McKnight v. Taylor's Trustee

THIS was an appeal from the equity side of the Circuit Court of the United States for the District of Columbia, holden in and for the county of Alexandria.

The facts in the case are fully stated in the opinion of the court, to which the reader is referred.

Semmes and Jones, for the appellant.

Lee and Bradley, for the appellee.

Semmes, for the appellant, contended that the decree of the court below was erroneous, and should be reversed for the following, among other reasons.

1. Because there is no equity in the bill or supplemental bill, and no case made for the interference of the court.

2. Because it decrees debts to be paid which the record shows has already been paid.

3. Because it decrees the debt mentioned in the schedule as that due to Thomas Janney and Co., to be paid to John Lloyd, who claims by virtue of various assignments named in said decree.

4. Because it did not allow the appellant, a lien on or pro rata dividend out of the trust fund for the debts paid off, and assigned for his use, as shown in the record.

5. Because the court should have presumed payment of the debts, in the absence of all evidence showing them still due, after the great lapse of time; or, if the court believed them still unpaid, they should have presumed an abandonment of the claims by the creditors from their laches and the lapse of time; and therefore erred in decreeing relief to claimants whose demands were stale, and who had knowingly slept upon their rights.

6. Because the court should, for like reason, have presumed a performance of the covenant contained in the deed of trust executed between the appellant and Robert I. Taylor, for payment of the schedule debts-a release of the same, or that it was abandoned or extinguished.

7. Because, if the said covenant was any part of the grounds or foundation of their decree, the court erred in decreeding upon it in favour of parties between whom and the covenantor there was no privity; or, if there was any such privity, then, because the covenant was a personal matter, disconnected from the trust, and upon which the remedy was by action at law; and more especially as there was no prayer in the bill for an enforcement of the covenant.

8. Because, if it was right under the circumstances to give any relief at all, the court should have decreed only the principal of the debts found due, and should, on account of the laches, have refused to allow any interest, on the principle on which the account of profits was denied in Acherly v. Roe, 5 Ves. 565; or, upon the principle of Pickering v. Lord Stamford, 2 Ves. jr. 272, 581, interest should have been allowed only from the filing of the bill; the plaintiffs having gone into equity for general relief, and not for an enforcement of the covenant in the deed, on which there was full remedy at law.

On the subject of the lapse of time, he cited 5 Leigh, 350; 6 Wheat. 481; 4 Johns. 1; 9 Peters, 416; 5 Leigh, 381; 7 Johns. 556; 2 Nott and McCord, 360; 9 Leigh, 393; 2 Baldwin, 477; Cowper, 109.

Bradley, for appellee.

As to lapse of time: there was a covenant between McKnight and Taylor, the consideration of which was the forbearance of creditors to sue, and they did forbear. 3 Swanston, 417. As to the presumption of payment: it is not well settled whether it is a matter of fact or law. Hughes v. Edwards, 9 Wheat.; same case in Cond. Rep. 654, 655; Elmendorf v. Taylor, 10 Wheat. 152; same case in Cond. Rep. 55, 56. See also, 10 Leigh, 284.

Jones, for appellant.

A decree must follow the equity of the bill, but the court below has not done it. Hellary v. Waller, 12 Vesey, settles the rule that a court of equity will put itself in the position of a court and jury. The trustee, here, had full legal power to sell without coming to equity, and courts act on different principles when called upon to lend their aid, than when acting regularly. Ambler, 645. The creditors, generally, do not answer or take any notice, but appear to have abandoned the claim. Only one acts. This circumstance ought to be coupled with the staleness of the demand.

Mr. Chief Justice TANEY delivered the opinion of the court.