211 F. 172 | E.D. Ark. | 1914
(after stating the facts as above). The argument of the numerous counsel took a very wide range, and a great many questions were discussed. Among others were the liability on the bonds, the liability of the railroad company regardless of the bond, before the final decree making the injunction perpetual was rendered by this court, and the liability of the railroad company on the bonds, as well as individually, for the excess rates collected after the injunction had been made perpetual by this court, and up to the time it was dissolved and the bill dismissed in obedience to the mandate of the Supreme Court. As these questions will have to be determined when the report of *the special master comes up for hearing, the court deems it unnecessary to determine them in this proceeding. The only question properly before the court is whether this supplemental bill can be maintained as an ancillary proceeding to the original bill, and, if so, whether it is the duty of the court, in order to prevent the many thousands of suits which might be instituted in the different courts of the state to recover these overcharges, to enjoin the parties having these claims and determine the entire matter in the proceeding now pending in this court to ascertain the liability of the. railroad company for the wrongful injunction.
“The proposition that the eleventh amendment, or section 720 of the Revised Statutes, controls a court of the United States in administering relief, although the court was acting in a matter ancillary to a decree rendered in a cause over which it had jurisdiction, is not open for discussion”—citing Dietzsch v. Huidekoper, 103 U. S. 494, 26 L. Ed. 497; Prout v. Starr, 188 U. S. 537, 23 Sup. Ct. 39S, 47 L. Ed. 584; Julian v. Central Trust Co., 193 U. S. 93, 112, 24 Sup. Ct. 399, 48 L. Ed. 629.
To these cases may be added Root v. Woolworth, 150 U. S. 401, 14 Sup. Ct. 136, 37 L. Ed. 1123; Lang v. Choctaw, etc., R. Co., 160 Fed., 355, 87 C. C. A. 307; Mound City v. Castleman, 187 Fed. 921, 110 C. C. A. 35.
In Root v. Woolworth the supplemental bill was filed several years after a decree in the original case had been rendered establishing the title of the grantor of the plaintiff in the supplemental bill. The jurisdiction of the court to grant such relief was attacked upon several grounds by the defendant; one of them being that there was no diversity of citizenship between the plaintiff and defendant in the ancillary proceedings, but the court held:
“The bill being ancillary to the original proceedings of Morton v. Root, and supplementary to the decree rendered therein, can be maintained without reference to the citizenship or residence of the parties. There is consequently no force in the objection that the court below had no jurisdiction in this case because the appellee and the appellant were both citizens of Nebraska.”
Another objection was that the proceeding should have been an action of ejectment on the law side of the court. The court in overruling that objection held:
“If the bill in the present case could be properly considered as an ejectment bill, the objection taken thereto by the defendant would be fatal to the proceeding; but, instead of being a bill of this character, if is clearly a supplemental and ancillary bill, such as the court had jurisdiction to entertain. * * * It is well settled that a court of equity has jurisdiction to carry into effect its own orders, decrees, and judgments which remain unreversed when the subject-matter and the parties are the same in both proceedings.”
The court, after quoting section 338 of Story’s Equity Pleading, proceeded :
“The jurisdiction of courts of equity to interfere and effectuate their own decrees by injunction or writs of assistance in order to avoid the relitigation of questions once settled between the same parties is well settled.”
Nor is it necessary that the parties be the same.
“It is equally clear,” the court in that case held, “that his assignee or privy in estate has the right to the same relief that Morton (the original party, and-Woolworth’s grantor) could have asserted”—quoting as authority for this rule of law section 429, Story’s Equity Pleading.
Upon the same principle it has also been held that, if a state court refuses to grant a petition for removal to a federal court, when the petition and bond show that the cause is one properly removable, and a transcript of the record has been filed in the national court to which it was sought to have it removed, that court may by a proceeding an
2For these reasons, if the court has jurisdiction to maintain this ancillary proceeding, the fact that the defendant Gallup had, before 'the filing of this supplemental bill, instituted his action in the state court, would not prevent this court from enjoining him from prosecuting that action by reason of the provisions, of section 720, Rev. Stat.
Has the court jurisdiction to entertain the supplemental bill?
As this is an ancillary proceeding, the jurisdiction of the court depends upon the jurisdiction of the original cause, regardless of the fact that it would have no jurisdiction if this were an original proceeding.
In Riggs v. Johnson County, 6 Wall. 166, 187 (18 L. Ed, 768), it was held that:
“Process subsequent to judgment is as essential to jurisdiction as process antecedent to judgment, else the judicial power would be incomplete and entirely inadequate to the purpose for which it' was conferred by the Constitution.”
In Lamb v. Ewing, 54 Fed. 269, 4 C. C. A. 320, the Circuit Court of Appeals for this circuit held;
“The rule is well settled that, where a court rightfully takes jurisdiction over the parties and the subject-matter of a controversy, it has the right not only to render judgment in the first instance, but also to secure to the prevailing party the fruits of such judgment, and the original jurisdiction is a continuing one for that purpose; and as corollaries to the general rule it is also equally well settled that, where third parties have rights in or claims to property taken into the possession of the court under process issued against the original parties, such third parties may intervene in the proceedings for the protection of their rights; and, further, that, where the process of the court is wrongfully and illegally used to the injury of a third party, the latter may appeal to the court for proper redress. If the federal courts were deprived of the power to protect third parties against injury resulting from the enforcement of process issuing from such courts by reason of the citizenship of the injured party, or because the amount of the injury was less than $2,000, it would work great hardship upon the individual citizen and be a most serious blot upon the system of federal jurisprudence. The power of the courts of the United States in these particulars is as ample as that of the courts of the state, and the technical question of jurisdiction is solved by the ruling that in all ancillary or auxiliary proceedings for the enforcement of judgments rendered, and in proceedings for the protection of the rights of third parties the jurisdiction is supported by that of the original action or suit.”
See, also, Reilly v. Golding, 10 Wall. 56, 19 L. Ed. 858; Cooke v. Avery, 147 U. S. 375, 390, 13 Sup. Ct. 340, 37 L. Ed. 209; Camp v. Boyd, 229 U. S. 530, 551, 33 Sup. Ct. 785, 57 L. Ed. 1317; Tyler Mining Co. v. Last Chance Mining Co., 90 Fed. 15, 32 C. C. A. 498; Lea v. Deakin (C. C.) 13 Fed. 514; Coosaw Mining Co. v. Farmers’ Mining Co. (C. C.) 51 Fed. 107; Redlich Mfg. Co. v. John H. Rice & Co. (C. C.) 203 Fed. 722; Files v. Davis (C. C.) 118 Fed. 465.
In Russell v. Farley, 105 U. S. 433, 445, 26 L. Ed. 1060, a leading case on this subject, it was held, Mr. Justice Bradley delivering the
One of the principal questions involved in this proceeding is the construction of the effect of the final decree rendered in the main cause.
In Tullock v. Mulvane, 184 U. S. 497, 505, 22 Sup. Ct. 372, 375 (46 L. Ed. 657), it was held that an action on an injunction bond given in a cause pending in a court of the United States raises a federal question, and therefore a judgment of the highest court of the state on such a bond is subject to review on error by the Supreme Court. In that case the opinion was delivered by Mr. Justice, now Mr. Chief Justice, White, and it was held:
“It is settled that such court (meaning the national court in which the injunction bond had been given) has the inherent right to set the bond aside and to determine in its discretion whether a recovery could be had upon it”— citing Russell v. Farley, supra.
A similar conclusion was reached in M., K. & T. Ry. Co. v. Elliott, 184 U. S. 534, 22 Sup. Ct. 446, 46 L. Ed. 673, which was on error to the highest court of the state of Missouri, and Leslie v. Brown, 90 Fed. 171, 32 C. C. A. 556; National Foundry Co. v. Oconto Water Supply Co., 183 U. S. 216, 233, 22 Sup. Ct. 111, 46 L. Ed. 157.
Even if it were true that the bonds were only the ordinary injunction bonds “to pay the defendants all damages they may sustain by reason of the granting of the injunction, if upon final hearing it should
In the last-cited case it was said:
“It is not an action to recover any money from tlie state. Its results will not inure to tlie benefit of the state as a state in any degree. * * * The parties interested are the railway company, on the one hand, and they who use the bridge, on the other; the one interested to have the charges maintained as they have been, the other to have them reduced in compliance with the order of the Commissioners. * * * It is true that the state has a governmental interest in the welfare of all its citizens, in compelling obedience to the legal orders of all its officials, and in securing compliance with all its laws. But such general governmental interest is not that which mates the state, as an organized political community, a party in interest in the litigation. * * * The interest must be one in the state as an artificial person.”
But, aside from this, each of the bonds in this case expressly provides that it is for the benefit of all shippers and passengers. The conditions in the first bond are:
“If it should eventually be decided that so much of this order as inhibits the enforcement of existing rates should not have been made, the said complainant shall, within a reasonable timé to be fixed by the court, refund in every instance to the party entitled thereto the excess it charged over what would have been charged had the inhibited rates been applied.”
And in the other bond the condition is:
“If it should eventually be decided that so much of this order as inhibits enforcement of the rates prescribed * * * the complainant shall refund to the owners and holders of the certificates issued by it (showing the excess payments) the excess.charges as shown by the same.”
It will thus be seen that when the temporary injunction was granted by the court it reserved to itself the right to require the railroad and the sureties on its bonds to “refund in each instance to the party entitled thereto” the moneys collected in excess of the enjoined rates as directed by the court. The orders of the court and the bonds given in pursuance thereof are just as much for the benefit of every shipper and passenger as those who were, made parties defendants to the suit as representatives of all shippers and passengers. To have made all shippers and passengers parties to the original action would, of course, have been, if not impossible, at least impracticable, for it would have necessitated making every inhabitant of the state, and even nonresi
Equity Rule 10 (29 Sup. Ct. xxvi), then in force, provided:
“Every person, not being a party in any cause, who bas obtained an order, or in whose favor an order shall have been made, shall be enabled to enforce ■obedience to such order by the same process as if hd were a party to the cause.”
And it has been held that bidders or purchasers at a foreclosure sale, although not parties to the suit, are entitled to appeal as to matters affecting them. Blossom v. Milwaukee, etc., R. Co., 1 Wall. 655, 17 L. Ed. 673; Kneeland v. American L. & T. Co., 136 U. S. 89, 10 Sup. Ct. 950, 34 L. Ed. 379.
In re Farmers’ Loan & Trust Co., 129 U. S. 206, 213, 9 Sup. Ct. 265, 266 (32 L. Ed. 656), Mr. Justice Miller said:
“But the doctrine that, after a decree which disposes of a principal subject of litigation and settles the rights of the parties in regard to that matter, there may subsequently arise important matters requiring the judicial action •of the court in relation to the same property and some of the same rights litigated in the main suit, making necessary substantive and important orders and decrees in which the most material rights of the parties may be passed upon by the court, and which, where they partake of the-nature of final decisions of those rights, may be appealed from, is well established by the decisions of this court.”
In that case a mandamus was granted to the judges of the Circuit ■Court to grant an appeal from an order made after final decree, and while the cause was pending on appeal in the Supreme Court.
Suppose the court, when it granted the temporary injunction, had required the 'railroad company to deposit in the registry of the court all the excess charges, to be there impounded until the final determination of the cause. Can there be any doubt of the power of the court in that case to have enjoined shippers from maintaining independent suits in other courts for the recovery of such excess charges? When the •court, instead of requiring such deposits, exacted a bond to do the same thing, why does not the bond take the place of the money, and authorize the court to do what it would have done if the money were in the registry? This objection must therefore be overruled.
On the part of some of the shippers counsel concede that the court would have the right to retain jurisdiction of the ancillary proceeding, but insist that the injunction be granted only upon condition that complainant will not contest its liability but only the amounts claimed. There can be no doubt that the court in granting an injunction has ■the power to impose reasonable conditions, as the writ of injunction is not a writ of right but one of discretion; but that does not mean an arbitrary discretion, dependent solely on the whim of the chancellor. It means a sound, judicial discretion, informed and directed by the established principles, rules, and practice of equity jurisprudence.' This question was fully discussed in the opinion filed in this case in 168 Fed. 720, where many authorities are cited. .To grant an in
If the defendants had suggested to the court that there is some doubt as to the solvency of the complainant or its ability to pay any decree that may be finally rendered against it, the court would no doubt have required a bond conditioned that it would satisfy any decree which may be finally rendered against it; but no such demand nor suggestion was made.
The object of this ancillary proceeding is to determine whether the plaintiff is liable, and, if so, to whom and for what sums. The jurisdiction might also be maintained upon the ground that when a court of equity once obtains jurisdiction it has the right to retain it for the purpose of settling all matters arising by reason of the litigation. Dewing v. Perdicaries, 96 U. S. 193, 24 L. Ed. 654; Gormley v. Clark, 134 U. S. 338, 10 Sup. Ct. 554, 33 L. Ed. 909; United States v. Union Pacific R. Co., 160 U. S. 1, 16 Sup. Ct. 190, 40 L. Ed. 319; Hopkins v. Grimshaw, 165 U. S. 342, 17 Sup. Ct. 401, 41 L. Ed. 739.
The decisions of the Supreme Court in Re City of Louisville, 231 U. S. 639, 34 Sup. Ct. 255, 58 L. Ed. —-, and in Re John Engelhard & Sons Co., 231 U. S. 646, 34 Sup. Ct. 258, 58 L. Ed.-, opinions filed January 5, 1914, and just to hand, are very much in point and, in the opinion of this court, sustain the conclusions reached herein.
The court fully realizes that the question of jurisdiction of a national court in cases of this nature is always a delicate one. But, as stated by Chief Justice Marshall in Cohens v. Virginia, 6 Wheat. 264, 404 (5 L. Ed. 257); '
“It is most true that this court will not take jurisdiction if it should not; but it is equally true that it must take jurisdiction if it should. The judiciary cannot, as the Legislature may, avoid a measure because it approaches the confines of the Constitution. * * * We have no more right to decline the exercise of jurisdiction which is given, than to usurp that which is not given. The one or the other would be treason to the Constitution. Questions may occur which we would gladly avoid;, but we cannot avoid them. All we can do is to exercise our best judgment, and conscientiously to perform our duty”— quoted and followed in Ex parte Young, supra.
As the parties agreed' in open court that a final decree may be entered, the defendants declining to plead further, a perpetual injunction is granted, restraining these defendants and all other persons similarly situated from instituting or maintaining any suits for excess of charges collected by the complainant during the pendency of this injunction.
