Central Railroad v. N. J. West Line Railroad

32 N.J. Eq. 67

• Court: New Jersey Court of Chancery
• Decided: February 15, 1880
• Status: Published

Opinion

The Chancellor.

The bill was filed in 1879, by The Central Railroad Company of New Jersey, The American Dock Company, Francis S. Lathrop, receiver for the creditors and stockholders of the former company, and John C. Van Horne, against The New Jersey West Line Railroad Company, William L. Earned, receiver for the creditors and stockholders of that company, The Trustees for the Support of Public Schools, Asa Packer, Lloyd Chamberlain and others. Its object is to obtain relief against a certain grant of land under water, made by the state to the West Line Railroad Company. That company, and its receiver, are made parties because of the interest of the former as grantee, and the Trustees for the Support of Public Schools, because of a mortgage held by them, given for part of the consideration money of the grant. Hnder a decree of foreclosure of that mortgage, obtained in tliis court, the premises in question Avere sold, December 26th, 1878, and at the sale Avere purchased by Lloyd Chamberlain. The sale Avas set aside on the ground of surprise.

As to concurrent remedies on other liens, see Embree v. Hanna, 5 Johns. 101; American Bank v. Robbins, 99 Mass. 313; Thielman v. Carr, 75 Ill. 385 ; Barker v. Amark, 3 Beav. 64; Hecker v Mitchell, 6 Duer 687 ; Lawrence v. Remington, 6 Biss. 44; Wurtz v. Hart, 13 Iowa 515; Monroe v. Castleman, 3 A. K. Marsh. 399. As to a special or qualified election, see Franklin v. Hersch, 3 Tenn. Ch. 467; Thompson v. Graham, 1 Paige 452. A suit in aforeign court, however, not always compel the plaintiff to elect (West v. McConnell, 5 La. 424; Chatzel v. Bolton, 3 McCord 33; Barnes v. Willett, 19 How. Pr. 566; Davis v. Morton, 4 Bush 442; Grider v. Apperson, 32 Ark. 332 ; Allen v. Watt, 69 Ill. 655 ; Williams v. Ayrault, 31 Barb. 364; Osgood v. Maguire, 61 Barb. 54; Burrows v. Miller, 5 How. Pr. 51; Smith v. Lathrop, 44 Pa. 326; Humphries v. Dawson, 38 Ala. 199; De Armond v. Bohn, 12 Ind. 607; Yelverton v. Conant, 18 N. H. 123; Trabue v. Short, 5 Cold. 293; Wilson v. Ferrand, L. R. (13 Eq.) 362; Cox v. Mitchell, 7 C. B. (N. S.) 55. See, also, McLane v. Manning, Winst. (N. C.) Eq. 60; McGilvray v. Avery, 30 Vt. 538); and in this respect the English cases are said to include the courts of Scotland (Cowan v. Braidwood, 1 Man. & Gr. 382; Russell v. Smith, 7 M. & W. 810; Venning v. Loyd, 1 De G. F. & J. 193; Carron Iron Co. v. Maclaren, 5 H. of L. Cas. 416); Ireland (Sheehy v. Life Ass’n Co., 3 C. B. (N. S.) 597; Alexander v. Adams, 16 L. T. (N. S.) 384); Jamaica (Bayley v. Edwards, 3 Swanst. 703); Newfoundland (Henley v. Soper. 8 B. & C. 16; Foster v. Vassall, 3 Atk. 587); Canada (Young v. Barclay, 5 H. of L. Cas. 431); New South “Wales (Bank of Australasia v. Nias, 16 Ad. & E. (N. S.) 717); the island of Grenada (Farquharson v. Seton, 5 Russ. 45); India (Ostell v. Lepage, 10 E. L. & E. 250, 5 DeG. & Sm. 95, 2 DeG. M. & G. 892); Wales (Morgan v. _____, 1 Atk. 408); the consular court at Constantinople (Barber v. Lamb, 8 C. B. (N. S.) 95); the United States (Cox v. Mitchell, 7 C. B. (N. S.) 55).

The bill, according to its own statement, is filed to have the sale perpetually enjoined, and to have the grant declared invalid and void, to* restrain any one claiming or to claim thereunder from setting up such title against the complainants, and from disturbing the complainants in their possession of the property, and to remove the cloud which the grant casts upon the complainants’ title.

On the 10th of January, 1876, a bill in equity Avas filed in the circuit court of the United States for the district of NeAV Jersey, by John Taylor Johnston, claiming, as grantee of the Central Railroad Company, and the Dock Company, against the West Line Railroad Company, the Trustees for the Support of Public Schools, and William L. Lamed, receiver, for relief against the grant and the mortgage. In that suit a preliminary injunction was obtained, on the 5th of May, 1876, prohibiting the defendants therein from proceeding to ■ sell the premises, and from disturbing the possession of Mr. Johnston until the further order of the court. That injunction was dissolved in 1878, on the ground, as stated in the rule, that by force of the statute it continued in force only until the next term after it was granted, and had not been renewed. The promises were subsequently sold under the decree of foreclosure in this court before mentioned, and were purchased by Chamberlain. Some of the defendants in this cause, who are not parties defendant to the suit in the United States court, are made parties by reason of their interest as holders of liens or encumbrances on the premises under the West Line Railroad Company, and the rest by reason of their interest under the sale in foreclosure.

As to suits in other counties of the same state, see Claywell v. Sudreth, 77 N. C. 287. Also, federal courts in districts outside of the state where the action is pending. Cook v. Litchfield, 5 Sandf. 330; Lloyd v. Reynolds, 29 Ind. 299; Brooks v. Mills Co., 4 Dill. 524, and especially the note on 529 et seq., S. C. 2 Cent. L. J. 719; Lawrence v. Remington, 6 Biss. 44; Stanton v. Embrey, 3 Otto 548; Ins. Co. v. Brune, 6 Otto 588.

The bill in this suit states that the suit in the federal court was, in fact, instituted by the Central Railroad Company and the Dock Company, through John Taylor Johnston ; that the conveyances by those corporations to him, under which alone he derived his title, were made merely for the purpose of giving jurisdiction to the federal courts, in order that those corporations might thus (in view of the interest of the state in the controversy) be enabled to avail themselves of those courts as a forum for the litigation of the question in dispute. It seems undeniable, and, indeed, it is not questioned, that this suit is, so far as those corporations arc concerned, for the identical cause, and for precisely the same relief as the suit in the federal court, except as to the sale under foreclosure, which occurred subsequently to the institution of the latter suit. There is, indeed, an additional complainant, John C. Van Horne, here. He makes common cause with the complainant corporations, because he is (though independently of them) affected by the same grant against which they seek relief. Motion is made that the complainant corporations elect in which forum, the federal or state, they will proceed. The suit in the federal court appears to have rested since the dissolution of the injunction, which took place on the 30th of November, 1878.

Where the federal court is held in the same district as the state court, the cases are conflicting; those maintaining that they are even then foreign, are: Wadleigh v. Veazie, 3 Sumn. 165; White v. Whitman, 1 Curt. 494; Loring v. Marsh, 2 Cliff. 311; Parsons v. Greenville R. R., 1 Hughes 279; Bininger's Case, 7 Blatch. 168; Greenwood v. Rector, 1 Hempst. 708; while those holding the contrary are: Presb. Church v. White, 4 Am. Law Reg. 526; Earl v. Raymond, 4 McLean 233; Smith v. Atlantic Ins. Co., 2 Fost. (N. H.) 21; Nelson v. Foster, 5 Biss. 44; Wood v. Lake, 13 Wis. 84 Wurtz v. Hart, 13 Iowa 515; Whitridge v. Taylor, 66 N. C. 273; McConnell v. Stettinius, 7 Ill.707; Mitchell v. Bunch, 2 Paige 606. See Hatch v. Spofford, 22 Conn. 495 ; Barney v. Patterson, 6 Har. & Johns. 182; Williams v. Wilkes, 14 Pa. St. 228; Cunningham v. Campbell, 8 Tenn. Ch. 488. After a suit begun in one state, the plaintiffs sued for the same cause in another, and pursued it to judgment,—Held, that the judgment was a bar to the first suit. North Bank v. Brown, 50 Me. 214; also, Baxley v. Linah, 16 Pa. St. 241; Paine v. Schenectady Ins. Co., 11 R. I. 411. One of several defendants, without the concurrence of the others, has the right to compel an election. Bradford v. Williams, 2 Md. Ch. 1. The second suit must be for substantially the same subject matter (Carlisle v. Cooper, 3 C.E. Gr. 241; Macey v. Childress, 2 Tenn. Ch. 23; Rattenbury v. Fenton, Coop. temp. Brough. 60; McEwen v. Broadhead, 3 Stock. 129; Davison v. Johnson, 1 C. E. Gr. 112; Ballou v. Ballou, 26 Vt. 673; Calaveras Co. v. Brockway, 30 Cal. 325; Bradford v. Williams, 2 Md. Ch. 1; Sullings v. Goodyear Co., 36 Mich. 313; McRue v. Singleton, 35 Ala. 297; Flint v. Sparr, 17 B. Mon. 513) ; and brought by the same parties, or in the same right (Higgins v. York Co., 2 Atk. 44; Henry v. Goldney, 15 M. & W. 494 ; Nunn v. Lomer, 13 Jar. 236; Wise v. Prowse, 9 Price 393; Sowter v. Dunston, 1 Mann. & Ry. 508; Fulton v. Golden, 10 C. E. Gr. 353; Botts v. Cozine, 2 Edw. Ch. 583; Walsworth v. Johnson, 41 Cal. 61; Beach v. Norton, 8 Day 71; Cole v. Butter, 43 Me. 401; Stern's Case, 14 Ala. 597; Adams v. Gardiner, 13 B. Mon. 197; Atkinson v. State Bank, 5 Blackf. 84; Dawson v. Vaughn, 42 Ind. 395; O' Connor v. Blake, 29 Cal. 312; Fisk v. Union Bac. R. R. Co., 8 Blatch. 299; Davis v. Hunt, 2 Bail. 412; Paul v. Hurlbert. 5 Reporter 738; Osborn v. Cloud, 23 Iowa 104; Chase v. Bank, 56 Pa. St. 355; New England Screw Co. v. Bliven, 3 Blatch. 240. See Graves v. Dale, 1 Mon. 190; McConnell v. Slettinius, 7 Ill. 707; Thomas v. Freelove, 17 Vt. 138; Blackburn v. Watson, 85 Pa. St. 241; Parsons v. Greenville Co., 1 Hughes 279).

The complainants’ counsel insist that the objection under consideration is not valid, and that, if made by answer, as it in fact is, it cannot avail the defendants before the final hearing; and if the defendants would avail themselves of it before final hearing on the merits, they must do so by plea, and that, therefore, the motion cannot prevail. ’ They further insist that the mere pendency of a suit for the same cause in a foreign court, or in a court of the United States, cannot be pleaded in abatement or in bar to a proceeding in a state court. The defendants, in whose behalf the motion is made, The Trustees for the Support of Public Schools, have answered.

The pendency of another suit cannot be shown without pleading it (Percival v. Hickey, 18 Johns. 257; White v. Talmage, 35 N. Y. Sup. Ct. 223; Rizer v. Gilpatrick, 16 Kan. 564; Anderson v. Barry, 2 J. J. Marsh. 281; Hixon v. Schooley, 2 Dutch. 461. See, however, Haigh v. Paris, 16 M. & W. 144; Bissell v. Williamson, 7 H. & N. 391); and it may be set up by answer or demurrer or plea (Hornfager v. Hornfager, 6 How. Pr. 279; Morton v. Sweetser, 12 Allen 134; Curd v. Lewis, 1 Dana 351; Patterson v. Mercer, 23 Ind. 16; Schenck v. Schenck, 5 Hal. 276. See Blanchard v. Stone, 16 Vt. 234).

A complainant who has two suits, one at law and the other in equity, or both in equity, pending for the same cause, at the same time, will be put to his election, except in the case of foreclosure of mortgage, in which case both a suit at law and a suit in equity, at the same time, may be maintained. Story’s Eq. Pl. § 736 ; Way v. Bragaw, 1 C. E. Gr. 213; Conover’s Ex’r v. Conover, Sax. 403 ; McEwan v. Broadhead, 3 Stock. 129; Moore v. Grubbs, 3 B. Mon. (Ky.) 77 ; Brown v. Wallace, 2 Bland 585, 601. And the defendant may call for the election as soon as he has filed his answer.

In Mitchell v. Bunch, 2 Paige 606, cited by complainants’ counsel, there was a suit at law in the federal court, and a suit in equity in chancery of the state of New York. Though the chancellor, indeed, said that the mere pendency of a suit in a foreign court, or in a court of the United States, could not be pleaded in abatement or bar to a proceeding in a state court, he, at the same time, refused to regard the circuit court of the United States, sitting within the limits of his state, as a foreign court, and he also intimated that, had the notice in the suit before him been properl’ framed, he would have required an election, and, in fact, ho did require the complainant to elect between bail in the federal court and ne exeat in 'the state court.

But the plaintifi'need not elect until after the defendant has answered (Semmes v. Mott, 27 Ga. 92; Dunlap v. Newman, 62 Ala. 178); and may then proceed by motion or petition (Freeman v. Staats, 4 Mal. Ch. 814). Semble, the motion must be made in the last shit. Ratzer v. Ratzer, 2 Abb. N. C. 461; Nicholl v. Mason, 21 Wend. 339; Bank of U. S. v. Merchants Bank, 7 Gill 415; Sherwood v. Hammond, 4 Blackf. 504; Renner v. Marshall, 1 Wheat. 215; Haight v. Holley, 3 Wend. 258. See Morton v. Webb, 7 Vt. 123 ; Williamson v. Paxton, 18 Gratt. 475. After an election to proceed in one court, the party cannot object to its jurisdiction. McBroom v. Wiley, 2 Heisk. 58; Mortimore v. Soares, 1 El. & El. 399; Harrison v. Harrison; 39 Ala. 489. As to waiver of an election, see Welchel v. Thompson, 39 Ga. 559; Washburn v. Great West. Ins. Co., 114 Mass. 175; Kittredge v. Race, 2 Otto 116.—Rep.

The right to put the complainant to an election is not confined to suits brought in our own courts; but he may be compelled to elect whether he will proceed in this or in a‘ foreign court. 1 Hoffm. Ch. Pr. 343; 1 Barb. Ch. Pr. (2d revised ed.) 247 ; Pieters v. Thompson, Cooper 294.

■ In Lathrop Sewing Machine Co. v. Bond and Lathrop Manufacturing Co., in this court, in 1868, the complainants were required, before answer filed, to elect between a suit, in equity in New York and that suit.

If, in this case, the complainants should be permitted to proceed in both courts, there might result decrees diametrically opposite to one another and a conflict of jurisdiction. If so, which decree Avould prevail? Apart from the other considerations appropriate to the decision of this question, it is the policy of the federal and state courts to avoid such conflicts. New Jersey Zinc Co. v. Franklin Iron Co., 2 Stew. 422.

According to the practice, the complainants may be put to their election after answer, by order, upon motion. Way v. Bragaw, ubi supra, Gilb. For. Rom. 196; Dan. Ch. Pr. (4th Am. ed.) 815; Conover’s Ex’r v. Conover, ubi supra.

Manifestly, it is the dictate of justice'that the Trustees for the Support of Public Schools should be spared the necessity of defending both suits. In the main, the prayer of each bill is precisely the same and the relief sought in each suit identical. The fact that there are other defendants in this suit than those in the suit in the federal court, or that there is 'another complainant here besides those who were the real'complainants there, will not prevent this court from requiring the election. Story’s Eq. Pl. § 738; Dows v. McMichael, 6 Paige 139 ; Gardner v. Raisbeck, 1 Stew. 71.

The complainant corporations should be required to elect. There will accordingly be an order that they elect within eight days after service of the order. Such is the practice. Boyd v. Heinzelman, 3 Ves. & Bea. 381; Rogers v. Vosburgh, 4 Johns. Ch. 84. If they elect to proceed in the federal court, the bill in this suit will be dismissed as to them, with costs, and if they elect- to proceed 'here, they will be required to dismiss their bill in the federal court as a condition precedent to doing so.