First N. Bank v. Fair

Opinion,

Upon-the facts set forth in the plaintiff’s statement and defendant’s affidavit of defence, we are of opinion that the plaintiff is not entitled to judgment. The plaintiff’s statement does not aver that the defendant knew that Fair had bought the land of O’Connor and Reid and paid the full value of it, and therefore he has no right to the inference of Such a fact from the omission of the defendant to deny it. As the affidavit of defence avers that the money was received by the bank upon the indebtedness to it from O’Connor and Reid, and that *329it was not sufficient to pay all of said indebtedness, and that the balance of the indebtedness was subsequently paid by indorsers of O’Connor and Reid, it is difficult if not impossible to discover any element of mala lides on the part of the bank in receiving and retaining the whole amount of the money paid to them by the sheriff. The bank held a judgment against O’Connor and Reid for $625, to secure the payment of notes to that amount. Three hundred dollars, being for three of the notes, had been paid to the bank by O’Connor and Reid. The plaintiff’s statement alleges that the $300 “ was to apply on the said judgment,” but it does not allege that the hank had agreed to so apply it, or that O’Connor and Reid had made any such application of it, when the money was paid. Without such an averment the statement that the $300 “was to apply on the said judgment ” is nothing more than the expression of the affiant’s opinion to that effect. The same is true of the allegation that the amount “ should have been credited on said judgment.”

The case then is, that, without any averment of a special application of the money paid to the extinguishment of the judgment pro tanto, by either of the parties to the judgment, the plaintiff in the judgment having issued execution thereon and sold the real estate of the defendants therein, the sheriff voluntarily paid to the plaintiff, out of the proceeds in his hands, a sum sufficient to satisfy the judgment as it stood of record. This amount was in excess of the amount which would have been due, if the $300 paid by the defendants in tbe judgment previously, had been credited on the judgment when paid, or at any time after, but was not enough to pay the whole amount of the indebtedness due by tbe defendants to tbe plaintiff. Clearly, as between the defendants and the hank, the latter had the legal, as well as the moral, right to retain the whole amount of the money received, for it would he no more than a debtor to the defendants for the amount of the excess, and this indebtedness it would have a right to apply to the remaining indebtedness due by the defendants to the bank. Indeed it would be a grave question whether the bank might not be required to make such application by tbe indorsers of tlie other-paper beld by tbe bank.

This being so, bow does it become unconscionable for the *330bank to retain tbe money? The defendants in the judgment owed it to the bank, and so far as appears on the record of this case they make no objection to this action of the bank. If the bank owed no duty to return the money to the defendants in the judgment, how do they owe such a duty to Fair, who claims title to the land under the defendants ? He was a voluntary purchaser from the defendants. The judgment of the bank was at that time a lien on the property purchased, ostensibly for its whole amount, and Fair took the title with full record notice of the judgment for its whole amount. The bank owed him no duty of information. If he failed to know of the judgment, it was his own fault for which he cannot hold the bank resjionsible in any manner whatever. He had ample opportunity to intervene and assert any rights he may have had as a purchaser before the sheriff’s sale, but he did not see fit to do so. He allowed the sale to proceed and the purchase-money to be paid over to the bank without objection, and after all this has been done and the bank has simply received money made by lawful process of execution, and which as against its judgment debtors, the defendants in the execution, it had a perfect right to retain, he brings an action against the bank to recover for himself the money so received. We know of no principle of law or morals upon which a recovery can be had in such circumstances,' and we are referred to no authority which has ever sanctioned it.

Judgment reversed, and procedendo awarded.