Court Opinion

ID: 9849647
Source: CourtListenerOpinion
Date Created: 2023-09-24 04:43:35.081309+00
Date Added: 2024-06-11T09:20:21.559237
License: Public Domain

Fromme, J.:
Dissenting. The partial disposition of this controversy approved by the majority opinion will result in further uncertainty and confusion for these litigants. The Neosho county case was submitted on limited issues. The court affirms the case on the issue of the George family’s ownership and rights to the original certificates of stock. The original certificates are lost or destroyed.
The court reverses and returns the case to the Neosho district court to determine equitable set-offs against $5,200 which the George family is ordered to repay to Woods before being entitled to reissue of this stock. Assuming the equities are determined and the amount is paid to Woods the Neosho district court will presumably order the corporation to reissue 222 shares of stock to the George family.
However, new certificates were previously issued to Woods. He pledged these new certificates with the bank in Salina. The pending action in the Saline district court includes these same parties plus the bank. It is probable that the Saline district court in that action will find and determine that the bank is a bona fide holder under the Uniform Stock Transfer Act and entitled to its lien on the certificates of stock which they now hold. In such case the certificates of stock may be ordered sold to satisfy the indebtedness. In the hands of a purchaser at the sale the stock as evidenced by the certificates would be validly owned and held by the purchaser.
In such event the Neosho county judgment affirming the George family ownership of the stock is an exercise in futility, regardless of what may be said to the contrary in the majority opinion. In truth and in fact the ultimate outcome of this controversy depends *368upon the judgment of the Saline district court which has jurisdiction of all parties necessary to determine the entire controversy.
The error which should require a complete reversal of the judgment with directions to dismiss the case arises because of the absence of an indispensable or necessary party, the Salina bank. During the trial in the Neosho district court evidence was introduced which established that the Salina bank claimed an interest in the reissued certificates which had been pledged to it to secure indebtedness. At that time the Salina bank was known to be a necessary party to determine the entire controversy between Woods and the George family. Without the bank complete relief could not be accorded to those parties already in the action. The bank held possession of the certificates evidencing 222 shares in this corporation. This stock was the subject matter of the Neosho county action. As a practical matter it should have been apparent to the parties that they were subject to substantial risk of incurring inconsistent obligations with regard to the subject matter of the action because of the bank’s rights in the stock and the pendency of the action in Saline county. The bank was a necessary party. (See K.S.A. 60-219 [now 1969 Supp.])
It is well settled that where there is concurrent jurisdiction in more than one court, the court which first acquires jurisdiction retains it to the exclusion of another court which is requested or seeks to assume it. (See Colorado Interstate Gas Co. v. State Corporation Comm. 192 Kan. 29, 386 P. 2d 288, and cases cited at page 35.)
There are certain prerequisites to the application of this rule.
In 20 Am. Jur. 2d, Courts, § 131, the rule is stated:
“Generally, the priority principle is applicable only when the cases involved are identical as to subject matter, parties, and relief sought. The identity as to subject matter, parties, and relief sought must be such that a final adjudication of the case by the court in which it first became pending would, as res judicata, be a bar to further proceeding in a court of concurrent jurisdiction.”
Also, in section 138, another is stated:
“The priority principle does not come into operation where the plaintiff cannot obtain from the first court all the relief aslced for and to which he is entitled. This means that though the party who invokes the jurisdiction of one of the courts having concurrent jurisdiction is generally bound by his election and cannot thereafter bring an action in another tribunal, this is not so where the later suit involves questions that cannot be considered in the earlier one. In fact, it has been said that where an action is brought in a court that does not have the jurisdiction to afford complete relief, the court *369having such jurisdiction may restrain the parties from proceeding further in the court not having such plenary jurisdiction. Moreover, it has been said that to bring the priority principle into operation in the suit later instituted, the defendant as well as the plaintiff must have a complete opportunity for the adjudication of his rights in the suit first instituted.
“In this connection it has been pointed out that the priority principle must yield to the more vital and fundamental principle of justice which requires that every litigant shall have his day before a court competent to afford adequate and complete relief.”
The law of Kansas is to the same effect. See Walker v. McNutt, 165 Kan. 533, 196 P. 2d 163.
The bank is an indispensable party to a complete determination of this controversy. There is no relief which can be granted by the Neosho district court against either W-G Fertilizer, Inc. or Woods which does not substantially affect the rights of the bank. Therefore, since the George family chose not to make the bank a party to the Neosho county action, and the bank chose not to intervene in Neosho county but to file its own action in Saline county and secured service on all parties necessary to a complete determination of the matter in Saline county, the Saline district court was the first court to acquire jurisdiction of all parties. Thereafter all proceedings herein should have been in the Saline district court and the defendants not required to defend a piecemeal affair in Neosho county.
The entire controversy can and should be litigated in the Saline county action.
The judgment partially determining the controversy should be reversed and the case should be remanded with directions to dismiss the action.
Price, C. J., and Schroeder, J., join in the foregoing dissenting opinion.