Opinion
Decided June 17th, 1927.
This court has ample power to restrain the enforcement of a judgment at law where an equitable defense is established, as well as to restrain a suit at law before judgment, and in this case the defendants should be accorded appropriate relief against the enforcement of the judgment at law against them.
On bill, c. On pleadings and proofs.
Messrs. Kappes Hille, for the complainant.
Mr. William Perlis, for the defendants.
The complainant had obtained a judgment in the Hudson county circuit court against one of the defendants, upon an alleged agreement to assume the supposed debt of a man by the name of Diehl, who had given a chattel mortgage to complainant on saloon fixtures in the premises where he had carried on the business. The defendants asserted that it was agreed between the parties when the assumption was made, that it was not to be considered a debt, but was signed merely as a formality at the request of the complainant, and that the defendants would never be bothered in paying the money as long as they continued to sell complainant's beer. No interest was ever paid on the obligation, and no demand for payment of interest or principal was made until the defendant gave up the saloon business. In the action at law judgment was allowed to go by default on amended pleadings, after the trial court had ruled upon the trial that defendant's contention constituted no defense to the action at law, and that the defendant should seek relief in chancery and there establish the equitable defense. Instead of restraining the action at law before judgment, the defendant suffered the judgment by default to be entered, and thereafter the present complainant filed its bill to set aside a conveyance of certain property made by the defendants, so that complainant's judgment could be satisfied by levy upon and sale of that property.
There seems to be ample authority to sustain the power of this court to restrain the enforcement of the judgment where an equitable defense is established, as well as to restrain the suit at law before it goes to judgment.
I have reached the conclusion that the bill of complaint should be dismissed, and that the defendants should be accorded appropriate relief against the enforcement of the judgment at law, entered in favor of the plaintiff, upon the authority of O'Brien v. Paterson Brewing, c., Co., 69 N.J. Eq. 117; Oak Ridge Co. v. Toole, 82 N.J. Eq. 541, and other cases of like import, and cases cited therein.
If the pleadings are not strictly in form to effect this result, the necessary amendments can doubtless be readily made.
I will advise a decree accordingly.