[Chambersburg,
October 20, 1828.]
FLEMING against BEAVER.
IN ERROR.
H. andM. were sureties forP., and M. paid half the debt, and joined H. in confessing.^ judgment to a creditor of P’s. for the other half, it being agreed H. should pay this judgment. M. however, was compelled to pay it: Held, that H’s. land being sold, by execution, M'. had a right to come on the fund in the sheriff’s hands, in preference to a subsequent judgment.creditor of H.
Actual’payment discharges a judgment at law; but in' equity, it may still sub-. sist if the justice of the case requires it. .' .
An equitable right to such judgment may exist without any actual assignment of it-.
In the Court of Common Pleas of Franklin county, to which this writ of error was-directed, the following case was stated, for the opinion of. the court. The plaintiff in error was defendant below:—
. In the year 1818, James Walker held two judgments, amounting to about'six hundred dollars; one entered to November Term, 1817, No. 113, arid the other to the same. term, No. 114, ¡against a certain George Fennell, who was the owner of a certain house and lot in Greencastle. Fennell sold and conveyed the-house and lot to Henry Guiger, for a sum more than sufficient to discharge the encumbrances, payable in three or four annual instalments; but Guiger being apprehensive that the encumbrancers *129might press their liens against the house and lot, before sufficient of the purchase money owing to Pennell by Cuiger, would become due, required that he should be indemnified against such an event. It was likewise part of the agreement' between Pennell and Guiger, that the purchase money should be applied, as it became due, to the discharge Of the liens of which the parties mentioned were aware; and at the same time, Pennell entered into a bond with Isacic Hartman, deceased, (of whom Thomas M'Cauley subsequently became administrator,) and 'Peter Hawbucker, as his sureties to Henry Guiger, conditioned to indemnify Guiger against encumbrances. After some time, Walker being about to proceed against the property on his judgments, Thomas M‘Cauley, as representative of Isaac Hartman, who was then dead, paid him the sum of three hundred and seventy-six dollars and eighteen cents, and discharged the balance due to Walker in the following manner: Walker was indebted to a certain Henry Finfrock in a certain judgment to January Term, 1818, No. 140, and which had been, subsequently revived by Scire Facias, amounting to two hundred and forty-two dollars and seventy-two cents. For this sum Thomas M'Cauley, Peter Hawbucker, and JamesWalker, confessed judgment to Henry Finfrock at November Term, 1820, No. 1S2, which it was agreed, amongst the defendants thereto, was to be paid by Hawbucker. This judgment was entered on the 4th of December, 1820, and revived by Scire Facias to April Term, 1823, upon which judgment was entered, and a Fieri .Facias issued thereon to November Term, 1823, upon which the goods of Thomas M‘Cau~ ley were levied. This judgment was to be recovered for the use of the M‘JKean’s administrators. On the 29th of December, 1823, Thomas M‘ Cauley paid to A. J. Findlay, their attorney, the balance due on the execution, to the amount of two hundred and se- - venty-nine dollars and, eighty-nine cents, .and the execution was endorsed, “plaintiff satisfied, A. J. Findlay, attorney of the plaintiff.” _ _•
_ The following entry was also made on the execution docket: — •
“ Received the 29th of December, 1823, of Thomas M‘Cauley, satisfaction in full of debt, interest, arid attorney’s fee; and by order 'of Peter Hawbucker filed, this judgment and execution are to stand against him, the said Hawbucker, for the use of the said M'Cauley.
“A. J. Findlay, attorney of the plaintiff.”
The bonds given by Guiger to Pennell as the consideration of the purchase of the house and lot, were shortly after transferred by Pennell to other persons. - •
• On a Venditioni Exponas, No. 73; April Term, 1824, at the. suit of William Drucks, a house and lot of Peter Hawbucker were sold to John Beaver, on the for the sum of five hundred and five dollars, which was paid over to.the defendant, Archi*130bald Fleming, the then sheriff, to abide the question, whether the said judgment of Henry Finfrock was entitled to be paid out of the proceeds of the said sheriff’s sale. John Beaver was the surviving partner of George Palsgrove, and' claimed the money under the judgment stated below.
The following are the judgments against Peter Hawbucher: —
Henry Finfrock v. Thomas M'Cauley, Peter Hawbucker, and James Walker. Entered the 4th of December, 1820. Judgment for . - - - $279 83 > Interest from the 12th of June, ' - 1823, Costs, - - - ' 13 563
Waynesburg, Greencastle, and Mercersburg Turnpike v. Peter Hawbucker. Entered the 22d oí April, 1821. Judgment,' No. 313, Jan. ” 1811,. - - ' - #118 81 Interest till 17th Jan. 1821.- . 04
118 85
Then paid,, 18 25
100 65
Interest till sale, 19 66
Costs,' 50
Commission, - 2 40
123 16
Drucks v. Hawbucker and M‘Lanahan., Venditioni Exponas, No.73,April Term,1824. Costs of sale, - #12 02 ,123 16
505 00 135 IS
135 18
369 72
6 693
363 123
John Beaver and George Palsgrove v. Peter Hawbucker. Entered on the 18th of April, 1821. Judgment, No. 226, April Term, for - - - - -,#380 00 Interest from the 17th of April, 1821, ..... Costs, - - - - - 50 Commission, 6 693
*131. If the court, on the above statement of facts, should he of opinion, that Thomas'M‘Cauley is entitled to be paid the amount of the judgment in favour of Henry Finfrock, and to stand, in his place, judgment is to be entered for the defendant; and, if they should be of opinion that he is not, then judgment to be entered for the plaintiff, for three hundred and sixty-three dollars and nineteen and-a half cents.
The court below gave judgment for the plaintiff.
Dunlop, for the plaintiff in error.
Findlay, contra.
'The opinion of the court (Tod, J. dissenting, and Huston, J. and Smith, J. being absent at the argument, and taking no part in the cause,) was delivered by
Gibson, C. J.
— The substance of this obscurely stated case is this: Pennell sold a- house and lot to Guiger, and together with Hawbucker and Hartman, (since dead, and represented by McCauley,) executed a bond, with condition, that the encumbrances should not be pressed faster than the purchase money should grow due, to discharge them. Walker, a judgment creditor, being about to proceed, MDauley paid him in cash rather more than half the amount of the bond of indemnity to Guiger, and the residue thus: — Finfrock had a judgment against Walker; in satisfaction of which, Hawbucker, M'Cauley, and Walker, confessed a judgment to Finfrock, which, it was agreed by the parties, should be paid by Hawbucker, but which was ,levied on the goods of M'Cauley, and paid by him. Haiobucker’s house and lot being sold on a judgment at the suit of Drucks, the question is, whether 31‘Cauley shall come on the fund in the hands of- the sheriff, as a judgment creditor under Finfrock;, or,, whether it shall be paid to Beaver, a subsequent-judgment creditor.
It is clear, that Hawbucker and M‘Cauley stand in the relation of principal and surety; and a surety -who has paid the debt, is entitled to be substituted for the creditor. But a subsequent creditor, whose fund has. been taken away by á prior creditor, is also entitled to be substituted. Hence, an argument, that' in ,the case at bar, there is but equity against equity, arid that the parties are to be left to their legal advantages. The parties are the principal, the surety, and the subsequent encumbrancers. But the judgment creditor had not a.second fund in the hands of the surety and eyen if he had, it is not easy to imagine on what principle of justice the surety would be bound to pay the debt in ease of the principal, and for the'bene,fit of a subsequent encumbrancer. Surety was not demanded for the benefit of any but those who were parties to the contract;, arid, the advantages incident to it, .necessarily belong only to themselves. The right of the surety to be substituted in the first place, is indisputable; and the question stands exactly as if the prior creditor himself were pressing his claim on this fund, without having pursued *132the surety to insolvency. That would not be required of him. The surety contracted on the credit of this very fund; and being prior in time, he is prior in right to a creditor who has acquired a claim on it subsequently. If such creditor could compel the surety to pay the prior debt, the effect would be precisely the same as if the principal had paid it, and the surety were compelled to pay the subsequent creditor; for as both debts would be satisfied, it could be of no consequence to the surety, whether, his money were applied to the one debt or the other: and thus, it is obvious, his responsibility might be kept alive after the extinction of the debt for which alone it was pledged. That cannot be done.
Actual payment discharges a judgment at law, but not in equity, if justice require the parties in'interest to be restrained from alleging it, or insisting on their legal rights. Kuhn v. North, 10 Serg. & Rawle, 399, was the case of a voluntary paymént of the debt of another, which, so far from creating an interest in the judgment to affect subsequent creditors, would not have sustained an action of indebitatus assumpsit against the debtor. There is an obvious difference between one who has voluntarily paid the debt.of another, and one who has paid on compulsion, from having become surety at the instance of the debtor, which gives an equity, not only against the latter, but against every one else deriving title from him subsequently to the contract of suretyship.
As to the supposed ineificacy of the substitution attempted by' the parties, and the alleged inability of this court to compel the creditor to assign the judgment, it is sufficient to remark, that an actual assignment is unnecessary. The right of substitution is every thing, and actual substitution nothing. By a.fiction, to which we are indebted for nearly all our equitable jurisdiction, the law has made the assignment already;-and hence, the right of the party entitled, by no meáns depends on -the willingness of the creditor to transfer the security. Here there is a clear right of substitution; and the surety having paid the debt, succeeds by operation of law to the rights of the creditor.
Judgment reversed, and judgment for the defendant,