Swan v. Wright

WOODS, Circuit Judge. This is the first time that the defendants have brought to the notice of the court the fact that no security for costs had been given'by the complainant. The defendants have answered, the complainant has replied, and an immense mass of testimony has been taken at great cost and expense. The English rule on this subject of security for the costs is without question substantially the rule by which this court is to be governed. The fifth of Lord Bacon’s ordinances provided that no bill of review should be put in except the party that preferred it entered into recognizances, with sureties, for satisfying costs and damages for the delay, if it was found against him. This provision being insufficient, by an order of March 12, 1700, it was ordered, for the future. that no bill of review should be allowed or admitted, except the party who preferred it first deposited the sum of £50 with the registrar of the court as a pledge to answer such costs and damages as the court should award to the adverse party, in ease the court should think fit to dismiss the bill of review. 3 Daniell, Ch. Prac. 1730. But conceding this to be the rule of this court, yet if a bill of review is filed without security or deposit of money, and the defendant allows costs to accumulate without objection, he cannot have the bill dismissed on that account. The conduct of defendant is a waiver of his right to have the bill dismissed. The most he can claim is that complainant shall be ordered to give security within a given day, and in default thereof that then his bill be dismissed. Lavange v. Burke, 50 Ala. 61. The first ground of the motion to dismiss is, therefore, not well taken. The second ground for the motion to dismiss is, that the complainant has not performed the decree. To entitle a party to bring a bill of review, it is necessary that he should have obeyed and performed the decree. as if it be for laud, that the possession be yielded, if it be for money, that the money be paid. 3 Daniell, Ch. Prac. 1730. And by the third and fourth of Lord Bacon’s ordinances, no bill of review shall be admitted, or any other new bill, to change matter decreed, except the decree be first obeyed and performed. Mitf. Eq. Pl. (6th Am. Ed.) 106, note. And Lord Itedesdale says: “It is a rule of the court that the bringing of a bill of review shall not prevent the execution of the decree impeached, and if money is directed to be paid before the bill of review is filed, it ought regularly to be paid before the bill of review is filed, though it afterwards be ordered to be refunded.” Mitf. Eq. Pl. (6th Am. Ed.) 106. In Wiser v. Blachly, 2 Johns. Ch. 488, Chancellor Kent says: “The party asking for a bill of review must gen [502] erally show that he has performed the decree, especially if it lie a decree for the payment of money, and he must likewise pay the costs, and nothing will excuse the party from this duty but evidence of his inability to perform it. This appears to be a settled rule laid down in the ancient and modern books.” In Partridge v. Usborne, 5 Eng. Ch. 195, the lord chancellor said: “Whatever the party is bound to do whenever'the bill of review is put on file, that he must do before the bill is filed. But as the permission to file a bill of review is always given upon the assumption and implied understanding and engagement that the original decree shall be performed, 1 am also of opinion that if, after the bill is filed, the period arrives when money ought to be paid, it is incumbent on the party to pay that money. Otherwise an application to dismiss the bill may be made on that ground, he having filed the bill upon an engagement and understanding which he has failed to comply with.” In the case of Williams v. Mellish, 1 Vern. 117, a motion was made on behalf of the plaintiff, that proceedings might be stayed on a decree until the plaintiff was heard on a bill of review. But the lord keeper said: “In this case the decree shall be performed to a tittle before any bill of review be allowed, unless the plaintiff Williams will swear himself not able to perform the decree, and will surrender himself to the fleet, to lie in prison till the matter be determined on the bill of review.” See, also, on this subject, the following cases: Anon., 12 Mod. 343; Bishop of Durham v. Liddell, 2 Brown, Parl. Cas. 63; Wiser v. Blachly, 2 Johns. Ch. 488; 2 Smith, Ch. Prac. (2d Am. Ed.) 53. These authorities apply not only to bills of review, strictly so-called, but to all bills in the nature of bills of review, which seek to disturb decrees of the court already rendered: Bacon’s Ordinances, 3 and 4, supra. Has the complainant in the bill of review performed the decree? This question can only be answered by inquiring what the decree required him to do. The property which the complainant purchased was- sold to him for a fixed sum, and subject to the lien of such receiver’s certificates as should be allowed by the court, and other claims superior to the first mortgage bonds. The fixed sum, namely, $600,000, and the liens superior tc th" first mortgage bonds, including receiver’s certificates, principal and interest, constituted the purchase money. The decree of the court contemplated the payment of the interest as it fell due on the receiver’s certificates, as much as it did the payment of the bid of $600,000. If the purchaser was not bound to pay the interest on the receiver’s certificates as it fell due, then the question occurs, when was he bound to pay the interest? His obligation, under the decree of the court, was dulv to pay his bid, $600,000, in the installments fixed by the court, and to pay such interest coupons as were due and not extinguished by the $600,000, and to pay the coupons not due as they fell due. The complainant himself has put this construction upon the decrees of the court, and his obligations thereunder. In the fourteenth paragraph of his bill be states that he has made no default in complying with the order or decrees of the said circuit court, in respect to his said purchase, * * * and that by an existing order of said court, made during the present term, * * * the payment of the said claims of John S. Wright, as well as of other claims, was postponed to a future period. The order referred to here was that made January 29, 1878, “that any and all payments of the unpaid purchase money arising out of said purchase of petitioner Swan, be and the same is hereby suspended and postponed until the fourth Monday of the next regular term of this court.” It is, therefore, evident that the complainant himself considered the certificates of Wright a part of the purchase price of the railroad, and that it was his duty, under the decrees of the court, to pay the interest thereon as it accrued, for he claimed that the order ot the court just quoted was effectual to prolong the time for the payment of the claim of Wright. When, therefore, Swan applied to the court, on January 22, 1878, that all further payment of the unpaid part of the purchase money, under said purchase of said Swan, might be stayed and postponed till the further order of the court, he asked to have the payment of the past due coupons on Wright’s certificates postponed. If the claim of Wright was not then payable by the terms of the decree of the court, there was no propriety in asking the court to postpone its payment The undoubted purpose of the order of January 29, 1878, was to postpone the payment of all sums which, by the decree of the court, were then due from Swan on his purchase. His petition for postponement represented that, by a bill filed in the United States circuit court for the Northern district-of Alabama, a mortgage lien superior to the mortgage lien by virtue of which the sale had been made, was set up against said railroad which he had purchased. The purpose of the postponement of payments prayed for in his petition was, that he might ultimately be relieved from his purchase, in case the prior lien set up in said bill should prevail. It was, therefore, just as important that he should be relieved from the present payment of past due coupons on the receiver’s certificates, which at that time amounted to about $400,000, as from the unpaid balance of his bid, which was only $300,000. It may, therefore, be assumed that th'- order of January 29, 1878, and' the subsequent orders on the same subject, heretofore mentioned, postponed until July 11, 187S, the payment of all sums due and payable by Swan'on his purchase, whether due on his bid or due on coupons attached to the receiver’s certificates. That was what Swan asked for, and that was what the court granted him. When, therefore, on February 13, [503] 1878, in his petition for leave to file his hill of review, he stated that he had performed up to that time all things required of him by the orders and decrees of the court, he stated, so far- as appears, what was the truth, find upon that statement the court allowed the bill of review to be filed. [On final hearing the bill was dismissed, and on appeal to the supreme court that decree was affirmed. 110 U. S. 590, 4 Sup. Ct. 235.] Therefore, when the defendants, in their answer filed June 3,1878, set up, as a defense to the bill of review, that the complainant therein had not obeyed and performed the decree of the court, their allegation was not sustained by the facts of the case. But on July 11, 1878, the indulgence granted by the court to Swan expired. The entire residue of his bid was then due and he paid it. But it was just as incumbent on Swan to pay on that day the past due interest on the receiver’s certificates, as the residue of his bid. The orders and decrees of the court required it. The grace which he had asked from the court for the payment of this interest, including the coupons belonging to Wright’s certificates, had expired. He had no warrant for another day’s delay. Yet, up to this time, although there is $50,000 of interest due on the certificates held by the defendants, it is not pretended that he has paid them one cent. His failure to pay is a contemptuous disregard of the orders and decrees of this court. In the mean time, the bill setting up a prior lien on the railroad property has been dismissed; he is in the undisturbed possession and enjoyment of the railroad, aDd he still prosecutes his bill of review, without any pretense of compliance with the decree of the court which he seeks to review. It is no excuse that the railroad property on which his certificates are a lien is ample security for the performance of the decree. These defendants are entitled to something more than security. They are entitled to the absolute and unconditional performance of the decree. After, as in this case, the court has deliberately settled the rights of the parties by its decree, the operation of the decree cannot be suspended by the filing of a bill of review, either with or without leave. The complainant was allowed to file his bill of review on the assumption that he would perform the decree, unless relieved from performance by the orders of the court. If, after the bill of review is filed, the period arrives when money ought to be paid, it is incumbent on the party to pay that money, otherwise an application to dismiss the bill may be made, he having filed the bill upon an engagement and understanding which he has failed to comply with. Partridge v. Usborne, supra. This is the first time since the complainant has been in default that the fact has been brought to the attention of the court. The defendants are now entitled to require the complainant to give security for costs, and to perform so much of the decree as it was his duty to perform up to this time. But he is not, under the circumstances, entitled to a peremptory order of dismissal. The complainant should be allowed a reasonable time to discharge the duty required of him. The final hearing of this case having been heretofore fixed for October next, the order of the court will be that, unless by that time the complainant gives security for the costs, and pays to the defendants all coupons which at that date shall be past due on the certificates held by them, his bill of review shall be dismissed out of this court.