93 F. 16 | U.S. Circuit Court for the District of Western Tennessee | 1898
(after stating the facts as above). No affidavit or other proof has been filed on either side to support the remarkable statements of this original and amended bill, or the not less remarkable statements of the answer which has been filed to it;
The slightest inspection of this record shows that there are the gravest questions of our jurisdiction, both as relates to the parties and the subject-matter, under the acts of congress regulating removals from the state courts of suits between citizens and aliens, and forbidding the federal equity courts to entertain jurisdiction where there is a plain, adequate, and complete remedy at law. Acts 1887-88, cc. 373, 866, § 2 (2Í Stat. 552; 25 Stat. 433); 1 Supp. Rev. St. pp. 611, 612; Rev. St. § 723. Nor are these questions any less intricate when complicated with the irregularities of practice that have taken place in this case by filing an amended hill in the state court after the petition and bond for removal had been filed; by filing the record in this court, without any application or leave of the court, before the time prescribed by the removal act for its transmission to this court; by filing the defendants’ answer without like leave to file the record "here; and by submitting this motion for a receiver upon an irregular record, with no proofs, by affidavits or otherwise, in support either of the hill or the answer, the oath to which is waived; the bill and answer being also flatly contradictory in almost every statement,and especially as to the “residence” of the defendants seeking to remove the case, so essential, under the act of 1887, to be established for purposes of jurisdiction by removal under that act. The bill says they are residents of Shelby county, Tenn., and the petition for removal says they are residents of California, — oath against oath. The petition for removal also avers that the defendant husband is, and was at the time suit was begun, “a citizen of Great Britain,” and the wife a citizen of California; and it is by no means certain that this is a sufficient description of his national character, though the case may be distinguished, probably, as to that expression, being the equivalent of the more technical form of ancient usage,- — “an alien, and a subject of the queen of the United Kingdom of Great Britain and Ireland,” or “an alien, and a subject of the kingdom of Great Britain.” Stuart v. City of Easton, 156 U. S. 46, 15 Sup. Ct. 268. Besides this, it has not yet been definitely settled, so far as we are advised, whether or not the defendant wife by her marriage to an alien has not herself become an alien, at least so far as the right to sue, and the liability of being sued, in the federal courts are concerned. Pequignot. v. City of Detroit, 16 Fed. 211; Comitis v. Parkerson, 56 Fed. 556. It also appears that the plaintiffs are citizens of New York, so that the suit is one in which none of the parties are citizens, inhabitants, or residents of the state in which the land in controversy lies, and in which the suit is brought, if the removal petition states the truth, but citizens of another state are suing defendants, who are both aliens, it may be; and, while the petition says they are “residents” of California, the hill says they are “residents” of Tennessee. Cooley v. McArthur, 35 Fed. 372; Cudahy v. McGeoch, 37 Fed. 1; Walker v. O’Neill, 38 Fed. 374; Sherwood v. Valley Co., 55 Fed. 1. Is an alien a “resident” of any state, within the purview of this act of congress? Steamship Co. v. Kane, 170 U. S. 100, 18 Sup. Ct. 526; Railway
The questions arising under Rev. St. § 723, as to an adequate remedy at law, are quite as complex as any above noted: Whether, if this be a bill “to remove a cloud” , from the title of the plaintiffs, they can sustain it, being out of possession. Lacassagne v. Chapuis, 144 U. S. 119, 12 Sup. Ct. 659; Whitehead v. Shattuck, 138 U. S. 146, 11 Sup. Ct. 276; Scott v. Neely, 140 U. S. 106, 11 Sup. Ct. 712. Whether the filing of an answer has waived this objection. Reynes v. Dumont, 130 U. S. 355, 9 Sup. Ct. 486; Kilbourn v. Sunderland, 130 U. S. 505, 9 Sup. Ct. 594; Betts v. Lewis, 19 How. 72; Reynolds v. Watkins, 9 C. C. A. 273, 60 Fed. 824; Wait v. O’Neil, 22 C. C. A. 248, 76 Fed 408; Id., 72 Fed. 348. Whether it is in fact a bill to remove a cloud, and not maintainable, or is in fact a bill to rescind one’s deed of gift for want of consideration, or (taking the irregularly filed amended bill into consideration) a bill to enforce the devises of a will, or one to enforce the trusts of a settlement by deed of gift to protect a married woman, or the specific performance of a contract to share the “proceeds” of real estate, and for its “management and control,” and therefore maintainable, in some of these aspects, under the general prayer for relief, although not under the special prayer to remove a cloud. Inconsistent as these many-sided claims for relief may be, under a general prayer, there being no demurrer or plea to the jurisdiction,, whether or not, ¿gain, the filing of the answer has not waived all objections in that behalf; a plea only being appropriate to present the antagonistic facts set up in the answer as against the jurisdiction of a court of equity to entertain the bill in any aspect. This opens a rather wide field of inquiry as to the effect of Rev. St. § 723, on a bill so inartistic as this, and so destitute of any interpretation by its prayer of what is wanted in the way of relief, except that a receiver is wanted, as if that might be the main purpose of the bill, instead of an incidental purpose, dependent upon a fairly made out case of prima facie right to the property, through established methods of equitable relief or remedy, and not á mere action at law to recover a possession wrongfully withheld, which an action of ejectment would remedy, in some of its aspects, at least. Where is the legal title to this property, in the view of the bill? Clearly, in the plaintiffs, — one or both. Then why would not ejectment lie? If one out of possession cannot, in a federal court of equity, maintain a bill to remove a cloud from the legal title, particularly when the alleged cloud is one’s own deed, not denied as to its execution, but only as to its effect, there being a failure of consideration, if the question of jurisdiction be open, notwithstanding the answer, shall the case be remanded to the ’state court, if such a jurisdiction may be exercised there, be docketed here on the law side as an action at law rightfully removed, upon a rule
The question whether the court or judge may or shall remand the case for want of jurisdiction on the occasion of an application for a receiver, or other extraordinary action, made in the time intermediary from the filing of the removal petition in the state court to the first day of the next term of the federal court, to which alone the record is returnable, by the very terms of the statute, has never been authoritatively decided, so far as I am aware. Kev. St. § 639; Act 1875, § 7 (18 Stat. 472); 1 Supp. Rev. St. p. 83; Acts 1887, 1888, § 3 (24 Stat. 552; 25 Stat. 433); 1 Supp. Kev. St. pp. 611, 613; Frink v. Blackinton Co., 80 Fed. 306; Hamilton v. Fowler, 83 Fed. 321.
Nevertheless, it would seem that, if the court within that time may take extraordinary jurisdiction for extraordinary purposes, it might and should then and there remand the case, if it have no jurisdiction, without pretermitting that fundamental inquiry to a later date; especially if the parties were likely to suffer injury by a long delay between terms, as in this case of quite five months between the two dates. The rigid rule that the federal court can acquire jurisdiction only strictissimi juris, that its jurisdiction is defeated unless the record is filed strictly according to the statute, and that it has no power to proceed, or authority over the case, generally, until that date arrives, must, ex necessitate rei, yield to the circumstance that the injury of a suspension of jurisdiction between the two courts, as if between the heavens and the earth, may involve the parties in serious loss, and the court in the embarrassment of appointing a receiver where there is no jurisdiction to do anything at all in the premises, instead of remanding the case at once to a court competent to deal with that question without any embarrassment. Either the relief that comes of remanding the case under such circumstances must be classed with that of granting injunctions, dissolving them, appointing receivers, and the like, as extraordinary relief, which, like the others, the court may grant, within the time, as of necessity, against the general rule, or else section 3 of the act
“In the construction of statutes, too, judges have sometimes gone contrary to the general words of it. They have expounded the words of an act contrary to the text, to make it agree with reason and equity.”
Again, in Levinz v. Will, 1 Dall. 430, 433, while construing statutes, the court observes that:
“In doubtful eases, therefore, we may enlarge the construction of an act of assembly, according to the reason and sense of the lawmakers, either expressed in other parts of the act itself, or guessed by considering the frame and design of the whole.” Citing Arthur v. Bokenham, 11 Mod. 161.
If the act, therefore, may be so enlarged as to take jurisdiction before our term for some extraordinary purpose, it may be so enlarged as to effectuate that same purpose by some other extraordinary relief, if need be.
The foregoing questions as to our jurisdiction have engaged, therefore, my serious attention, with the purpose of immediately remanding the case, if it should be found that we certainly were without any jurisdiction of it, and that it ought to be remanded. But, as now advised, it seems that we have jurisdiction both of the parties and of the subject-matter, as a court of equity. However that may be, for the present the jurisdictional questions are reserved for the progress of the case, as the parties may be advised in the premises. For the purposes of this application, the bill will be treated as well filed in equity, at least for the purpose of letting an equitable, if not a legal, joint tenant into the' enjoyment of her share of the rents and profits under the deed from the feme defendant to the plaintiffs. It is true that an action of debt or assumpsit might lie for any share of the rents collected and -wrongfully withheld, but
The bill is sworn to, and there is not an item of proof otherwise offered in support of the application for a receiver. Concede that it may be used as an affidavit in support of the application, and it is fully met by the sworn answer of the defendants, which flatly contradicts every essential statement of the bill. The oath to the answer is waived, and it is thereby, perhaps, even on an application for a receiver made by the plaintiff, shorn of the ordinary force of an answer in chancery as proof on all the issues of the case. Yet it is as good as the bill, as an affidavit, and then we have an exact equilibrium of proof as to the facts, — oath against oath, and nothing more on either side. But the one is the oath of a claimant of ownership in possession, in support of that possession; and the other, of a claimant out of possession, seeking to establish an adverse claim of ownership. The circumstances of this possession do not distinctly appear. The’ bill says — incidentally, somewhat — that plaintiff Iris C. Ryder, on account of her devotion to defendant Marie, “has permitted her and her husband to act as the agent” of the plaintiffs “in the collection of the rents, permitting the said Marie Bateman and Louis T. Bateman to enjoy a portion of said rents when so collected”; that this was their only means of livelihood; that they have taken advantage of this “generosity,” and now setup an exclusive right to the property under the deed of gift, denying all right of plaintiffs, having “accounted to complainant for an insignificant amount of the rents they have collected.” The answer treats this part of the bill somewhat obscurely, and sets up adverse possession in defendant Marie ever since the deed of gift, about 20 years, that the possession of the plaintiff was held as guardian or trustee for the defendant Marie, that she has never accounted to defendant, but has appropriated the money largely to her own use, and misappropriated much of it by “gambling in the bucket shops.” The result of this, as evidence, is that the defendants substantially deny any agency, and claim the possession as one in their own right; and again it is only oath against oath, with the burden of proof on the plaintiff. Thus it is with all the important facts, — as to the proof of them, the burden of proof being always on the plaintiffs, it must be remembered. The bill says that the original deed of gift was never delivered.. The answer says it was. The fact that it went to record appears, and is not denied, which is a corroborating circumstance, if not a conclusive one, in favor of delivery, standing
Coming now to the plaintiffs’ claim under the will of their father and grandfather, it appears by the bill that at the very least the plaintiff Iris C. Ryder had a life estate in this property, which passed under her deed to the defendant, and that of itself will support her possession as a rightful one, until the deed of gift is rescinded by a decree on this bill; and the real question,' on the application for a receiver, is whether it appears probable that the deed of gift will be rescinded at the hearing upon the proof offered to sustain the application. The plaintiffs must show at least a prima facie case of right by the proof adduced. The want of it has already been pointed out; but, more, if the facts stated for rescission should be proved at the hearing, it is very doubtful if they would sustain a decree for rescission, except as to the fact of nondelivery, and, as to that, the bill contains no averment of a single circumstance to militate against its delivery for record, as before pointed out. Again, the answer sets up the fact that a court of competent jurisdiction, with these plaintiffs and defendants before it, has construed the grandfather’s will to have devised to the plaintiff Iris C. Ryder, not a life estate, with remainder to her children, but an absolute estate in fee. A certified copy of this decree is not furnished here, and possibly the mere statement of the answer is not proof of the fact; but it presents an issue of fact, at least, which, as an issue, may be considered on this application as to the probability of plaintiffs’ success at the hearing.
The amended bill presents a claim by the plaintiff Iris C. Ryder to be let into possession as a substituted trustee for Adams, the original trustee, who has died. For the present application it is sufficient to say that, on the case made by the bill alone, it is scarcely possible that a court of equity would install as trustee for a married woman one who denies the title of the beneficiary, repudiates
The disputed deed from the defendant to the plaintiffs presents an altogether better claim for them to be let into possession for at least their share of the rents. It is very peculiar in its form, and may be of doubtful construction as to its legal effect. As a mere contract to allow the plaintiff Iris O. Ryder “to manage and control” the property, as it is suggested by the amended bill to be, it may not be irrevocable by the defendant, notwithstanding its agreement that it shall be “irrevocable”; for surely no court of equity would enforce such an agreement, when the “management and control” were in the hands of one who since its execution had set up adverse claims to the property, denying not only the title of the grantor, but its effect as reserving anything by it to herself. Courts of equity do not compel any one to keep, on the score of agency, their property rights, whatever they may be, in the control of hostile agents or trustees claiming for themselves against the trust or agency, and may even relieve against a contract to that effect, as unconscionable. But even if the deed goes further, and reconveys to Iris C. Ryder the estate she held before, still it plainly reserves to the defendant a share of the property; and, as before, a court of equity will not compel one co-tenant to submit absolutely the control to another co-tenant, who denies all share to the other, or all interest, as the plaintiff does here. And yet that control is the relief asked by the bill. It is precisely on this principle that the defendant cannot keep possession, absolutely, if that deed be valid; and for precisely that reason, if the alleged danger by insolvency, extravagance, and wastefulness were proved, a receiver should be appointed, and would be, if the execution of the deed had been admitted by the answer. But, as always before, the answer denies the existence of the deed, avers it is fabricated and forged; and again there is only oath against oath as to the fact, with the burden of proving it on the plaintiffs. The deed itself is not exhibited, but only a copy, and it appears by the answer that the plaintiff refuses to disclose it and to allow the defendants to see it; and by other proceedings in the case it appears that she puts the defendants to their bill of discovery to obtain a sight of the original documentas she has a right to do, according to our decision herein. But, notwithstanding that right, the fact that the document is withheld is to be taken as a suspicious circumstance against the plaintiff on this application. The ground for withholding it is stated to be that the defendant Louis T. Bateman is not a proper person to have possession of papers, but, if that be so, the danger could be guarded, according to the practice, by depositing the deed with the
The alleged insolvency of the defendants is denied, and there is no proof of it, nor of any fact or circumstance from which it may be inferred, — again, mere oath against oath of interested parties, But no allegations of insolvency can strengthen the application, under the circumstances above set forth. If the property belongs to the defendants, they are shown by its ownership not to be insolvent, in the sense of having no property at all; and it is not to be held that every man is to keep enough property, outside of that which is claimed adversely, to protect him from being ousted by a receiver from that which he has. The bearing of the fact of insolvency is often misunderstood on an application for a receiver, and often, erroneously, it is supposed to be controlling. An insolvent party has the same right as another to enjoy his own until a better title is displayed. If a plaintiff sets up a case where the defendant is under some sort of obligation to pay over the rents to some one else, and he be insolvent, that fact might be controlling, perhaps; but not if he claims as owner, and is in possession and enjoyment as owner, absolutely. Then, if his right of ownership be challenged, the plaintiff must show something more than the challenge, to be entitled to a receiver pending the litigation. He must show a probably better right of ownership; otherwise insolvency is quite immaterial. If the corpus be in danger, there might be a better claim against an insolvent in possession of disputed property. Here the answer denies all charges of mismanagement; avers that taxes and mortgage interest are promptly paid, and repairs kept up as required.
One cannot read this bill and answer without the suggestion that it may have been improvident that the mother or foster mother, as the fact may be, should have given this large and valuable property to her child or foster child, subjecting herself to possible deprivation through that ingratitude of a thankless child which is “sharper than a serpent’s tooth”; but, bitterly as she may now regret the deed, the courts cannot revoke the gift, beyond the rules of law. The deeds of grantors and donors must operate according to their terms, and cannot be rescinded because of the neglect of filial duties
In the case of Sage v. Railroad Co., 125 U. S. 361, 376, 8 Sup. Ct. 891, Mr. Justice Harlan observes that:
“Whether a, receiver shall he appointed is always a matter of discretion, to be exercised sparingly and with great caution, * * * and always with reference to the special circumstances of each case as it arises.”
The case of Owen v. Homan, 3 Macn. & G. 378, 4 H. L. Cas. 997, is perhaps the leading case on this subject, and is appropriate here. It is there said that:
“The granting of a receiver is a matter of discretion, to he governed by a view of the whole circumstances of the case, — one most material of which circumstances is the probability of the plaintiff being ultimately entitled to a decree.”
In another case (Bainbridge v. Baddeley, 3 Macn. & G. 413) it is said there are two grounds only for appointing a receiver:
“(1) That there is a reasonable probability of success on the part of the plaintiff; and (2) that the property, the subject of the suit, is in danger.”
In Vose v. Reed, 1 Woods, 647, Fed. Cas. No. 17,011, Mr. Justice Bradley lays down substantially the same rules for the guidance of the courts as found in the other cases.
Chancellor Kent, in Verplank v. Caines, 1 Johns. Ch. 58, remarked that:
“The court ought not to interfere pending litigation, when the plaintiff’s right is not perfectly clear, and the property itself, or the income arising from it, is not shown to be in danger.”
That is the universal rule in cases like this, — reasonable probability of plaintiff’s right, and danger to the property, established before the hearing by sufficient proof to satisfy the court of both these conditions.
And in Houlditch v. Lord Donegall, 1 Ball & B. 402, it has been observed:
“That such interference is, to a certain extent, giving relief, — in fact, depriving the defendants of a present use and enjoyment of the estate, and so far a decision pro tempore against them; and therefore, without some strong necessity, the court ought not to do any act to disturb the existing possession, until, from a view of the whole case by a regular adjudication, it can pass upon the right.” Willis v. Corlies, 2 Edw. Ch. 281, 286.
In Baird v. Turnpike Co., 1 Lea, 397, the court, in determining whether a decree appointing a receiver may be superseded, remarks that such an appointment is extraordinary process; that ordinarily it cannot be superseded by the appellate court, unless “it would affect possession which is itself a right,” where the contest is over the legal title to land; and the intimation is that in such a case there is the want of power to appoint a receiver. Possibly that may be going too far, but it shows with what solicitude courts protect the possession of one having a prima facie right to it, against a plaintiff who does not show a better prima facie right at the time of the application.
“It is a contest as to the -title of the land, the complainant being in possession; and, until it is determined at the hearing that her title is invalid, she cannot be disturbed in her possession.” 2 Daniel, Oh. Prac. (6th Ed.) 1715, 1718, 1720, 1725.
This author notes that:
“A receiver may be appointed against a party having possession under a legal title. Thus, where fraud can be clearly proved, and immediate danger is likely, to result, if the intermediate possession should not be taken under the care of the court, a receiver may be appointed.”
For which he quotes in the notes Lord Eldon’s observation to that effect in Lloyd v. Passingham, 16 Ves. 70; saying, also, that “the court interposes against the legal title with reluctance.”
This doctrine is approved by the supreme court in Wiswall v. Sampson, 14 How. 52, 64, where it is thus stated:
“If the person holding the legal interest is not in possession, the equitable claimant against the property is entitled to the interference of the court, not only for the purpose of preserving it from waste, but for the purpose of obtaining the rents and profits accruing, as a fund in court to abide the result of the litigation. And the court will also appoint a receiver, even against a party having possession under a legal title, if it be satisfied such party has wrongfully obtained that interest in the property. Thus, "where fraud can be proved, and immediate danger is likely to result, if- possession pending the litigation should not be taken by the court in the meantime.”
The text writers are equally explicit on this subject, and cite innumerable cases following the lead of those already cited here. High, Rec. §§ 19, 20, 591-603, et seq.; Beach, Rec. §§ 5, 7, 67-70, 72, 480-484, 486, 488, 489; 3 Pom. Eq. Jur. §§ 1330-1335; Beach, Mod. Eq. Jur. §§ 931, 933, 936, 941; Beach, Mod. Eq. Prac. § 720.
The case of Hugonin v. Basely, 13 Ves. 105, wherein a receiver was appointed, has some features quite similar to this case, but the distinctions between the two are apparent. A widow, with an estate in Jamaica, lamenting her destitute condition, without consideration executed a conveyance to her clergyman, as a friend she could trust to manage her affairs; reserving for herself only an annuity of an amount about equal to the rental value. Lord Chancellor Erskine was embarrassed by the fact that the legal estate and possession were with the defendant, but there being “a very strong probability that the plaintiff had the title to call back this estate, and because of the suggestion of counsel that one standing in the capacity of a trustee could not take a bounty from the cestui que trust without great suspicion of undue influence,” appointed a receiver pending the litigation. That was a case of a donor seeking to recover the estate from a donee who was at the same time trustee for the reserved interest, upon the ground of undue influence. This is the case of a donor without any reserved interest seeking to recover from the donee, for whom at the same time she is a trustee, upon the ground that the donee is not in fact the donor’s daughter, as the
Mr. High in his work on Receivers, as do the other authors cited, states that the insolvency of a defendant in possession does not of itself warrant the court in appointing a receiver, butj in addition, it must appear that the plaintiff has a prohable right to recover in the end. High, Rec. § 18, citing Gregory v. Gregory, 33 N. Y. Super. Ct 39; Lawrence Iron-Works Co. v. Rockbridge Co., 47 Fed. 755.
Recurring now to the quotation from Mr. Justice Nelson’s exposition of the principles governing the application for a receiver in a case like this, in Wiswall v. Sampson, supra, it is apparent that the defendant has not the legal title, strictly and technically considered, perhaps, but she has the “legal interest,” to use his words, — chosen, no doubt, to accurately express the fact, running through the authorities, that the protection of the defendant in possession does not depend on the hare technical legal title, but on the right to enjoy the income or profits of the estate as the owner thereof; and, united with her trustee, the defendant has that, if her deed is good, both as to the legal and equitable interest. She may be separated from the bare legal title, but otherwise she has the entire interest, under the terms of her deed. It is not necessary to inquire whether the trustee under that deed had anything more than “a dry trust,” or whether the effect was to give her a legal title. Certainly he has no active duties imposed by the terms of the trust. She has, in my opinion, the same standing in a court of equity, .on an application like this, and under the peculiar circumstances of this case, as if she stood here with the legal title, or as if she and her trustee were both standing here, in possession. It is not to he overlooked that one of the plaintiffs is the substituted trustee of the deed of settlement and gift, hut, as already pointed out, she is a hostile trustee, denying her own title as trustee, and the defendants’ interest under the trust, by denying the validity of the deed, and seeking to set it aside. She cannot claim under it and against it, and if she were in possession, making such claims of adverse ownership as she makes here, a court of equity would remove her as trustee, or appoint a receiver against her, on the application of the defendant or her next Mend. Therefore she can claim nothing as to a receiver on that score, but her application must stand on the merits of the hostile claims of adverse tifie she sets up by this bill. The application for a receiver must be denied. Ordered accordingly.
