National Tube Works Company v. Vallou/Opinion of the Court

In his opinion in the case Judge Wallace states that he sustains the demurrer on the authority of his decisions in Claflin v. McDermott, 20 Blatchf. 522, 12 Fed. Rep. 375, and Walser v. Seligman, 21 Blatchf. 130, 13 Fed. Rep. 415; that he feels free to say that he doubts whether those cases did not adopt too technical a view of the right of a creditor whose judgment has been obtained against his debtor at the place of the latter's domicile, and whose execution has been issued there and returned unsatisfied, to maintain a creditor's bill in a court of another state; and that he may be permitted to express the hope that the present case may be taken to this court for review.

In Claflin v. McDermott, supra, it was held that a creditor's bill, founded on a judgment recovered against a debtor in a state court in California, would not lie in a circuit court of the United States in New York, to set aside a fraudulent transfer of personal property made by the debtor in California, by means of collusive judgments and sales under executions issued thereon, no judgment having been obtained or execution issued in such circuit court or in any state court of New York. The case of Tarbell v. Griggs, 3 Paige, 207, was cited as authority, where the court of chancery of the state of New York refused jurisdiction of a creditor's bill filed to obtain satisfaction of a judgment rendered in the circuit court of the United States for the southern district of New York, and upon which an execution had been returned unsatisfied, the judgment being treated as a foreign judgment, and as standing on the same footing with the judgments of a court of another state. The principle invoked was that the plaintiff's remedy at law had not been exhausted by the issuing and return of an execution on a foreign judgment, and McElmoyle v. Cohen, 13 Pet. 312, was referred to as authority.

In Walser v. Seligman, supra, creditors and stockholders of a corporation organized under the laws of Missouri and Kansas brought a suit in equity in the circuit court of the United States for the southern district of New York against certain persons to enforce the liability of the latter as holders of a number of shares of unpaid capital stock of the corporation, without the corporation being made a party to the suit, and without the plaintiffs being judgment creditors elsewhere than in Missouri; and the court held that, the plaintiffs being merely creditors at large, and not having exhausted their remedy at law in New York, and the Missouri judgments not having in New York the force of domestic judgments, except for the purpose of evidence, the bill would not lie.

The bill in the present case is defective in that respect. It alleges only the recovery of a judgment against the corporation in Connecticut, and the issuing and return there of an execution unsatisfied. It does not allege any judgment in New York, or any errort to obtain one, nor does it aver that it is impossible to obtain one. It alleges merely that the corporation has no fund or assets wherewith to pay the claim of the plaintiff.

Where it is sought by equitable process to reach equitable interests of a debtor, the bill, unless otherwise provided by statute, must set forth a judgment in the jurisdiction where the suit in equity is brought, the issuing of an execution thereon, and its return unsatisfied, or must make allegations showing that it is impossible to obtain such a judgment in any court within such jurisdiction. Taylor v. Bowker, 111 U.S. 110, 4 Sup. Ct. Rep. 397; Webster v. Clark, 25 Me. 313; Prish v. Lewis, Freem. Ch. 299; Brinkerhoff v. Brown, 4 Johns. Ch. 671; Dunlevy v. Tallmadge, 32 N. Y. 457; Terry v. Anderson, 95 U.S. 628; Smith v. Railroad Co., 99 U.S. 398, 401; Hawkins v. Glenn, 131 U.S. 319, 334, 9 Sup. Ct. Rep. 739; McLure v. Benceni, 2 Ired. Eq. 513, 519; Farned v. Harris, 11 Smedes & M. 366, 371, 372; Patterson v. Lynde, 112 Ill. 196.

Decree affirmed.