An order dismissing a bill in equity after a hearing on the merits is conclusive upon the same parties in an action at law, subsequently brought, in which the same matter is in issue. Hall v. Dodge, 38 N.H. 346, 351; Forist v. Bellows, 59 N.H. 229, 231. "The purpose of a suit to remove a cloud or a statutory action to quiet title is to determine adverse claims to real property.
Moreover, there does not appear to have been any attempt to decide it there, in the first instance. But while this claim was not in issue in the earlier case, certain facts essential to the maintenance of this bill were there involved; and, if they were decided adversely to the plaintiff, such decision might be a defence to the bill. Forist v. Bellows, 59 N.H. 229. The defendants claim such a situation.
Roberts v. Norcross, 69 N.H. 533. With certain exceptions not here material, the plaintiff can charge the trustee for what the defendant could hold and which he could recover against the trustee. Nashua etc. Co. v. Company, 74 N.H. 511; Libby v. Company, 67 N.H. 587; Forist v. Bellows, 59 N.H. 229, 232. While upon the order, as between the parties thereto, Woodward may have had sufficient equity in the $6,000 note to have enabled him to recover against the acceptor the sum held by the receiver, he could not have prevailed against the equitable claim of Bartlett, the owner of the note, to the proceeds of the order to the extent of his interest. Woodward's pledge to Bartlett as collateral was of the whole note — every dollar of the indebtedness; consequently each dollar paid to Woodward by the debtor was in equity Bartlett's until his claim was fully paid.
But the plaintiff in trustee process proceeds against the trustee upon the strength of the defendant's right and title, and in the absence of fraud can recover only what the defendant could against the trustee. Richards v. Railroad, 44 N.H. 127, 139; Forist v. Bellows, 59 N.H. 229, 231, 232; Tucker v. Chick, 67 N.H. 77, 79; Corning v. Records, 69 N.H. 390, 396, 397. The defendant could not maintain an action against the railroad for the destruction of the lumber; and this being so, no reason is apparent for acceding to the plaintiff's request to continue the action for notice to the defendant.
In the absence of fraud, a trustee can be charged for only what, at the time of service or afterwards, is equitably due to the defendant." Carter v. Webster, 65 N.H. 17, 19; Tucker v. Chick, 67 N.H. 77, 79; Forist v. Bellows, 59 N.H. 229, 231, 232. "Foreign attachment cannot change the nature of the contract between the trustee and the defendants." Nat'l Revere Bank v. Shoe Fastening Co., 67 N.H. 371, 374.
That trustee process is an equitable proceeding in which the rights of the parties are determined upon equitable principles, and that, in the absence of fraud in the intent, the trustee cannot be charged for chattels in his possession unless he has in his hands property belonging to the defendant which the defendant has the legal right to take and carry away, are propositions for which in this state the citation of authority seems superfluous. Pollard v. Pollard, 68 N.H. 356; Tucker v. Chick, 67 N.H. 77; Nat'l Revere Bank v. Shoe Fastening Co., 67 N.H. 371; Carter v. Webster, 65 N.H. 17; Proctor v. Lane, 62 N.H. 457, 463; Robinson v. Mitchell, 62 N.H. 529; Forist v. Bellows, 59 N.H. 229; Landry v. Chayret, 58 N.H. 89; Banfield v. Wiggin, 58 N.H. 155; Gutterson v. Morse, 58 N.H. 529; Conway v. Cutting, 51 N.H. 407; Garland v. Harrington, 51 N.H. 409; Richards v. Railroad, 44 N.H. 127, 129; Pittsfield Bank v. Clough, 43 N.H. 178, 187; Brown v. Warren, 43 N.H. 430; Rand v. Railroad, 40 N.H. 79, 87; Getchell v. Chase, 37 N.H. 106, 110; Swamscot Machine Co. v. Partridge, 25 N.H. 369, 373, 374; Boardman v. Cushing, 12 N.H. 105; Paul v. Paul, 10 N.H. 117, 120; Greenleaf v. Perrin, 8 N.H. 273; Hutchins v. Sprague, 4 N.H. 469. That upon equitable principles the trustee could not be deprived of his right to hold the property in his hands as security because the conveyance to him was absolute in form, though intended as security, is expressly decided in Boardman v. Cushing, 12 N.H. 105, 114, where it is said by Parker, C. J, "it would not consist with equity to deprive the party of a mortgage security, by reason of a mere mistake in the mode of taking it."
Marsh can hold only what Garney himself could recover if the action were brought by him. Forist v. Bellows, 59 N.H. 229, 231, 232; Wallace v. Investment Co., 68 N.H. 188, 190. The fact that Rollins brought suit upon the claim in the name of Garney does not affect the application of the principle.
Oakland is estopped by the judgment of absolute dismissal of the action of Oakland v.Carpentier, 13 Cal. 540, with no reservation of a right to bring a new action. ( Durant v. Essex Co., 7 Wall. 107; Gove v.Lyford, 44 N. H. 625; Foote v. Gibbs, 1 Gray, 412; Thurston v. Thurston, 99 Mass. 39; Bradley v. Bradley, 160 Mass. 258; Perine v. Dunn, 4 Johns. Ch. 140; Forist v.Bellows, 59 N. H. 229; Knowllan v. Banbury, 117 Ill. 471-74; Jenkins v. Johnston, 4 Jones Eq. 151; Curts v. Trustees, 6 J. J. Marsh. 536; Thompson v. Clay, 3 T. B. Mon. 359; 16 Am. Dec. 108; Messinger v. New England Mut.Life Ins. Co., 59 Fed Rep. 416; Altey v. Nott, 111 U.S. 472; Bissell v. Spring Valley Tp., 124 U.S. 225; Williams v. Hollingaworth, 5 Lea, 358; Goebel v. Iffia, 111 N. Y. 170, 177; Gates v. Preston, 41 N. Y. 113; Cochran v. Couper, 2 Del. Oh. 27; Parrish v. Ferris, 2 Black, 606; Case v. Beauregard, 101 U.S. 688; Lyon v.Perin etc. Co., 125 U.S. 698.) The city is estopped by the judgment notwithstanding its claim to be a trustee for the public.
Under the circumstances, their knowledge and silence are equivalent to consent; and when the agreement for the application was made by Ricker and Lombard, the company became bound by the act of Ricker. 2 Mor. Corp., s. 627; Sherman v. Fitch, 98 Mass. 59, 64. As Lombard is not indebted to the company, he is not chargeable as its trustee in this action. Forist v. Bellows, 59 N.H. 229. Ricker's testimony was competent.
WALLACE, J. The question to be determined is whether the insurance money in the hands of the trustee shall be held by the plaintiffs for the satisfaction of their claim against the defendants, or by the claimant for the benefit of the defendants' bondholders. It is a general rule that in the absence of fraud the attaching creditor has no greater rights against the trustee than the defendant would have in an action brought by him against the trustee; and as the trustee process is an equitable proceeding, the trustee can be charged for only such sum as the defendant could equitably recover against him. Leland v. Sabin, 27 N.H. 74; Forist v. Bellows, 59 N.H. 229; Carter v. Webster, 65 N.H. 17. The defendants could not recover this money in a suit against the trustee, in the face of the condition upon which they purchased the property.