Source: https://supreme.justia.com/cases/federal/us/264/552/
Timestamp: 2019-04-24 11:54:00+00:00

Document:
1. A decree of the district court refusing leave to file a bill of intervention upon the theory that there is no basis on which the court, as a federal tribunal, could adjudicate the matter presented by it rests on a jurisdictional ground, and is appealable directly to this Court under Jud.Code § 238. P. 264 U. S. 557.
2. Where, in the progress of a suit in a federal court, property has been drawn into the court's custody and control, third persons claiming interests in or liens on the property may be permitted to come into that court for the purpose of setting up, protecting, and enforcing their claims, although the court could not consider their claims if it had not impounded the property. P. 264 U. S. 558.
3. But this rule does not apply where the court has not impounded the property in question, but has merely adjudicated a controversy concerning it and retained jurisdiction of the suit to insure obedience to its decree. P. 264 U. S. 559.
Appeal from a decree of the district court refusing leave to file a petition of intervention for want of jurisdiction. The appeal was first taken to the circuit court of appeals, and was transferred to this Court under Jud.Code § 238a. See the opinion of the circuit court of appeals reported in 284 F. 837.
This is an appeal from a decree of the District Court for the Western District of Texas refusing leave to file a bill proffered as a petition of intervention in a designated suit in that court. The appeal was taken to the circuit court of appeals, and was by that court transferred here according to § 238a of the Judicial Code, c. 305, 42 Stat. 837, on the ground that it should have been taken directly to this Court under § 238, 284 F. 837.
"It is further ordered, adjudged, and decreed by the court that the said John K. Rose, as substitute trustee aforesaid, may, without further order of this Court, make from time to time such advances to the said plaintiff, Peter McClelland, Jr., not to exceed the net revenues and income from the said estate, as he may think right and proper, but no portion of the corpus of the said estate shall be delivered to, or be surrendered over during the lifetime of the plaintiff to the said plaintiff, or his vendees, except upon the further order of this court, and this court hereby retains jurisdiction of this cause to the end that it may, from time to time as occasion may require, exercise its power of direction and control over said trustee in this respect."
sold to pay his debts while he was living, and that the trustee was entitled to prevent such a sale in the son's lifetime, even though there was no purpose to disturb the trustee's possession or the administration of the trust. On an appeal to the Court of Civil Appeals, that decision was affirmed, Hoffman v. Rose, 217 S.W. 424, and an application for a further review was denied by the supreme court of the state.
It was after these proceedings that the creditors sought to intervene in the suit in the district court. They set forth in their proffered bill all that was done in the state court, including the attachment and judgment and the subsequent injunction, and also alleged that, by the attachment and judgment, they had acquired a lien on the attached property which was in no way avoided or affected by the injunction; that, by the prior proceedings in the district court, the property had been drawn into that court's custody and control, and thereby effectually impounded; that they had no means of enforcing their lien during the life of the son save through the interposition and aid of the district court; that the lien probably would be lost unless that court recognized and protected it, and that to postpone its enforcement until after the death of the son would not be equitable. The relief prayed was that the lien be recognized and protected, and the remainder interest of the son in the attached property be ordered sold under the lien to satisfy their claim.
In refusing leave to file the bill, the district court put its decision on the ground that it was without jurisdiction to entertain the bill, in that (a) the bill was not ancillary or dependent in the sense that it could be entertained in virtue of the jurisdiction acquired in the earlier suit, and (b) the citizenship of the parties and the nature of the matter presented were not such that the bill could be dealt with as an original and independent bill.
which the court, as a federal tribunal, could proceed to an adjudication of the matter presented, it is apparent that the petitioning creditors were shut out on a jurisdictional ground in the sense of § 238 of the Judicial Code, and so were entitled to bring that ruling here for review by a direct appeal.
It is settled that where, in the progress of a suit in a federal court, property has been drawn into the court's custody and control, third persons claiming interest in or liens upon the property may be permitted to come into that court for the purpose of setting up, protecting, and enforcing their claims, although the court could not consider or adjudicate their claims if it had not impounded the property. Power to deal with such claims is incident to the jurisdiction acquired in the suit wherein the impounding occurs, and may be invoked by a petition to intervene pro interesse suo or by a dependent bill. But, in either case, the proceeding is purely ancillary. Oklahoma v. Texas, 258 U. S. 574, 258 U. S. 581; Minnesota Co. v. St. Paul Co., 2 Wall. 609, 69 U. S. 632; Krippendorf v. Hyde, 110 U. S. 276, 110 U. S. 281; Compton v. Jesup, 68 F. 263, 279; Sioux City Co. v. Trust Co., 82 F. 124, 128; Minot v. Mastin, 95 F. 734, 739; Street, Fed.Eq. Pr. §§ 1229, 1245-1247, 1364.
met with that decision in the state court did the creditors conclude to resort to the district court. Even if that decision was wrong, as they seem to think, it did not change or affect the situation in the district court.
In our opinion, the bill could not be entertained as an ancillary or dependent bill.

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