Opinion
12852
March 12, 1930.
Before HENRY, J., York, September, 1928. Affirmed.
Action by the Stewart-Jones Company against Mrs. M.B. Hankins and others. From an adverse judgment, plaintiff appeals.
The Special Referee's report and the decree of the Circuit Judge were as follows:
REPORT OF REFEREEBy order of this Court the above action was referred to the undersigned to take testimony and to report conclusions on all issues. In accordance therewith several references have been held, testimony of which is herewith submitted, and the case has been fully argued before me. Owing to the importance of the issues, therefore, and the seriousness of the questions presented, the filing of this report has been delayed for a great deal longer than I had anticipated or wished, in order that the matter might be given due consideration.
The facts out of which this action arises are very complicated, and for the purpose of a clear understanding, it is necessary to give in detail the issues as made by the pleadings. The complaint alleges in substance that on the 5th day of August, 1922, the plaintiff, Stewart-Jones Company, corporation, attached certain real estate described in a suit begun by the said plaintiff against D.B. Hankins. That pursuant to attachment proceedings and judgment, the Sheriff of York County sold the property attached on April 6, 1925, the plaintiff purchased the same, and is entitled to possession, and that he had received a sheriff's deed for the same. That D.B. Hankins previous to the attachment had left the State, and the attachment was made after his departure. That subsequent to the attachment, which was made on August 5, 1922, D.B. Hankins with the intention of defrauding the plaintiff, and for the purpose of defeating the attachment, which was made on the 5th of August, 1922, did attempt to transfer to the defendant, M.B. Hankins, his wife, the real estate described, he being the owner of the property at the time of the attachment. That the property was the only property D. B. Hankins had at the time, and the deed was an effort on the part of D.B. Hankins and his wife to defeat the plaintiff in the attachment proceeding, and that the said deed did not pass any interest. It was further alleged that Mrs. M.B. Hankins and R.L. Shehan were in possession of the real estate, and were withholding possession. It is further alleged that Mrs. M.B. Hankins is liable to account for rents and profits received on the said house and lot, as she was in possession, and receiver be appointed for the same. The prayer of the complaint was that the plaintiff be placed in possession, a deed of D.B. Hankins to defendant M.B. Hankins be declared null and void, and she to account for rents and profits.
Mrs. M.B. Hankins answered the said complaint setting up several defenses as follows:
(a) Denies that the plaintiff is the owner of the property by reason of the attachment, alleges that the said attachment proceeding was null and void for defects appearing on the face of the record.
(b) That the judgment under which the property was sold under which the plaintiff claims title was void for the reason that the former judgment on the same cause of action had been entered October 23, 1922.
(c) Denies conveyance to defendant by D.B. Hankins was made or accepted for the purpose of defeating the attachment, and the deed was made in good faith for valuable consideration.
(d) A former action had been begun between the parties on substantially the same allegations as in the complaint for recovery of the property, the same was heard at the November term, 1924, and the action was dismissed by decree dated December 18, 1924, because the plaintiff had not paid the costs of the former action.
(e) The action was commenced by plaintiff in 1923 against R.L. Shehan, the tenant in possession, for recovery of possession of the property by the plaintiff, alleging that it was owner in fee, and that the said action was decided adversely to the plaintiff on appeal to the Supreme Court, that this case was an action for recovery of real estate and the present action not being brought within two years, it is barred.
(f) In March, 1924, plaintiff brought an action against M.B. Hankins to recover possession of the real estate, that a demurrer was entered and order sustaining the demurrer was passed, with leave to amend to make other persons parties to the suit, and the same to be served within thirty days. That this order was not complied with, and the order sustaining the demurrer became a final judgment. That another action was brought, but not in compliance with the original order, and it being another case, and being a third action for recovery of land, and upon being brought to trial this last action was dismissed by decree of Court December 18, 1924. Final judgment having been rendered on all of the above actions, the action on the present case is res judicata.
(g) That D.B. Hankins at the time of conveyance was entitled to a homestead and defendant acquired good title to the homestead by his conveyance.
(h) That if the conveyance of D.B. Hankins to M.B. Hankins the defendant is not valid, the defendant is entitled to dower.
(i) That the plaintiff has paid off the mortgage owed on the premises by D.B. Hankins, the same has been assigned to her, and she is the owner and holder of the same, and entitled to keep the mortgage open to protect the property against any claims and the mortgage is not merged in the title.
Such are the issues made by the pleadings.
From the testimony and the records introduced before me at the hearing of this case, I find the following facts: That at various times since 1922 there have been four separate and distinct actions involving the premises described in this suit, and between either the same parties or some of them, and as the facts are complicated, it will be necessary to take up in order each action to see the issues made and the disposition of the same.
ACTION NUMBER ONEJudgment Roll No. 5405, entitled Stewart-Jones Company against D.B. Hankins.
This action was commenced on August 7, 1922, for the recovery of $10,143.00 against the defendant, D.B. Hankins. An itemized statement of the account set forth verified by H.C. Geiger, who stated that the account was taken from the books of Stewart-Jones Company. J.M. Stewart also made an affidavit that he was president of the corporation, and from information received from H.G. Geiger and Mrs. Mendenhall, D.B. Hankins had left the State for parts unknown. A second affidavit was attached to the record also by J.M. Stewart stating that from examination of the books of the plaintiff by H.C. Geiger, who was evidently an accountant, D.B. Hankins was indebted to the plaintiff in the sum of $10,143.00. That he was informed by Mrs. Mendenhall that D.B. Hankins left Rock Hill for parts unknown with the intention not to return, and "that he is further informed by C.H. Stewart, who received the information from his wife, who received it from Mrs. M.B. Hankins, that D.B. Hankins intended to dispose of his real estate by sending his papers to his wife that she might sell or do with it as she felt, thereby defrauding the Stewart-Jones Company." These papers were served on R.L. Shehan "who resided in the house of D.B. Hankins," on August 7, 1922. The summons was also served by publication against D.B. Hankins. On August 3rd a warrant of attachment issued and the sheriff made his return August 7, 1922, stating that he had attached the house and lot in Rock Hill, S.C., of D.B. Hankins. On October 19, 1922, an order for judgment was entered by default against D.B. Hankins for $10,143.00, the said order being signed by Judge Peurifoy and further ordered the sheriff to sell the real estate attached on the date named. The sheriff reported that he had sold the property attached on November 7, 1922, the same was bid in by the plaintiff for $500.00, and that a deed had been made. This deed by F.E. Quinn, Sheriff of York County, to the plaintiff conveying the property was dated November 13, 1922, recorded in Book 54, page 226.
In the meantime on August 12, 1922, D.B. Hankins had executed a deed to his wife, Mrs. M.B. Hankins, for the house and lot described. The consideration was recited as being $3,500.00. This deed was duly recorded September 11, 1922.
ACTION NUMBER TWOBox 146, Roll No. 5940.
On June 9, 1923, the plaintiff commenced a proceeding against R.L. Shehan by having J.F. Wingate, Magistrate, to issue his warrant of ejectment against R.L. Shehan to show cause why the defendant should not be deposed from the premises described, alleging that the plaintiff was the owner of the same, and that R.L. Shehan be required to deliver possession. Shehan answered denying the plaintiff was the owner, and alleging that he was not a tenant of plaintiff, but was a tenant of M.B. Hankins. He also filed a demurrer contesting the jurisdiction of the Magistrate. The Magistrate gave judgment for the plaintiff, which was reversed by the Circuit Court, and on appeal to the Supreme Court the order of the lower Court was sustained, this judgment of the Supreme Court being reported in case of Stewart-Jones Co. v. Shehan, 127 S .C., 451, 121 S.E., 374.
ACTION NUMBER THREEThereafter in March, 1924, Stewart-Jones Company commenced an action against Mrs. M.B. Hankins to have a deed to the premises made by D.B. Hankins set aside on the ground that the same was without consideration, and was made to hinder, delay and defraud creditors. This record is contained in Judgment Roll _______. Mrs. M.B. Hankins demurred to the complaint on the ground that there was no allegation that the plaintiff was in possession, and no allegation that the transfer to the defendant affected the plaintiff's rights and also that there was a defect of parties. On June 4, 1924, Judge Henry passed an order sustaining the demurrer, but giving leave to the plaintiff to amend by making D.B. Hankins a party. The order providing that an amended summons and complaint be served within thirty days was passed.
On July 2, 1924, the plaintiff filed what he entitled was an amended complaint, Judgment Roll No. 5938, Box 146, against M.B. Hankins, D.B. Hankins and R.L. Shehan, alleging that R.L. Shehan and M.B. Hankins were in possession of the premises and were illegally withholding the same from the plaintiff. That the transfer by D.B. Hankins to his wife be declared void, and asking that D.B. Hankins be required to account for rent, and a receiver be appointed. These papers seem to have been regarded by plaintiff's counsel as compliance with the order of Judge Henry, but it would seem that in effect that instead of amending his complaint that the plaintiff practically began another action. The summons and what was entitled the amended complaint was served on M.B. Hankins and R.L. Shehan personally, and by publication on D.B. Hankins, the last publication being July 17, 1924. M.B. Hankins and R.L. Shehan duly answered this amended complaint.
On December 18, 1924, the cause came on to be heard before Judge M.L. Bonham, who passed an order declaring the original judgment which Stewart-Jones Company obtained against D.B. Hankins was null and void, for infirmities appearing on the face of the record, and for the reason that the Judge had no authority to grant judgment at Chambers, and ordered the complaint dismissed.
This order of Judge Bonham seems to have been regarded by all parties as the final judgment in action Number Three, and nothing was attempted to be done in that action thereafter.
However, at the February term of Court of Common Pleas for York County, 1925, the plaintiff called his original action, entitled action Number One as above, in which he had previously attempted to take judgment by default before the Judge at Chambers, and which judgment Judge Bonham declared void, to trial in open Court and took a verdict of the jury, the jury finding for the plaintiff in the sum of $10,092.40, and the said case being tried before Judge Memminger. This, as will be recalled, was the original action against D.B. Hankins on a money demand. After the taking of the judgment Judge Memminger filed an order directing the sale of the real estate under the warrant of attachment previously made. The sheriff on April 6, 1925, under the order of Judge Memminger, made a second sale of the premises described in the complaint and the property was bid in by the plaintiff, the sheriff duly making the plaintiff a deed, recorded in Book 54, page 746.
Such is the rather involved history of the litigation between these parties. The complaint in the present action was filed May 8, 1925, after the execution and delivery of the second deed of the sheriff to the plaintiff, conveying the premises. It will be noted by reference to the pleadings that the allegations of the complaint in the present action are practically the same allegations of the complaint in amended complaint in action Number Three above, which case resulted in a dismissal by Judge Bonham, and both the complaint in the former action, designated as action Number Three above, and in the present action set forth allegations appropriate to an action for recovery of real estate, the allegations being that the defendants are illegally withholding possession from the plaintiff and the prayer of the complaint in both cases being that the plaintiff be placed in possession, and that the deed under which the defendant M.B. Hankins claimed be set aside as null and void.
On the pleadings in this case and the testimony some very serious and interesting problems are raised. The first question is:
I. Must the present action be dismissed and not sustained on account of failure to pay costs in the former action?
II. Is the judgment obtained by the plaintiff against M. B. Hankins in attachment proceedings under which the sale was made null and void for defects and infirmities appearing on the face of the record?
III. Can the judgment and attachment proceedings under which the plaintiff claims be attached or questioned by the defendant in this proceeding?
IV. Must the deed of D.B. Hankins to M.B. Hankins be declared null and void as being fraudulent so far as the plaintiff creditor of D.B. Hankins is concerned?
V. If the deed of D.B. Hankins to M.B. Hankins was fraudulent so far as the plaintiff creditor is concerned, can the deed be sustained as conveying the homestead interest of D.B. Hankins?
VI. If the deed is void, has the defendant M.B. Hankins a right to dower in the premises as the wife of the original owner, D.B. Hankins?
VII. Is M.B. Hankins entitled to hold open and claim the mortgages paid by her for D.B. Hankins against the premises, so far as the plaintiff is concerned?
I have attempted plainly to state all the issues in this case, and all the same have been ably and exhaustively argued before me by counsel representing both parties. It is evident that if the first issue is decided adversely to the plaintiff, it will be unnecessary to consider the other propositions, because that issue would dispose of the case. Therefore, while the other issues raise very serious and interesting questions in my own mind, I have not deemed it necessary to render a decision on the same, as the conclusion I reach on the first issue is determinative.
Must this action fail for the reason that costs in the former action were not paid?
Section 317, Code of Civil Procedure, provides as follows:
"The plaintiff in all actions for recovery of real property, or the recovery of the possession thereof, is hereby limited to two actions for the same, and no more: Provided, That the costs of the first action be first paid, and the second action be brought within two years from the rendition of the verdict or judgment in the first action, or from the granting of a non suit or discontinuance therein."
It is evident from the record and from the facts I have recited above that whether action Number Two, the case against R.L. Shehan, which went to the Supreme Court, and was decided adversely to the plaintiff be considered as an action to recover possession of real estate or not, that certainly action Number Three was an action to recover possession of real estate, having the identical allegations of the complaint as in the present action. That action was ended and so regarded by plaintiff's attorneys when the order of dismissal was made by Judge Bonham in 1924. The present action having been begun on practically the same allegations is certainly the second action to recover possession of real property. Have the conditions laid down in the Code been complied with? The testimony shows that J.H. McMackin, Deputy Clerk of Court for York County, and the officer mainly in charge of keeping records of cases and taxing costs, testified that there were some accrued costs in the action of Stewart-Jones Company against M.B. Hankins, Judgment Roll 5939, designated action Number Three above, and that the costs had not been paid, stating that they were about $5.75. He also stated that in the action against D. B. Hankins et al, Roll 5938, which was the case in which Judge Bonham had an order dismissing the complaint that there were accrued costs and that these had not been paid. There seems to be some confusion on this issue by the testimony of T.E. McMackin, Clerk of Court for York County, who also testified, and F.E. Quinn, Sheriff of York County. Mr. McMackin testified seemingly that he did not have any costs in the Stewart-Jones Company v. Hankins case, and that he had been paid by the sheriff in one case. However, it is plain that the case to which Mr. McMackin had reference was the original attachment suit, action Number One, in which the sheriff paid the costs, as the money passed though his hands, and that the Clerk did not have any costs in this suit on the second sale. It was made plain that he was speaking of the case against D.B. Hankins, and stated that he did not agree to waive any other costs in any other suit, that they had filed papers and had done some recording. He also testified that the matter of taxation of costs was looked after by his son, J.H. McMackin. The testimony of F.E. Quinn, sheriff, shows the disposition of funds arising from the sale by him under the attachment and judgments against D.B. Hankins. He did not handle either action Number Three nor the present action, which were begun in the Court of Common Pleas in which Mrs. Hankins was a party. In face of the record, therefore, as given by the witnesses, I cannot but fail to find that there were costs in action Number Three, which could be considered as a first action to recover possession of this real estate, and which are unpaid. The Deputy Clerk so testifies positively, and the Clerk of Court says that there were some costs, and it is not his intention to waive costs in any case except those which the sheriff was handling. I am, therefore, constrained to find that the costs in the first action to recover possession of the real estate were not paid.
From this finding of fact it necessarily follows as a matter of law that the present action cannot be sustained. I will state that I reach this conclusion with a great deal of reluctance, as it seems an extremely technical ground on which to deprive the right of the plaintiff in his present suit, but in face of the uncontradicted testimony and in face of the law that is plainly declared by our. Supreme Court, I can see no other conclusion that can be reached except that stated above. This matter has been fully and finally settled, as I conceive in the case of Columbia Water Power Co. v. Columbia Land Co., 42 S.C. 489, 20 S.E., 378, 380, 540, which involved the very same proposition, and which held that where the costs in the first action had not been paid, the second action must fail. The Court said:
"So that, before a second action can be brought for the recovery of real property, two conditions must be complied with: (1) The costs of the previous action must `be first paid'; and (2) the second action must be brought within two years from the termination of the first action, either by the `rendition of the verdict or judgment in the first action' or `the granting of a non suit or discontinuance therein.' If either or both of these conditions be not first complied with, then there is no authority for the bringing of a second action, and it must, therefore, necessarily fail. Ita lex scripta est. Now in this case, while the second condition was complied with, inasmuch as the present action was commenced within two years from the granting of the order discontinuing the first action, the second condition was not, inasmuch as it is conceded, that the costs of the previous action had not been paid before the commencement of the present action, and hence this action must fail."
The Court thus held that the payment of costs in the first action was not a privilege that could be claimed or waived by the defendant, but was the condition precedent to the plaintiff maintaining his suit, and that it was not the duty of the defendant to have the costs taxed up and paid, but it was the duty of the plaintiff to ascertain and pay the costs which had been incurred. As I understand this decision, it does not mean that the costs had to be formally taxed and the plaintiff notified. It was the condition which had to be complied with before he could begin his suit. The language of Chief Justice McIver in deciding that case is very pertinent, and while it may seem harsh to enforce the statutory requirements, the answer is: "Ita lex scripta est."
The plaintiff has contended strenuously that it did all in its power and all that could be reasonably expected to do about these costs, and thought the costs had been paid. That may be true, and I will say that there can be no criticism or reflection upon the able counsel who represented the plaintiff all through these actions. It is simply one of those cases where strict requirements of the statute must be enforced, regardless of the motives of the parties who have not consciously violated the same. In face of the Water Power Co. case above, I can, therefore, attach no legal importance to the position that the costs would have been paid if they had been taxed, and that the same were never formally taxed. As I say, this does not change the effect of the statute or that decision.
The Water Power Co. case was reaffirmed also in 47 S.C. 117, 25 S.E., 48, and in Peterman v. Pope, 74 S.C. 296, 54 S.E., 569, and my rather extended search has disclosed no case in which the doctrine of these cases has been modified or overruled. The case of Lewis Co. v. Hinson, 57 S.C. 193, 35 S.E., 519, does not overrule the doctrine of these cases, but expressly reaffirms it. In that case the action was allowed for the reason that the costs in the former action had been formally taxed, and the amount taxed had been paid. The Court, therefore, did not penalize the plaintiff for failure to pay items which were not included in the taxation. And in a later case, that of Peterman v. Pope, supra, it was stated that the payment of the costs in the first action being a condition precedent to bringing the second action, it must be alleged in the complaint and proof, and if not, the defendant could raise the point in his answer. While as stated it is a harsh and stringent rule and I reach the conclusion with extreme reluctance, I feel that I am forced to bow to this plain and pertinent decision of our own Supreme Court in face of the uncontradicted evidence as made by this record.
As stated above, therefore, having reached this conclusion, it is not necessary to pass upon the other issues in the case
DECREE OF JUDGE HENRYThis action was commenced by the plaintiff above named in May, 1925, for the recovery from the defendant, Mrs. M.B. Hankins, and her co-defendant, R.L. Shehan, as her alleged tenant, of possession of a lot of land located in the City of Rock Hill, in the County and State aforesaid, alleged to belong to the plaintiff and to be in the unlawful possession of these defendants, and rents for the use of the same, and it is the last of a series of efforts, by action in this Court and by action or proceeding in a Magistrate Court of York County, having practically the same purpose in view. In each former action or proceeding referred to, as well as in the present action, the plaintiff has alleged ownership in itself of the property in dispute by virtue of an alleged attachment thereof issued in an action brought by the plaintiff against D.B. Hankins in August, 1922, and proceedings thereunder, the said property having been conveyed by said D.B. Hankins to Mrs. M.B. Hankins on August 12, 1922, subsequent to the date of said attachment. The validity of said attachment was questioned in each former action, and is also questioned in this action, but this is not an issue before me on this hearing. One of the main defenses in each action, including the present, has been a denial of plaintiff's alleged ownership of the property in dispute and an allegation that the defendant, Mrs. M.B. Hankins, is the owner of the property.
The issues herein were referred to J.A. Marion, Esq., an attorney of this Court, as Special Referee, and this action now comes on for a hearing before me upon the report of said Referee, filed herein on the 8th day of February, 1928, and upon exceptions by the plaintiff to said report.
The history of the litigation to which reference has been made is set forth in detail in said Referee's report, and from said report and the records in evidence herein the following facts appear:
In June, 1923, the plaintiff, under a Sheriff's deed of date of November 7, 1922, arising out of said attachment suit against D.B. Hankins, brought an action or proceeding in a Magistrate Court of York County against R.L. Shehan, then in possession of the property in dispute to eject him therefrom. The defense was, that the title to the property was in Mrs. M.B. Hankins, and that the defendant was her tenant. This case was decided adversely to the plaintiff, both on the Circuit and in the Supreme Court, being reported in 127 S.C. 451, 121 S.E., 374.
In March, 1924, the plaintiff brought action in this Court against Mrs. M.B. Hankins, alleging ownership of the property in dispute under proceedings in its attachment suit against D.B. Hankins and asking that the deed from D.B. Hankins to said defendant be set aside upon the grounds set forth in the complaint. The defendant demurred to the complaint on several grounds, one of which was that D.B. Hankins was a necessary party defendant. This action was heard before me and I sustained the demurrer on all the grounds in an order filed in said action on June 6th, 1924, in which plaintiff was allowed to amend "so as to make D. B. Hankins a party defendant, and with appropriate allegations" as plaintiff might be advised. The order also provided that the amended summons and complaint be served upon the defendants within thirty days from the date of its filing. This is the action referred to as Action Number Three in the Referee's report.
In July, 1924, the plaintiff served upon Mrs. M.B. Hankins and R.L. Shehan, a summons and complaint, the latter being entitled "amended complaint," in which Mrs. M.B. Hankins, D.B. Hankins and R.L. Shehan are named as defendants. The said summons appears to have been served upon D.B. Hankins by publication, the last publication thereof being on July 17, 1924. The Referee, in speaking of this action, says: "These papers seem to have been regarded by plaintiff's counsel as compliance with the order of Judge Henry, but it would seem that in effect that instead of amending his complaint that the plaintiff practically began another action."
D.B. Hankins did not appear in this action, or in any of the others in which he was named as defendant, but the paper entitled "amended complaint" was answered by both Mrs. Hankins and the defendant Shehan. On December 18, 1924, this action was tried, by consent of counsel, before Judge M.L. Bonham, without a jury, and the same was dismissed by him for failure of proof in an order of that date, in which he held that the judgment entered in the said attachment suit against D.B. Hankins and set up in support of plaintiff's title was null and void for defects and infirmities appearing on the face of the record. The judgment so held void in this action was entered upon an order made in the attachment suit under date of October 19, 1922. The Referee reports the determination of this action as follows: This order of Judge Bonham seems to have been regarded by all parties as the final judgment in action Number Three, and nothing was attempted to be done in that action thereafter.
Next the Referee reports, in substance, that at the February, 1925, term of this Court, the plaintiff called up the original attachment action against D.B. Hankins in which was entered the judgment held void by Judge Bonham in the controversy between plaintiff and the answering defendants in the action last above mentioned, empaneled a jury and secured a verdict against D.B. Hankins on the same cause of action upon which the former judgment was entered. The record in said attachment suit, as it now stands, shows that judgment was entered upon said verdict and a second sale ordered thereunder of the property in dispute in this action, and that, in pursuance of said judgment and order, a second deed was made by the Sheriff purporting to convey the property in dispute to the plaintiff, the said deed bearing date of April 6, 1925.
The present action is founded upon this last judgment and proceedings thereunder in the said attachment suit, and its scope and purpose are set forth in the first paragraph of this decree; and the Referee recites the several defenses thereto of Mrs. M.B. Hankins, the only defendant having any real interest in the result thereof, among which is that of a former action having been brought by the plaintiff against her and her co-defendant, R.L. Shehan, upon substantially the same allegations of fact, for the recovery of the real estate involved herein, and the bringing of this action without first paying the costs of said former action, which resulted in dismissal.
The Referee finds and holds that the issue raised by this defense is of first importance, since, if it is decided adversely to the plaintiff, the decision will be determinative of the action and the other defenses need not be considered. He thereupon quotes the second paragraph of Section 317 of the Code of Civil Procedure, which provides that in all actions for the recovery of real estate, or the possession thereof, the plaintiff is limited to two actions, and, as a condition precedent to the bringing of a second action, that the costs of the first action be first paid and the second action brought within two years from the rendition of the verdict or judgment in the first action, or from the granting of a non suit or discontinuance therein.
In considering the evidence with relation to this provision of the Code, the Referee holds that, whether the above-mentioned action against R.L. Shehan be considered an action to recover possession of real estate or not, certainly the action set forth in his report as action Number Three was an action to recover possession of real estate, having substantially the same allegations as those of the complaint in the present action. He says: "That action was ended and so regarded by plaintiff's attorneys when the order of dismissal was made by Judge Bonham in 1924. The present action having been begun on practically the same allegations is certainly the second action to recover possession of real property."
The Referee then proceeds to a consideration of the testimony relating to the issue of payment of costs of said former action, and he finds that the costs in the first or former action by the plaintiff to recover the real estate sought to be recovered in the present action were not paid, and upon this finding he reports as a matter of law that the present action cannot be sustained. A number of decisions of our Supreme Court are cited in support of this conclusion of law announced by the Referee.
The plaintiff has served and filed a number of exceptions to the findings and conclusions of the Referee as herein set forth, the first ten of which raise the question, in differing forms, of the correctness of the finding that the costs of the action designated as Action Number Three in the Referee's report, which was dismissed on hearing, were not paid, and that the conditions in that respect were not complied with by the plaintiff so as to entitle it to bring this second action for the recovery of the land described in the complaint.
Upon a careful examination of the records, testimony and minutes of trial in the case, I am of the opinion that none of said exceptions can be sustained, and they are overruled.
The 11th exception questions the finding of the Referee that the amended complaint under the order of Judge Henry began a new action.
In examining the record on this point, I find that, while the Referee stated that seemingly the plaintiff instead of amending its complaint practically began a new action, in the consideration of the case he treated the action in which the demurrer was set up and the action on the amended complaint as practically one and the same action. Further, the testimony shows that the costs in the action in which the demurrer was interposed have not been paid. This exception is overruled.
The 12th and last exception charges error on the part of the Referee in not finding that plaintiff was entitled to the possession of the property sought to be recovered and that the deed from D.B. Hankins to Mrs. M.B. Hankins should be set aside for fraud; and error in that the findings of fact and conclusions of law thereon are contrary to the preponderance of the testimony. This exception cannot be sustained, for the reason that the Referee's finding of plaintiff's failure to pay the costs of the former action is determinative of this action and precludes the plaintiff from any right to show, or attempt to show, its alleged title or right of possession. And the charge that the deed referred to in this exception was fraudulent is involved in and forms a part of plaintiff's claim of title and for possession and cannot be considered. The latter part of this exception is too general to raise any question. This exception is overruled.
It is ordered, adjudged and decreed, that the Referee's report, filed herein on the 8th day of February, 1928, be and the same is hereby sustained.
It is further ordered, adjudged and decreed, that the plaintiff, Stewart-Jones Company, and any and all persons claiming by, through or under said plaintiff, be debarred and forever excluded from any further action against the defendants for the recovery of the real estate described in the complaint in this action, and that the possession and ownership of said real estate by the defendant, Mrs. M.B. Hankins, be, and the same hereby are, finally settled and established.
Messrs. Dunlap Dunlap, and Hart Moss, for appellant, cite: Cases distinguished: 42 S.C. 488. Payment of costs: 64 S.C. 197; 57 S.C. 193; Secs. 317, 327, 627, Code Proc.; 122 S.E., 378; 2 Rich., 27; 12 S.C. 130; 68 S.C. 941; 76 S.C. 773; 42 S.C. 500.
Mr. William J. Cherry, for respondents, cites: Jurisdiction: 142 S.C. 477; 139 S.C. 463; 115 S.C. 385; 78 S.C. 489; 57 S.C. 193; 50 S.C. 511. Costs: Sec. 625, Code Proc.; 24 S.C. 457; 42 S.C. 499; 13 S.C. 288; 16 S.C. 58; 21 S.C. 601; 98 S.C. 219; 42 S.C. 499; 81 S.C. 87.
March 12, 1930. The opinion of the Court was delivered by
This action by the plaintiff, Stewart-Jones Company, a corporation, against the defendants, Mrs. M.B. Hankins, D.B. Hankins, and R.L. Shehan, was commenced in the Court of Common Pleas for York County, May 8, 1925, for the recovery of a certain lot of land in the city of Rock Hill, together with rents and profits for the use of the same. Upon issues being joined, the cause was referred to J.A. Marion, Esq., as Special Referee, to take the testimony and pass upon the issues involved. The Referee's report contains a full and clear statement of the case, and should be incorporated in the report of the case. There are several defenses set up in the defendants' answer, but the Referee did not consider it necessary to consider but one of the defenses relied upon by the defendants; namely, that before the commencement of this action the plaintiff brought an action in the same Court (Court of Common Pleas for York County) against the same defendants named in this action, on substantially the same allegations as are set forth in the complaint in this action, for recovery of possession of the same lot of land involved in this action; that said former action, having been heard on the merits, was dismissed for failure of proof by the plaintiff of the allegations of the complaint; and that the action now before the Court was commenced by the plaintiff without the payment of the costs in the said former action, which was a condition precedent to its right to bring this action. The Referee sustained this defense, and his finding and holding was confirmed by the Circuit Judge, Hon. J.K. Henry, who heard the case on the report of the Referee. In our opinion, the conclusion reached by the Circuit Judge is well supported by the facts and law of the case.
Therefore, the judgment of the Circuit Court is affirmed.
MR. CHIEF JUSTICE WATTS and MESSRS. JUSTICES BLEASE and STABLER concur.
This is a second action for the recovery of real estate (?) by the same plaintiff against the same defendants. The defense of the defendant Mrs. M.B. Hankins, which was sustained by both the Special Referee and the Circuit Judge, his Honor, Judge Henry, was that the costs of the first action had not been paid before the commencement of the second, as required, as a condition precedent, by Section 317, subdivision 2, of the Code of Civil Procedure; it was commenced on May 8, 1925.
The Section referred to is as follows: "The plaintiff in all actions for recovery of real property, or the recovery of the possession thereof, is hereby limited to two actions for the same, and no more: Provided, That the costs of the first action be first paid, and the second action be brought within two years from the rendition of the verdict or judgment in the first action, or from the granting of a nonsuit or discontinuance therein."
A somewhat detailed statement of the circumstances of the controversy appears essential to an apprehension and decision of the issue involved:
Prior to the year 1922, the defendant D.B. Hankins was an employee of the plaintiff company, and had been so, and in the complete confidence of the plaintiff, for several years as bookkeeper, in charge of the office work and financial affairs of the company. At some time shortly before August 1, 1922, an audit of his accounts developed the fact that he had misappropriated funds of the company to the extent of something over $10,000. He absconded, and his whereabouts have since been unknown. Early in August, 1922, the plaintiff brought an action against D.B. Hankins for the amount of said defalcation, and, upon affidavits that he had fled the State, procured an attachment which was levied upon a house and lot in the City of Rock Hill, the subject of this action. After his flight from the State, from some point elsewhere, he transmitted to his wife, Mrs. M.B. Hankins, a deed dated August 12, 1922, purporting to convey to her the house and lot referred to. The summons upon him was served by publication. He made default in answering, and on October 19, 1922, the plaintiff took judgment by default against him for the amount sued for. The order for judgment was signed by his Honor, Judge Peurifoy, presiding in the Circuit, at Winnsboro, within the Circuit, but not in the county in which the suit had been commenced. In pursuance of the execution issued upon this judgment, the sheriff of York County advertised and sold the house and lot in November, 1922. At the sale the plaintiff became the purchaser at $500. The bid was complied with, and a deed executed by the sheriff to the plaintiff. The $500 paid by the plaintiff was disbursed by the payment of costs $40.90 and the remittance of the balance $459.10 to the attorneys for the plaintiff. In June, 1923, the plaintiff instituted an ejectment proceeding against Mrs. Hankins and her tenant, Shehan, then in possession of the house and lot, which proved abortive; the defendants having raised the issue of title, which this Court decided ( Stewart-Jones Co. v. Shehan, 127 S.C. 451, 121 S.E., 374) ousted the Magistrate of jurisdiction. This decision was rendered February 7, 1924.
The Special Referee finds as follows: "Thereafter in March, 1924, Stewart-Jones Company commenced an action against Mrs. M.B. Hankins to have a deed to the premises made by D.B. Hankins set aside on the ground that the same was without consideration, and was made to hinder, delay and defraud creditors."
He thus refers to it in several places, and at others as an action to recover the possession of real estate, which view the counsel for the appellant seem to take of it.
On July 2, 1924, the plaintiff served an amended complaint making the present defendants parties to the suit. In December, 1924, exactly how does not appear, the matter came up before his Honor, Judge Bonham, who signed an order dismissing the complaint upon the ground that the judgment by default against D.B. Hankins rendered by his Honor. Judge Peurifoy, at Winnsboro was void, and that it was a necessary link in the title of the plaintiff.
Later, it appears that in February, 1925, the plaintiff recovered a judgment against D.B. Hankins, practically a duplicate of the one rendered by his Honor, Judge Peurifoy which was set aside by his Honor, Judge Bonham. Under the execution issued upon this judgment, the house and lot were again levied upon and sold in April, 1925, the plaintiff again becoming the purchaser at the price of $250.
The amount of the bid was paid by the plaintiff to the sheriff under instructions of counsel to pay all costs taxed against the plaintiff and to remit the balance to them, which he did. It appears, however, that there were certain services performed by the Clerk in the action which had been dismissed by Judge Bonham's order for which he might have taxed costs, but did not, and which of course the sheriff did not pay. Plaintiff's counsel, relying upon the belief that they had paid all costs for which the plaintiff was liable, on May 8, 1925, instituted the present, the second, action, and have been met with the defense that the costs of the first action had not been paid.
In the meantime, that is, between the order of Judge Bonham in December, 1924, dismissing the first action for the reason stated and the commencement of the second action in May, 1925, no judgment had been entered up and no costs had been taxed, other than those paid by the sheriff out of the check transmitted to him by counsel for the plaintiff. As a matter of fact, it was not entered until June 10, 1925, before the counsel for Mrs. Hankins served his answer, and then it appears with the costs blank. It was done, as counsel admits, for the purpose of establishing the ground of his defense. With commendable candor he announced to the Referee: "I would like to state in this connection, Mr. Referee, that it was my purpose to make this defense, and I did not see that it was to my best interest to tax these costs, and it was to their interest under the order of Judge Bonham."
It should be remembered that the Clerk said that he had no costs charged against either plaintiff or defendants, but the testimony shows that, long after the second action was brought (about two years in fact), counsel for respondents exhibited to the Clerk certain papers and asked if he would have costs on these papers, and the Clerk answered that, when these papers were filed and recorded by him, or sealed and enrolled, there would be costs. The second action was brought May 8, 1925. The Clerk's indorsement shows that these papers on which he says he would have costs, and particularly the judgment dismissing the complaint, were not filed in his office by defendants' counsel until the 10th day of June, 1925, or thirty-two days after the beginning of the second action. The Clerk had no costs when the second action was brought, for the reason that he had done nothing to earn costs. It is reasonable to suppose that the papers upon which it is now sought to tax costs to defeat this action were in the hands and custody of respondents' counsel. Certainly, they were not in the hands of appellant's counsel, and the record shows by their entry that they were not in the hands of the Clerk until thirty-two days after the action was brought. Judge Bonham's order is dated December 18, 1924. The record shows that this order was never lodged in the Clerk's office to be entered as a judgment until the 10th day of June, 1925, or thirty-two days after the second action was brought. It may be true as a legal proposition that the judgment may be entered and the costs subsequently taxed and inserted by the Clerk, but it cannot be true, either as a legal proposition or in equity, that a paper may be not filed in the office, so that neither the sheriff, appellant's counsel, nor Clerk would know of it and then be delivered to the Clerk, thirty-two days after the commencement of a second action for the purpose of creating costs. The papers creating these costs were lodged for enrollment June 10, 1925, and the answer was served setting up the nonpayment of these costs June 11th, or the following day thereafter. How could the Clerk have any costs, when he had recorded no papers, or done any work to entitle him to them?
I think, too, that it is worthy of consideration that the second action was brought upon a cause of action that did not exist at the time that the first action was brought, it having been decided that at that time the plaintiff had no title, the judgment upon which its deed depended having been declared void.
I think that there are several grounds upon which the circuit decree should be reversed:
(1) The action was an equitable action to set aside the deed from the absconded debtor to his wife, and not subject to the limitation prescribed in Section 317 of the Code.
(2) That it was the duty of counsel for the defendant Mrs. Hankins to enter up the judgment under the decree of his Honor, Judge Bonham, and to have the costs taxed; that he is not in a position to invoke the failure of the plaintiff to pay the costs under these circumstances.
(3) That the counsel for the plaintiff exercised the greatest degree of care in complying with the statute, and that his client should not be heavily penalized for an omission due largely to the remissness of counsel for the defendant; that he paid all of the costs that had been taxed at the time he remitted the check for the purchase price upon the second sale.