Case ID: haw_26/html/0069-01.html
Source: Caselaw Access Project
Author: {"author": "COKE, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

J. K. SMYTHE, MANUEL SEBASTINE SANTOS, WILLIAM F. POGUE, FRED WILHELM AND WILLIAM SMYTHE, PRESIDENT, VICE-PRESIDENT, TREASURER, SECRETARY AND AUDITOR, RESPECTIVELY, OF THE HUI KUAI AINA O PEAHI, v. J. TAKARA, ALSO KNOWN AS J. TAKADA, G. M. MAALO AND THE BALDWIN NATIONAL BANK OF KAHULUI, MAUI, T. H. J. K. SMYTHE, MANUEL SEBASTINE SANTOS, WILLIAM F. POGUE, FRED WILHELM AND WILLIAM SMYTHE, PRESIDENT, VICE-PRESIDENT, TREASURER, SECRETARY AND AUDITOR, RESPECTIVELY, OF THE HUI KUAI AINA O PEAHI, v. J. TAKARA, ALSO KNOWN AS J. TAKADA, G. M. MAALO AND THE BALDWIN NATIONAL BANK OF KAHULUI, MAUI, T. H.
    No. 1314.
    No. 1315.
    Appeals from Circuit Judge Second Circuit. Hon. L. L. Burr, Judge.
    Argued May 17, 1921.
    Decided May 24, 1921.
    Coke, C. J., Kemp, J., and Circuit Judge Franklin in Place of Edings, J., Absent.
    Appeal aud Error—interlocutory appeal.
    
    After allowing an interlocutory appeal tbe court below should stay its band until that appeal is perfected and determined in tbe appellate court.
    
      Parties—general rule in equity.
    
    It is a general rule in equity that all persons materially interested, either legally or beneficially, in the subject-matter of a suit are to be made parties to it either as plaintiffs or defendants, however numerous they may be, so that there may be a complete decree which will bind them all.
    
      Same—same—exceptions to the rule.
    
    To this rule there are certain exceptions, one of which is that where the parties interested in the suit are numerous and it would hot be feasible without great inconvenience to make all of them parties a few may sue for themselves and all others similarly situated.
   OPINION OP THE COURT BY

COKE, C. J.

The petitioners appellants, above named, filed in tbe circuit court of tbe second judicial circuit a bill for discovery and avoidance of a lease. Tbe respondents interposed thereto a plea in abatement in wbicb it was alleged that tbe petitioners were not interested .in tbe subject-matter of tbe cause and therefore could not maintain tbe suit. Tbe circuit judge sustained tbe plea in abatement but allowed tbe petitioners an interlocutory appeal. Before tbe time for perfecting tbe interlocutory appeal bad expired the court below entered a final decree dismissing tbe petition. Tbe petitioners thereupon appealed from the final decision and have perfected both tbe interlocutory and final appeals. Tbe two appeals, being presented to this court, were by order duly made consolidated and will be beard jointly.

After allowing tbe interlocutory appeal tbe circuit court should have stayed its band until that appeal was disposed of in tbe appellate court and it is surprising that tbe impropriety of tbe action of tbe circuit court in entering a final judgment in tbe cause pending tbe perfection and determination .of tbe interlocutory appeal did not occur to tbe judge of tbe court below. But as tbe appeal from tbe final decree is now before us in case No. 1315 and tbe record therein presents for final disposition tbe questions raised by the interlocutory appeal in case No. 1314 we will not further notice the interlocutory appeal but will confine ourselves to the appeal from the final decree.

The Hui Kuai Aina o Peahi is an Hawaiian hui the members of which own as tenants in common a tract of land situated at Peahi on the Island of Maui. The members of the hui appear to have organized by adopting a constitution and by-laws and have created an executive committee to manage the affairs of the hui or association. The petitioners herein constitute the executive committee. Articles 21 and 23 of the constitution and rules of the hui prohibit the leasing of any of the lands of the association except by the executive committee thereof subject to the approval of not less than two-thirds of the shares of the association. It appears from the allegations in the bill of complaint that G-. M. Maalo, the owner of a number of the shares of the hui, without the knowledge or consent of the executive committee and in defiance of the rules of the association executed a lease of two tracts or parcels of land of the common property containing an area of about 63 acres to the respondent Takara, the leasehold being thereafter by the lessee mortgaged to the respondent the Baldwin National Bank of Kahului. The purpose of the suit is to have a decree nullifying the lease and mortgage and for a restoration of the leased premises to the members of the hui.

The sole question involved in the appeal challenges the correctness of the decision of the lower court holding that the petitioners cannot maintain the suit.

The appellants concede, as they must, that the hui itself is not a legal entity (Re Taxes Hui of Kahana, 21 Haw. 676, 678) and therefore can neither sue nor be sued and that the petitioners bringing this suit are not proceeding as officers of the hui but as representatives of a majority of tbe members thereof.: It is not alleged that the petitioners are part-owners in the cotenancy , or otherwise interested in the hui except as officers thereof. Their only right to prosecute this action is contained in paragraph 12 of their.bill which sets forth that at the meeting of the hui held in March 191.9, at which more than two-thirds of the shares of the association were present, the petitioners were authorized by a majority' of the shares represented at such meeting and by a majority of all the shares in said association to bring such proceed-1 ings as “may be necessary to protect the rights of the members of said association in and to said lands and to recover from said J. Takara, also known as Takada, the possession of the lands of the said association taken and held by him as hereinabove set forth.” While those voting undoubtedly attempted to clothe the petitioners with authority to proceed against the respondent Takara their action was in no wise binding upon the other members of the hui and it is very clear that they could not thus confer upon any person or set of persons authority to institute the suit in their behalf and ignore the other parties in interest.

It is a general rule in equity that all persons materially interested, either legally or beneficially, in the subject-matter of a suit are to be made parties to it either as plaintiffs or defendants, however numerous they may be, so that there may be a complete decree which will bind them all. To this rule there are certain exceptions, one of which is that where the parties interested in the suit are numerous and it would not be feasible without great inconvenience to make all of them parties a few may sue for themselves and all others similarly, situated. Story’s Eq. Pl. 9 ed. Sec. 107; Supreme Tribe of Ben-Hur v. Cauble, decided by the Supreme Court of the United States March 7, 1921; Smith v. Swormstedt, 16 How. 288, 303; Beatty v. Kurtz, 2 Pet. 566; Lilly v. Tobbein, 103 Mo. 477, 488. But the petitioners herein have not by any allegation in their -bill of complaint brought themselves either within the rule or within the exception thereto. It is trué that in the prayer of the bill they ask that “they may be permitted to bring and prosecute the proceeding- as the officers, directors and members of the executive committee of said Hui Kuai Aina o Peahi for and on behalf of all the members thereof whose interests are not in conflict therewith.” This does not aid them in the least, first for the reason that under the rules of equity pleading the matters contained in the prayer of the bill do not determine the sufficiency thereof, and for the further reason that the petitioners if permitted to maintain the suit at all may not do so as officers of the hui but they can only maintain it as parties interested in the subject-matter of the suit for themselves and all others in the- same class under a proper allegation that the parties are numerous and cannot be joined without great inconvenience, etc.

S. W. Fitsherbert (Smith, Warren & Stanley on the brief) for petitioners.

E. Vincent and J. TP. Kalua for respondents submitted the case upon the brief.

For these reasons the decree of the lower court dismissing the bill of complaint is affirmed.