20 Minn. 422 | Minn. | 1874
The defendant, Stanchfield, as author of the.defective mortgage, is in equity bound to correct the mistake, and as against him the respondent states a good cause of action by the averments in the complaint, showing the loan of money, the agreement for a mortgage, and . the mistake through which the premises agreed to be mortgaged were not correctly described in the instrument as executed.
But this portion of the complaint, while sufficient as against Stanchfield, fails to disclose any cause of action against the appellant; for it will not be claimed that the existence of the mistake in Stanchfield’s mortgage to the respondent raises an equity in favor of the respondent as against all the world, and that he may at his pleasure make any third person, a stranger to the mortgage, a party defendant to a suit for its reformation.
While it is in some cases difficult to determine who should be made parties to a suit in equity, the rule is well settled that the complaint must show that the person sought to be made defendant has an interest in the subject matter of the action ; (1 Dan. Ch. Pr. 3d Am. Ed. 239, 330, 582 ; Story, Eq. Pl. §§ 226, 231, 519,) and it is not sufficient that the defendant may be in some way affected by the decree.
To meet this requirement, the complaint proceeds to allege the insurance of the buildings, forming a part of the premises intended to be mortgaged, the amount of the insurance being less than the mortgage debt; the agreement between Stanch-field and the respondent for an assignment of the policy, as further security for the mortgage debt; the so-called assignment, whereby the policy is made payable to the respondent to the extent of his claim; the destruction of the buildings by a peril insured against; the continuing existence of the mortgage debt, larger in amount than the sum named in the policy ; the commencement and pendency of an action by the
The grounds, upon which the respondent claims that this ac-. tion is properly brought against the appellant, are stated as follows in the fourth point made by his counsel: “ It is manifest that the only claim the plaintiff has” (to recover the insurance money) “ is through the mortgage. The defendant, being interested in the property through its insurance, has a right to contest the allegations in the complaint, as, if they ai'e not true, the plaintiff has no cause of action against the company; and a reformation of the mortgage would not bind the company unless it were made a party. Hence it is a proper party defendant, and not only a proper party, but a necessary party, inasmuch as it has an interest, to the extent of its insurance, in the mortgaged property. And if the defendant could prove the allegations of the complaint untrue, manifestly it has a full defense to the action now pending on the policy of insurance.” «
The ,position that the appellant acquired by its insurance an interest in the mortgaged property, is wholly untenable. It needs no argument to prove that the contract of insurance vests in the underwriter no estate, interest, or lien, legal or equitable, in or upon the real estate insured.
The remainder of this fourth point has no tendency to show any interest on the part of the appellant in the subject matter, or even in the event of this suit. The respondent argues that as he is interested in obtaining judgment against the appellant in aid • of bis suit on the policy, therefore this action is properly brought; but this is to found the appellant’s liability not on its own, but on the respondent’s interest. The respondent’s argument seems to ignore the relation which the appellant holds toward the other parties to the suit. It
The appellant’s entire want of interest in the claims of respondent and Stanchfield to the insurance money, is further apparent from the circumstance, that upon the facts alleged in the complaint, the appellant might well exhibit its bill of interpleader against the other parties, to compel them to litigate their rival claims to the fund in its hands (Warington vs. Wheatstone, 1 Jac. 202;) and nothing is better settled than that a bill of interpleader will only lie in favor of a plaintiff who has no interest, and against defendants claiming in privity with each other. 2 Dan. Ch. Pr. 1659; Story Eq. Pl. §§ 291, 293.
The appellant, claiming nothing' under the mortgage, and having no interest that will be affected by its reformation, can be in no wise injured by any judgment that may be rendered against Stanchfield as sole defendant in this action. A judgment for the relief asked in the complaint would conclusively establish, as against Stanchfield, that since the first day of February, 1869 — and therefore at the time of the loss — the respondent was, in equity, a mortgagee of the insured premi
A stranger to a judgment, which is offered in evidence against him, has a right to avoid it by plea and proof, if it was erroneously rendered, and if his rights would be injuriously affected by it. (Inman vs. Mead, 97 Mass. 314 ; Downs vs. Fuller, 2 Metc. 138; Sidensparker vs. Sidensparker, 52 Me. 488.) But in most cases where judgments are offered in evidence against strangers, as muniments of the title of the person claiming under them, such strangers, having no interest in the suits in which the judgments were rendered, are in no wise injuriously affected thereby. It is accordingly held, in such cases, that the judgment cannot be attacked, except for want of jurisdiction in the court rendering it. Thus, in Secrist vs. Green, the former was not permitted to attack the record of proceedings in partition, to which he was a stranger, and under which Green claimed title. The court say : “ The jurisdiction of the court being once established,^its subsequent proceedings cannot be collaterally questioned. Secrist is a stranger to the proceedings, and cannot object to a result, of which the parties to the decree do not complain.” And see
In Koogler vs. Huffman, which, like Secrist vs. Green, was an action of ejectment, it was necessary for the plaintiff to prove a conveyance of the land in question from one Dewees to one Boatwright. For this purpose he offered in evidence a decree in a suit in equity between Boatwright and one Delezaire, the agent of Dewees, directing that Delezaire, as such agent, should make a deed to Boatwright. Huffman made various objections to the decree, as that Dewees was not a party to the suit in equity, etc.; but the court held that the decree and deed were properly admitted in evidence, and that the decree could not be attacked collaterally by Huffman, although he was a stranger to it. The ground of this decision was that Huffman had no interest in the suit, and therefore could not be prejudiced by the decre®. In the language of the court, “This decision (in the suit in equity) affected none of the rights of the defendant. And it is not for him, a stranger, to complain that justice has not been done to Dewees. * * * * There is no possible view, which can be taken of the effect and operation of this decree of the court of equity, in which it will appear that the rights of the defendant have been affected. Where, then, is the ground of objection 1 If the land was Dewees’ the right is transferred; if not, the decree avails nothing, and the defendant might prove to whom it does belong.”
Had this mortgage been reformed, either by act of the parties or by judicial decree, prior to the loss, we presume that no question would have been raised as to the effect of such reformation in a suit on the policy. But the circumstance that the present action was commenced while a suit on the policy was pending, does not render the decree, that may be rendered against Stanchfield, of any less effect against the appel
“ The objection to this record is, that it is res inter alios acta. But it is no more obnoxious to such an objection than would be a sheriff’s deed, where the judgment, etc., are evidence to support it. * * * A party may often go behind his deed to his article of agreement to fix the commencement of his title. Here the commencement of the plaintiff’s title was an element in the proceedings, and they show it, and it is prima facie established, by the decree. The defendants were, not precluded from showing the contrary, notwithstanding the decree. If the plaintiff had held a written transfer of the equitable interest, of the date of the actual transfer of possession, I presume no one would have thought of objecting to it as incompetent evidence. It would, however, have been but another mode of showing that the equitable owners had transferred the property to him, but not the only one.
“ The whole proceedings were evidence of title, and given in evidence as title, with no more effect than title derived in any other way, and they show, (and were evidence for that purpose,) the whole title, when it began and when consummated. The other side might have controverted any step in it if they could. It clearly established the plaintiff’s equitable ownership of the property at and before the insurance was effected. * * * We think there was no error in admitting the record in evidence, nor in the effect allowed to it by the learned judge in his charge.”
If the court in this opinion intended to hold that the decree
The complaint not only fails to show that the appellant is interested in the subject matter of the suit, but it also fails to show any privity between it and the respondent. “ In all cases of mistake in written instruments, courts of equity will interfere only as between the original parties, or those claiming under them in privity; such as personal representatives, heirs, devisees, legatees, assignees, voluntary grantees, or judgment creditors, or purchasers with notice.” (1 Story Eq. Jur. § 165.) The word “ privity ” is here used in its proper meaning, and in accordance with the approved definition of Prof. Greenleaf, viz.: “ mutual or successive relationship to-the same rights of property.” 1 Greet. Ev. § 189.
While between the respondent and Stanchfield there exist
It is unnecessary to discuss the exceptions to the rules requiring interest and privity. They are collected in the works cited, and have no bearing on the. present case.
As the complaint states no cause of action against the appellant, it is evident' that it does not unite two causes of action against it, and that this action is not for the same cause as the suit brought by the respondent to recover the insurance money. The second and third grounds of demurrer are therefore untenable. The first was very, properly abandoned upon the argument.
The order overruling the demurrer is reversed.