Louisville Manufacturing Co. v. Brown , 101 Ala. 273 ( 1893 )

HARALSON, J.

—l. The first assignment of error is, that the court below erred in taking jurisdiction 0f the administration of the trust, as created in the deed of assignment. A trustee has the undoubted right to .come to a court of equity, for its assistance and protection, in all cases of doubt or difficulty, in the administration of the trust; and the bill in this case makes a clear ea&e for equitable interposition, for the protection and direction of the trustee in the .discharge of his duties, as such. Perry on Trusts, § 928 ; Hill on Trustees, § 543.

2. The second assignment questions the power of the court to order a sale of the property assigned. When the trust is before the court, by a bill filed for its execution, the whole matter of the trust and its proper execution is within its jurisdiction, and the trustee must proceed as directed. He can not sell, without the sanction of the court, even if the deed of trust gives him the express power to do so. Pie must sell as directed by the court. — Perry on Trusts, §§ 764, 770, 928.

In this case, the leasehold interest of the store, was included in the deed of assignment for the benefit of creditors, as well as the goods and merchandise in the store, and no distinction can be drawn between the two, as to the power of the court to order their sale. — Perry on Trusts, §§ 449, 450, 547.

3. The fourth assignment is a complaint against the action of the court, m sustaining a demurrer to the appellants’ petition to be made parties defendants to the cause.

The court committed no error in refusing to grant the petitions of appellants, to be made parties defendants, for the purposes specified therein. It conformed its rulings to the principles of chancery practice, and allowed appellants, as beneficiaries of the trust fund, to intervene by petitions, and propound their respective claims— “to have their interests ascertained, and their rights protected.” Under this order, they may prove and have their own claims allowed, and may resist the claims of any or all of the creditors of the assignors, which is all they can demand. — Ex parte Printup, 87 Ala. 148, 6 So. Rep. 418.

4. The third and fifth assignments, relate to the action of the court, (1) in ordering a reference to ascertain the amount of the rent due and payable to Mrs. L. L. Molton; and (2), in decreeing that the amount ascertained by the register, on the reference, should be paid out of the proceeds of the sale of the stock of goods sold, and the sale of the leasehold interest.

It is true, generally, that a decree on any of the merits of the case, rendered before the defendants are in default for want of answers, or before decrees pro confesso have been entered against them, is premature, and should never be made. It was irregular and contrary to the practice in such cases for the court to have ordered the register to ascertain the amount of the debt due to L. L. Molton for rent, and to have decreed its payment, before the cause was at issue. These were matters of essential merit, which the defendants and creditors had a right to contest. The proper and usual practice in such cases is, after answers filed, or decrees pro confesso against such as have not answered, to give reasonable notice by publication for all the creditors to file and prove their claims by a specified day, or they will be barred, and on the day named in such notice, for the register to pass upon all claims presented and filed, each creditor having the right to contest the claim of every other one, and for the register to report to the court, the result of his inquiries, with all objections and exceptions which may have been made to his rulings, together with all the evidence taken; and to this report, when made, all parties should have the right to except, before the court makes its decree passing on the merits of any disputed claim. — Morton &' Bliss v.'New Orleans cfc Selma Railway Co., 79 Ala. 590 : McDonald v. McMahon, 66 Ala. 115. Any proceeding, which deprives a person of his property, and its control, or adjudicates his rights without notice and the opportunity of being heard in opposition, is coram nonjudice, as to such person. — Ex parte Trice, 53 Ala. 548; Dugger v. Tayloe, 60 Ala. 504.

The trustee, in filing his bill, admitted this debt of L. L. Molton to be a first lien on the assigned property, and was active in procuring the orders of the court to have it ascertained and paid, without notice to the creditors, the real parties in interest. The only defendants he made parties to his bill were I. Phillips & Brother, the assignors, who had no real interest, Mrs. L. L. Molton, an adversary with whom the assignee was not at variance, and a single creditor, A. Dreher, who lived- at Cullman. The bill states, “that the other creditors are very numerous, and can not, without manifest inconvenience and oppressive delays in this suit, be at this time brought before this honorable court, the most of them being non-residents of the State of Alabama, and their residences unknown.” But, it was proffered, that “as soon as all their respective names and residences could be ascertained, they would, according to law, and the rules and practice'of the court, be made parties defendants to the bill of complaint.”

When the appellants sought, as creditors to come in and be made parties defendants to the suit — in compliance with the proffer in the bill for them to do so — that they might answer, plead or demur and do every thing necessary for the protection of their rights and interests, as if they had been made defendants in the beginning, they were resisted in their application by the trustee ; and, on the execution of the first reference to the register, which was to .ascertain L. L. Molton’s claim for rent, and how it should be paid, and which involved inquiries and a report as to the main matter of contest in the case, when appellants appeared before the register and asked to be allowed to cross-examine the witnesses called by the complainant, and to offer evidence on the issues made by the decree of reference, the complainant, the assignee, objected, and the register sustained the objection — the assignee and the register proceeding upon a mistaken discharge of their duties, respectively. The court, it is proper to state, set aside the report of the register, on account of that ruling, and oi’dered a new reference, the same as the other, upon the execution of which appellants were allowed to appear. Even then, they encountered the assignee as an adversary. The assignee possibly feels interested to have that debt allowed, as he may suppose he may be personally liable for it.

There was no error in the court ordering the assignee to sell the goods and the leasehold estate, and hold the proceeds subject to the orders of the court; but there was error in decreeing on the merits of the cause before it was at issue, in having the Molton debt ascertained and in ordering it paid, and the decree, to that extent, must be reversed and set aside.

5. We stated in Adams v. Sayre, 76 Ala. 517, that it was the settled doctrine of this court, that, as a general rule, there can be but one final decree upon the merits of a chancery cause, which is required to settle all the equities litigated, or necessarily involved in the issues of the particular suit; that the policy of the rule is founded in the indisposition of appellate courts to multiply appeals, by undertaking “to review litigated cases piecemeal.” But we held, that a decree may, nevertheless, be partly final, and partly interlocutory ; final, so far as it determines all issues of law and fact, constituting the equities proper in the cause, and interlocutory as to ulterior proceedings regulating its mode of execution, from each of which, an appeal will lie to this court. — Thornton v. Highland Av. & Belt R. R. Co., 94 Ala. 353; 10 So. Rep. 442; Morton & Bliss v. N. O. & S. R. R. Co., 79 Ala. 590.

The decree in this case, so far as it goes, settled matters of contention and the material equities in the cause, and is such a decree as supports an appeal.

6. The appeal is taken by two of the creditors, who intervened by petition, and who were authorized to take it. — Jones v. Wilson, 54 Ala. 50; Weaver v. Cooper, 73 Ala. 318.

It was taken in their names alone, and the point is now made, that it should be dismissed because not prosecuted in the name of all the defendants, and without a summons and severance. A sufficient reply to this, if any were needed is, that the cause was submitted without objection, and no motion was made to dismiss the appeal, for the reasons assigned, and it is too late for appellees to suggest in argument, as they do, that the appeal is improperly here.— Vaughan v. Higgins, 68 Ala. 548.

7. It would be premature at this time, for us to pass upon the merits of Mrs. Molton’s claim or that of her assignee for rent. It was prematurely considered and passed on in the court below. The cause must be reversed and remanded, that the chancery court may order a new reference, in the manner indicated in this opinion, to require all creditors to present and prove their claims, to ascertain what debts there are, andafterw ards to make distribution of the trust fund.

Reversed and remanded.