Opinion
December Term, 1834.
1. A defense which is good in equity against the assignor of a note or judgment is available against his equitable assignee.
2. To a bill brought by the assignee of a judgment the assignor is a necessary party.
THE CASE made by the bill, answer and proofs was that one Sackett sold a tract of land to the defendant Rutherford. The land was (15) under mortgage, of which Rutherford was ignorant at the time of the purchase. To secure the purchase-money Rutherford gave four several promissory notes payable to Sackett or bearer, which the latter afterwards pledged to the plaintiff for money borrowed of him. After the notes became due, suit was brought on them in the name of Sackett, and judgment obtained, Rutherford knowing at that time that McKinnie had an interest in them. After the judgments were obtained, Rutherford, discovering for the first time that the lands which Sackett had conveyed to him were under mortgage, filed his bill against Sackett alone, praying an injunction, which at the hearing was perpetuated. The plaintiff then filed this bill against Rutherford, omitting to make Sackett a party, claiming to be the equitable assignee of the notes, and to be entitled to the beneficial interest in the judgments, and seeking to be made a party defendant with Sackett to the former suit.
No counsel appeared for either party.
If the plaintiff had had the legal interest in the notes, as he pretends, he should have brought suit at law in his own name as bearer, and then Rutherford could not have proceeded in his bill without making him, as well as Sackett, defendant. But he did not sue at law in his own name, but in that of Sackett, which is strong proof that he had not the legal title in the notes, but was only a pledgee. The judgments have merged the simple contracts on the notes, and the plaintiff's interest, if any, is purely equitable. The plaintiff contends that Rutherford had notice of the mortgage at the time of the sale of the land, but there is no proof of that; and if he had notice afterwards, he could not have set it up as a defense at law in the actions brought on the notes; therefore, his suffering judgments to be taken upon them operates nothing against him in equity. If Rutherford had an equity against the notes, or the judgments on them, as to Sackett, he must, as it seems to us, have the same equity against the plaintiff, the equitable assignee. Again, it is (16) a rule in equity that where a bill is brought by the assignee of a judgment, the assignor is a necessary party. Cuthcart v. Lewis, 1 Ves. Jun., 463; 2 Mad. C. P., 148. But in such case the bill is not ordinarily dismissed, but the case will be ordered to stand over with liberty for the plaintiff to amend by adding parties upon paying the cost of the day (2 Mad. C. P., 142). But, because of the defects of the bill, and the great irregularity of the proceedings in this cause, we deem it idle to retain the bill, and therefore direct that it be dismissed with costs, but without prejudice to the plaintiff to bring a new bill if he thinks proper.
PER CURIAM. Bill dismissed.