Hagan v. Walker et al.

was upwards of seventeen years old, and no step had been taken to revive it against the administrator or the heir. His decision, in accordance with two previous cases to which he refers, was, that such a creditor could sustain the bill, though it might be necessary to direct him to proceed at law to revive his judgment.

*It has been argued, that the bill does not show that [*36 there are not other assets in the hands of the administrator sufficient to pay this debt, and contains no allegation that the administrator was ever requested to pay it. But this bill does expressly aver, that, aside from the property fraudulently conveyed, there is not, any where, any property of Leroy Pope, out of which the debt could be collected; and, although it states that the fraudulent grantor and grantee both remained in possession, and took the crops jointly, and that these crops were of great value, yet, inasmuch as between themselves the crops belonged to the grantee, and as it was the object of the conveyances to prevent them from being applied to the benefit of creditors, we are of opinion there is no presumption that any thing arising from this joint possession ever came to the hands of the administrator, and, therefore, that a demand on him would have been a vain act, which the creditor was not compelled to do.

One other ground on which the demurrer has been rested requires notice. The bill alleges that, after the fraudulent conveyances to William H. Pope had been made, he mortgaged the property to Virgil Maxcy, as Solicitor of the Treasury of the United States, to secure the debt of Leroy Pope which William H. Pope assumed to pay, and it avers that this debt has been in part paid by means described in the bill. Virgil Maxcy and, subsequently when he went out of office, his successor Charles B. Penrose, were named as parties to the bill, but they were out of the jurisdiction, no process was served on either of them, and neither ever appeared or answered. The bill prays that William H. Pope may be compelled to pay to the United States the balance due to them, out of the property in question, and that the residue may be subjected to the payment of the complainant's debt, and for other and further relief.

Under the act of Congress of the 28th of February, 1839, (5 Stat. at L., 321, § 1,) it does not defeat the jurisdiction of the court that a person named as defendant is not an inhabitant of or found within the district where the suit was brought; the court may still adjudicate between the parties who are

Hagan . Walker et al.

properly before it, and the absent parties are not to be concluded or affected by the decree.1

It is obvious, however, that there may be cases in which the court cannot adjudicate between the parties who are regularly before it, for the reason that it cannot bind those who are absent. Where no relief can be given without taking an account between an absent party and one before the court, though the defect of parties may not defeat the jurisdiction, strictly speaking, yet the court will make no decree in favor of the complainant.2

*The case before us is not one of this character; for *37] although the whole of the relief specially prayed for cannot be granted in the particular mode there indicated, because the United States not being a party, no account can be taken of the debt due to them from Leroy Pope or William H. Pope, yet, subject to the encumbrance of this debt, and without affecting it in any manner, the property may be appropriated to the payment of the complainant's debt.

It is true, that in Finley v. The Bank of the United States, (11 Wheat., 306,) which was a bill to foreclose a mortgage by sale, Chief Justice Marshall says: "It cannot be doubted that the prior mortgagee ought regularly to have been a party defendant, and that had the existence of his mortgage been known to the court, no decree ought to have been pronounced in the cause until he was introduced into it." But it could not have been intended by this to say, that a prior encumbrancer was absolutely a necessary party without whose presence no decree of sale could be made, because in that very case the court refused to treat the decree as erroneous, after it had been executed.

In Delabere v. Norwood (3 Swanst., 144, n.) in a bill to obtain payment of an annuity charged on land, prior annuitants were held not to be necessary parties. In Rose v. Page, (2 Sim., 471,) the same rule was applied to a prior mortgagee; and in Wakeman v. Grover, (4 Paige (N. Y.), 23,) and Rundell v. Marquis of Donegal, (1 Hogan, 308,) and Post v. Mackall, (3 Bland (Md.), 495,) to prior judgment creditors; and in Parker v. Fuller, (1 Russ. & My., 656,) persons having encumbrances on real property, which the bill sought to subject to the payment of debts of the deceased owner, were held not to be necessary parties to the bill. See also Hoxie v. Carr, 1 Sumn., 173; Calvert on Parties, 128.

1 RELIED ON in dis. op. Barney v. Baltimore City, 6 Wall., 289.

2 RELIED ON in dis. op. Florida v.

Georgia, 17 How., 508. CITED. Ober v. Gallagher, 3 Otto, 204.

Hagan . Walker et al.

On the other hand there are cases in which it has been declared that all encumbrancers are necessary parties. Many are collected in Story, Eq. Pl., 178, n. But we consider the true rule to be, that, where it is the object of the bill to procure a sale of the land, and the prior encumbrancer holds the legal title, and his debt is payable, it is proper to make him a party in order that a sale may be made of the whole title. In this sense, and for this purpose, he may be correctly said to be a necessary party, that is, necessary to such a decree. But it is in the power of the court to order a sale subject to the prior encumbrance, a power which it will exercise in fit cases. And when the prior encumbrancer is not subject to the jurisdiction of the court, or cannot be joined without defeating its jurisdiction, and the validity of the encumbrance is admitted, it is fit *to dispense with his being made a party. To such a case the 47th rule for the equity [*38 practice of the Circuit Courts of the United States is applicable, and by force of it, this cause may proceed without making the United States, or the Solicitor of the Treasury a party to the decree.

The decree of the District Court must be reversed, and the case remanded, with directions to overrule the demurrer and order the defendants, other than the representative of the United States, to answer the bill.

ORDER.

This cause came on to be heard on the transcript of the record from the District Court of the United States for the Northern District of Alabama, and was argued by counsel. On consideration whereof it is now here ordered, adjudged, and decreed, that the decree of the said District Court in this cause be, and the same is hereby, reversed with costs, and that this cause be, and the same is hereby, remanded to the said District Court, with directions to overrule the demurrer, and to order the defendants, other than the representative of the United States, to answer the bill.

I FOLLOWED. Jerome v. McCarter, 4 Otto, 736.

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Hagan . Walker et al.

properly before it, and the absent parties are not to be concluded or affected by the decree.1

It is obvious, however, that there may be cases in which the court cannot adjudicate between the parties who are regularly before it, for the reason that it cannot bind those who are absent. Where no relief can be given without taking an account between an absent party and one before the court, though the defect of parties may not defeat the jurisdiction, strictly speaking, yet the court will make no decree in favor of the complainant.2

*The case before us is not one of this character; for *37] although the whole of the relief specially prayed for cannot be granted in the particular mode there indicated, because the United States not being a party, no account can be taken of the debt due to them from Leroy Pope or William H. Pope, yet, subject to the encumbrance of this debt, and without affecting it in any manner, the property may be appropriated to the payment of the complainant's debt.

It is true, that in Finley v. The Bank of the United States, (11 Wheat., 306,) which was a bill to foreclose a mortgage by sale, Chief Justice Marshall says: "It cannot be doubted that the prior mortgagee ought regularly to have been a party defendant, and that had the existence of his mortgage been known to the court, no decree ought to have been pronounced in the cause until he was introduced into it." But it could not have been intended by this to say, that a prior encumbrancer was absolutely a necessary party without whose presence no decree of sale could be made, because in that very case the court refused to treat the decree as erroneous, after it had been executed.

In Delabere v. Norwood (3 Swanst., 144, n.) in a bill to obtain payment of an annuity charged on land, prior annuitants were held not to be necessary parties. In Rose v. Page, (2 Sim., 471,) the same rule was applied to a prior mortgagee; and in Wakeman v. Grover, (4 Paige (N. Y.), 23,) and Rundell v. Marquis of Donegal, (1 Hogan, 308,) and Post v. Mackall, (3 Bland (Md.), 495,) to prior judgment creditors; and in Parker v. Fuller, (1 Russ. & My., 656,) persons having encumbrances on real property, which the bill sought to subject to the payment of debts of the deceased owner, were held not to be necessary parties to the bill. See also Hoxie v. Carr, 1 Sumn., 173; Calvert on Parties, 128.

1 RELIED ON in dis. op. Barney v.

Baltimore City, 6 Wall., 289.

2 RELIED ON in dis. op. Florida v.

Georgia, 17 How., 508. CITED. Ober v. Gallagher, 3 Otto, 204.

Hagan . Walker et al.

On the other hand there are cases in which it has been declared that all encumbrancers are necessary parties. Many are collected in Story, Eq. Pl., 178, n. But we consider the true rule to be, that, where it is the object of the bill to procure a sale of the land, and the prior encumbrancer holds the legal title, and his debt is payable, it is proper to make him a party in order that a sale may be made of the whole title. In this sense, and for this purpose, he may be correctly said to be a necessary party, that is, necessary to such a decree. But it is in the power of the court to order a sale subject to the prior encumbrance, a power which it will exercise in fit cases. And when the prior encumbrancer is not subject to the jurisdiction of the court, or cannot be joined without defeating its jurisdiction, and the validity of the encumbrance is admitted, it is fit *to dispense with his being made a party. To such a case the 47th rule for the equity practice of the Circuit Courts of the United States is applicable, and by force of it, this cause may proceed without making the United States, or the Solicitor of the Treasury a party to the decree.

[*38

The decree of the District Court must be reversed, and the case remanded, with directions to overrule the demurrer and order the defendants, other than the representative of the United States, to answer the bill.

ORDER.

This cause came on to be heard on the transcript of the record from the District Court of the United States for the Northern District of Alabama, and was argued by counsel. On consideration whereof it is now here ordered, adjudged, and decreed, that the decree of the said District Court in this cause be, and the same is hereby, reversed with costs, and that this cause be, and the same is hereby, remanded to the said District Court, with directions to overrule the demurrer, and to order the defendants, other than the representative of the United States, to answer the bill.

FOLLOWED. Jerome v. Mc Carter, 4 Otto, 736.

41