Court Opinion

ID: 8813930
Source: CourtListenerOpinion
Date Created: 2022-11-26 15:12:07.84288+00
Date Added: 2024-06-11T17:04:23.825042
License: Public Domain

SANBORN, Circuit Judge
(after stating the facts as above). The first question in this case is: Did the court below have jurisdiction thereof? The foregoing statement of facts demonstrates the conclusion that the real issue in the case was and is whether the Fryers were entitled to one-half of the surplus rents of the land under Dr. G. N. Fryer’s grant of November 13, 1913, and the compromise of 19Í6, in view of the reconveyance to him by the plaintiff and his granting on November 1, 1914, of all the surplus'rents to the plaintiff. The real parties in interest in that issue were and are the plaintiff and King on one side, and the Fryers on the other. All these parties were and are residents of Tennessee. The plaintiff, in commencing this suit, however, was careful not to make the Fryers parties to it. She brought it against tenants in actual possession of the land under rental contracts which they made with W. S. Fryer, and for which they *513had given their rental notes to him, payable to the plaintiff and W, S. Fryer, according to the provisions of Dr. G. N. Fryer’s instrument of November 13, 1913, which he or his brother have collected. She prayed for a decree that she was the sole owner of the property during her natural life, that these tenant defendants had no right to pay, and should be enjoined from paying, any rents or executing any rental notes to W. S. Fryer or George L. Fryer, and that the claim of the tenant defendants through Fryer — that is to say, the instrument of November 13, 1913 — be adjudged a cloud upon her title and be removed. There are two other prayers in the complaint — -that the plaintiff have an accounting with the tenant defendants of the amount of rents wrongfully paid by them to the Fryers for the year 1916, and that a receiver be appointed; but these prayers are negligible, because there was no allegation in the complaint that these tenant defendants had made any such payments, and because the grant of each of these prayers was conditioned by the adjudication prayed that the claim of Fryer of one-half of the surplus rents and to the management and control of the property under the instrument of November 13, 1913, through which the tenant defendants claimed, should be adjudged invalid.
[1, 2] There is a fundamental principle of equity jurisprudence that a court of equity ought not to and will not render a final decree, which cannot be made without seriously affecting the interest of one who is not a party to the suit, or without leaving the controversy pleaded in such a condition that its final determination might be inconsistent with equity and good conscience. As the indispensable condition of the decree sought from the court below against these tenant defendants was its adjudication that the grant of the management and control of the property and of one-half of the surplus rents lo W. S. Fryer by the instrument of November 13, 1913, was ineffectual, and that his claim thereto was unfounded, and as she demanded a perpetual'injunction against any agreement to pay and any. payment of any rents to him or to G. D. Fryer by any of these tenant defendants, there is no escape from the conclusion that no final decree against those defendants could be rendered in favor of the plaintiff upon this complaint without substantially affecting the interest of the Fryers in the subject-matter of this litigation. While such an adjudication and such a decree of an injunction would not be res adjudicata as against the Fryers while they were not parties to the suit, it would nevertheless deprive them of all the benefits of their claim, of all the fruits of the grants to W. S. Fryer on which they relied, at least until they should bring independent suits against these tenants and recover judgments or decrees against them upon the rental contracts.
If there were any doubt of the proposition that the Fryers and King and the plaintiff were the real parties to this controversy, and the decree sought against the defendant tenants would seriously affect their rights, the subsequent course of the parties to this suit and the subsequent action of the court below must dispel it. The tenant defendants answered the plaintiff’s complaint that the rents for the year 1916 *514liad been paid in full, that they had no interest in the outcome of the suit, and that they would pay the rents of 1917 and those arising thereafter to whomsoever the court should direct. About three months after this answer was filed, W. S. Fryer and G. B. Fryer filed a petition, in which they set forth their interest in the property, the rents, and the controversy, and prayed that they be permitted to intervene and to defend this suit in their own right in lieu of the defendant tenants, and the court below granted their petition and ordered that they “be permitted to intervene and be substituted as defendants in place of the defendants named in the bill.” Thereafter the real parties in interest in this controversy, the plaintiff, King, and the Fryers, were the parties to this suit, and each of them was a citizen and resident of the state of Tennessee. So it is that W. S. Fryer and G. B. Fryer were indispensable parties to the suit below by the plaintiff here, without whose presence as parties thereto she could not maintain it. As they were and are citizens and residents of the same state as the plaintiff, and as their joinder as parties would necessarily oust the jurisdiction of the court, this suit cannot be maintained in the federal court, and the order appointing a receiver was made without jurisdiction.
[3-5] If the suggestion occurs of the possibility of the maintenance of this suit as a suit to quiet title against the tenant defendants without joining the Fryers, the answer is (1) that since the substitution of the Fryers for the tenant defendants, and therefore at the time of the appointment of the receiver, all the parties to the suit and all the real parties to the controversy have been and are residents and citizens of the same state; (2) that nonpossession by the defendants is essential to the maintenance in a federal court of an action to quiet title, and the possession was in the defendant tenants holding under the Fryers when this action was commenced and ever since, and has not been during that time in the plaintiff; and (3) that the plaintiff had an adequate remedy at law, either by ejectment for the possession of -the land or at the plaintiff’s option by an action on the leases between her and the defendant.tenants, if there were such leases, and, if not, for the use of the premises.
[6] The conclusion is that this case falls clearly without the jurisdiction of this court, under the opinion of Judge Carland in Hawes v. First National Bank, 229 Fed. 51, 143 C. C. A. 645. The order of the court below appointing the receiver must therefore be reversed, and the case must be.remanded to the District Court, with directions to cause all the moneys and property and all the proceeds of the property seized or collected by the receiver to be paid over and delivered to the defendants W. S. Fryer and G. B. Fryer, and to tax the costs and expenses of the receiver against the plaintiff below. The court, being without jurisdiction, has no property to pay them. As was well said by Judge Carland in the Hawes Case:
“Where a receivership is procured illegally, the costs of the receivership may be taxed against the complainant procuring the appointment. * * * Courts may not seize property without jurisdiction, and then claim jurisdiction over the property because it is in the possession of the court.”