Court Opinion

ID: 3547980
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:00:34.692871+00
Date Added: 2024-06-11T13:33:51.678919
License: Public Domain

The right of Mrs. Gruber to maintain this action in her own name for the one-quarter interest deeded to her by Pollard is the only question upon which there is any difference of opinion among the members of this court. The terms of the agreement executed contemporaneously with the deed clearly show that *Page 479 
there was no absolute sale, no conveyance of the property, nor of any interest therein. Mrs. Gruber acquired no right, title, or interest in or to the one-quarter interest of Pollard in the Oest mine by the deed, or in the fruits of the litigation, so far as that interest is concerned. All that was conveyed to her, or that was intended to be conveyed, was the mere naked right to sue in her own name for the sole benefit of Pollard. There are some very respectable authorities which maintain the doctrine that the right to bring an action to cancel a deed for fraud cannot be conveyed or assigned even to a purchaser for value. Other more numerous and better considered cases declare that the party who has been defrauded may sell his equitable interest in the property to a third party, and that such third party may establish the fraud in equity, and thereby be protected in his purchase. These authorities recognize the distinction between an absolute conveyance of the property and the assignment of a mere right to sue for the benefit of the grantor. Where the conveyance is made to another person, bona fide, for a valuable consideration, such person can maintain the action in his own name, for he is the real party in interest. If a conveyance is made to a trustee for the benefit of creditors, minor heirs or persons who may inherit an interest in the estate, or in any case where the assignee has an interest in the fruits of the litigation, the action can be maintained for the same reason. But, if the transaction relating to the assignment or conveyance of the property amounts simply to a mere right in the assignee or grantee to sue in his name for the sole benefit of the assignor or grantor, then the action cannot be maintained. All the authorities agree that the assignment of a bare right to file a bill in equity for a fraud committed on the assignor cannot be maintained in the name of the assignee. The fraud upon Mrs. Gruber and Pollard arose out of the purchase of their separate interests in the Oest mine, at the same time, in the same manner and from the same cause; but Mrs. Gruber was not thereby defrauded or damaged by the sale of Pollard's interest, nor was Pollard injured by the fraud upon Mrs. Gruber. They were both equally interested in having the transaction declared fraudulent, and beyond that their interests and rights were entirely separate and distinct. Neither had any right, title or interest whatever either in the damages, or in the property to be recovered by the other. *Page 480 
It is claimed that the assignment of the Pollard interest to Mrs. Gruber ought to be sustained because it tended to lessen the litigation, and to avoid the unnecessary expenses of separate suits; in other words, that appellants, instead of being prejudiced, have really been benefited by the assignment. The contention is not well founded. If two persons were injured in a collision upon a railroad, at the same time and place, one of them might, by assigning his cause of action for damages to the other, for the purpose of settling all disputed questions in one suit, materially lessen the expenses of the litigation, and cases might be imagined where such a course would be beneficial, instead of prejudicial, to the railroad corporation, the defendant in the action. But is it not equally clear that cases might frequently arise when it would be detrimental and injurious to the interests and legal rights of the defendant? If such a practice were permissible, the parties injured, by blending the causes of action into one suit, and thereby uniting the weaker with the stronger and clearer case, might stand a much better chance for a recovery on both than if each was made to rest exclusively upon its own merits. Would not the defendant in such an action, irrespective of the question of expense or injury, and without any proof that the assignment was champertous, have the right to object, and have his objections maintained upon the ground that the law does not permit such actions to be assigned? It is within the power of the legislature, whenever it is deemed advisable so to do, in the interest of public justice, to make causes of action for fraud assignable, so as to authorize any person to maintain such a suit for the benefit of another; and in my opinion, it is a safer and better course for the courts to leave the question of practice, if any change is needed, to be decided by legislative action. It may be that no harm or injury has resulted in this particular case to appellants; but they had the legal right to prove, as they did, that Mrs. Gruber had no interest whatever in the interest in the mine deeded to her by Pollard, or in the damages to be recovered thereon, and to object to her maintaining the suit as to the Pollard interest on that ground, and to rely in support of the objection upon the numerous authorities which without exception declare that such assignments are void as against good policy, and savor of maintenance. This conclusion is based upon the theory that such assignments, if allowed, would have a tendency to encourage *Page 481 
litigation, and lead to improper intermeddling and undue interference in the prosecution of such suits. I am of opinion that, as a general rule, it would lead to such injurious results, and that the reasons given in the decided cases are substantial, wise, and just, and ought to be sustained. Entertaining these views, I concur in the judgment announced by Mr. Justice Murphy.