Ex parte Branch, Sons & Co. , 53 Ala. 140 ( 1875 )

MANNING, J.

The cause of Morris and Lowery, trustees, &c. vs. the Western Eailroad Co., and others lately decided in the chancery court of Montgomery county, to which petitioners pray this court will by mandamus compel the chancellor to make them parties defendant, is one of peculiar and uncommon features and of great importance. We do not, however, on this motion, have occasion to comment on them.

The final decree was rendered on the 18th of December, 1874, and ordered an inquiry and report to be made by the register, as master, of the amount of the two series of mortgage bonds, first and second, issued by the late Montgomery and West Point Eailroad and charged upon its railroad, and of the first mortgage bonds issued by the Western Railroad Co. of Alabama, charged upon the railroad, which was all it then owned, extending from Montgomery to Selma, and of th.e second mortgage bonds of the Western Railroad Co. of Alabama, issued after the acquisition by that company of the Montgomery and West Point Railroad and the incorporation of it with its own road aforesaid from Montgomery to Selma, making a continuous road from West Point on the eastern border of the State through Montgomery to Selma, a distance of about 150 miles, now called the Western Railroad of Alabama, and which is charged with the payment of the last aforesaid bonds; The register was further instructed to inquire and report the amount of the past due and unpaid coupons for interest, of said several series of bonds, with interest at 7 per cent, thereon from the time of the maturity of the coupons, respectively, and the costs and expenses of the suit, including commissions to the register for the sale of said railroads, commissions to the trustees, plaintiffs in the suit, and the fee of their solicitor. And after ascertaining the amount of all of these latter sums, which must be paid in ready money, and the amount of the bonds which are not yet due, the register was instructed to offer all the property of said Western Railroad Company in Alabama for sale at auction for cash, requiring as the minimum bid therefor the total amount of all said bonds, and past due coupons and other items aforesaid, less $150,000, the estimated value of that part of the company’s property which was situated in Georgia beyond the boundary line of this State.

The total sum aforesaid, less said $150,000, amounted on the day of sale, April 19th, 1875, to $3,129,166.01, and no person having bid said amount in cash, the entire property was sold, according to directions in the decree, to the Central Railroad and Banking Company of Georgia, and The Georgia Railroad and Banking Company, both corporations of the State of Georgia, and guarantors of the mortgage bonds of the Western Railroad Company, for the sum last above mentioned, of which they were required to pay in cash, or past due coupons of said bonds, the amount of all of said past due and unpaid coupons with interest, and the costs, commissions, expenses and fees aforesaid, and to pay the principal of said bonds and coupons, not yet due, for interest, as they shall respectively become. due and payable. The entire amount bid was thus appropriated by the decree, to the payment of the said costs, expenses, commissions, fees, and past due coupons in cash and to the payment of the bonds secured by the mortgages aforesaid, as they should, respectively, become due and payable, without any provision for the other creditors of the Montgomery and "West Point, or Western Railroad Company.

After this sale was made, and before confirmation thereof, to-wit, on the 10th of May 1875, the petitioners, Branch, Sons & Co., filed their petition, setting forth that they were unsecured creditors of the late Montgomery and West Point Railroad Company, and holders of its bonds and coupons past due and unpaid; that these were a part of a like unsecured indebtedness of that company amounting to about $300,000; that' the railroad of said company and the appertenanees thereof were well worth $2,000,000, and its entire indebtedness did not exceed $300,000, and the company was entirely solvent, when it was dissolved and its road was incorporated with that of the Western Railroad Company in 1870; while on the contrary, the latter company was insolvent, and its railroad unprofitable, that the so-called purchase, or acquisition by the Western Railroad Company of the Montgomery and West Point Railroad, and the recent purchase of the consolidated .roads, property and effects of both of the companies, through the aid of the court in said suit, were the work and results of a scheme and conspiracy of the two Georgia railroad companies, their presidents, John P. King, and Wm. M. Wadley and others, named, who had got control of the Alabama companies, and (which Georgia companies were guarantors of the bonds of the Western Railroad Company,) to defraud the unsecured creditors of the Montgomery and West Point Railroad Company of payment of its debts to them, and to get all its property discharged therefrom ; that this property was a trust fund in the hands of the company, and afterwards and especially in the hands of the Western Railroad Company, for the payment of all the creditors, both those without and those with mortgage liens, of said Montgomery and West Point Railroad Company ; that these creditors ought all to have been made parties to the suit of Morris and Lowery, trustees, in this cause, <&e., &c. Wherefore, petitioners “pray that they may be permitted to come in and be made parties defendant to this cause, and that the decrees heretofore made in this case may be set aside, and that the sale of the property of the said Montgomery and West Point Railroad Company made on the 19th of April 1874, maybe set aside and held for naught, and that petitioners may be permitted to file an answer to the bill filed in this cause, and that they be permitted to file their answer as a cross bill — and may it please your Honor to grant such further, and other and different relief, as they may be entitled to under the facts in this petition stated.”

The chancellor denied the motion and dismissed the petition ; and an application is now made to this court for a mandamus or other appropriate writ requiring him to admit petitioners to become parties defendant, to have said decree set aside and let them file an answer, &c., as prayed for in the petition.

The counsel who prepared this petition perceived that the facts therein set up by allegation, require a larger field for their development, and opportunity for more vigorous action than is afforded generally to a petitioner who comes into a cause to attend to the details of the distribution of a fund in court, and to claim his share. Hence, as will be seen, these petitioners pray to be made parties defendant, and that the decree be set aside, and that they be permitted to file an answer, and a cross bill, &c., &c. Without being allowed all this liberty, they capnot, they conceive, obtain the redress and relief they are entitled to; and accordingly their petition is for nothing less than this. For although they pray also for such further and other and different relief as they may be entitled to, this is prayed for conjunctively with and in addition to the things previously insisted on, and not disjunctively or without them. The effect of a prayer in this form is considered and explained in Cotton v. Ross, (2 Paige 396) and Graham v. Cook, et. al., (48 Ala. 103.) It does not allow so much scope for a decree different from that specifically asked, as it would if disjunctively expressed.

This court long since held that when a petitioner avers in his petition the purpose for which he desires to be a party to the former suit, * * * * * * to this purpose he must be held; and also that the court should not do a nugatory act, by allowing the petition for an avowed purpose which the court cannot permit to be accomplished. Boykin v. Kernochan, 24 Ala. 699.

Moreover, it has “always been held to be a sound rule of practice that a plaintiff should not be permitted to introduce into a corner of a bill, some secondary and trivial claim, on which if it stood alone he might be entitled to succeed, in order, as it were to catch a decree on a minor point, in the event of his failing in the main .object -of his suit.” Kendall v. Beckett, 2 Russ and Myl. 88; and such a petition as this would be subject to that rule.

The chancellor in considering this petition, must have regarded its particular and express purpose to be the setting aside of a decree from which petitioners could derive no advantage, after the expiration of the term in which it was rendered, and the re-opening of the case, and allowing other facts and allegations set forth in the petition, and evidence thereof, to be introduced into the cause, that would change its entire character.

Having these views, the chancellor must have overruled the motion and dismissed the petition, unless he possessed the power, and the case was one in which it should properly be exercised, to carry into effect the object of the petitioners. Did he have that power ? No precedent in which it was employed has been produced by the learned counsel who appear in support of this application; and we know of none, or of any principle of equity practice, which would justify a chancellor in the exercise of such a large discretionary authority.

It is possible, perhaps, that if the petitioners had set forth that they were advised and insisted, that upon the pleadings and evidence in the cause before the chancellor, the decree therein was erroneous and would be reversed on appeal, and had shown that they had such an interest in the subject matter that they ought to have been made parties to the cause at the beginning, and had prayed that they might now be made parties to enable them to seek redress by appeal to this court to have the decree reversed — a case might have have been made in which the prayer should have been granted. ¥e do not now decide, however, that this Avould be so. The cases of Watson and Wife v. May, 8 Ala. 177; Lees v. Brownings, 15 id. 495; and Boykin v. Kernochan, 24 id. 699, seem to indicate that the power in question might, to that extent, and under such a state of facts, be properly exercised. Such was not the case made by the petition presented to the chancellor, or, of course, that which is brought before us.

The application for a mandamus must be denied.