Court Opinion

ID: 6894863
Source: CourtListenerOpinion
Date Created: 2022-07-23 21:48:34.224735+00
Date Added: 2024-06-11T16:05:56.931558
License: Public Domain

Lord, C. J.,
dissenting.—As I am unable to concur in the result reached by my associates, the importance of the principles involved must be my excuse for a statement of the grounds of my dissent. I hold that the decree rendered in the suit of Teal v. Dickinson et al., is a conclusive bar against Goldsmith’s title in the present suit, for the reason that he is the grantee or successor in interest of Teal, by title subsequent to the commencement of that suit. The decree in that suit was to the effect that the fee simple was not in Teal, but the defendants, in the proportions named therein; and that Teal, nor any person claiming by, through, or under him, has any right, title, or interest in or to said premises, or any part thereof. It is provided by the code, that “ The effect of a judgment, decree, or final order in an action, suit or proceeding before a court or judge thereof of this state, or of the United States, having jurisdiction to pronounce the same, is as follows : ® * * The judgment, decree or order is, in respect to the matter directly determined, conclusive between the parties and their representatives and successors in interest by title subsequent to the commencement of the action, suit, or proceeding.” (Code, Sec. 723, Sub. 2.)
It is not disputed but that the “ matter directly determined ” by the decree in that suit is the identical title asserted by Gold*154smith in the present suit; nor that he derived his title from Teal after the complaint was filed, summons issued and delivered to the proper officer, and service had on one of the defendants. If these acts—the filing of a complaint and the causing of a summons to be issued and delivered to the sheriff —constitute, within the meaning of the code, the commencement of a suit, Goldsmith is in privity with Teal, and bound by the decree. In his complaint Teal alleged that “ He was the owner in fee simple, and in possession of the premises ” described ; and by force of the provision referred to, it is the title at the time of the commencement of his suit of which the decree rendered therein is conclusive, not only as against him, but against all who claim title under him, subsequent to the commencement of that suit. It becomes important, then, to ascertain the definition of the “ commencement of an action ” or suit within the meaning of the code.
At common law an action is commenced by issuing a writ, and in some of the states that rule is practically adhered to or declared by the statute. In New Y ork it is provided that an action shall be commenced by the service of a summons. (Code of 1872, Sec. 127.) The same is declared in Minnesota. (Statutes 1878, Sec. 52, p. 714.) In California, Kansas, and Indiana, a civil action is commenced by filing a complaint and the issuing of summons thereon. (Cal. Code, 1872, Sec. 22; Com. L. of Kansas, 1879, Sec. 57, p. 608 ; Kev. Stats, of Indiana, 1881, Sec. 314.) By reference to the decisions under these different provisions, it will be noted that the language is resorted to and controls in determining what constitutes the commencement of an action. To illustrate : In Depuy v. Shear, 29 Cal. 238, Sawyer, J., said: “The complaint in this case was filed, and summons issued thereon, on the 26th day of July, 1855. A suit was, therefore, commenced on that day, within the provisions of section 22 of the practice act.’’ Again: “ The practice act prescribes the mode of 'commencing suits and acquiring jurisdiction of the parties. The proceeding is controlled by its provisions, and not by the rules of practice which prevailed at common law. * * * The acts of *155filing a complaint and issuing summons were both performed, and a suit was, therefore commenced.” Our code in reference to the commencement of an action is equally plain and precise. It provides that “ actions at law shall be commenced by filing a complaint with the clerk of the court. * * * At any time after the action is commenced, the plaintiff may cause a summons to be served on the defendant,” &c. (Civil Code, Sec. 50.) This provision is made applicable to suits in equity (Civil Code, Sec. 385), so that the same meaning applies to the commencement of a suit in equity as an action at law. The action or suit is commenced by filing the complaint, and after it is commenced, that is, by filing a complaint, the plaintiff may cause a summons to be served on the defendant.
On the fifth day of May, 1880, Teal filed his complaint with the clerk of the court, and delivered a summons to the sheriff to be served on the defendants. A suit was, therefore, commenced on that day within the meaning of the section cited. It is not claimed that the court acquired jurisdiction of the defendants until there was service upon them. But, in this particular, the case stands different as to Teal. When he commenced his suit by filing a complaint, and, at the same time, caused a summons to be delivered to the officer to be served on the defendants, he necessarily invoked and submitted himself to the jurisdiction of the court. As to Teal, the suit was not only commenced, but jurisdiction was acquired, on the 5th day of May, 1880, and when service was obtained upon the defendants, and the cause proceeded regularly to judgment or decree on issue joined as to the title alleged in his complaint, whoever, after that date—the commencement of the suit—acquired an interest or title in the subject matter of that suit of Teal, as Goldsmith did, took such title subject to, and is bound by, the decree rendered therein.
Taking, then, these provisions of the code together, viz., that “ by filing a complaint with the clerk ” a suit is “ commenced,” and the conclusive effect to be given to a decree, against “ a successor in interest by title subsequent to the commencement of the suit,” and Goldsmith holding a derivative title from Teal *156after the filing of complaint—the commencement of the suit— the decree is as effectual as to him as his grantor Teal. Privies, within the meaning of this rule, are those who are successors in interest of the matter or title directly determined, by title subsequent to the commencement of the suit, and under the familiar and elementary rule are bound by the decree, although not made parties. By taking his title in that manner, Goldsmith placed himself in legal privity with Teal, part of whose interest or title he purchased, and which was affected by the decree. It may be hard, as remarked in Buller’s Nisi Prius, “ that a man should be injured by a determination that he, or those under 'whom he claims, was not at liberty to controvert.” But the party under whom Goldsmith claims did have that liberty and opportunity. He instituted the suit, and brought the defendants into court in invitum, by force of the summons he caused to be served, and compelled them to adjudicate the title alleged in his complaint. The whole matter as thus alleged was controverted by pleadings, by evidence and by argument. The truth is, however, there never was any “ hardship in holding that a man should be bound by that which would have bound those under whom he claimed quoad the subject matter of the claim; for qui sentit commodum, sentiré debet et onus, and no man can, except in certain cases excepted by the statute law and tliefiaw merchant, transfer to another a better right than he himself possessed.” (2 Smith’s Leading Cases, 624.) Yet such is the consequence of the decision in the present suit. It holds, in effect, that the decree in the Teal-Dickinson suit does not operate as an estoppel against Goldsmith. Teal has been able to transfer a better right—a better title, than he possessed. The stream has risen above its source, a thing which cannot be true in law or philosophy.
In nearly all the states there is a statutory provision, to the effect that in any action affecting the title to real property, the plaintiff, at the time of filing the complaint or at any time afterwards, may file with the clerk of each county in which the property is situated a notice of the pendency of the action, containing the names of the parties and the general nature of *157the action, etc. From the time of its filing it operates as constructive notice of the pendency of such action, and whoever purchases thereafter the property affected thereby,is bound to-the same extent as if he were made a party. Under these statutes it will be observed that the notice to purchasers or encumbrancers dates from the filing with the officer; while at' common law, the lis pendens and consequent notice only began from the service of the subpoena, or other process, after the filing of the bill, so that the court may have acquired jurisdiction of the defendant. (2 Pom. Eq. Jur., Sec. 631.) At common law, also, the averments of the bill “ must be so definite that any one on reading the case can learn what property was intended to be made the subject of litigation,” in order to operate as notice.
We have no statutory provisions upon this subject. But it seems to me that the sections cited, when taken together, and of which all persons are bound to take notice, are calculated, if not designed, to include this object. By filing the complaint with the clerk—it necessarily containing proper and specific averments of the subject matter to be litigated, and the names of the parties to be affected thereby—=a suit is commenced, and operates, under Sec. 723, as constructive notice of the pendency of the suit and the subject matter involved for judicial determination, against all persons who purchase or acquire an interest of the parties by title subsequent to the commencement of the suit, making the decree rendered therein conclusively binding on them to the same extent as if they had been made parties. To hold otherwise, would allow the plaintiff, by such alienation of title after suit commenced, to defeat any judgment or decree adverse to him, and subject the defendants to the annoyance and expense of another defense, again to be defeated by a similar course of proceeding. Usually, and in fact in all the cases which have come under my observation, the question is raised as to the purchasers from the defendant; but the reason of the rule applies with much greater force to him deriving title from the plaintiff who instituted the suit, and brought the defendants into court.
*158But to obviate this effect, it is said that prior to the commencement of the suit of Teal v. Dickinson et al., Goldsmith had made a contract with Teal for the conveyance of this identical land which Teal deeded to him after the commencement of that suit; and, consequently, he had an equitable estate in the lands antecedent to that suit, which was unaffected by the decree, unless he was made a party to the proceeding. But in' this case his equitable estate depends upon Teal’s having title to the lands. By taking title from Teal subsequent to the commencement of the suit, he is bound by the decree as to that title. The decree adjudged the title to be in the defendants— that Teal had no title—and consequently, there is no title upon which the equitable estate can rest. In a word, if Teal had no title, as the result proved, his contract could create none, legal or equitable. If I am right in this point, it is decisive of the case.
It only remains now to consider wherein I differ with my associates in the application of the law to the facts in avoiding the doctrine of Us pendens. As I understand it, the reasoning of the decision is, that equity treating that as done which was agreed tobe done, Goldsmith, under the contract referred to, acquired an equitable estate or interest in the lands prior to the commencement of the suit of Teal v. Dickinson et al., and that in order to bind him by the decree rendered therein, he must have been impleaded, notwithstanding he acquired his title to such property by deed from Teal after the suit was instituted. His equity is thus made antecedent to that suit, and put beyond the reach of the doctrine of lis pendens.
Now, there are some facts which are undisputed, that need to be stated and kept in view, to properly understand how the law has been applied to the facts of this case. With the exception of one-eighth, the land which was the subject matter of the suit in Teal v. Dickinson et al. is the subject matter of the present suit. After that suit was commenced, Teal made and delivered his deed to Goldsmith, which on its face purported to convey then, and of that date, the land in question; but the deed was not recorded till more than two months thereafter *159and after the defendants had been served and answered in the suit. There is no pretense that the defendants in the former suit had any knowledge or notice, actual or constructive, of the equitable estate or interest acquired by Goldsmith under the contract of 1878. Whatever of advantage might have accrued to Teal in the prosecution of the former suit, would have inured to the benefit of Goldsmith as against the defendants. Ihe result, as we have seen, proved otherwise. The court held that the defendant had the superior or paramount title; or in fact, that Teal had no title whatever. Now Goldsmith claims that he is not bound by that decree, because he was not made a party to the suit, although his deed purports to be a conveyance of the lands after the suit was commenced; and that the doctrine of Us pendens, invoked by the plaintiff in the present suit, is not applicable to him, because, under his contract with Teal, he acquired an equitable estate anterior to that suit. But how is that equity made antecedent as to the defendants in the suit of Teal v. Dickinson et al. ? It is said that in equity an agreement for the sale of land, although executory, is treated as executed, and operates to transfer the estate from the vendor and to vest it in the vendee; so that Goldsmith, by force of his contract, acquired an estate or interest in the land which was prior to the suit. The maxim of equity is that “ equity regards that as done which ought to be done.” It is the presence of the “ ought ”—the equitable duty which imposes the obligations upon the consciences of the parties to the contract, and induces equity to treat as done that which ought to be done. It has no reference to third parties unaffected by notice. Nor will equity thrust aside the law where the contract is still executory, and no estate is vested in or acquired by the vendee, to push forward a concealed equity as against third parties without notice. It creates no rights destructive of the interests of third parties, without notice actual or constructive of that contract. “ What ought to be done is considered in equity as done,” and its meaning, Mr. Adams says, “ is, that whenever the holder of property is subject to an equity in respect to it, the court will, as between the *160parties to the equity, treat the subject matter as if the equity had been worked out, and as impressed with the character which it would then have borne.” (Adams Eq. 135. “ But,” says Judge Story, “equity will not thus consider things in favor of all persons, but only in favor of such as have a right to pray that the acts might be done.” (Story’s Eq. Jur., See. 2-19. See also Pomeroy’s Eq. Jur., Secs. 363, 368; Pomeroy on Contracts, 290.)
It is plain that this equitable construction of contracts is only applied to the parties or grantees with notice, upon whom an equitable duty is devolved, and will not be extended so as to affect injuriously the rights of third persons. As to these, equity will not regard the contract as executed, and as operating to transfer an estate, but will rather leave it as at law, which imparts no property right whatever. In this view, Goldsmith acquired no antecedent equity or property in the land, or other title, until the contract was executed by performance, and he became invested by his deed with whatever title, legal or equitable, Teal had. He then became a purchaser of the land, and acquired a property in it; but this was not until after the suit was commenced, and by the doctrine of lis pendens he was bound by the decree rendered against his grantor, Teal.
I am aware that it is laid down by the text-writers that the rule applies only to rights or interests acquired from a party after the institution of the suit, and not to the case of a right or equity antecedently acquired. (2 Pomeroy’s Eq. Jur., 637 ; Wade on Notice, Sec. 160.) But the question is, When, upon the facts, will such rights or equities be treated as antecedent, when property was conveyed after the suit was commenced ? Mr. Pomeroy says : “ If a person has acquired a prior right to the specific land, the commencement of a suit affecting the same land will -not invalidate any act which he may subsequently do in pursuance of such antecedent right, or for the purpose of carrying it into effect.” (Sec. 637.) Now note the illustration given in the notes. “ For example,” he says, “ the bringing of a suit against A as the owner of land is not notice to B, a prior vendee from A, who is in actual possession, and willno.t *161prevent him from subsequently taking the necessary steps to complete the purchase and obtain a deed of conveyance.” But his “ actual possession ” does charge the party bringing the suit with notice that he has an interest, or some right of property in the land, and that he must make him a party, or he will not be bound by the decree. And so here, if Goldsmith, under his contract, had gone into possession of the land, or done any act or thing which would have been the equivalent of notice, the defendants in the suit of Teal v. Dickinson et al. would have been charged by the law that it was necessary to make him a party, otherwise the decree would not bind him. It is unnecessary to say there is no pretense of any facts from which such notice may be inferred. Goldsmith had actually done nothing under his contract that charged third parties or the defendants in that suit with notice of any equity or interest he had acquired in the land; and what is still worse, the deed which was executed to him after the suit was commenced was pocketed, and not recorded for more than two months afterwards ; the suit all the while being prosecuted by Teal for the whole interest, with whom, to say the least, lie had an identity of interest, and the court jurisdiction of all the parties.
Under this state of facts, I propose now to make a brief examination of the authorities cited, for the purpose of ascertaining whether the facts to which the law is applied in them differ in any essential degree from the facts here.
In Parks v. Jackson, 11 Wend. 442, the court held that the institution of a suit was not notice to a prior purchaser, who had gone into possession, and made expenditures on the faith of the purchase, although his deed was not in fact executed until the institution of the suit. In Trimble v. Boothby, 14 Ohio, 115, the defendants had taken possession and paid the consideration money, under the contract to sell the land, prior to the commencement of the suit. The court says : “If the interest in these lands acquired by purchase from Kerr was to be affected by the suit of Morris’ devisees, such interest existing prior to the commencement of the suit, the persons so interested should have been made parties. Not having been *162made parties, it was their right to clothe their equity with the legal title. The opinion must be read in the light of the facts. The parties were in actual possession under their contract, and nothing is better settled than that this constituted notice.”
In Clarkson v. Morgan's Devisees, 6 B. Monroe, 445, the court say : “ There is evidence tending strongly to the conclusion that Fowler had acquired the possession, claiming the same in his own right, before the bill was filed. He certainly, before the bill was filed, claimed and exercised a right to the possession, and sold land to James Marshall, one of the complainants, in April, before suit was brought, who must have entered upon the same immediately.” The italics are the court’s.
In Haughwont v. Murphy, 22 N. J. Eq. 545, the court say: “ But the defendant was not a purchaser pendente lite: he acquired title by deed which bears date on the 7th day of August, 1865, and was acknowledged on the next day. * * * The proof, however, is full and clear, that it was executed and delivered to Murphy before the bill was filed in the case of Haughwont v. Boisaubin. The commencement of a suit in chancery is constructive notice of the pendency of such suit, only as against persons who have acquired some title to or interest in the property involved in the litigation, after the suit was commenced. A person whose interest existed in the land at the commencement of the suit is a necessary party, and will not be bound by the proceeding unless he be made a party to the suit.” By reference to the statement of facts in this case, the reader is referred to Haughwont v. Murphy, 21 N. J. Eq. 122, in which the court say: “Murphy might have been made a party to the bill against Boisaubin; he was a proper if not a necessary party; and if his deed was not known to Haughwont at the filing of the bill, he had notice on the filing of the answer in Oct., 1865, and might have amended his bill so as to make Murphy a party, or he might then have commenced suit against him.”
Essentially as the facts differ in all these cases from the state of facts here, it cannot escape the attention that the pre*163vailing parties in all these suits had full notice, either possession or some equivalent fact, at the time of bringing the suit, and thus opportunity to make them parties to the suit, and bind them by the decree. Have we not a right to infer—more especially where title is derived from the plaintiff after the commencement of his suit—in the absence of any fact to charge notice, actual or constructive, that a different rule would prevail as to the defendants? These cases do not reach the facts, or the law to be applied to them, as disclosed by this record. There is no claim that the defendants in the suit of Teal v. Dickinson et al. had any notice whatever of the interest of Goldsmith under the contract. And without notice of such interest, how was it possible for them to have made him a party ? The law does not require the performance of impossible things. Teal knew of his interest and brought the suit, and the law devolved upon him the duty of bringing in all parties to be affected by the adjudication. But be may have thought, as I think, that it was unnecessary. ’ .cSuse Goldsmith was identified with him in interest; and the rule is that “ Whenever this identity is found to exist, all alike are concluded.”
Moreover, it seems to me in such case that a party’s interests or rights ought not to be treated as vested—the contract executed—and thereby made antecedent, until by going into possession, or doing some other act, the defendants in that suit became chargeable with notice of its existence. The rule is that such equitable estate of the vendee arising out of an executory contract is only treated as executed, and only avails against the vendor’s heirs, devisees, and grantees with notice. (Pomeroy’s Eq. Jur., Sec. 368.) Nor can I avoid the impression, that to deprive the defendants now of the rights acquired by the decree in the former suit, on the ground of Goldsmith’s antecedent equity, and that to bind him he must have' been made a party, when no act of either Teal or Goldsmith was calculated or designed to impart notice, and when the defendants, by the most active scrutiny, could have acquired no knowledge of the existence of such equity, is the announcement of a principle which is liable to result in the future in serious obstruc*164tions to the administration of justice. The genei’al rule, that a person whose interest existed at the commencement of the suit is a necessary party, and will not be bound by the proceedings unless he be made a party, is conceded. But under the facts of this case, when the former suit was necessarily prosecuted as much in the behalf of Goldsmith as Teal, the title conveyed after his grantor had commenced suit, and the record disclosed Teal clothed with the full legal title, Goldsmith should be taken to have acquired his interest when the deed was recorded as to the defendants; which, being after the suit was commenced, and service had on all the defendants, comes within the operation of the doctrine of lis pendens.
In Utley v. Fee, 33 Kan. 689, the court say : “ The title and estate of a person holding an unrecorded deed is, as to third persons without notice, wholly in the grantor, and the grantee is in privity with his grantor; and any decree rendered against the grantor affecting the grantor’s title is also in effect a decree rendered against the grantee, and it equally affects his title; and the decree is res adjudieata as to the interests of all.”
In Norton v. Birge, 35 Conn. 263, it was held that when a party to a suit had conveyed his interest in the land before the commencement of the suit, the deed not being recorded, the purchaser would be bound by the judgment. “ Otherwise,” said the court, “the purposes of the suit, and the ends of justice in all such cases, would be defeated.” The party was deemed to have taken his deed pendente lite. But here the deed was not executed or recorded until after suit and service. With stronger reason, upon the facts, why ought not the same rule apply to this case ?
I am aware it is claimed the doctrine of lis pendens does not stand upon the ground of notice, but that it is a rule of public policy, the effect of which is to impose a disability to convey the subject matter of litigation pendente lite (Bellamy v. Sabine, 1 DeG. & J. 580); and that the rule only applies to purchasers, and not to holders of previously acquired equitable interests in the property. (Wade on Notice, Sec. ) But it is a rule *165of public policy that there should be an end of litigation, and I have endeavored to show that unless the decree in Teal v. Dickinson et al. operates as an estoppel and binds Goldsmith, there is no disability to convey the subject matter pendentelite, and there ean be no end to the litigation. But the cases already referred to sufficiently illustrate the doctrine, and none of them are parallel witli this; and in all of them there were facts which imparted notice at the commencement of the suit, which enabled the party bringing the suit to make the holders of such interests a party, or to take the consequences of his failure to do it, which cannot be charged against the defendants in Teal v. Dickinson et al. My conclusion is that the decree operates as an estoppel, and bound Goldsmith, and, of course, all who claim under him.