No. 754 | 5th Cir. | Feb 21, 1899
This case was before us on a writ of error at the November, 1895, term of this court. Our decision (Short v. Hepburn) is reported in 41 U. S. App. 520, 21 C.C.A. 252" court="5th Cir." date_filed="1896-06-15" href="https://app.midpage.ai/document/short-v-hepburn-8856042?utm_source=webapp" opinion_id="8856042">21 C. C. A. 252, and 75 F. 118" court="8th Cir." date_filed="1895-12-02" href="https://app.midpage.ai/document/lockwood-v-wickes-8856043?utm_source=webapp" opinion_id="8856043">75 Fed. 118. James B. Simpson had acquired the land in controversy December 9, 1889, and owned and held it until July 21, 1891. His title thereto at that time is not disputed. Under him both the plaintiff and the defendants claimed as the common source of title. By a deed dated July 21, 1891, he purported to convey the land to Kennetl Cayee. This deed was not filed for record in the proper county until January 19. 1892. Between July 21, 1891, and January 31, 1892, Simpson, as grantor, individually and as owner of the lands, by deeds duly executed and recorded, conveyed portions of the land in controversy to Farber, Morris, Reynolds, Hopkins, Hereford, and numerous other parties. Simpson was indebted to the Bankers’ & Merchants’ National Bank of Dallas. On February 20, 1892, it brought an action against him on its debt, and procured to he issued an attachment, which on February 22, 1892, was levied on the land, in controversy as the property of Simpson. Before that time, on
:‘This agreement, entered into between William Kelly, U. F. Short, and Wm. D. Simpson, Jr., witnesseth that whereas, said parties are jointly inter-*419 cstod in .a certain tract of land, as hereinafter described, and in the proportion as hereinafter stated; and whereas, a suit is now pending in the district court, Camp county, Texas, for part of said tract of land, and it may toe necessary to bring or defend other suits in reference to said lands, as described as follows: A tract, of land situated in the counties of Camp and Upshur, Texas, known as the ‘Dickson Rands,’ containing 7,(530 Vio acre's, as fully described in a deed of Amanda Dickson and others to Jas. B. Simpson, dated 19 and 21 days of December, 1889, and recorded in Yol. (4. pages 247, 248, 249, and 250 of the records of deeds of Camp county, Texas, to which reference is here made for a full and complete description of said tract of land. Therefore it is agreed, toy and between the parties hereto, that we will make common cause, and work in each other’s interest, in prosecuting and defending suits in reference to said land; and if successful, and said property is awarded to either of the parties hereto, then Wm. Kelly shall first hare 2,000 acres, undivided, of said land; and, if over 2,000 acres is recovered, then U. F. Short shall have 200 acres, undivided, of said land; and after Wm. Kelly has received his 2.000 acres, and U. I<\ Short his 200 acres, all the balance of said land, supposed now to amount to about 3,000 acres, shall belong to, and be the property of, Wm. D. Simpson, Jr., and an equitable partition and division of same shall be made between all the parties hereto in the proportions hereinbefore stated. It is further agreed that, in all litigation in reference to said land, each party hereto shall furnish his attorney, at his own expense, but the court costs shall be shared pro rata in proportion to the interest iu said land, as herein indicated; that is, for every dollar of cost U. F. Short shall pay, Wm. Kelly shall pay ten dollars and Wm. D. Simpson, Jr., fifteen dollars.”
Before the execution and delivery of tlie foregoing agreement, Hepburn, as receiver of the hank, brought suit against Kelly and Short in the state court, in Camp county, to try the title and recover possession of the land. He afterwards, on December 28,1894, brought this action in the circuit court of the United States, at Jefferson, against the same defendants, Kelly and Short, who made common cause in defending against the same. As appears in the report of our former decision, supra, plaintiff obtained a judgment in the circuit court against both of the defendants, which judgment we reversed, and the cause was remanded to the circuit court, with instructions to award a new trial. The case again came on for trial in the circuit court on January 29, 1898, on which date it was, on motion of the plaintiff, ordered that the suit he dismissed as to I he defendant Short. On the same day the defendant Kelly moved the court to dismiss the suit for want of authority of the receiver to further prosecute the same. On this motion the court took time to consider, and on January 31st (the intervening day being Sunday) the court, being sufficiently advised, overruled Kelly’s motion. The trial proceeded. and on February 4, 1898, resulted in a judgment in favor of the defendant William Kelly, to review which this writ of error was sued out.
On the trial U. If. Short testified, in substance, that, when our former opinion was given out, iu which we referred to “charges of fraud against persons more or less reputable,” he resolved that he would not be mixed up in this transaction any further; that the receiver of the bank had been ordered by the comptroller of the currency to close out these assets, and in obedience thereto the receiver came to the witness, and asked' if he could not make a sale of the lawsuit; that the witness spoke to Judge Morris (Kelly’s attorney) about
M. L. Morris, attorney for Kelly, testified, in substance, that the receiver of the bank told this witness that he wished to compromise the litigation; that he wanted to wind up the bank’s affairs, and asked him (Morris) to make a proposition to buy the lands in behalf of Kelly; that witness asked a day or two to consider the matter; that Judge Short afterwards came to witness’ office, and told witness that the receiver wanted to sell out and close up the litigation, and desired to act at once; that Short said that he was in a better position to buy the receiver out than witness was; that the original cross bill of Kelly, setting up the agreement of April, 1SD4, between William Kelly, IT. F. Short, and William D. Simpson, Jr., was first filed in the state court, at Pittsburg, Tex., in March, 1897, after the plaintiff, H. G. Weaver, as receiver of the bank, had conveyed the land in controversy to Short; that in his negotiations with Short, in the summer of 1896, with reference to buying out the plaintiff, he„stated to Short that he represented William Kelly, and, as Kelly’s attorney, he made an oral agreement with Short to buy out the plaintiff; that he and Short even went further, and decided that, after Kelly and Short bought out the plaintiff, Short and witness would then buy out Kelly, and thus own the land, but that this was not to- be considered until the deal with the receiver was consummated; that Short and Kelly did not have the money to pay the receiver, but Short agreed that, when the deal was ready to be consummated, the title would be cleared up, and he (witness) and Short expected then to borrow th<2 money ($2,500) to pay the plaintiff; that the sale was to be confirmed by the circuit court, at Dallas, in January, 1897, but on November 23, 1896, U. F. Short, or some one, without the knowledge of witness, slipped off to Waco-, Tex., and had the sale to Short confirmed at a session of the circuit court then in session there, and, without the knowledge of witness, the deed of plaintiff, as receiver
Where it had been made to appear that one party to a suit had sold out to the other, and that the suit was prosecuted by the purchasing party, for his own benefit, the supreme court, on its own motion, after notice and hearing, dismissed the case. East Tennessee R. Co. v. Southern Tel. Co., 125 U.S. 695" court="SCOTUS" date_filed="1888-04-09" href="https://app.midpage.ai/document/east-tennessee-virginia--georgia-railroad-v-southern-telegraph-co-92219?utm_source=webapp" opinion_id="92219">125 U. S. 695, 8 Sup. Ct. 1391. In a later case the supreme court said:
“We cannot consent to determino a controversy in wliicli the plaintiff has become the dominus litis on both sides. * * * The liügation has ceased 1o be between adverse parties, and ihe case, therefore, falls within the rale applied where the controversy is not a real one. If the writ oi' error be tils missed, the judgment will remain undisturbed, and tlio plaintiff i in error might be cut off from submitting the questions involved for the determination of the appellate tribunal; while, if the judgment be reversed, The minority of the stockholders of the defendant in error would be deprived of the benefit of the litigation in its favor. But, although the latter might be thereby subjected to the delay and expense of further litigation, they would still be free to vindicate whatever rights they are entitled to. Without considering or passing upon the merits of the cuse m any respect, we deem it most consonant to justice To reverse the judgment and remand the case for further proceedings in conformity to law." South Spring Co. v. Amador Co., 145 F. S. 300, 12 Sup. Ct. 921.
Home of ihe earlier- cases, announcing and illustrating the rule above referred to, are: Lord v. Veazie, 8 How. 251" court="SCOTUS" date_filed="1850-02-22" href="https://app.midpage.ai/document/lord-v-veazie-86524?utm_source=webapp" opinion_id="86524">8 How. 251; Cleveland v. Chamberlain, 1 Black, 419" court="SCOTUS" date_filed="1862-02-18" href="https://app.midpage.ai/document/cleveland-v-chamberlain-87479?utm_source=webapp" opinion_id="87479">1 Black, 419; Paper Co. v. Heft. 8 Wall. 333" court="SCOTUS" date_filed="1869-11-18" href="https://app.midpage.ai/document/wood-paper-company-v-heft-88093?utm_source=webapp" opinion_id="88093">8 Wall. 333; and Dakota Co. v. Glidden, 113 U.S. 222" court="SCOTUS" date_filed="1885-01-26" href="https://app.midpage.ai/document/dakota-county-v-glidden-91281?utm_source=webapp" opinion_id="91281">113 U. S. 222, 5 Sup. Ct. 428.
It is clear that the receiver of the bank has had no interest in the matter involved in this litigation since the 8th of December, 189(5. Short continued to figure as a defendant in the litigation from December 8, 1896. when be acquired all of the plaintiffs title, until January 29, 1898, when the case came on for trial, and the suit, which lie plainly then controlled, was dismissed as to him.
The jurisdiction of the circuit court depended wholly on the character of the original plaintiff (Short v. Hepburn, supra); and it continued to depend on the like character of his official successor, Weaver, who duly qualified as receiver, and, as such, became (he party plaintiff in this litigation. By the compromise and sale of the bank’s interest to Short, the control of this litigation passed fully to the defendants. The agreement between them and William I). Simpson, Jr., is one which a court: of equity would enforce and charge Short as trustee for the benefit of the other parties thereto. Bartlett, if in fact he was a purchaser, and not merely a lender- of the money, is charged with notice by the lis pendens, and could not take or hold a better position than Short occupied. Under the conditions which are shown to have existed, the circuit court should not have suffered the litigation to proceed for the benefit exclusively of the original defendants.
As was done in South Spring Co. v. Amador Co., supra, we'deem it most consonant to justice to reverse the judgment of the circuit court,