Gaytes v. Franklin Savings Bank

Mr. Justice Scott delivered the opinion of the Court: Without entering upon any discussion of the merits of this case, we think the court failed to enter the proper decree. It appears complainant is, and was, holder of the bonds secured by the deed of trust from the Biverside Improvement Company to Ogden, and whether that fact was known to defendant when he filed his bill to compel conveyance to himself of the lots he alleges he purchased at the sale under the deed of trust, is involved in much doubt by the evidence. But in any event, complainant, or whoever was owner of the indebtedness, was a necessary and indispensable party to that suit. Such owner could alone be affected by the decree. Ogden, being a mere trustee, had no real interests in the premises. Whether defendant had actual knowledge who were owners of the bonds, it was his duty to make inquiry on that subject. Had he done so, no difficulty would have been experienced in ascertaining names and residence of owners of the bonds for payment of which, and coupons attached, the property was about to be sold. Surely, Ogden, acting trustee, must have known who had declared all bonds due on account of failure to pay interest then matured, and on whose behalf he was making sale of the property, and, no doubt, would have disclosed all necessary information. Nothing appears in the facts of the original case to take it out of the general rule, that all parties whose interests would be directly affected by the decree, should be parties to the bill, otherwise they can not be concluded by any action of the court. Of course, no one is bound by a decree to which he is not a party, nor by a decree against another party, although acting on his behalf, who has no real interest in the subject matter of litigation. Before any one is concluded by judicial sentence, he must have his day in court. Where no such opportunity is afforded, any one aggrieved, if application is made within reasonable time, may have such decree against him set aside upon terms that shall be considered equitable, and be let in to make his defense to the cause as though he had been made party defendant. That is the extent of the relief that ought to have been granted in this case. When that is done, all rights of the respective parties may be fully investigated and determined. But treating this as a bill for review, on account of want of proper parties to the original suit, or as a bill for general relief, the law seems to be, the decree complained of may be opened, and the aggrieved party let in to make his defense. Alexander v. Stevens, 7 B. Monroe, 351; Mitford’s Pleading, 92. The decree will be reversed, and cause remanded for further proceedings. Decree reversed.