
    Greene v. The Woodland Avenue and West Side Street Railroad Co. and the Cleveland City Railway Co.
    
      Street railway company — Action against in justice of peace court— Section 6478 Rev. Stat. not applicable to street railways — Filing of motion to vacate judgment does not enter appearance to the action when — Reversal of jtidgment for want of service of summons — Attempt to enforce void judgment — Corporation formed of two or more companies' — Holds property in its own right not in trust.
    
    1. Section 6478, Revised Statutes, is not applicable to street railroad companies,
    2. The filing of a motion to set aside and vacate a judgment rendered without service of summons or other legal notice, the appearance being for the purpose of such motion only, does not enter an appearance to the action.
    3. A judgment on the docket of a justice of the peace which is void for want of service of summons, does not become valid by the reversal by the circuit court of' a judgment of the court of common pleas enjoining collection of such void judgment. In legal effect such reversal left the matter just as it was before the judgment was rendered by the common pleas.
    4. Where an attempt is made to enforce payment of a void judgment, it may be adjudged invalid without showing a defense to the action.
    5- A corporation formed by the consolidation of two or more companies holds its property acquired by such consolidation in its own right, and not in trust for the constituent companies.
    (Decided February 20, 1900.)
    Error to the Circuit Court of Cuyahoga County.
    The plaintiff in error, also plaintiff below, brought his action in the court of common pleas against the Woodland Avenue and West Side Street Railroad Company and the Cleveland City Railway Company for the. collection of a judgment which plaintiff averred in his petition that he had recovered on the docket of a justice of the peace in and for Brooklyn township, on the 21st day of August, 1893, against said Woodland Avenue and West Side Street Railroad Company for a sum less than one hundred dollars, upon a cause of action which accrued on the 17th day of April, 1893, for damages to his horse, wagon and harness.
    The petition averred that said Woodland Avenue, and West Side Street Railroad Company was not then the owner of any property upon which a levy could be made sufficient to satisfy such judgment; that after said cause of action accrued said street railroad company consolidated with other companies and thereby transferred all its property to the Cleveland City Railway Company without valuable consideration, in trust for the payment of all then existing liabilities of said Woodland Avenue Company, including the said judgment of said plaintiff, and prayed that sufficient of said property so conveyed and transferred in trust as aforesaid to pay said judgment, be sold and the proceeds applied to the payment thereof.
    The Cleveland City Railway Company by its answer admitted that it was a corporation duly incorporated; that it was formed by the consolidation of the Woodland Avenue and West Side Street Railroad Company and the Cleveland City Cable Railway'Company; that all the property of said companies became vested in it by said consolidation, and denied each and all other allegations of the petition.
    The cause was appealed to the circuit court, and that court heard the same upon the pleadings and evidence, and decided the case in favor of the defendants in error, also defendants below. Upon request the court found and stated its conclusions of fact separate from its conclusions of law as follows :
    
      “First — That the defendant, The Woodland Avenue and West Side Street Railroad Company, was, on the 17th day of April, 1893, and for some time subsequent thereto, a corporation organized and existing under the laws of Ohio, and managed and operated a line of street railroad in Cleveland and Brooklyn township, Cuyahoga county, Ohio; that the principal business office of the defendant, The Woodland Avenue and West Side Street Eailroad Company, was not, at any time herein named, kept within the township of Brooklyn, Cuyahoga county, Ohio; that J. C. Poe was at all said times the duly elected, qualified and acting Justice of the Peace in and for said Brooklyn township.
    
      “Second — That, some time subsequent to the said 17th day of April, 1893, and prior to the 10th day of August, 1893, the defendant, the Cleveland City Eailway Company, one of the defendants herein, was formed under and by virtue of the laws of Ohio, by the consolidation of the Cleveland City Cable Eailway Company and the Woodland Avenue and West Side Street Eailway Company, the other defendant herein, and that it owns and operates the lines of the constituent companies.
    
      “Third — That on the 10th day of August, 1893, plaintiff brought suit against defendants, The Woodland Avenue and West Side Street Eailroad Company, and The Cleveland City Eailway Company, before said J. C. Poe in said Brooklyn township, for alleged injury to plaintiff’s horse, harness, and wagon, caused by one of the motor cars managed and operated by said Woodland Avenue and West Side Street Eailroad Company, coming in contact with said horse and wagon on said 17th day of April, 1893; that on the 17th day of August, 1893, said J. C. Poe issued a summons against the defendants in said action, returnable August 21st, 1893, at 2 o’clock p. m.; that the same was delivered to G-. S. Barnett, constable, who returned the same, endorsed as follows: “Eeceived August 17,1893, and served the same by leaving a true and certified copy thereof at the office of the president of the Woodland Avenue and West Side Street Railroad Company, M. A. Hanna, August IStli, 1893.” That the president and other officers of said Woodland Avenue and West Side Street Railway Company were residents of Cleveland township, Cuyahoga county, Ohio, and that said president and other officers’ place ®f business was also in said township and county at all the times herein named; that on the return day of said summons at the hour set for hearing of said cause, the said justice, in the absence of defendants and on the testimony offered by the ■plaintiff, gave judgment in favor of the plaintiff and against the defendant in • the sum of $87.00; that thereafter, on the 10th day of October, 1893, defendants filed a motion in said justice court, appearing only for the purpose of said motion, and not entering their appearance in said cause, to set aside and vacate the judgment heretofore given, on the ground that no valid service had been had on defendants; that on the 13th day of the same month said motion was argued, and on the 16th day of October, 1893, said justice overruled said motion, and that no appeal or error proceedings were taken from said order or findings.
    
      “Fourth — That on or about the 21th day of October, 1893, the defendant, The Cleveland City Railway Company, began an injunction proceeding against the plaintiff, J. C. Poe, Justice of the Peace, and G. S. Barnett in the Court of Common Pleas of Cuyahoga County, wherein said Cleveland City Railway Company prayed that said judgment rendered against it and the Woodland Avenue and West Side Street Railroad Company in favor of R. É. Green before J. C. Poe, J. P., be declared wholly nuU and void, and that said defendants be perpetually enjoined from taking any steps whatever to collect said judgment; that on the 28th day of October, 1893, said injunction and relief was granted as prayed for, the order of the court of common pleas being as follows: “By agreement of parties this cause came on for'final hearing upon the petition, testimony and argument of counsel, and after due consideration the court finds that the plaintiff is entitled to the relief prayed for, and that the allegations of the petition are true. Wherefore said judgment set forth in said petition is hereby declared to be illegal and void, and that the defendants herein are perpetually enjoined from collecting or taking any steps whatever to collect said judgment in the petition.”
    
      “Fifth — That afterwards on error proceedings in this court, said decree of the common pleas court granting said injunction was reversed so far as it prohibited this plaintiff from collecting the judgment from the defendant, the Woodland Avenue and West Side Street Railroad Company, the order of this court being as follows: “This cause came on -to be heard upon petition in error, bill of exceptions, original papers and pleadings, a transcript of the record in the court of common pleas, and was argued by counsel. In consideration whereof, the judgment of said court of common pleas in so far as it enjoins the plaintiff in error from collecting against The Woodland' Avenue and West Side Street Railway Company the alleged judgment by J. C. Poe, is reversed. In all other respects said judgment of the common pleas court is affirmed.”
    
      “Sixth — This court finds as conclusions of law that the provisions of section 6478 of the Revised Statutes of Ohio do not apply in actions against street railroad companies and that service of summons as provided in that section is not proper service, and gives the justice no jurisdiction of the defendant company; that the defendant, The Woodland Avenue and West Side Street Railroad Company, was served with summons as provided by said section 6478 of the Revised Statutes of Ohio in the said action before the said justice of the peace, and no jurisdiction was acquired of said defendants by said service, and the said judgment against it was void. The court further finds that the defendants by filing said motion in said justice court to have the said judgment set aside and vacated, did not submit themselves to the jurisdiction of the said justice, and were not bound by any judgment or final order which the justice was required to make in disposing of that motion and that at no time were they properly made parties in said cause.
    
      “Seventh — The court further finds that the defendants are not bound to show a meritorious defense to said action of plaintiff, against them before the said justice of the peace before the said judgment will be declared to be invalid upon the ground of want of service of legal notice to them of the pendency of said action.”
    A motion for a new trial having been made and overruled, plaintiff filed his petition in error in this court, seeking to reverse the judgment of the circuit court.
    IF. H. Polhamus, for plaintiff in error.
    
      Squire, Sanders & Dempsey, for defendants in error.
   Burket, J.

There was no pretense of service of summons upon the Cleveland City Railway Company in the action before the justice of the peace, and. it is too clear for argument that the judgment against that company was and is void and of no effect, and the collection of that judgment was very properly forever enjoined by the court of common pleas, and that judgment affirmed by the circuit court.

The circuit court held as matter of law in the case at bar, that the service of summons upon the Woodland Avenue and West Side Street Railroad Company was not sufficient to give the justice of the peace jurisdiction; that section 6478, Revised Statutes, does not apply to service of summons upon street railroads; that said judgment against said last named company was therefore void; that said defendants did not submit themselves to the jurisdiction of the justice of the peace by making said motion to vacate said judgment, and that said defendants are not bound to show a meritorious defense to the action, before the justice of the peace, before having said judgment decreed invalid upon the ground of want of service of summons.

The correctness of these holdings of the circuit court is challenged by the plaintiff in error. It does not appear in the proceedings before the justice of the peace, nor in the petition of the plaintiff, nor in the finding of facts, nor elsewhere in the record that the Woodland Avenue and West Side Street Railroad Company was a company formed by consolidation with any other company, or that it was what is usually known as a consolidated company. There is an intimation to that effect in the brief of the plaintiff in error, but there is nothing in the record to that effect. The Cleveland City Railway Company was, at the commencement of the action before the justice of the peace, a consolidated company into which the Woodland Avenue and West Side Street Railroad Company had become merged, but there was no attempt to serve a summons upon that consolidated company, and therefore no question arises in this case as to the manner of serving summons upon a consolidated street railroad company, nor as to the effect or construction of section 2505b.

It is urged by counsel for plaintiff in error that the manner of service of summons as provided for railroads in section 6478, Revised Statutes, is applicable to street railroads. That section is as follows:

'"Suit may be brought before a justice of the peace against any railroad company, in the township in which the president of the company may reside, or in any township into or through which the road owned or leased by said company may be located, whether such company be foreign or created under the laws of this state, and whether the charter thereof prescribes the place where suit must be brought against it, or the manner or place of service of process thereon; and if the principal business office of the company is not kept in the township in which any such suit may be brought, it shall be the duty of the justice of the peace to issue a writ of summons against said company, directed to any constable in the toAvnship in which said suit may be brought. The constable shall, on receipt of such summons, forthwith serve the same personally upon the president of such company, if he be a resident of the county in which suit is brought, or by leaving a certified copy at his place of business, if the same be within such county; provided, that if the president of any such company shall not be a resident of, or have a place of business within, the county in which such suit shall be brought, it shall be lawful for the constable having such summons, to serve the same personally upon the person having charge of a ticket office, or on the person having charge of a freight depot, owned by or under the control of such company, if such ticket office or freight depot be situated within the county where such suit shall be brought; and, provided, further, that when such summons shall be served on either of such last described persons, it shall be done at least eight days prior to trial; but when served upon the president, as aforesaid, it may be served in accordance with the law for serving summons issued by justices of the peace; provided, that when the president of such company does not reside, and there is no such officer or depot in said county, then it shall be the duty of the justice of the peace to issue a writ of summons directed to the sheriff of the county where the principal business office of the company is located, with an endorsement on the back of the writ, of the name of the post office to which said writ shall be returned; and the sheriff, upon the receipt of said writ, shall forthwith serve the same personally upon the president, if found, or by leaving a copy at the business office of said company Avith the person having charge thereof, and immediately return the said writ to the justice of the peace issuing the same, by mail, directed to the post office named on the back of the writ.”

This statute was first enacted in substantially its present form in the year 1850 before street railroads had an existence. It was amended by the act of March 31, 1866, 63 O. L., 63, and was carried into the Revised Statutes of 1880 with a slight addition from section 66 of the Code, as amended April 30, 1868, 65 O. L., 116, and made section 6178 of the revision. As the statute stood from its enactment in 1850 to the time when street railroads were first authorized by act of April 10, 1861, 58 O. L., 66, it could apply to railroads only, and there is no change in the act by the amendment of 1866, nor by the Revised Statutes indicating an intention to extend the act to street railroads, and the wording of the section shows that it was intended to apply to railroads only, and not to street railroads. Both the history of the section and the wording thereof induce us to hold that it has no application to street railroads.

It follows that the service of summons made under this section on the Woodland Avenue and West Side Street Railroad Company was void, and gave the justice of the peace no jurisdiction, and that the judgment rendered by him was without jurisdiction and void.

The filing of the motion to set aside and vacate this void judgment, the appearance being for- the purpose of the motion only, did not have the effect to render the void judgment valid. The appearance was only for the purpose of calling the attention of the justice of the peace to the fact that he had not acquired jurisdiction, and not for the purpose of submitting to his jurisdiction. Freeman on Judgments, 193; Lutes v. Perkins, 6 Mo., 57.

It is also contended by counsel for plaintiff in error, that when the court of common pleas enjoined the collection of this judgment., and the circuit court reversed that judgment, the question of the validity of the judgment was thereby adjudicated, and cannot now be again called in question. This contention is not sound. The reversal of the judgment did not conclude the matter. The judgment of the circuit court acted only upon the judgment of the court of common pleas and reversed and vacated that judgment and the injunction thereby awarded, but it could add no life or vigor to the judgment rendered by the justice of the peace. And as it was void and of no force when the action was begun in the court of common pleas, it remained void after the judgment of the court was reversed, because the reversal left the matter standing the same as if no action had been prosecuted in either the court of common pleas or the circuit court.

It is further contended by counsel for plaintiff in error that the defendant cannot have said judgment before the justice of the peace decreed invalid, when an effort is made to enforce it by means of a creditor’s bill, until it is made to appear that there exists a valid defense to the action. This contention is not well taken. The cases in which a valid defense must first be shown, are those in which it is sought to open up a judgment after the term at which it was rendered, as provided in sections 5354 and 5360, Revised Statutes, or where an attack is made in equity upon a judgment for the purpose of setting it aside, or removing the lien thereof from real or personal property. This is not such a case. This is not for the purpose of opening up a judgment or making an attack thereon, but it is defending against the enforcement of a judgment rendered without legal service of summons upon the defendant. The service of summons having been made outside of the jurisdiction of the justice of the peace, was void, and therefore the judgment was void. It is urged that as the defendant might have waived the illegal service and entered its appearance, the judgment was only voidable. But such entry of appearance would not have been by virtue of any validity in the service. Appearance might have been entered without the issuing or service of any summons whatever.

But it is said that even though the service was void, it gave notice in fact to the defendant that an action was pending against it, and that where a defendant has knowledge of the action the judgment will not be set aside until it appears that there is a good defense to the action, and Gifford v. Morrison, 37 Ohio St., 502, is cited and relied upon.

In that case the service was within the jurisdiction of the justice of the peace, and while it was irregular, such irregularity did not appear upon the copy of the summons served upon the defendant, and he allowed judgment to be taken by default, supposing the proceedings to be regular. A transcript was filed and a lien thereby obtained upon real estate; and after the real estate had been sold and conveyed, the grantee filed a petition to quiet her title and to have the judgment lien removed from the premises. She thereby actively attacked the validity of the judgment, and in so doing she assumed the burden, in equity, of showing not only that the judgment was invalid, but that there was a good defense to the action. If the parties had shifted, and the judgment creditor had instituted proceedings to enforce his judgment, in which proceeding he would have been compelled to produce a valid judgment as the foundation of his action, the judgment debtor might in defense have challenged the validity of the judgment without showing a valid defense to the original action. When the invalidity of the judgment is used as an instrument of attack, it must appear that there is a valid defense; but when such invalidity is used as a defense — a shield — it need not appear that there is a valid defense to the original action. This distinction was made in Allen v. Everly, 24 Ohio St., 97, as to the application of the statute of limitations. The third subdivision of the syllabus is as follows: “A party invoking affirmative relief based on the alleged payment of a debt, must establish the fact of payment; such relief will not be granted upon a presumption of payment arising alone from lapse of time. Though such presumption may be successfully used as a shield, it is not equally available as a weapon of attack.” The following appears in the opinion on page 111: “It is to be borne in mind that the plaintiffs are not defending against the enforcement of the mortgage, or the decree rendered thereon against them, but are invoking affirmative relief. But relief cannot be granted upon principles of equity until the party affirmatively establishes facts which entitle him thereto. Unless that be done, equity leaves the parties where it found them. While, on the one hand, it refuses relief, oh the other it does not debar them from any defense either may be entitled to when, aggressively attacked.”

The principle of that case is applicable here and is consistent with the case of Gifford v. Morrison, supra.

When the validity of a judgment is attacked, and an effort made to have it set aside and vacated, or the lien thereof removed, it is proper to compel the plaintiff to show, not only that the judgment is invalid, but that there is a good defense to the action in which the judgment was obtained; but when the holder of the judgment attempts to enforce it in a legal proceeding in which he can succeed only by showing a valid judgment, the invalidity of the judgment may be shown as a defense without going further and assuming the additional 'burden of showing that there is a good defense to the action. If it were otherwise an action might be brought in one county and summons issued to any other county and judgment entered, and then before the judgment could be resisted, when attempted to be enforced, a good defense to the cause of action would have to be shown. Such a burden is inconsistent with our statutes on the subject of venue, and should not be laid upon a defendant when an illegal service of summons is made outside of the jurisdiction of the court. It was therefore not necessary for the defendant to show a good defense to the cause of action before having said judgment held invalid.

The petition avers that the property of the Woodland Avenue and West Side Street Railroad Company was transferred by consolidation to the Cleveland City Railway Company, and that the latter company holds it in trust for the payment of the debts of the former company. Legally speaking this can not be true. The consolidated company holds the property which it acquired by consolidation, as its own, and not in trust. The liability of the constituent companies attaches to the consolidated company by virtue of the statute, and not by virtue of the law of trusts. In such cases the consolidated company becomes liable for the debts of the constituent companies, and may be compelled to pay them the same as its own debts, by judgment and execution. There is therefore no room for a creditor’s bill, because the consolidated company does not hold any property for the constituent companies, but for itself. The finding of facts shows that the Cleveland City Railway Company had no property in its possession or under its control belonging to the Woodland Avenue and West Side Street Railroad Company, and therefore, even conceding the validity of the judgment before the justice of the peace, the judgment of the circuit court was right upon the merits.

General creditors do not have a lien upon the property of constituent compapies before consolidation, nor afterward, unless such lien is established by judgment and execution according to law. There being no lien, and no rights in action or property to be reached by a creditor’s bill, the cause was properly decided in favor of the defendants. The action could not be sustained as one at law for damages against the consolidated company because the amount claimed is less than one hundred dollars, and for that reason the judgment in favor of the defendant was right.

There are some other matters urged by counsel for plaintiff in error as to which it is sufficient to say that they are not of sufficient weight to reverse the judgment.

•Judgment affirmed.  