Opinion
April 25, 1949.
1. Judgments — extinguishment upon elapse seven years — applicable to judgment in favor of United States.
The lien of a judgment obtained by the United States in a federal court and enrolled in a county in this state is extinguished by the elapse of seven years from the rendition of the judgment, no action having been brought, nor execution issued, thereunder during the stated period.
Headnote as approved by Roberds, J.
APPEAL from the circuit court of Jackson County; L.C. CORBAN, J.
Joseph E. Brown, United States Attorney, and Swep S. Taylor, Assistant United States Attorney, for appellant.
It is fundamental law that the United States is not bound by a state statute of limitation unless Congress has clearly manifested such an intention, United States v. Nashville C. and St. L.R. Co., 6 Sup. Ct. 1006, 118 U.S. 120, 30 L.Ed. 81, and the very numerous decisions cited in 44 Federal Digest, Limitation of Actions, 11 (1). The court below, as we are advised, relied upon the following cases as authority for applying against the United States a state law limiting the time within which an execution may issue on a judgment: Custer v. McCutcheon, 283 U.S. 514; United States v. Harpootlian, 24 Fed. 2d 646.
These cases involved respectively the judgment lien statutes of Idaho and New York. Each statute, creating the judgment lien, also provided the limitation period and each statute was, therefore, not a statute of limitation, but a statute of creation. The same statute, in each instance, created a lien, a right, also a fixing period of time within which a party might enforce the right. The Idaho statute as a statute of creation and not of limitation, involved in the case of Custer v. McCutcheon, while not appearing in the Supreme Court decision in that case, appears in and is described in the Court of Appeals report, Custer v. McCutcheon. 41 F.2d 354.
An analysis of these two federal cases will clearly demonstrate that far from being authority against the validity of the judgment in favor of the United States, they are most cogent authority in favor of the validity of the judgment.
In the case of the United States v. Harpootlian, there was involved Section 510 of the Civil Practice Act of New York which "provides that a lien of judgment upon the real estate of the debtor which is docketed in the county clerk's office is a charge for ten years after filing the judgment roll upon the real estate and chattels real in that county where the judgment debtor has at the time of so docketing it such property."
The court at page 649 of the Reporter in discussing the New York Act, said: "The provision of the Civil Practice Act of the state of New York which creates the lien provides in express terms the period of its existence. It is not a statute of limitations upon a right of action, which may be of no avail against a sovereign. The provision of the Civil Practice Act fixes a period of time within which a party having a judgment may follow the defendant's . . . personal property by execution."
The opinion recognized the fact that a bare statute of limitations, standing alone and independent of and separate from the statute creating a right, could not be invoked against the United States, citing with approval on page 648 of the Reporter, United States v. Minor, 235 F. 101 (C.C.A. 4th Circuit), and the United States v. Kendall (D.C. La.) 263 F. 126, wherein it was held that a judgment in favor of the United States could be maintained after a ten year limitation period because the ten year limitation period "is said to be a statute of limitation which may not be invoked against the United States."
In the case of Custer v. McCutcheon, supra, the Supreme Court of the United States differed from the Court of Appeals of the Ninth Circuit only upon the ground that the Idaho statute, which created the judgment lien, also, provided the period of time in which the lien could be enforced. Said the Supreme Court of the United States, in approving the petitioner's position in enjoining the United States Marshall from levying execution on the government's judgment: "The petitioner insists that this action is not in the ordinary sense of the term a statute of limitation, that it does not affect the time in which a suit may be brought upon the judgment, but that upon the contrary it grants the right of execution, and the time element is an integral part of the statutory right conferred."
Granting, for the sake of argument, that the judgment lien in favor of the United States exists by virtue of the laws of the State of Mississippi, this lien can exist only by virtue of section 1555, Mississippi Code 1942, Annotated. Section 1554 provides manner of enrollment of judgments, and section 1555 provides that: A judgment so enrolled shall be a lien upon and bind all the property of the defendant within the county where so enrolled, from the rendition thereof. . . ." It is separate and distinct from sections 733 and 735 which are statute of limitation on domestic judgments. Its source is Chapter 61, Article 14 (1), Hutchinson's Code of 1848. The source of the two limitation statutes is Chapter 57, Article 6 in Subclauses 6 and 13, respectively, of Hutchinson's Code of 1848. The Mississippi statute creating the lien has done that alone without fixing in its terms a period of limitation and has so existed separate and distinct from the limitation statutes for over a hundred years. It, therefore, differs decisively from the New York statute in the Harpootlian case and the Idaho statute in the McCutcheon case, and the two Mississippi limitation statutes 733 and 735, Code of 1942, are no part of section 1555 which creates the lien, and are strictly statutes of limitation and nothing else and, therefore, under the weight of the unchallenged authority cannot be successfully pleaded against the United States.
For another reason, the judgment lien of the United States, being undisputedly prior in time, cannot be said to be barred. Even had the Mississippi statute creating the judgment lien, also, fixed a time for enforcing it, it could not avail as barring any remedy otherwise available to the government for the reason that such a limitation period, not being permitted against the State by Section 104 of the Mississippi Constitution of 1890, could not run against the United States. The States could acquire no greater rights or immunities than the United States, and Congress by Section 727 of Title 28, U.S.C.A., in providing for the application of state laws on executions, did not subject the United States to a position less favorable than the State of Mississippi under the state execution laws. The Supreme Court of the United States in Custer v. McCutcheon, supra, recognized this: "It is argued on behalf of the United States that the five year period is not binding upon the State of Idaho, and, therefore, the adopttion of the statutes does not affect the Federal government in respect to the time of issuance of the writ. We find no decision of the Supreme Court of Idaho exempting the sovereign from the provisions of the statute, nor does examination of other cognate sections of the Idaho Compiled Statutes disclose any matter which would indicate such a purpose." However, Mississippi by virtue of section 104 of the Constitution of 1890, unlike Idaho, does exempt the sovereign from the provisions of the statute, and prior to the adoption of the Constitution of 1890 the Supreme Court of the State of Mississippi in the case of Josselyn v. Stone, 28 Miss. 753, had so exempted the sovereign under the general principals of the law. The Government, therefore respectively submits that Sections 733 and 735 which were specifically pleaded in the court below by the appellee are statutes of limitation and nothing else and cannot avail against the United States and for that reason the court below should have sustained the claim of the United States and adjudicated the Government's judgment being first in point of time.
Ebb J. Ford, Jr., for appellee.
The appellant did not call to the court's attention certain Federal statutes which this appellee Williams-Richardson Co., Ltd., pleaded before the trial court. Accordingly, said statutes, 28 United States Code Annotated, Section 727, 812 and 814 are copied herein for the attention and the convenience of the court as follows: (See opinion of the court).
The case which appellant's brief suggests that the learned Circuit Court relied upon, Custer v. McCutcheon, 283 U.S. 514, 75 Law Ed. 1239, is the one which we know that this court will examine as a final authority among the Federal decisions, it also being the latest Federal case. That case was on Writ of Certiorari to the Ninth Circuit Court of Appeals to review the decision, same style, rendered by said Ninth Circuit Court of Appeals in its decision reported at 41 Federal 2d 354, and in which said Ninth Circuit Court had stated that the Second Circuit of Appeals case of United States v. Harpootlian, 24 F.2d 646, was the minority view. However the Supreme Court of the United States reversed the Ninth Circuit Court of Appeals, and we take occasion at this time to request the court to read this decision and with particular emphasis upon the latter and concluding parts thereof.
Now as to the Harpootlian case, supra, which has never been overruled and which is certainly sound, we call the court's attention to the latter part thereof as follows: "6,7. The state statute makes no provision for extension of time in the case of a judgment obtained by the United States, nor can the officers of the government prolong it by neglecting it to make use of its benefits. Payette v. Marshell County, 180 Iowa 660, 163 N.W. 592; Thompson v. Avery, 11 Utah 214, 39 P. 829. Congress has provided only, by the statutes above referred to, that the right to execution and examination of debtor shall be coextensive and consistent with that granted by the state within the territory of the District Court. Where the statutory period has run, the right expires completely by the mere lapse of time the lien is ended. The doctrine of Governmental immunity in the statute of limitations does not apply, and when the time of lien lapsed, within the terms of its grant, the government is in the same position as a private litigant.
"In Fink v. O'Neil, 106 U.S. 272, 1 S.Ct. 325, 27 L.Ed. 196, a perpetural injunction was granted to restrain the United States Marshal from proceeding upon a judgment rendered in favor of the United States in the District Court to levy on real estate, exempt under state laws from sale on execution. In affirming the decree, the court said: `Nothing can be more clear than this, as a recognition by Congress, that in case of executions upon judgments in civil actions the United States are subject to the same exemptions as apply to private persons by the law of the state in which the property levied on is found."
"After 10 years have elapsed, the lien of the plaintiff in error's judgment on the real property of the defendant in error was at an end, and the proceeding to examine in supplementary proceedings could not be maintained upon the basis of a continuation of the lien, because of the rule that the statute of limitations does not run against the United States."
Further, as to this Harpootlian case, it has been reviewed, in the American Law Reports, Volume 118, pages 933, 936; and it will there be noted that among the States whose appellate courts have made similar holdings are Utah, Washington, West Virginia, Indiana, Illinois, Arizona, Arkansas, Iowa, and North Carolina.
In 1940 the United States obtained through the federal court, Southern District of Mississippi, a personal judgment against one Brinkman. In 1943 that judgment was enrolled in Jackson County, Mississippi. In 1947 three other personal judgments were procured against Brinkman and duly enrolled in said County. Execution issued on the last of the three judgments, and property of Brinkman in said County was seized and sold under that execution. The sheriff paid the proceeds of the sale into the circuit court of that County. This sale was more than seven years after the date of appellant's judgment. In May, 1948, said four judgment creditors propounded their claims to said money. The fund was insufficient to pay even the last three judgments. The trial judge decided that appellant had no legal right to share in the proceeds of such sale. That was evidently because he thought that whatever lien appellant once had on the property of Brinkman by virtue of its judgment expired seven years after the date of such judgment. The correctness of that conclusion is the question for decision on this appeal. No execution had issued under appellant's judgment and no action had been taken to renew it.
Appellant invokes Section 104, Mississippi Constitution of 1890, which reads: "Statutes of limitation in civil causes shall not run against the state, or any subdivision or municipal corporation thereof."
Does that Section have the effect of continuing indefinitely the lien of appellant's judgment upon the judgment-debtor's property, or did such lien expire seven years after the date of such judgment? The question must be determined by a consideration of the meaning and effect of the foregoing constitutional provision and other applicable state and federal statutes in the light of the construction which has been given them in the decided cases.
(Hn 1) Section 733, Mississippi Code of 1942, Annotated, reads: "All actions founded on any judgment or decree rendered by any court of record in this state, shall be brought within seven years next after the rendition of such judgment or decree, and not after; and an execution shall not issue on any judgment or decree after seven years from the date of the judgment or decree."
Section 735, said Code, in its applicable part, provides: "A judgment or decree rendered in any court held in this state shall not be a lien on the property of the defendant therein for a longer period than seven years from the rendition thereof, unless an action be brought thereon before the expiration of such time; . . ."
Section 1554, said Code, prescribes the form and method of enrolling judgments.
The next section, in its pertinent part, reads: "A judgment so enrolled shall be a lien upon and bind all the property of the defendant within the county where so enrolled, from the rendition thereof, and shall have priority according to the order of such enrollment, in favor of the judgment creditor, his representatives or assigns, against the judgment debtor, and all persons claiming the property under him after the rendition of the judgment; and a judgment shall not be a lien on any property of the defendant thereto unless the same be enrolled; . . ."
The applicable federal statutes are Sections 727, 812 and 814, Title 28 United States Code Annotated. We set these out in the order stated:
(727) "The party recovering a judgment in any common-law cause in any district court, shall be entitled to similar remedies upon the same, by execution or otherwise, to reach the property of the judgment debtor, as are provided in like causes by the laws of the State in which such court is held, or by any such laws which may subsequently be enacted and adopted by general rules of such district court; . . ."
(812) "Judgments and decrees rendered in a district court of the United States within any State, shall be liens on property throughout such State in the same manner and to the same extent and under the same conditions only as if such judgments and decrees had been rendered by a court of general jurisdiction of such State. Whenever the laws of any State require a judgment or decree of a State court to be registered, recorded, docketed, indexed, or any other thing to be done, in a particular manner, or in a certain office or county, or parish in the State of Louisiana before a lien shall attach, this section and section 813 of this chapter shall be applicable therein whenever and only whenever the laws of such State shall authorize the judgments and decrees of the United States courts to be registered, recorded, docketed, indexed, or otherwise conformed to the rules and requirements relating to the judgments and decrees of the courts of the State."
(814) "Judgments and decrees rendered in a district court, within any State, shall cease to be liens on real estate or chattels real, in the same manner and at like periods as judgments and decrees of the courts of such State cease, by law, to be liens thereon."
In Custer v. McCutcheon, 283 U.S. 514, 51 S.Ct. 530, 532, 75 L.Ed. 1239, the Supreme Court of the United States, construing the effect of said section 727, held that an Idaho statute permitting the issuance of an execution only within five years from date of rendition of judgment was applicable to an execution issued on behalf of the United States as a judgment plaintiff. That court said: "The time limited for issuing executions is strictly speaking, not a statute of limitations. On the contrary, the privilege of issuing an execution is merely to be exercised within a specified time, as are other procedural steps in the course of a litigation after it is instituted. The plaintiff is not precluded from bringing an action upon the judgment, but merely from having an execution in the form provided by state law."
A statute of the Territory of Utah provided that from the time a judgment was docketed it became a lien upon the real estate of the judgment debtor, and that the lien should continue for five years. In Thompson v. Avery, 11 Utah 214, 39 P. 829, 836, the court construed the effect of federal statute 814 as applied to the state statatute and concluded that a lien for a fine or penalty obtained in a criminal prosecution in favor of the United States ceased under the state statute at the expiration of five years. The Court made this pertinent observation:
"The rule is, no doubt, that statutes of limitation do not run against the government without its express provision, but this principle does not reach this case. Such statutes are those `that restrict the period within which the right, otherwise unlimited, might be asserted.' . . . The government by its legislation has stepped into the territorial forum, and in order to have the benefit of judgment liens, has placed itself upon the same footing as domestic judgment creditors. No reasonable construction of the act of Congress above referred to permits the United States to avail itself of just enough of our statute to give it the benefit of the lien, and warrant it in repudiating that portion providing for its extinguishment. Our statute does not restrict the lien, which otherwise would be unlimited, but it creates a judgment lien which otherwise would not exist. Judgments and judgment liens are different things. The judgment against Bergen, in favor of the United States, may not be barred by the statute of limitations, but we think the judgment lien was extinguished at the expiration of the five years from the rendition of judgment. Counsel's position, that a lien is inseparable from a judgment, we think unsound, and is not supported by the cases cited."
In United States v. Harpootlian et al., 24 F.2d 646, the Circuit Court of Appeals, Second Circuit, held that a New York statute creating a lien on real estate of judgment debtor for a period of ten years, was applicable to a judgment in favor of the United States, where the state statute contained no provision for extension of time in case the United States was the judgment-creditor.
Other cases might be cited to the same effect as the three foregoing, as shown by annotation in 118 A.L.R., page 932, et seq.
It should be borne in mind that we are dealing only with extinguishment of a judgment lien — not the right to sue and renew a judgment. The last question is not before us.
Affirmed.