People's Bank in Liquidation v. Pennington

102 So. 386, 137 Miss. 653, 1925 Miss. LEXIS 2

• Court: Mississippi Supreme Court
• Decided: January 3, 1925
• Docket: No. 24479; No. 23479
• Status: Published

Opinion

Sykes, P. J.,

delivered the opinion of the court.

The People’s Bank of Sumnér, J. W. and G-. C. Jenkins in their original bill claimed that the bank held a deed of trust superior to that of the two complainants Jenkins, and also to that of the defendant Pennington, on a certain tract of land. The bill further alleged that Pennington’s deed of trust was void because it had been fraudulently altered. Pennington claimed in his answer and cross-bill that his deed of trust was superior to both of those held by complainants and denied any fraudulent alteration. The cause was heard in the chancery court on pleadings and proof, and a decree was there entered in favor of the complainants. An appeal was prosecuted to this- court, and the decree of the lower court was reversed and the cause remanded. For former opinion see 132 Miss. 23, 95 So.. 694. The court, in effect, held that Penningdon had the first deed of trust on the land, and that there was no fraudulent alteration.

After the cause was reversed and remanded, the defendant Ploward R. Jenkins died, and his heirs were made parties to the suit. The complainants jointly, and then each one separately, filed a motion to- be allowed to dismiss their original bill, which motion was overruled by the court. The heirs of Howard R. Jenkins then filed answers and a cross-bill to the cross-bill of Pennington. This was objected to by Pennington. From the order denying the complainants the right to dismiss their original bill this appeal is here prosecuted, and Pennington prosecutes his cross-bill from the action of the court in allowing the answers and cross-bills of the heirs of Howard R. Jenkins to be filed.

The court was correct in allowing the heirs of Jenkins to file an answer and cross-bill. The cause was reversed and remanded generally. 'Any party to the litigation, under these circumstances, has a right, with the leave of court, to file any pleadings or amendments thereto that he so desires.

In the case of Haines v. Haines, 98 Miss. 830, 54 So. 433, it is said:

“When a judgment or decree appealed from is by the supreme court reversed and remanded to the trial court, such court has full power to allow any amendment to be made to the pleadings, which it had power to allow before the judgment or decree appealed from was rendered.

“The remanding of a case to the trial court is for the purpose of having it tried de novo, and such a court has the same power to allow amendments to the pleadings, when a case is remanded with directions to enter a judgment or decree in accordance with the opinion of the supreme court, that it has when a cause is remanded without any such direction.

“If on the trial in the court below the pleadings and proof present the same case that was before the supreme court on appeal the judgment or decree of the court should be in accordance with the directions given by the supreme court, but should the pleadings and proof then present a different case, the judgment or decree should be made to conform thereto.”

This rule is restated in the case of Middleton v. Davis, 105 Miss. 152, 62 So. 164. From this it follows that the chancellor was correct in allowing the heirs of Howard B. Jenkins to file appropriate answers and cross-bills.

In the case of Adams v. Commercial Co., 113 Miss. 608, 74 So. 435, it was held that section 802 of the Code of 1906 (section 590, Hemingway’s Code), which gives to every plaintiff the right to suffer a nonsuit if he elects to do so, before the jury retire to consider its verdict, is likewise applicable to the right of a complainant in tlie chancery court, and that a complainant has. the right to dismiss his bill at any time before the cause is submitted to the chancellor for a decision upon its merits; that this is an absolute right of the complainant, and no discretion is vested in the chancellor when timely application is made. The only limitation recognized to this general rule as therein stated is when “the defendant has secured some right by the filing of the bill which would be destroyed by the dismissal of the bill.”

This rule above announced was in no way modified by the opinion of the court in the case of Northern v. Scruggs, 118 Miss. 353, 79 So. 227. On the contrary, part of the Adams opinion is quoted with approval in the Scruggs Case. The bill in the Scruggs Case expressly stated that the land had not been properly sold under the deed of trust and that the defendants had an interest in the land.

In the case of State v. Hemingway, 69 Miss. 491, 10 So. 576, it was held that the defendants “had acquired rights by what had occurred which entitled them to object successfully ... to a dismissal.” Also in the Scruggs Case is this quotation from Coopers v. Lewis, 2 Phil. Ch. 131:

“The plaintiff is allowed to dismiss his bill on the assumption that it leaves the defendant in the same position that he would have stood if the suit had not been instituted; it is not so when there has been a proceeding in the cause which has given the defendant a right against the plaintiff.”

Tested by these rules, the defendant Pennington in this cause secured no rights by the filing of the bill. All of his rights are expressly denied in the bill. In this court the case was reversed and remanded generally; no directions whatever were contained in the mandate. Consequently, at the time of the application of the complainants to dismiss their original bill all rights affirmed by one side in the pleadings were denied by the other. No rights whatever because .of the pleadings had been acquired by Pennington.

For former opinion, see 102 So. 386. Hays, Stingily & Whitten, Cutrer & Smith and May,. Sanders & McLaurin, on suggestion of error for appellants.

It is suggested in the briefs that, because of the death of one of the defendants, certain testimony may not be admissible if the complainants be permitted to dismiss their original bill. This contention, however, has nothing to do with the legal question before us. We therefore conclude that the complainants as a matter of right are entitled to dismiss their bill in this cause.

Reversed in pari, and affirmed in part.

Wells, Stevens <& Jones and H. G. Mounger, on suggestion of error for appellee. • Argued orally by J. Morgan Stevens and H. (7. Mounger, for appellee.

Eti-iridge, J.,

On a former day the court considered this cause and reversed in part and affirmed in part the action of the court below, reversing the chancellor on his refusal to allow the complainants to dismiss their bill without prejudice. 102 So. 386.

A suggestion of error has been filed, and the court has reconsidered the cause, and we have reached the conclusion that we erred in reversing the chancellor on his refusal to allow the bill to be dismissed without prejudice.

The former opinion said:

“No rights whatever because of the pleadings had been acquired by Pennington.

“It is suggested in the briefs that, because of the death of one of the defendants, certain testimony may not be admissible if the complainants be permitted to dismiss their original bill. This contention, however, has nothing to do with the legal question before us.”

It will be seen that we were then of the opinion that the rights gained or lost in the former proceeding must be such as are contained -in the pleadings pf the ease, and therein we erred.

In the case of Adams v. Commercial Co., 113 Miss. 608, 74 So. 435, the court reached-the conclusion that section 802, Code of 1906, Hemingway’s Code, section 590, was applicable also to the chancery court, and it was there held that the only limitation of the rule is applied to causes wherein the defendant has secured some right by the filing of the bill which would be destroyed by the dismissal of the bill, and even then it is not a matter of discretion with the chancellor; it is a right of the defendant which controls.

In Schaffer v. Deemer Manufacturing Co., 108 Miss. 257, 66 So. 736, the court held that a nonsuit at law could not be taken after the trial judge had granted the peremptory instruction, using the following language:

“To permit a party to dismiss under such circumstances is, in substance, to grant him a new trial after he has been fairly defeated, and to deprive his adversary of the fruits of a fairly won victory. It is contrary to good sense and sound policy to allow a party to take his case from one court to another until fortune favors him with a judge who is willing to accept his view of the law or his construction of the evidence. “Such a mode of proceeding would,’ as was said in Conner v. Drake, 1 Ohio St. 166, 170, 'be trifling with the court as well as with the rights of defendants.’ One who is defending against a claim which he believes to be unjust ought not to be subjected to the expense of litigation which settles nothing. And since he is not permitted to choose another forum when it is discovered that the court is against him, it is manifestly unfair to give the plaintiff an unlimited freedom of choice”—citing Bee Building Co. v. Dalton, 68 Neb. 38, 93 N. W. 930, 4 Ann. Cas. 508.

In State v. Hemingway, 69 Miss. 491, 10 So. 575, 576, at page 506 of the Mississippi Report, the court said:

‘ ‘ Testimony had been taken in the cause, and a stipulation had been entered into between the solicitors on both sides as to certain matters of fact to be considered as proved, and certain letters and official reports were agreed to be received in evidence. Much of this agreed testimony relates to the inquiry on which bond liability is chargeable. The case had been heard by the chancellor, who, on the 14th of March, 1891, made a decree adjudicating that the conveyance is valid and enforceable in behalf of the state, but primarily for the exoneration of the sureties on the two bonds; that Hemingway was entitled to homestead exemption, and that sale should be made of the property embraced in the conveyance on certain terms (included in which was the consent of the Attorney General), and the net proceeds should be paid into the state treasury, with certain other matters relating to the administration of the trust property not necessary to be mentioned. The attack made by the bill on the conveyance had failed. Its prayer to enforce the conveyance as a security for the state was granted.

‘ ‘ The question where the liability, as between the two sots of sureties, should fall, was left open, with a reservation to the court of the right to do justice between them by final' apportionment of the proceeds of the trust property according to their rights upon adjustment of the respective liabilities. The decree made March 14, 1891, was based on, and could be justified only on, the assumption of a final decree, ascertaining where among the sureties liability is. The requisite parties were before the court; the trust property was in its possession; a decree had been made adjudicating the chief matter of controversy, and directing payment of money into the state treasury; testimony by depositions and agreements had been taken and filed; the cause had been set for final hearing, after the expiration of the time allowed for taking testimony, and it was too late to dismiss the parts of the bill proposed and allowed. The defendants had acquired rights by what had occurred which entitled them to object successfully, at that stage of the suit, to a dismissal.

“The decree already made in the cause, required, as its complement, a further'decree on the very matters as to which the bill was dismissed, without which that decree could not stand. It had been made, and the defendants were interested in its maintenance. In such a condition of things, it is not allowable for the complainant to dismiss against the objection of the other parties. The cases to this effect are numerous. Seymour v. Jerome, Walker’s Ch. (Mich.) 356; Watt v. Crawford, 11 Paige’s Ch. (N. Y.) 470; Cozzens v. Sisson, 5 Rhode I. Rep. 489; Bank v. Rose, 1 Rich. Eq. (S. C.) 292; C. & A. R. R. Co. v. Union R. M., 109 U. S. 702 [27 L. Ed. 1081.], which last case contains an extensive review of authorities on the subject, English and American. All seem to agree that, in the stage at which this case was when the dismissal occurred, it was not allowable to dismiss without the consent of all concerned.”

In the case of C. & A. R. R. Co. v. Union Rolling Mill Co., 109 U. S. 702, 3 S. Ct. 594, 27 L. Ed. 1081, the United States supreme court discussed the case fully, which case was cited in the case of State v. Hemingway, supra, by our court with approval. In that case the United States supreme court (109 U. S. 713, 714, 3 S. Ct. 601, 27 L. Ed. at pages 1085, 1086) said:

“It may also be conceded that, as a general rule, a complainant in an original bill has the right, at any time upon payment of costs, to dismiss his bill. But this latter rule is subject to a distinct and well settled exception, namely: That after a decree, whether final or interlocutory, has been made, by which the rights of a party defendant have been adjudicated, or such proceedings have been taken as entitle the defendant to a decree, the complainant will not be allowed to discuss his bill without the consent of defendant.

“The rule is stated as follows in Daniel’s Chancery Practice, p. 793 (5th Am. Ed.): ‘After a decree or decretal order the court will not allow a plaintiff to dismiss his own bill, unless upon consent, for all parties are interested in a decree, and any party may take such steps as he may be advised to have the effect of it.’

“The same writer, page 794-, says that, ‘After a decree has been made, of such a kind that other persons besides the parties on the record are interested in the prosecution of it, neither the plaintiff nor defendant, on the consent of the other, can obtain an order for the dismissal of the bill.’

‘ ‘ The rule, as we have stated it, is sustained by many adjudicated cases. It was laid down by the Lord Chancellor in Cooper v. Lewis, 2 Phill. Ch., 181, as follows: “The plaintiff is allowed to dismiss his bill on the assumption that it leaves the defendant in the same position as he would have stood if the suit had not been instituted; it is'not so where there has been a proceeding in the cause which has given the defendant a right against the plaintiff. ’

“In Bank v. Bose, 1 Rich. Eq. (S. C.) 294, it was said: ‘But whenever, in the progress of a cause, the defendant entitles himself to a decree, either against the complainant or a co-defendant, and the dismissal would put him to the expense and trouble of bringing a new suit or making new proofs, such dismissal will not be permitted. ’

“So in the case of Conner v. Drake, 1 Ohio St. 170, the supreme court of Ohio declared: ‘The propriety, of permitting a claimant to dismiss his bill is a matter within the sound discretion of the court, which discretion is to be exercised with reference to the rights of both parties, as well the defendant as the complainant. After a defendant has been put to trouble in making his defense, if in the progress of the case rights have been manifested that he is entitled to claim and which are valuable to him, it would be unjust to deprive him of them merely because the complainant might come to the conclusion that it would be for his interests to dismiss his bill. Such a mode of proceeding would be trifling with the court as well as with the rights of defendants.’ ”

In the former appeal of the case before us in 132 Miss. 23, 95 So. 694, the facts as then developed were fully set forth. At page 33 of the Mississippi Report the court held that the chancellor was not warranted by the evidence in finding that the People’s Bank’s deed of trust was a prior one and that of Pennington was a secondary one or subordinate to that of the People’s Bank or G. C. and J. W. Jenkins. The court further held that all of the documents in evidence, including the recordation of the instruments, showed that Pennington’s deed of trust had priority and that Pennington had a first lien on the land. The court further held that the evidence did not show that Mr. Rowland, the cashier of the People’s Bank, who had the deeds of trust recorded, was the agent of Pennington, but held that the evidence showed that Mr. Rowland was the agent of the bank. In other words, the court then found on the record before it for Pennington in several important and decisive particulars and announced the law of the case which it would be the duty on a new trial of the court below to follow. It left open for determination the question as to whether the deed of trust given to Pennington by H. R. and Elizabeth Jenkins matured in 1921 or in 1926. It is true that the judgment of the court and the mandate thereof contained nospeeific directions and was generally reversed and remanded.

Since the decision of the -court in 132 Miss. 23, 95 So. 694, referred to, one of'the complainants and cross-defendants, Howard R. Jenkins, has died, and both Howard R. Jenkins and Ben T. Pennington testified in the former case. The case had been tried in the court below, judgment of the chancellor rendered, appeal taken to this court, and judgment of this court obtained on the controversy as it then stood in its most vital particulars By these proceedings Pennington acquired important rights. To permit a dismissal of the bill without prejudice now would certainly be to deprive him of important rights which he has obtained.

The defendants to the cross-bill filed by Pennington are in possession of the property upon which the deed of trust was given. The deed of trust had been foreclosed by Pennington prior to the filing of his cross-bill, and by his cross-bill he sought to obtain possession of the land involved.

The People’s Bank, Gr. C. Jenkins, J. W. Jenkins, and H. R. Jenkins, and Elizabeth Jenkins, were complainants to the original bill and set forth their contentions therein and had answered the allegations of Pennington’s cross-bill. Since H. R. Jenkins has died, his heirs stand in his place in the suit. It is important to all of the parties that the rights of both Pennington and of the Jenkinses be settled. Their rights are so interrelated with the rights of the People’s Bank and with the bank’s claims that it would be difficult to proceed without having the whole issue determined in one cause. It might be a vital thing to Pennington’s rights or claims to be deprived of his own testimony, and we think it would be unfair and unjust and contrary to the general public policy of having litigation settled to permit a dismissal of the bill without prejudice which would or might have the effect of changing the strategical position of the parties.

On the cross-appeal the appellants, of course, would be permitted to make such amendments as might be necessary to secure their rights, provided such amendments do not change the scope ánd purpose of the lawsuit. The appeal being for the purpose of settling principles, we do not undertake to decide precisely whether the pleadings filed are exactly what they should he. We leave that matter to be passed upon by the chancellor in the light of what we have said in our former opinions as well as in this opinion.

The suggestion of error will therefore be sustained to the extent indicated, and the judgment on both direct and cross appeals affirmed.

Suggestion of error sustained in part and cause a/firmed.