Opinion ID: 1567838
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Heading: As to the Appealability of the Order Complained of.

Text: Preliminarily, we must determine whether the order of the court below is appealable. Our appellate jurisdiction of course is purely statutory. United States v. Horns, 3 Cir., 147 F.2d 57. 28 U.S.C.A. § 1291, provides for the appeal of final decisions. But, as was pointed out by Judge Magruder in Rubert Hermanos, Inc. v. People of Puerto Rico, 1 Cir., 118 F.2d 752, 757: A `final decision' is not necessarily the ultimate judgment or decree completely closing up a proceeding. In the course of a proceeding there may be one or more final decisions on particular phases of the litigation, reserving other matters for future determination. See Knox National Farm Loan Ass'n v. Phillips, 300 U.S. 194, 197, 198, 57 S.Ct. 418, 81 L.Ed. 599, 108 A.L.R. 738; Trustees v. Greenough, 105 U.S. 527, 26 L.Ed. 1157; Gay v. Hudson River Electric Power Co., 2 Cir., 184 F. 689; Dant & Russell v. J. D. Halstead Lumber Co., 9 Cir., 103 F.2d 306. The words `final decisions,' like the equivalent `final judgments and decrees' in former acts regulating appellate jurisdiction, have not been understood in a strict and technical sense, but have been given a liberal and reasonable construction. Forgay v. Conrad, 6 How. 201, 203, 12 L.Ed. 404; City of Eau Claire v. Payson, 7 Cir., 107 F. 552, 557. In Cobbledick v. United States, 309 U.S. 323, 328, 60 S.Ct. 540, 84 L.Ed. 783, the opinion by Mr. Justice Frankfurter contains an illuminating discussion of the subject of finality and refers to the mischief which may come to pass when an erroneous order, though made early in a proceeding but of final effect in determining a party's right, is considered not appealable. While the Cobbledick opinion deals with a criminal appeal the principle set out therein is equally applicable to civil causes. In United States v. River Rouge Imp. Co., 269 U.S. 411, 414, 46 S.Ct. 144, 145, 70 L.Ed. 339, it was said, While the general rule requires that a judgment of a federal court shall be final and complete before it may be reviewed on a writ of error or appeal, it is well settled that an adjudication final in its nature as to a matter distinct from the general subject of the litigation and affecting only the parties to the particular controversy, may be reviewed without awaiting the determination of the general litigation. See also Janssen v. Belding-Corticelli, 3 Cir., 84 F.2d 577; Stokes v. Williams, 3 Cir., 226 F. 148, certiorari denied 241 U.S. 681, 36 S.Ct. 728, 60 L.Ed. 1234; Pennsylvania Co. for Insurances on Lives and Granting Annuities v. Philadelphia Co., 3 Cir., 266 F. 1. See also 10 Cyc.Fed.Procedure, 2nd Edition, 1943, p. 231. The nature of the instant controversy and that of the main action in the case at bar leaves no doubt that Beneficial's application for security is collateral. The corporation seeks to enforce its own right under the statute against the plaintiff and intervener. Its interest in respect to security is adversary to that of the plaintiff and of the intervener. The individual defendants, real parties in interest in the main action, are not involved directly in the controversy as to the giving of security and cannot be affected legally by its determination. In at least two decisions the Supreme Court has come very close to the position asserted by Beneficial. In Trustees v. Greenough, 105 U.S. 527, 531, 26 L.Ed. 1157, the Court held that an order awarding expenses and counsel fees to the plaintiff in a representative bondholder's suit was appealable. In the more recent case of Sprague v. Ticonic Bank, 307 U.S. 161, 59 S.Ct. 777, 83 L.Ed. 1184, the Court took the position that an issue respecting the allowance of counsel fees and expenses was separate and distinct from the main litigation, outside the original decree of the trial court and the scope of the appellate mandates, and, treating an order denying counsel fees and expenses as appealable, passed upon the merit of the application. We are not unmindful of the provisions of R.S. 14:3-15 which state that the corporation at any stage of the proceeding may make application for security but the court below deemed the statute inapplicable in the instant case at any time. It follows therefore that without the right to sustain an appeal Beneficial could never gain the security to which it is entitled if the statute is applicable for a writ of mandamus could issue from this court only in aid of its appellate jurisdiction. See 28 U.S.C.A. § 1651, and United States ex rel. Potts v. Rabb, 3 Cir., 147 F.2d 225, certiorari denied 324 U.S. 870, 65 S.Ct. 1013, 89 L.Ed. 1424. If the order of the court below is not appealable we would not have the right to issue the writ since insofar as the instant litigation is concerned this court would have no appellate jurisdiction to protect. We hold the order to be appealable.