FACTS
William A. Wilson, a disbursing officer for the Philippine Government, defaulted on his duties, causing a loss of $8,931.80. The plaintiff, The Fidelity and Deposit Company of Maryland, and The American Surety Company of New York, served as sureties on Wilson’s official bond for $15,000 and each paid $4,465.90 to the Government to cover the defalcation. Wilson was apprehended in Canada with $785 in his possession, which was turned over to the Insular Treasurer. The plaintiff filed a complaint seeking judgment against Wilson for the amount paid and for the $785 to be applied to this judgment, with preference. H.D. Terrell intervened, claiming Wilson had transferred all his rights to the $785 to him on September 3, 1904, in payment of attorney’s fees. Terrell asserted he had notified the Treasurer of this transfer before the depositary was appointed in the principal case. The plaintiff and The American Surety Company opposed Terrell’s claim, arguing they had a better right and should receive the funds equally as partial reimbursement for their payments to the Government, based on subrogation to the Government’s rights. The lower court ordered judgment in favor of the plaintiff against Wilson for the amount paid and declared Terrell the owner of the $785, ordering its delivery to him. The plaintiff appealed the portion of the judgment awarding possession of the $785 to Terrell.

ISSUE
Whether the intervenor, H.D. Terrell, has a superior right to the $785 found in Wilson’s possession over the plaintiff, The Fidelity and Deposit Company of Maryland, and The American Surety Company of New York, who acted as sureties for Wilson.

RULING
The Supreme Court reversed the lower court’s decision regarding the possession of the $785. The Court found that neither the plaintiff nor the intervenor had a privileged credit under the Civil Code. The intervenor’s claim was based on a private document, and the appellant’s claim was derived from their payment as sureties, with no proof of this payment presented in court. Since both credits fell into the general class of unsecured debts, they were not entitled to preference. Therefore, the funds were to be distributed pro rata between the intervenor, H.D. Terrell, and the appellant, The Fidelity and Deposit Company of Maryland, based on their respective credits.