Merriman v. Chicago & E. I. R.

64 F. 535, 12 C.C.A. 275, 1894 U.S. App. LEXIS 2517

Opinion

After making tbe foregoing statement, the opinion of the court was delivered by

BAKER, District Judge;

This court, by the organic act creating it, is vested with power to exercise appellate jurisdiction to review by appeal or by writ of error final decisions of the district courts and of the existing circuit courts in all cases other than those provided for in the fifth, section of the organic act, unless otherwise provided for by law. 26 Stat. 828, § 6. The limitation upon the appellate jurisdiction of this court provided for in section 5 has relation to certain classes of causes wherein the right of appeal from final decisions of the district and circuit courts to the supreme court is preserved. In addition to the exercise of appellate jurisdiction to review final decisions of the district and circuit courts, this court is vested with authority to review, by appeal, certain interlocutory orders or decrees made during the progress of a cause. Id. § 7. This section provides:

“Tliat where, upon, a hearing in equity in a district court, or in an existing circuit court, an injunction shall he granted or continued by an interlocutory order or decree, in a canso in which an appeal from a final decree may be taken under the provisions of this act to the circuit court; of appeals, an appeal may be taken from such interlocutory order or decree granting or continuing such injunction to the circuit court of appeals: provided, that the appeal must bo taken within thirty days from the entry of such order or decree.’’

It is thus made apparent that the determination of the morion to dismiss the appeal as to the appellee Walker hinges on the question whether or not the decision of the court below against him was final or interlocutory. A final decree or judgment is one which puis an end to the controversy between the parties litigant. It' the decision or judgment leaves some matter involved in the controversy open for future hearing and determination before the ultimate rights of the parries are conclusively adjudicated, it is interlocutory, aud not final. The authorities are uniform to the effect that a, decree or judgment, to be final for the purposes of an appeal or writ of error, must leave the case in such a condition that if there be an affirmance here the court below will have nothing to do but to execute the decree or judgment it has already entered. Bostwick v. Brinkerhoff, 106 U. S. 3, 1 Sup. Ct. 15; Grant v. Insurance Co., 106 U. S. 429, 433, 1 Sup. Ct. 414; St. Louis, I. M. & S. R. Co. v. Southern Exp. Co., 108 U. S. 24, 28, 2 Sup. Ct. 6; Ex parte Norton, 108 U. S. 237, 242, 2 Sup. Ct. 490; Mower v. Fletcher, 114 U. S. 127, 5 Sup. Ct. 799; Dainese v. Kendall, 119 U. S. 53, 54, 7 Sup. Ct. 65. Tested by the principle above stated, the decree against the ap-pellee Walker is not final, and the motion to dismiss the appeal must be sustained. The decree fixes riie liability of the appellee Walker to account for 327 bonds, of the par value of 11,000 each, together with interest on the coupons thereon; but it is expressly decreed that he is entitled to credit thereon for such sum or sums as may be rightfully due him. The sum or sums rightfully due him, and to which he is adjudged to be entitled to credit, is left wholly undetermined by the decree of the court, so that it is Impossible, without a further hearing, to determine the extent of his liability, if any. Until such sum or sums as may be rightfully due him shall be ascertained and credited upon the fund with which he is charged, the extent of his liability remains undetermined. It is found by the court that in a suit, in which the appellee Walker is a party, pending in a state court touching the bonds here in controversy, an accounting has been had, and a report thereof has been made to such court, but has not been acted upon; and it is thereupon ordered that the execution of the decree fixing his liability be stayed until the final determination of the suit in the state court, and until the further order of the court. And the court below expressly reserved to itself the right to allow such further proceedings in the cause between the appellants and the appellee Walker as may become necessary or proper by reason of the final determination of the case in the state court. These facts conclusively demonstrate that there has been no final decree rendered against the'appellee Walker, and that the final settlement and determination of the question of his liability, if any, are reserved for further hearing after final judgment in the state court.

The appellants contend that the court erred in dismissing for want of equity the original, amended, and supplemental bills against the Eastern Illinois Company. Counsel for appellants, in their elaborate briefs, have pointed out only one alleged error in the decree. They earnestly contend that the court erred because it did not charge the Eastern Illinois Company with liability to account for and pay over to the appellants the value of the 500 bonds, of $1,000 each, issued by it to certain agents, attorneys,, officers, and stockholders of the Danville Company after the filing of the original bill in- this cause. The court below decided that these bonds, or their proceeds, belonged to the Danville Company, and that the parties to whom they were issued held them in trust to the use of that company, and subject to the paramount rights of the appellants as judgment creditors. It is claimed by appellants that their original bill was a creditors’ bill, and that from the time of its filing and the service of process it operated as an equitable attachment of these bonds in the hands of the Eastern Illinois Company, and that, having issued them to other parties while thus impounded, it ought to have been decreed to account to the appellants for their full value, or for so much, at least, as would satisfy their respective judgments. Neither the amended bill nor the supplemental bill is material to the determination of this question. Both of these bills were filed after the Eastern Illinois Company had issued these bonds, and therefore, unless the original bill operated as an equitable attachment of them while in the hands of that company, the appellants acquired no interest in or lien upon them or their proceeds, and consequently have no right to complain of their transfer to other parties. In view of the fact that the court decreed that these bonds, or their proceeds, belonged to the Danville Company, it is apparent that it dismissed the original, amended, and supplemental bills op the ground that the original bill created no lien upon the bonds in controversy in the hands of the Eastern Illinois Company, and that no lien upon them could be acquired by the amended or supplemental bills, because when they were filed that company had ceased to own or control them. It seems to us the decision is right upon either of two grounds. A careful consideration satisfies us that, in its true scope and purpose, the original bill is one to be let in to redeem the property of the Danville Company in ¡he hands of the Fas tern Illinois Company as a mortgagee in possession under an onforeelosed mortgage. The; allegations in the bill touching the bonds in controversy, and the prayer for an injunction to restrain the Eastern Illinois Company from issuing them, are peculiarly app opriate in a hill to redeem, because if such bonds were issued, and came into the hands of bona Me; holders for value, they would create1 an additional incumbrance on the property sought to he redeemed. It is true that there is a prayer for the discovery of assets, and for an injunction to restrain their transfer, and a general prayer that the1 appellants' claims be decreed to be paid out of any assets and properly of the Danville Company. Hut the1 specific relief asked for is that they be permitted to redeem all the property of whatever sort belonging to the Danville Company in the possession of the Eastern Illinois Company as a mortgagee in possession under an unforeelosed mortgage. The bill of complaint is devoted almost: exclusively to setting forth facts entitling the appellants to redeem the1 entire property of the Dan-ville; Company from the Eastern Illinois Company, to the end that it may be subjected to the1 satisfaction of their judgments. The allegations touching the bonds in controversy occupy but, an inconsiderable part of the trill of complaint. It seems evident that it was framed on the theory (hat the mortgagers err trust dee;ds me*n-tioneel in the bill we;re invaliel. and that (he1 preroee;elings resulting in the ferreeiersure; and sale of the property erf the Danville Company did nert eliverst, its title, and that its property in the hands of the Eastern Illinois Oermpanv was held by it, as a mortgage» in possession under an nnfemreioseal merrtgage. The* e;laim of a right to redeem is inconsistent with the claim to recover the; bonds in controversy err their proceebls. The. first e-hiinv proceeds upon the theory that the; Easteu-n Illineris Company acquiree! no title under the proceedings resulting in a foreefiosure and sale; of the; propea-ty of the Danville1 Company, while* the eribew proceeds uperu the1 theory that a valid title was acquired thereby, authorizing the former cermpany to issue; boneis secured by a valid merrtgage of the property. The one theerry affirms, and the other disaffirms, the title; of the Eastern Illinois Cermpany. The1 appellants cannot suem-d in ¡he same case on such antagonistic f.heerrms. If lhe;y are entitled to a decree admitting then» ter redeem upon the tlmerry that the; Eastern Illineris Cermpany has ae-epiireel no title to the; property of the Danville Cermpany, and (hat its only right is that of a mortgagee in posses-siern mielen1 an unforee-lersed mortgage*, thew cannot: claim the light ter have the1 bonds in earntroversy err ihelr proceeds applied to the salisfactiern erf their judgments. Be>siele;s, iroate'd as a hill to rene-.h and appropriate the bemds in cemtroverrsy to ¡lie1 satisfaction of their judgments, the1 greater part of its allegations would becerme irrelevant, immaterial, and surplusage, and. in fae-t:, inconsistent. That e-.emstructiem erugbt to be; giveur ter the* bill which appears to best; haramnize with its apparent scerpe and purperse*, and which will not lay it opem ;<> the charge1 erf stating antagonistic and conflicting grounds of relief. And it seems to us that the only theory upon which the allegations of the hill can he substantially harmonized is to • treat it as a bill to redeem, and that the averments touching the bonds in controversy were incorporated in it to procure an injunction, and thus prevent their issue, thus preserving the status of the property pending the litigation. The bill unquestionably states in great detail a cause of action for redemption, and in clear and unambiguous terms it prays that the property of the Danville Company now in possession of the Eastern Illinois Company may be decreed to be the property of the former company, subject to the right of the, latter company to hold possession of it as a mortgagee in possession under an unforeclosed mortgage; that an accounting may be had of the amount due to the latter company, which the appellants offer to pay; and that upon payment they be allowed to redeem said property and be subrogated to the rights of the mortgagees. If the bill is to be treated as a creditors’ bill, and as stating a good cause of action to reach and appropriate the bonds in controversy, then we have in the same bill — First, a cause of action to redeem and take from the Eastern Illinois Company all the property obtained by it from the Danville Company; and, second, a cause of action to acquire and appropriate bonds issued by the Eastern Illinois Company to secure and confirm its title to the property so sought to be taken from it.* Thus construed, the bill states two inconsistent causes of action; and the right to recover upon one theory is destructive of the right to recover upon the other. Such a bill cannot be maintained. It would be multifarious and self-contradictory.

“By multifariousness in a Dill is meant the improperly joining in one bill distinct and independent matters, and thereby confounding them; as, for example, the uniting in one bill of several matters, perfectly distinct and unconnected, against one defendant, or the demand of several matters of a distinct and independent nature against several defendants in the same bill.” Story, Eq. PI. § 271.

The objection of multifariousness ought ordinarily to be taken by demurrer, but the court may, however, take the objection at the hearing, sua sponte; for the court is not bound to allow a bill of such a nature, although the party may not take the objection in season. Greenwood v. Churchill, 1 Mylne & K. 559; Story, Eq. Pl., supra. The bill might, therefore, have been properly dismissed at the hearing by the court sua sponte, for multifariousness.

It is urged by counsel for appellants that a bill is not multifarious, and may well be maintained, where, upon a given case, there is a prayer for consistent alternative relief. The rule is undoubtedly well settled that upon a given case there may be prayers for consistent alternative relief; but Ave do not understand that alternative and inconsistent cases may be stated in the bill, coupled with prayers for alternative and inconsistent relief. If the appellants’ case was solely that the Eastern Illinois Company has no title to the property of the Danville Company, they might pray for various forms of alternative relief consistent with that case; but they cannot in the same bill make a case that it has no title, and also a case that it has a title, and then ask for inconsistent relief according to the different cases thus made. Such course of procedure we do not understand is warranted by tlie doctrine of alternative relief, ¡duck are alterna live cases, and not cases of alternative relief. They are inconsistent, for a decree of one of these forms of relief would proceed upon a theory fatal to the other form of relief.

In the case of Shields v. Harrow, 17 How. EH), the. original hill prayed that a certain agreement, made by way of compromise, should he set aside as having been fraudulently and improperly procured. Afterwards, the hill was amended by adding a prayer that if the court should he of the opinion that tlie agreement was valid, and ought not to be set aside, it would decree its specific performance. The court said:

‘‘Tlie court allowed the above amendment1. So that the bill thereafter presented, not only I wo aspects, but two diametrically opposite prayers for relief, rosiing upon necessarily inconsistent cases; (he one being that fhe court would declare the contract rescinded for imposition and other causes, and the other that tlie court would declare it. so free from all exceptions as to be entitled to its aid by a decree for specific performance. Whether this amendment be considered as leaving the bill in this condition, or as amounting to a.n abandonment of tlie original bill for a rescission of the contract and the substitution of a new MU for a specific performance, it was equally objectionable. A bill may be originally framed wifli a double a sped, or may be so amended as to be of that character. But the alternative ease staled must be the foundation for precisely the same relief, and it would produce inextricable confusion if the plaintiff were allowed to do wliat is a (tempted here. Story, Eq. Pl. 212, 213; Welf. Eq. Pl. 88; Edwards v. Edwards, Jac. 335. Nor is a complainant at liberty to abandon tlie entire case made by his bill, and make a new and different case by way of amendment We apprehend that the true rule on this subject is laid down by me vice chancellor in Verplanck v. Insurance Co., 1 Edw. Oil. 46.”

In Iko case before us the alternative eases stated cannot be the foundation for precisely the same relief, because, as we have already seen, a decree to be let in to redeem is not only inconsistent with, but absolutely destructive of, the right to a decree awarding the bonds in controversy to the appellants.

The cast of Williams v. Jackson, 107 U. S. 478, 2 Sup. Ct. 814, was a suit in the supreme court of the District: of Columbia by the holder of a debt secured by a, dot'd of trust, the main purpose of whirli was to set aside a l-elease negligently executed by the trustee to the grantor, and to satisfy the plaintiffs debt out of the land. The judge who heard the case' refused to set aside the release, and adjudged that Stiekney, as trustee, had fraudulently and negligently executed the same, and decreed that he should personally pay the debt The court at general term reversed that part of the decree which declined to set aside the release, and also that part which adjudged that the plaintiffs recover against: Htieknev the amount of their debt. On appeal from the judgment of the general term, the court said:

‘‘Bin: tluil decree, so far as ii refuses relief against Stiekney personally, Is right. The main purpose of tin' bill is to set aside Hie deed of release, and to satisfy Ilie plaintiffs’ debt out of (lie land. The attempt to charge Stiekney with ihe amount of Hint debt, by reason of liis negligence in exeeming the release, is wholly inconsistent with this. The one treats tin* release as void; the oilier assumes that it is valid. In 1he one view, Stiekney is made a party in his capacity of trustee only; in the other, it is sought to charge him per sonally. The joinder of claims so distinct in character and in rélief is unprecedented and inconvenient. Shields v. Barrow, 17 How. 130, 144; Walker v. Powers, 104 U. S. 246.”

The case of Micou v. Ashurst, 55 Ala. 612, contains an equally clear and explicit discussion of this doctrine. The court say:

“But we concur with the chancellor that the hill is not filed for redemption, nor could a decree be founded on it that the complainant be lot in to redeem. The averments of the bill are adapted only to a decree for the cancellation of the mortgage, because the debt is founded on an illegal consideration. As a general rule, a bill may be framed in a double aspect, or in the alternative, when either of the aspects or alternatives entitles the complainant to the same relief. But we do not understand that when a bill is filed for a distinct purpose, which wholly fails, whether on the facts stated, or on the proof, that it can be converted into a bill for another purpose. Nor do we understand that a bill may aver either one or the other of two alternatives is true when they are repugnant to and inconsistent with each other, and, if the one is true, entitling the party to relief wholly distinct from and repugnant to that which would be granted if the other was true. Now, if the consideration of the mortgage debt was illegal, violative of positive law, and offensive to public policy, a court of equity would not entertain a bill for redemption, nor foreclosure. The cancellation of the mortgage, as a cloud on the title of the mortgagor, would be, perhaps, the only ground on which the court would intervene. Averring the illegality of the debt, and the consequent invalidity of the mortgage, the appellant cannot then aver that he may be mistaken in this, and affirm their validity, and claim to redeem, especially when there is no averment of ignorance of the facts and of a necessity of a discovery. Suppose a bill of this character should be confessed by the defendant, what relief would the court grant? Which of the repugnant and inconsistent statements would he adopted? The averments of the'hill not authorizing the specific relief prayed, —the cancellation of the mortgage, and of the evidences of the mortgage debt, which was its primary purpose, and the specific relief prayed, — it should have been dismissed. Cresy v. Bevan, 13 Sim. 354; Shields v. Barrow, 17 How. 130.”

See, also, Sneed v. McCoull, 12 How. 407; Allen v. Spring, 22 Beav. 615; Maynard v. Green, 30 Fed. 643; St. Louis, etc., R. Co. v. Terre Haute, etc., R. Co., 33 Fed. 440, 448; Electric Accumulator Co. v. Brush Electric Co., 44 Fed. 602, 607; Rollet v. Heiman, 120 Ind. 511, 22 N. E. 666.

This last case was a creditors’ bill to set aside a conveyance and to reach assets. Speaking of the rule of construction applicable to such a bill, the court, by Mr. Chief Justice Elliott, say: “A pleading, as we have often held, is to he judged from its general scope and tenor, and so this complaint must be judged.” In the case before us, as in- the case last cited, we are disposed to construe the bill as one for redemption, rather than to construe it as a hill stating two inconsistent alternative cases. But whether construed in the one way or in the other, it is equally objectionable, and the court committed no error in dismissing it.

The motion of the appellee Walker to dismiss the appeal, so far as it concerns himself, is sustained; and the decree dismissing the original, amended, and supplemental bills against the Chicago & Eastern Illinois Railroad Company is affirmed, — both at the costs of the appellants.