Boston & Providence Railroad v. New York & New England Railroad

12 R.I. 220
CourtSupreme Court of Rhode Island
DecidedOctober 24, 1878
StatusPublished
Cited by2 cases

This text of 12 R.I. 220 (Boston & Providence Railroad v. New York & New England Railroad) is published on Counsel Stack Legal Research, covering Supreme Court of Rhode Island primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Boston & Providence Railroad v. New York & New England Railroad, 12 R.I. 220 (R.I. 1878).

Opinion

Potter, J.

The bill is brought by certain stockholders of tbe Hartford, Providence, and Fishkill Railroad Company, for themselves and other stockholders, against tbe New York and New England Railroad Company and Henry Lippitt and others, trustees under certain mortgages of portions of tbe Hartford, Providence, and Fishkill Railroad, in Connecticut and Rhode Island, who are in possession thereof as trustees. The prayer of the bill is to set aside a certain agreement, lease, and deed from tbe Hartford, Providence, and Fishkill Railroad Company, to the Boston, Hartford, and Erie Railroad Company, dated August 28,1863. The New York and New England Railroad Company claims under an assignment of the so-called Ber-dell mortgage, executed by tbe Boston, Hartford, and Erie Railroad Company upon the whole road, and is in possession of the [221]*221portion of the road in Massachusetts. The assignees in bankruptcy of the Boston, Hartford, and Erie Eailroad Company have also been authorized by the Court of Bankruptcy to sell said Boston, Hartford, and Erie Eailroad to the New York and New England Eailroad Company, but have never, so far as appears, transferred the same. The bill also prays that the complainants may be decreed to be the lawful owners on redemption of the valid mortgages, and may be permitted to redeem and for an account.

To the complainant’s bill, the New York and New England Eailroad Company pleads that before the filing of the present bill Charles S. Bradley and others, assignees in bankruptcy of the Boston, Hartford, and Erie Eailroad Company, filed their bill in the United States Circuit Court for the district of Ehode Island, against the Hartford, Providence, and Fishkill Eailroad Company, the trustees of the mortgages on the portions of the road lying in Connecticut and Ehode Island, made by the Hartford, Providence, and Fishkill Eailroad Company, and the trustees under the so-called Berdell mortgage made by the Boston, Hartford, and Erie Eailroad Company, claiming the right to redeem the Hartford, Providence, and Fishkill Eailroad from the various mortgages, and for an account and for further relief; that the said respondents have been cited and have appeared; that the bill is still pending, and that the said Circuit Court has jurisdiction of the parties aforesaid, and of the entire subject-matter of said suit; that the respondents included all who had then asserted any right to the equity of redemption; that the trustees under the Berdell mortgage have since conveyed said mortgage to the New York and New England Eailroad Company ; that with the substitution of parties thus made, and with the changes of trustees, the respondents named in the present bill are identically the same as in the bill pending in the Circuit Court; that thereby the said Circuit Court had acquired jurisdiction of the controversy and of the subject-matter thereof before the present bill was filed ; that the complainants in the present bill had not then set up any right of redemption and could not then be made parties to that bill, but that they are sufficiently represented by the Hartford, Providence, and Fishkill Eailroad Company, in which they are stockholders, and they [222]*222should set up tbeir claims by proceedings in the suit now pending in tbe said Circuit Court.

, This plea is set down for argument, and tbe question, and tbe only question, is, Is it sufficient ?

Briefly stated, tbe point made by the plea is, tbat the United States Circuit Court has, by a suit previously commenced, obtained jurisdiction of tbe parties and subject-matter.

Tbe general rule is well settled as to courts of concurrent jurisdiction ; that tbe court which first obtains jurisdiction of the parties and subject-matter is entitled to retain it, and decide the controversy between them. In all matters, excepting such as arise under the Constitution and laws of the Union, the courts of the United States and of the States are courts of concurrent jurisdiction.

But this rule can only be properly applied where not only the subject-matter, but also the parties, are the same. In all suits except such as are technically proceedings in rem, a decree can bind only the parties before the court and their privies. And this privity exists only in cases of mutual or successive relations to the property. It is founded on the presumption that the privies are identical in interest with the parties, and it cannot be extended farther. 1 Greenleaf on Evidence, § 189 ; Freeman on Judgments, § 162; Hunt v. Haven, 52 N. H. 162; 2 Smith’s Lead. Cas. 7th Amer. ed. 624, 626, 800, and it would be difficult to say that there is any privity of interest in the present case. It is very evident that the rights of certain stockholders of the Hartford, Providence, and Fishkill Railroad Company, who have not exchanged, but still hold their original stock, may be very different from, and even adverse to, the interests of the majority represented by the directors who have the control of the corporation, and they are allowed in such cases to sue separately from the corporation for that very reason.

Has the United States Circuit Court obtained jurisdiction of the subject-matter, and of the parties of this suit, so that the general rule will apply to it ?

The parties are not the same. The suit in this court is by the stockholders of the Hartford, Providence, and Fishkill Railroad Company, who are not parties to the other suit unless they are represented by the Hartford, Providence, and Fishkill Railroad [223]*223Company as a corporation. But tbe very ground of their suing here is that they have called upon the directors to protect their rights and the directors have refused to do so. And the rights of those stockholders as stockholders have been reserved and protected in several decrees, and we think that fact alone would give them a standing in a court of equity, and if a proper case is made, they would be entitled to relief as stockholders. To hold in such circumstances that a decree in a suit against the Hartford, Providence, and Fishkill Railroad Company, controlled by its directors, and to which these stockholders, although having an adverse interest, were not parties, could control the rights of these stockholders, would seem inconsistent with the principles which should govern courts of equity.

Could these complainants as stockholders come in as parties in the suit in the Circuit Court ?

The complainants well say that if they were admitted as co-complainants, their interests would be adverse to the interests of the other complainants ; if admitted as respondents, even if they prevailed, the only effect would be to dismiss the complainants’ bill; and it would be only by a cross bill that they could set up their claims.

By the recent amendment to our law, Pub. Laws R. I. cap. 563, April 20, 1876, no cross bill is any longer necessary, and any person not a party to a bill may be allowed to become a party. If these provisions had been adopted in the practice of the United States courts, a remedy might be had there ; but they have not been. The respondents here offer to consent that the complainants may appear there and be admitted as parties, and then they could file a cross bill. But we do not think the complainants should be compelled to rely for their rights on the mere consent of parties, even if consent could give jurisdiction.

It is true that in Freeman v. Howe, 24 How. U. S.

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Cite This Page — Counsel Stack

Bluebook (online)
12 R.I. 220, Counsel Stack Legal Research, https://law.counselstack.com/opinion/boston-providence-railroad-v-new-york-new-england-railroad-ri-1878.