followed the words of this decree, made its own decree in the same terms by entering the mandate on its record, and then remanded the case to the district court for further proceedings. In that court the decree of this court is entered as part of its decree, but there is also added that part of the decree of the circuit court which contains the findings that Phipps & Co. had obtained a preference for their claim in fraud of the bankrupt law, and it is the fear of counsel that they will be used as conclusive against that claim, since filed with the assignee for a share in the distribution of the assets, which has caused the present motion. But this court is unanimously of the opinion that no such defense to that claim is consistent with the decree of this court, and that of the circuit court founded on it. In affirming that part of the decree of the circuit court which gave to the assignee the proceeds of the sale of the real estate, from which Phipps & Co., with others had appealed, the | Adams,9 Wall., 661 [76 U.S., XIX.,808], and to decree says in express terms, that "their af- avoid the difficulty experienced in that case, firmance is without prejudice to the right of Rules 4 and 5, regulating appeals from the Court any person now holding the debt growing out of Claims, were promulgated. The Fourth reof Phipps & Co.'s commercial debt against quires that court to file its finding of facts at or James K. Place & Co., to present it for the pur- before the time of entering the judgment, and pose of having it allowed as a claim against the the Fifth permits either party to call for a findbankrupt estate, and without any determina ing upon a special question deemed material to tion of that right." the judgment in the case, and, if refused, to ask For the district court to hold that this leaves this court to pass upon the materiality of the in force the finding of the circuit court that fact alleged, and, should it be considered maPhipps' claim was the subject of fraudulent terial, to send down for the finding. Such is preference, is to render nugatory the carefully the construction given the rules in Mahan v. U. considered words of the decree which we have | S., 14 Wall., 112 [81 U. S., XX., 765]. The given verbatim. It is as plain as language can object is to present the question here as upon make it, that this court intended to declare that an exception to the ruling of the court below in while Phipps & Co. had no lien on the land respect to the materiality of the fact. For that claimed by Mrs. Place, they might present their purpose it must have been submitted to the court claim to the assignee, unaffected by the decree in a written request, as provided in the Rule. of the circuit or of this court; that neither the Nothing of the kind appears here. While other decree which we were reviewing, nor the one requests were made, this was not, and the recwe rendered on that review, should establish ord upon its face does not show that the court or defeat, or in any wise affect the action of the has omitted to pass upon any fact necessary to assignee or of the court on that claim, when pre- the decision of the cause. No foundation has, sented for allowance as against the estate. If therefore, been laid for this application. it did not mean that, it meant nothing; and it is too carefully inserted to justify the latter conclusion. GEORGE SESSIONS, P. in Err., v. FRANCIS M. JOHNSON and JOEL H. LEMOYNE, Assignees of SOLOMON R. KANE and SOLON S. SPRAGUE, Bankrupts. (See S. C., 5 Otto, 347-355.) The opinion of this court [ante, 592], is in strict conformity to this. In speaking of Phipps & Co.'s claim, the court carefully avoids the question of fraudulent preference, but says: "It seems to be clear that the mortgage was taken under such circumstances of notice of the nature of Mrs. Place's title, on the part of Phipps & Co.," that their claim under that mortgage is no better than the title of Mrs. Place. we held that Mrs. Place's title was void, their mortgage on that property failed, without considering whether they had done anything in fraud of the Bankrupt Law or not. And so that question was left intentionally by the court, as fairly deducible also from the words of the decree, to be an open one, if raised by any-cerned in the commission of a wrongful act, they 2. When several persons have been jointly conbody when the claim should be presented for may all be charged jointly as principals, or the plaintiff may sue any one of the parties separately. 3. Judgments bind parties and privies, but they do not bind strangers. As Judgment for tort-joint or separate action— effect of judgment. allowance. We see no occasion to change a word in our decree or mandate, to give effect to the intent of the court, and the motion is, therefore, denied. 1. A judgment against one wrong-doer without satisfaction is no bar to an action against any one of the other joint tort-feasors, but the injured party can have only one satisfaction which, when made, is conclusive in all subsequent proceedings. [No. 244.] Argued Apr. 20, 1877. Decided May 7, 1877. Opinion filed Oct. 15, 1877. IN ERROR to the Circuit Court of the United States for the District of Massachusetts. The defendants in error brought suit in the District Court of the United States for the District of Massachusetts. Judgment was given in their favor, and affirmed by the Circuit Court upon writ of error; whereupon the defendant sued out this writ of error. The case is fully stated by the court. thous Even without satisfaction, a judgment against one of two joint contractors is a bar to an action against the other, within the maxim transit in rem judicatem; the cause of action being changed into matter of record, which has the effect to merge the inferior remedy in the higher. King v. Hoare, 13 Mees. & W., 504. Judgment in such a case is a bar to a subsequent action against the other joint contractor, because, the contract being merely joint, there can be but one recovery; and consequently the plaintiff, if he proceeds against one only of two joint promisors, loses his security against the other, the rule being that by the recovery of the judgment the contract is merged and a higher security substituted for the debt. Robertson v. Smith, 18 Johns., 477; Ward v. Johnson, 13 Mass., 149; Cowley v. Patch, 120 Mass., 138; Mason v. Eldred, 6 Wall.,231 [73 U. S., XVIII., 783]. But the rule is otherwise where the contract or obligation is joint and several, to the extent that the promisee or obligee may elect to sue the promisors or obligors jointly or severally; but even in that case the rule is subject to the limitation, that, if the plaintiff obtains a joint judgment, he cannot afterwards sue them separately, for the reason that the contract or bond is merged in the judgment; nor can he maintain a joint action after he has recovered judgment against one of the parties in a separate action, as the prior judgment is a waiver of his right to pursue a joint remedy. Different modifications of the rule also arise where the controversy grows out of the tortious acts of the defendants. Where a trespass is committed by several persons, the party injured may sue any or all of the wrong-doers, but he can have but one satisfaction for the same injury, any more than in an action of assumpsit for a breach of contract. Courts everywhere in this country agree that the injured party in such a case may proceed against all the wrong-doers jointly, or he may sue them all or any one of them separately; but if he sues them all jointly, and has judgment, he cannot afterwards sue any one of them separately; or, if he sues any one of them separate ly, and has judgment, he cannot afterwards seek his remedy in a joint action, because the prior judgment against one is, in contemplation of law, an election on his part to pursue his several remedy. Where the injury is tortious, the remedy may be joint or several; but the rule in this country is that a judgment against one without satisfaction is no bar to an action against any one of the other wrong-doers. Lovejoy v. Murray, 3 Wall., 1 [70 U. S., XVIII., 129]; S. C., 2 Cliff., 196; Livingston v. Bishop, 1 Johns., 290; Drake v. Mitchell, 3 East, 258. Sufficient appears to show that the bankrupts, Kane, Sprague & Co., on April 5, 1870, mortgaged their stock, tools, fixtures and machinery to W. W. Sprague, to secure him as their indorser; that the mortgagee, on the 13th of the same month, assigned the mortgage to the defendant below as security for a debt due from the mortgagee to the assignee of the mortgage. On the 4th of October following, the bankrupts made a second mortgage, including the property described in the first mortgage, together with other property, to E. A. Goodnow, for $4,000, which sum the mortgagee paid to the mortgagee of the first mortgage, as the agent of the bankrupts, and which he, the agent, used in part to pay three notes given by the bankrupts, upon which the mortgagees in both mortgages were indorsers. Eight days later, the bankrupts sold the whole property covered by See 5 OTTO. U. S., Book 24. the mortgages to Nichols and Johnson, and received in payment their notes and those of Henry W. Snow, to the amount of $6,000, which they divided between the said mortgagees as follows: $2.444.40 to the first mortgagee, and $3,555.60 to the second mortgagee, who thereupon released their respective mortgages. Bankruptcy proceedings against the mortgagors in the two mortgages were commenced on the second of November in the same year, and the plaintiffs were duly appointed assignees of the bankrupt's estate. Subsequently they sued the mortgagee in the second mortgage to recover the value of the property covered by his mortgage; and judgment was, by agreement, entered in their favor for $4,000, interest and costs, and the evidence showed that the judgment was satisfied by the judgment debtor. They, the assignees, also brought another suit against the same party to recover for the preference he obtained when the agent of the bankrupts paid three of their notes upon which the defendant in the last named suit was indorser, which suit was settled by the payment of $2,000 and a release given by the assignees of all their claims against the defendant in that suit. Beyond doubt, the first mortgage was valid, but it was given to secure the mortgagee as indorser for the mortgagors and, inasmuch as the defendant failed to prove that the mortgagee had taken up any paper on which he was so liable, it is evident that the defendant derived no right to the proceeds of the property paid to him by virtue of that mortgage. Nothing having been paid by the defendant as indorser for the bankrupts, the money paid him for the release of his mortgage was plainly a preference by the way of indemnity. Proceedings in bankruptcy were commenced within four months thereafter; and the assignees brought the present suit in the District Court against the defendant to recover back the proceeds of so much of these notes given to the defendant for the release of his mortgage from the bankrupt debtors, the claim being that the amount was paid to secure the defendant for his indorsements for the insolvent debtors; he having reasonable cause to believe that they were insolvent, and that the payment was made to prevent the property from coming to the assignees for distribution, and to impede and evade the provisions of the Bankrupt Act. Service was made; and the defendants appeared and pleaded the general issue, and that the plaintiffs previously recovered judgment against E. A. Goodnow for the value of the same property, and that the said judgment has been fully paid and satisfied. Issue being thus raised, the parties went to trial; and the verdict and judgment were for the plaintiffs in the sum of $2,786.56 and costs of suit. Exceptions were filed by the defendant; and he removed the cause into the Circuit Court, where the parties were again heard, and the Circuit Court affirmed the judgment, and the defendant removed the cause into this court. Five errors are assigned, to the effect following: (1) Because the District Court did not instruct the jury that the action is not maintainable, the assignees having disaffirmed the sale of the goods and received the value of the property. (2) Because the District Court did not instruct the jury that the plaintiffs were estopped by their previous proceedings from maintaining the suit. (3) Because the District Court did not instruct the jury that the plaintiffs could only have judgment for the value of the property, deducting the amount previously recovered. (4) Because the District Court did not instruct the jury that the plaintiffs could not recover the proceeds of the property in the hands of the mortgagee so long as any contingent liability remained. (5) Because the issue submitted to the jury, whether the defendant had paid any thing for the bankrupts, was an immaterial one, if there was any outstanding and undischarged indorsement of the defendant for which he was liable. Separate mortgages were held by the defendant and the other mortgagee, of different dates, and it appears that they were given for entirely different considerations. Of course, the respective mortgagees held the property subject to an equity of redemption in the mortgagors; and the case shows that the mortgagors sold the respective equities of redemption, and distributed the proceeds of the sale between the respective mortgagees. Throughout, the relations of the mortgagees to the insolvent debtors were entirely separate. They never held any joint claim against the insolvent mortgagors, nor did the mortgagees ever receive any joint security from the insolvent debtors for their separate claims. Instead of that, the respective equities of redemption remained in the mortgagors, and the conceded facts show that they sold the equities and distributed the proceeds between the respective mortgagees, showing to a demonstration that there never was any joint contract relation between the mortgagees and the insolvent debtors. Even the proceeds of the sale of the equities of redemption, as distributed between the respective mortgagees, were entirely separate; nor would it make any difference if the mortgagees, in receiving their respective portions of those proceeds, had acted jointly, as it is well settled law that where the tort is joint the injured party may have a joint or several remedy, the rule being that a judgment against one wrong-doer without satisfaction is no bar to an action against any one of the other joint tort-feasors. Lovejoy v. Murray [supra]. when several persons have been jointly concerned in the commission of a wrongful act, they may all be charged jointly as principals, or the plaintiff may sue any one of the parties separately, torts being in their nature several, even when the wrongful act was jointly committed. Ad. Torts (3d ed.), 939. Suppose that is so, still it is insisted by the defendant that the plaintiff cannot, in any proper view of the facts, recover more than the difference between the amount paid by the other mortgagee and the value of the property dis tributed. What the plaintiffs claim is the amount the defendant received from the insolvent debtors as part of the proceeds of the sale of the equities of redemption. Abundant proof is exhibited that he received $2,444.40, and it is conceded that the whole of that amount remains in the hands of the defendant. Two sums, amounting in the whole to $6,000, were received by the plaintiffs of the second mortgagee before the present suit was instituted. $4,000 of the amount was recovered by judg ment in favor of the plaintiffs. They also instituted a second suit against the same party, to recover the amount received by him in payment of the notes upon which he was liable as indorser; which action was compromised by the payment to the assignees of $2,000, as appears by the agreed statement of facts. Such payment being made, the assignees executed a release to the defendant in that suit of all claimsand demands which they, as such assignees, had against him on that account. Judgments bind parties and privies, but they do not bind strangers; and it is clear that the present defendant was neither a party nor privy to the action in the first suit, nor had he anything to do with the compromise of the second suit between those parties. Enough appears in the evidence to establish that theory; but if any possible doubt could otherwise arise in respect to the conclusion, the matter is set entirely at rest by the verdict of the jury. They were told by the court that if the plaintiffs had once received full satisfaction for the proceeds of the sale from the other mortgagee, "then they can recover nothing from the defendant;" and it follows from the verdict that they did not recover in the suits against the Joint wrong-doers may be sued separately; other mortgagee anything for the portion of and the plaintiff may prosecute the same until notes taken for the sale of the equities which the amount of the damages is ascertained by was distributed to the defendant in the present verdict, but the injured party can have only suit. All that he received remains in the hands; one satisfaction, the rule being that he may make and, inasmuch as the assignees are not estopped his election de melioribus damnis, which, when by the proceedings against the second mortmade, is conclusive in all subsequent proceed-gagee from prosecuting their claim against the ings. Heydon's case, 11 Co., 5; White v. Phil brick, 5 Me., 147; Knickerbacker v. Colver, 8 Cow., 111; O'Shea v. Kirker, 4 Bosw., 120. Without more, these remarks are sufficient to show that the theory of estoppel cannot be maintained, and that the first two errors as signed must be overruled, for two reasons: (1) Because the relation of joint contractors never subsisted between the insolvent debtors and the mortgagees, to whom the proceeds of the equities of redemption were distributed by the insolvent mortgagors. (2) Because the mortgagees, acted separately in accepting certain portions of the proceeds of that sale; nor would it have made any difference if they had acted jointly, as it is settled by all the authorities that defendant for the portion of the proceeds of the equities of redemption which was distributed to him by the insolvent debtors, it follows that the assignee may recover the whole amount of that portion without regard to the antecedent proceedings against the second mortgagee, which is all that need be said in response to the third assignment of error. Both parties agree that the first mortgagee was not a creditor of the mortgagors, and that the mortgage was given merely to secure future advances or future liabilities to be incurred by indorsing the paper of the mortgagors. Nothing had been paid by the mortgagee; but the defendant insists that the portion of the notes distributed to him cannot be recovered back if any outstanding undischarged contingent liability | and undischarged. Assume the facts to be so, of the kind remains. Grave doubts arise whether that proposition is well founded in law, for two reasons; (1) Because it was the equities of redemption which the mortgagors sold, and the notes distributed represented the proceeds of that sale. (2) Because it does not distinctly appear that any such contingent liability remained at the time of the trial. But it is unnecessary to decide that question, because the bill of exceptions does not show that the district judge gave any instruction contrary to that construction of the mortgage to the defendant, nor does the record show what, if any, instructions he gave in that regard. Unsustained by the record, as the fourth assignment of error is, it must be overruled as inapplicable to the questions presented for decision. Evidence to show that the defendant had paid any paper which he had indorsed for the insolvent debtors, so far as appears, was entire ly wanting; nor does the transcript show that any was introduced to prove that any indorsement made by the defendant was outstanding See 5 OTTO. and it would be clear that the mortgage could not avail the defendant as a defense to the claim of the assignees; and it is equally clear that, if there were no such outstanding indorsements, then it was important for the defendant to prove that he had advanced moneys to discharge such liability. Viewed in that light, it is impossible to sustain the fifth assignment of error, for the reason that it is shown that the inquiry whether the defendant had made any payment for the insolvent debtors was an important inquiry, and one that was properly submitted to the jury. Proper instructions, it must be assumed, were given to the jury in respect to all the issues in the case not made the subject of complaint in the bill of exceptions, and that all questions involved in the pleadings, except those presented by the assignment of errors, are correctly settled by the verdict, from which it follows that there is no error in the record. Judgment affirmed. Cited-99 U. S., 45, 46. 599 END OF VOL. 95. |