Opinion
No. 21998
Decided August 16, 1950.
Attachment — Nonresidence as ground — Claim arising on contract — Ex contractu claim a condition precedent — Burden on claimant to establish, on motion to discharge — Whether any evidence tends to support claim — A question of law.
1. Where a claimant relies upon nonresidence as a ground for attachment in respect to a claim arising on contract, the fact that the claim is ex contractu is a condition precedent which must be sustained by the claimant on a hearing on motion to discharge the attachment secured in the first instance on that ground.
2. Where a party, against whom an order of attachment is obtained, by affidavit in support of his motion to discharge the attachment denies the ground of the attachment stated in the affidavit therefor, it devolves upon the party procuring the attachment to establish, upon hearing, such ground by proper evidence; and whether there is any evidence tending to sustain it is a question of law to be decided by the court.
APPEAL: Court of Appeals for Cuyahoga county.
Messrs. Bulkley, Butler Pillen, for appellant.
Messrs. Squire, Sanders Dempsey, for appellees.
This is an appeal on questions of law from an order of the Common Pleas Court of Cuyahoga County wherein that court granted separate motions to discharge attachments and overruled separate motions for new trials. The plaintiff and the two individual defendants are nonresidents of the state of Ohio, all being residents of Ligonier, Pennsylvania.
The record shows that on May 9, 1950, the plaintiff instituted suit in Cuyahoga county alleging that the defendants were indebted to him in the sum of $10,291.40, and asserting, among other things, that the individual defendants were "associated together and doing business as coal producers and brokers, sometimes trading under the name and style of Green Valley Coal Company, Ligonier, Pennsylvania." Plaintiff alleged further that the third party defendant, the garnishee herein, was an Ohio corporation with its principal office in the city of Cleveland.
Contemporaneously with the filing of the petition, plaintiff filed an affidavit in attachment on the ground of nonresidence, alleging that the corporate defendant "is indebted to one or both defendants," and that the indebtedness of defendant Youghiogheny Ohio Coal Company to the individual defendants is an asset of such defendants in Ohio. Plaintiff alleged further that the affidavit of attachment was made in conformity with Section 11820, General Code, for the purpose of procuring an attachment of defendant's assets in the state of Ohio at the commencement of the action. At the same time an affidavit for service by publication was filed.
Pursuant to plaintiff's affidavit, the clerk of Common Pleas Court issued an order of attachment without bond against the defendant garnishee. In accordance with the order of attachment, the garnishee advised the clerk of court by letter that it was indebted to the defendant Bernard J. Goebel in the total net amount of $10,853.16; that it was indebted to Green Valley Coal Company in the amount of $26; that it had no indebtedness owing to defendant John M. Lee; and that the sums would be held pending further order of the court.
Thereafter, the individual defendants filed separate motions to discharge the attachments and appeared specially and solely for the purpose of such motions without submitting themselves to the jurisdiction of the court.
On July 14, after due notice, a hearing was held on the motions. Upon such hearing, counter affidavits of the defendants were filed, introduced in evidence and considered by the trial court. The counter affidavit of the defendant Goebel denied the allegations of the plaintiff as contained in the petition and traversed directly the statements set forth in the affidavit of attachment. He set forth in substance that he did not then have and never had had any dealings with the plaintiff; that he had never been associated with the defendant John M. Lee in the business of coal broker or producer; that he had never traded under the name of Green Valley Coal Company; that he had no interest or connection whatsoever with such company; and that he was not indebted to the plaintiff in any sum whatsoever. Likewise, the defendant Lee filed a counter affidavit in which he deposed and said in substance that he was an individual doing business under the name of Green Valley Coal Company; that the trade name had been duly registered in the state of Pennsylvania; that the defendant Goebel had no interest or connection whatsoever with the business conducted by affiant under the trade name of Green Valley Coal Company; and that the defendant Goebel was not connected with the affiant in any of the transactions between the plaintiff and the affiant or between Heald Coal Company and Green Valley Coal Company. In short, his statement corroborated completely the allegations of fact contained in Goebel's affidavit. However the affiant Lee stated that he himself had done business with Heald Coal Company, the trade name of the plaintiff, which trade name to the best of his knowledge had not been registered in the state of Pennsylvania, and then alleged that there was not due or owing to the plaintiff herein any sum whatsoever from the affiant or from Green Valley Coal Company, and that the plaintiff had failed to set forth as credits on account "at least three payments to Heald Coal Company from Green Valley Coal Company in the total amount of $16,081.44."
Supporting the affidavits there was filed and introduced in evidence the certificate of the secretary of the commonwealth of Pennsylvania, certifying that defendant John M. Lee carried on a business under the name and style of Green Valley Coal Company at Ligonier, Pennsylvania, and that he was engaged in the business of operating coal lands, buying and selling coal, and inspecting coal for shipment, and also the certificate of the prothonotary of Westmoreland county, Pennsylvania, certifying that there had been filed in his office the certificate provided for in the act of the General Assembly above described.
The bill of exceptions sets forth the fact that the plaintiff was present in the courtroom at the time of the hearing on the motions to discharge the attachment but did not take the witness stand to offer testimony contradicting the allegations contained in the counter affidavits of the defendants.
By journal entry dated July 24, 1950, the trial court granted the motion of the defendant Goebel to discharge the attachment and ordered the garnishee to release all the attached funds of Goebel to him and allowed the plaintiff until July 28, 1950, to file his appeal to this court provided that with such appeal the plaintiff give bond to the defendants with surety to be approved by the clerk of the Court of Appeals in double the amount of the appraised value of the property which had been attached, conditioned to pay said defendant in the manner provided by law.
A motion for new trial having been filed, the same was overruled July 27, 1950, at which time the trial court, by journal entry, again ordered the garnishee to release all the attached funds of Bernard J. Goebel as well as the attached funds of Green Valley Coal Company to each of them respectively and then extended the time for appeal to August 4, 1950, under the same conditions set forth in the previous order. The plaintiff then appealed to this court, but has not up to this date posted bond as ordered by the trial court
The case here was advanced for hearing on application of plaintiff at which time the defendants again entered their appearance specially and solely for the purpose of the motions without submitting themselves to the jurisdiction of this court, and each defendant filed separate motions to dismiss; the first motion on the ground that this court is without jurisdiction to hear this appeal and the second for failure of plaintiff to comply with the journal entry appealed from by filing bond in accordance with the order of the trial court. The cause is now before us on said motions of defendants to dismiss and upon the appeal of the plaintiff.
The assignments of error are as follows:
"1. The trial court erred in granting the separate motions of defendants to discharge attachment.
"2. The trial court erred in entering its order having the effect of terminating the jurisdiction of the court over the defendants when the plaintiff had not had his day in court, and defendants, electing to enter only a special appearance, waived their right to deny plaintiff's allegations, or to demur.
"3. The trial court erred in its order requiring the plaintiff to file an appeal bond in a sum double the amount of the appraised value of the property attached.
"4. Other errors manifest on the face of the record."
It should be observed at the outset that whatever jurisdiction is had either by the trial court or this court is solely in rem. The defendants being nonresidents, the only way in which the trial court acquires jurisdiction over them is by the seizure of property lying within the territorial jurisdiction of the court under the order of attachment. Thus, there can be no judgment in personam but in rem only, and any judgment rendered could have no effect beyond the appropriation of the attached property to the satisfaction of the debt and costs. See Pilgrim Distributing Corp. v. Galsworthy, Inc., 148 Ohio St. 567, 76 N.E.2d 382.
It has been the contention of the plaintiff, both in oral argument and by way of brief, that on the motion to discharge the attachment the trial court should have considered only the proposition of nonresidence of the defendants and, that being admitted, the motion to discharge the attachment should have been overruled.
At the commencement of the action the attachment was secured through the clerk of court, without the intervention of a judge or an order of the court, under favor of Section 11820, General Code, which provides in substance that an order of attachment shall be made by the clerk of the court in which the action is brought in any case mentioned in Section 11819, General Code, when there is filed in the office of the clerk an affidavit of the plaintiff, his agent, or attorney, showing the nature of the plaintiff's claim, that it is just, the amount which the affiant believes the plaintiff ought to recover and the existence of any one of the grounds for attachment enumerated in Section 11819.
Section 11819, General Code, provides that in a civil action for the recovery of money, at or after its commencement, the plaintiff may have an attachment against the property of the defendant upon any of the grounds therein mentioned. Ground two is that the defendant "is not a resident of this state." The last paragraph of Section 11819, General Code, specifically provides that an attachment shall not be granted on the ground that the defendant is not a resident of Ohio, for any claim other than a debt or demand arising upon contract, judgment, or decree, or for causing damage to property or death or personal injury by negligent or wrongful act. In this case, as indicated, the plaintiff predicates his right of attachment on the ground that defendants are nonresidents and that the debt or demand is one arising upon contract. It follows, therefore, that unless the plaintiff shows by the requisite degree of proof that his debt arises upon contract his right of attachment must fail. To hold otherwise would be in direct contravention of the express terms of the statute which gives rise to the right of attachment. Nonresidence alone is not sufficient. There must, perforce, coexist, as an incident to the right of attachment, one of the conditions set forth in the last paragraph of Section 11819, General Code. Therefore, where the plaintiff relies upon nonresidence as a ground for attachment in respect of a claim arising on contract, proof of the latter is a condition precedent which must be sustained by the plaintiff on a hearing to discharge such attachment. The claim that the court may not inquire into this condition precedent, upon the assertion that the court will be going into the merits of the original case to which the defendant has not pleaded over, is, therefore, untenable.
It is stated in 4 Ohio Jurisprudence, 273, "Attachment," Section 209:
"It would seem obvious, however, that an attachment would be discharged on the ground that the action was not one of the class of actions in which an order of attachment may be obtained. Thus, it might be alleged that the action was not upon a claim arising upon a contract, judgment, or decree although the attachment was obtained upon the ground of nonresidence."
The majority of this court, therefore, holds that nonresidence alone is not sufficient to sustain an order of attachment at the commencement of the action, but that the provisions of Section 11819, General Code, require the existence of one or more of the conditions enumerated therein as a condition precedent before an attachment can be sustained where such attachment is challenged upon hearing of a motion to discharge.
We come next to a question more or less procedural in character which relates to the burden of proof on such a hearing. From the earliest days the rule in Ohio has been that the burden of proof is upon the party seeking the attachment at the commencement of an action. See Coston v. Paige, 9 Ohio St. 397, the second paragraph of the syllabus of which is as follows:
"The charge thus made, if denied by the defendant, must be sustained by the plaintiff to the satisfaction of the court; upon the plaintiff, by the denial, is thrown the burden of proof."
This proposition was concurred in by a unanimous court although Peck, J., dissented as to the first paragraph of the syllabus, the import of which is not in issue here. At page 398, we find the following cogent language by Gholson, J.:
"We have examined the affidavits as to the truth of the facts charged in the affidavit. In assigning the reasons for his decision, upon that part of the motion, the judge of the Court of Common Pleas appears to have supposed that, the charge being made, it must be disproved by a clear preponderance of evidence, thus assuming that the burden of proof in such a case was thrown on the defendant. To this reasoning we can not assent. If the charge be made by the plaintiff and denied, and nothing appears to authorize greater credit to be given to the statements of the plaintiff than to those of the defendant, the attachment ought to be discharged. When the charge is made and denied, the burden of proof is, we think, thrown on the plaintiff, and he ought to satisfy the court that the charge he has made is well founded."
We are unable to find any disapproval of this case by later Supreme Court decisions. On the contrary the doctrine has been supported in cases dealing with the subject. See 4 Ohio Jurisprudence, 280, "Attachment," Section 216, and numerous cases thereunder cited, including Coston v. Paige, supra, and Seville v. Wagner, 46 Ohio St. 52, 18 N.E. 430, the second paragraph of the syllabus of which is as follows:
"Where the weight of the evidence is the only question presented by such bill of exceptions, this court will not enter upon its review, or disturb the judgment of the court below thereon; but when the party against whom an order of attachment is obtained, in support of his motion to discharge the same, by his affidavit denies the ground of the attachment stated in the affidavit therefor, it devolves upon the party procuring the attachment, to establish such ground by proper evidence; and whether there is any evidence tending to sustain it, is a question of law, which the parties may have determined by this court."
To the same effect are the Court of Appeals cases of Morelli v. Thombs, 35 Ohio App. 233, 172 N.E. 381, and McCray Refrigerator Sales Corp. v. Logan, 36 Ohio App. 201, 172 N.E. 699. The latter case was decided by this court on May 5, 1930. The second paragraph of the syllabus thereof is as follows:
"On motion to dissolve attachment, where defendant introduces counter testimony, and plaintiff relies solely on affidavit, attachment must fail."
At pages 203 and 204 of the same case, Sullivan, J., speaking for a unanimous court, said:
"It is a well-settled proposition of law that, where there is counter testimony in a motion to dissolve an attachment, in the absence of further testimony on the part of the party attaching, the claim for attachment must fail. The reason for this is that the assertion of fact in the affidavit is mainly for the purpose of securing the attachment, and not for the purpose of creating testimony as to any issue of fact that may arise thereon, unless additional testimony is offered."
The same rule applies in many other jurisdictions where there are comparable statutes, but we believe that it is sufficient for the purpose of this opinion to confine our consideration to the law of Ohio.
The only case cited contra by plaintiff is Ascherenka v. Lonsdale Manufacturing Co., 20 Ohio App. 123, 153 N.E. 150. An examination of that case discloses that it is not in point with respect to the issues in this proceeding. The question there raised applied directly to the merits of the original case as indicated by the opinion of Buchwalter, J., and as appears by the second paragraph of the syllabus, which is as follows:
"The grounds stated in a motion to discharge an attachment, that plaintiff had entered his appearance and elected to pursue his remedy in a chancery court of another jurisdiction and was enjoined by said chancery proceeding from prosecuting his claim against defendant in any other cause, are matters of defense and cannot be presented on a hearing on such motion to discharge."
Coming now to apply the law to the facts established by the evidence as set forth in the record, we find that the affidavit filed by plaintiff in order to secure the attachment was more than counterbalanced by the affidavits and supporting certificates filed on behalf of the defendant Goebel to the effect that the claim of the plaintiff did not arise and could not have arisen upon contract, either express or implied, so far as the claim of plaintiff against defendant Goebel is concerned.
As previously indicated, the affidavit of the defendant Goebel is supported not only by the affidavit of the defendant Lee but is supported further by the certificate of the secretary of the commonwealth of Pennsylvania certifying to the use of the fictitious name of Green Valley Coal Company by John M. Lee alone and showing no relation of the defendant Goebel with the enterprise carried on under such name.
On this state of the record "the burden of proof was thrown" upon plaintiff to sustain his claim for attachment against the defendant Goebel by producing further evidence. This the plaintiff failed to do although present in the courtroom at the time of the hearing.
Therefore, we conclude that the order of the trial court granting the motion to dissolve the attachment as to the defendant Goebel must be affirmed and the attachment, as to him, discharged.
In relation to the defendant Lee it will be noted that the garnishee answers that it has no indebtedness to him, but that there is a credit in favor of the Green Valley Coal Company (a fictitious trade name of defendant Lee) in the amount of only $26, a sum obviously not within the jurisdiction of Common Pleas Court, which court, in civil actions, has original jurisdiction where the sum involved exceeds the exclusive jurisdiction of justice of peace courts, which is limited in amount to $100. This action being in rem only, no jurisdiction is acquired over the defendant Lee.
Before concluding, we wish to make reference to the four separate motions of defendants to dismiss this appeal.
The contention is made by defendants that no bond having been filed by plaintiff either in compliance with the journal entry of the Court of Common Pleas or at any other time, this court has no jurisdiction to hear this appeal from the granting of a motion dissolving an attachment on the ground that the statutes granting the right to an order of attachment require a bond to be filed by the person seeking the attachment at any time the trial court may order it as a prerequisite to further prosecution of the attachment.
The further claim is made that the provisions of Section 11866, General Code, which in positive language states that "the party who appeals must give a bond to the adverse party, with surety to be approved by the clerk of the Court of Appeals, in double the amount of the appraised value of the property attached," are mandatory and, the plaintiff having failed to comply with the order of the court specifically made as a condition of the appeal, the same should be dismissed. In view, however, of our decision of this case on the merits of this appeal, we deem it unnecessary to pass upon the motions to dismiss.
The judgment of Common Pleas Court granting the motions of the defendants to discharge the orders of attachment is affirmed and attachments discharged.
Judgment affirmed.
PHILLIPS, J., concurs.
The record discloses that defendants in their affidavits admitted they were nonresidents of this state. The other averments in their affidavits traversed the allegations of plaintiff's petition and included a denial that defendants were associated together in relation to the transactions referred to in plaintiff's petition and further denials by both defendants that defendant Goebel, either individually or as an associate of defendant Lee, had ever done business with or promised to pay plaintiff for shipments of coal.
Plaintiff took the position that these averments in defendants' affidavits related to the merits of the principal action and ought not to be considered in a hearing of a motion to discharge the attachment where defendants appeared specially and solely for the purpose of the motion. There is abundant authority to support this position. 4 American Jurisprudence, 934, Section 635; 7 Corpus Juris Secundum, 606, Section 416; Asamen v. Thompson, 55 Cal.App.2d 657, 131 P.2d 839; Singer v. Shapiro, 133 N. J. Law, 133, 43 A.2d 12; Aurbach v. Grand National Pictures, Limited, 176 N. Y. Misc., 1031, 29 N. Y. Supp. (2d), 747, affirmed without opinion 263 App. Div. 712, 31 N. Y. Supp. (2d), 670; Republic Truck Sales Corp. v. Peak, 194 Cal. 492, 229 P. 331.
There was no indication by the trial court that its consideration of the affidavits of defendants was limited to a determination whether plaintiff could sustain his claim of contractual relations with both defendants as joint obligors. Plaintiff did not testify in support of the allegations of his petition and affidavit in attachment that were traversed by the affidavits of defendants. However, plaintiff did offer to submit to interrogation by the trial court. The court declined to examine him. In view of these circumstances, the application herein of the rule laid down in Coston v. Paige, 9 Ohio St. 397, Seville v. Wagner, 46 Ohio St. 52, 18 N.E. 430, and Morelli v. Thombs, 35 Ohio App. 233, 172 N.E. 381, is unwarranted.
It is settled law that the attachment statutes of Ohio and the procedure incident thereto are of a remedial nature and must be construed liberally for the benefit of the attaching party. Northwestern Yeast Co. v. Broutin, 133 F.2d 628; Weirick v. Mansfield Lumber Co., 96 Ohio St. 386, 117 N.E. 362; Hart v. Andrews, 103 Ohio St. 218, 132 N.E. 846; Smith v. Buck, 119 Ohio St. 101, 162 N.E. 382, 61 A. L. R., 1343.
Assuming this court has jurisdiction on appeal, the attachment ought to be sustained and the cause remanded to the Common Pleas Court for further proceedings on the motion to discharge the attachment so as to enable the trial court to inquire and the plaintiff to testify in respect of his alleged contractual relations with both defendants jointly.
I am of the opinion, also, that upon a hearing of a motion to discharge the attachment under the circumstances disclosed by the record in this case, the plaintiff is not required to sustain the burden of proof on the issue of the alleged contract with both defendants. If, upon a hearing of the motion, the court is satisfied that plaintiff's claim is fictitious or not supported by credible evidence, the attachment ought to be discharged. However, if plaintiff offers evidence that establishes a prima facie case and a bona fide dispute between the parties on such issue, the attachment ought to be sustained. Granting that a joint contract is a condition qualifying plaintiff's right to an attachment against the property of both defendants as nonresidents of the state, it is also a matter that relates directly to the merits of the main action and plaintiff is entitled to a determination thereof, upon the weight of the evidence, in a trial by a jury.
PHILLIPS, J., of the Seventh Appellate District, sitting by designation in the Eighth Appellate District.