Commercial Publishing Company v. Beckwith

A Tennessee corporation, styled the Commercial Publishing Company, brought this action in a court of the state of New York to recover from Samuel C. Beckwith a sum of money which, it was averred, belonged to the publishing company. It was alleged in the complaint that the right was derived from one Crawford, who, it was averred, became the owner of certain newspaper advertising accounts, on which payments had been made to Beckwith, the aggregate thereof constituting the amount sued for. The manner in which Crawford was asserted to have acquired the ownership of the accounts will appear in the following statement summarized from the pleadings: On September 30, 1893 an action was begun in the chancery court of Shelby county, Tennessee, to foreclose a deed of trust which had been made by the Memphis Appeal Company, publishers of a newspaper known as the Memphis Appeal-Avalanche. Samuel C. Beckwith was made a party defendant to the cause. Cotemporaneously with the filing of the bill, a receiver of the assets of the newspaper company was appointed, and he continued the publication of the paper. Although the complaint in the action at bar did not set out the nature of the controversy in the Tennessee suit between the trustees, who were plaintiffs in the action, and Beckwith, it was alleged that a short time after the bill was filed Beckwith procured the removal to a circuit court of the United States of a separate controversy existing between himself and the trustees, in which court, it was averred, such controversy thereafter continued. Subsequently, it was alleged, other actions were filed in the Tennessee court against the Memphis Appeal Company, which actions were ultimately consolidated with the trustee cause. It was charged that in the month of April, 1894, like decrees were simultaneously entered in the consolidated actions in the state court and in the one which had been removed to the United States court, and that, under such decrees, a sale was had on June 16, 1894, of the property vested in the receiver, including the accounts due said receiver, representing moneys earned by the receiver in the operation of the newspaper, of which the accounts upon which Beckwith had collected the money sued for formed a part. At this sale, it was alleged, Crawford became the purchaser of all the property embraced in the order of sale, and he thereafter assigned his purchase to the plaintiff.

In an amended answer Beckwith admitted having collected and retained the moneys sued for, and specially denied the other allegations of the complaint. He also set up as a defense that he had collected the moneys in question rightfully, under the authority of an agreement with the Memphis Appeal Company made prior to the execution of the deed of trust heretofore referred to. He further alleged that the receiver never acquired title to the moneys, and had never offered for sale or sold any right or title thereto. Subsequently, by supplemental answer, it was alleged that after the execution of the decrees of sale, and on appeal from a final decree which had been entered in the consolidated cause, the supreme court of the state of Tennessee adjudicated that the trust deed and all proceedings based thereon were null and void, and that, by reason thereof, the sale in question was a nullity.

The action at bar was tried by a jury, upon an agreed statement of facts. By direction of the court there was a verdict in favor of the plaintiff for the full amount claimed. This judgment was affirmed by the appellate division of the supreme court of the state of New York. An appeal was then taken to the court of appeals of the state, which reversed the judgment, and ordered the complaint to be dismissed with costs. 167 N. Y. 329, 60 N. E. 642. The judgment of the court of appeals having been made that of the trial court, a writ of error from this court was prosecuted.

Messrs. A. Walker Otis and Thomas B. Turley for plaintiff in error.

Messrs. Anthony B. Porter and Thomas Kilvert for defendant in error.

Mr. Justice White, after making the foregoing statement, delivered the opinion of the court: