In re Rice

181 F. 217, 1910 U.S. App. LEXIS 5572
CourtU.S. Circuit Court for the District of Middle Alabama
DecidedAugust 2, 1910
StatusPublished
Cited by19 cases

This text of 181 F. 217 (In re Rice) is published on Counsel Stack Legal Research, covering U.S. Circuit Court for the District of Middle Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Rice, 181 F. 217, 1910 U.S. App. LEXIS 5572 (circtmdal 1910).

Opinion

JONES, District Judge.

Alex Rice, on May 13, 1910, entered into a contract, in New York, with Doherty & Co., for the sale of 800 shares of stock, owned or controlled by him, in the Citizens’ Eight, Heat & Power Company, and the Citizens’ Eight & Power Company, to be delivered on June 15th, upon performance, according to the terms of the contract, of their respective undertakings. On that day the attorneys of Doherty & Co. notified Rice they desired to consummate the contract, and Rice referred them to his attorney, Fred S. Ball, as his representative for that purpose. Differences arose over the construction of some of the provisions of the contract, and, no agreement having been reached, Doherty & Co.’s attorneys notified Ball they wished to make a tender, whereupon Ball replied, in substance, that he had no authority to receive the tender, and no longer represented Rice in that matter. Rice by advice of his counsel went that evening to Birmingham, beyond the jurisdiction of this court.

Doherty & Co. filed their bill in this court the next day, June 16th, praying for specific performance by Rice, making him, the Citizens’ Light, Heat & Power Company, and the Citizens’ Eight & Power Company defendants to the bill, and on the evening of that day, about 6 o’clock, a restraining order issued forbidding Rice from transferring, assigning, or in any manner disposing of the shares of stock in the two corporations named, or the trustees’ certificates representing such shares, and forbidding said corporations from making any transfers of said stock upon their books, until the further order of the court. Ehe restraining order was served on Whiting, the secretary and general manager of the two corporations, about 7:20 that evening. Rice returned to the* city a little before 7 o’clock of the same evening and went to the house of a friend so that he could not be found or served until the next day. In less than four hours after Rice’s return to the city and the service of the order upon an officer of his two codefendants, the stock and trustees’ certificates which he had contracted to sell to complainants had been sold and transferred to Tillis, in the very teeth of the terms of the restraining order. In answer to a rule, at the- instance of complainants, to show cause why they should not he punished for contempt, Rice and Ball appeared, and, not denying the transfer of the stock and trustees’ certificates, averred on oath that they had acted as they did without knowledge or notice, direct or indirect, of the issue of the restraining order, and thereupon a lengthy examination of witnesses was had before the court touching the issues thus raised.

As said by the Supreme Court in Re Debs, 158 U. S. 595, 15 Sup. Ct. 910, 39 L. Ed. 1092, quoting and approving the language of the Supreme Court of Mississippi:

“A court without power to effectually protect itself against the assaults of the lawless, or to enforce its orders, judgments, or decrees against recusant parties before it, would be a disgrace to the legislation and a stigma upon the age which invented it. The power to fine and imprison for contempt from the earliest history of jurisprudence has been regarded as a necessary attribute of a court, without which it could no more exist than without a judge.”

A violation of the orders of a court may be of such a nature that it affects only the right litigated between the parties to the suit. A [220]*220party may condone such a disobedience, and the powers of the court are exerted to redress the wrong done the party. Where, however, the orders of the court are disobeyed, whether or not there be injury to a litigant, under circumstances which evince a deliberate purpose to contemn the authority of the tribunals set up for the administration of justice and defy their orders, the consequences reach far beyond the private right. The disobedience then becomes an offense against government and society, which the courts must notice and punish, since to leave the evil example unnoticed and unpunished would soon lead to the subversion of order, and the establishment of anarchy in its stead. The disobedience in the one instance is called a “civil contempt,” and in the other a “criminal contempt.”

The objection that the charge of a violation of the order upon which the rule issued was made on information and belief, supported only by an affidavit of the same character, comes too late, when the alleged contemnor, without raising that point, admits the act charged, and' defends himself on the ground that the act was done in ignorance of the existence of the order. The exaction of positive allegations to support the rule to show cause is intended to protect the court from the improvident'institution of contempt proceedings and useless investigation as to the breach of their orders which the proof may show were not violated. The reason of the rule ceases when the respondent answers, admitting the act charged, and the omission to make a positive charge in the beginning, is, therefore, not of the slightest consequence in the subsequent phases of the prosecution.

■ It is insisted that Ball is called to account for a breach of -the injunction, an offense, which it is argued, although he acted as agent merely, he cannot commit, since he was not a party to the suit by name or designation, and that the charge against Rice is not sufficiently explicit, being merely that he had “notice of the injunction,” wherefore the rule should be discharged as to both respondents, regardless of what the evidence proves.

Undoubtedly, the current of authority is to the effect that the commands and directions of an injunction are not addressed to or binding upon one who is not a party, either by name or designation, and in consequence that a person not so made a party is not subject to committal for a breach of the injunction, which, technically speaking, can be committed only by a party to it. Rice was a party to the suit, and of course could breach the injunction. Ball was Rice’s attorney in fact, as well as legal adviser, asserting no right of his own, and acting only in the name of his principal and carrying out his commands. He knew, if he had knowledge of the injunction, that it forbade an agent to do for Rice that which it forbade Rice to do. On principle it would seem, whatever the holding of some of the authorities to the contrary, that the directions and commands of an injunction, though not ad-' dressed to strangers, are admonitions and orders to any one, although not named in any way in the suit, who acts in the assertion of the principal’s right only, contrary to the terms of an injunction addressed to his principal, and that a mere agent may, in that way, be guilty of its breach, in the proper sense. He claims under one to whom the in[221]*221junction speaks, acts for him only, and intentionally puts himself in privity with him, and in consequence is amenable to its commands.

It is not necessary in the posture of this case to decide whether the above objections are well taken. The acts charged against respondents concern the authority and dignity of the court, and a high sense of public duty would compel it to issue a new rule to cover any contempt if one be developed by the evidence, though the present proceeding were dismissed on purely technical grounds. 'The evidence has been gone into at length and the matter fully argued by counsel for respondents in all its phases.

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Bluebook (online)
181 F. 217, 1910 U.S. App. LEXIS 5572, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-rice-circtmdal-1910.