Stout v. Lye

• Decision Date: 01 October 1880
• Citation: 26 L.Ed. 428,103 U.S. 66
• Parties: STOUT v. LYE
• Court: U.S. Supreme Court

103 U.S. 66

103 U.S. 66

26 L.Ed. 428

STOUT v. LYE.

October Term, 1880

APPEAL from the Circuit Court of the United States for the Northern District of Ohio.

The facts are stated in the opinion of the court.

Mr. John Hutchins for the appellants.

Mr. John E. Richie, contra.

MR. CHIEF JUSTICE WAITE delivered the opinion of the court.

This record discloses the following facts: On the 10th of November, 1873, Francis J. Lye executed to the First National Bank of Delphos a mortgage on certain real estate situate in the village of Delphos, Allen County, and within the northern judicial district of the United States in the State of Ohio, to secure his note to the bank for $6,000, dated Nov. 1, 1873, and payable Jan. 1, 1874, which was given to take up in part his old note to the bank then past due. The mortgage was duly recorded in the records of the county, November 10, at which time, under the laws of the State, it took effect. Rev. Stat. Ohio (1880), sect. 4133.

On the 29th of December, 1875, the present appellants, John W. and Jacob O. Stout, brought suit in the Circuit Court of the United States for the Northern District of Ohio, against Lye and Philip Walsh, who were partners, to recover a judgment for $5,106.36 and interest. The first day of the January Term, 1876, of that court was January 4, and process was served on Lye & Walsh, in the suit of the Stouts, January 3. On the 15th of January, 1876, the bank commenced suit against Lye in the Court of Common Pleas of Allen County to foreclose its mortgage. Process was served on Lye in that action January 20. The Stouts were not made parties, the bank having then no actual notice of the pendency of their suit in the Circuit Court.

On the 31st of January the Stouts recovered judgment in their action in the Circuit Court against Lye & Walsh for the full amount of their claim and costs, and on the same day caused an execution to be issued, which was, on the first day of February, duly levied on the lands covered by the bank mortgage. The effect of the judgment, without this levy, was to bind the lands of the defendant for the satisfaction thereof from the first day of the term of the court at which it was rendered, January 4. Id., sect. 5375. On the 23d of February the Stouts commenced this suit in the Circuit Court of the United States for the Northern District of Ohio, making the bank a defendant, in which they sought to set aside the mortgage as illegal for want of authority to take it, or if that could not be done, to have certain alleged payments of usurious interest applied to reduce the debt. The bank was served with subpoena on the 25th of February, and required to appear on the first Monday in April.

The February Term of the Court of Common Pleas of Allen County began on the 7th of February, and on the 7th of March, during that term, a judgment was rendered in the suit of the bank against Lye for the full amount of his note and interest, and for a foreclosure of the mortgage by a sale of the mortgaged property. The bank answered the suit of the Stouts, setting up the foregoing facts, which being proved by the agreed statement of the parties, the bill was dismissed. From that decree this appeal was taken.

The first question to be decided is whether the appellants are concluded by the judgment of the State court finding the amount due the bank and establishing the lien of its mortgage. If they are, they concede that the decree below is right.

There cannot be a doubt that the State court bad jurisdiction of the suit instituted by the bank, and, as was said by Mr. Justice Grier, speaking for the court in Peck v. Jenness, 'It is a doctrine of law too long established to require a citation of authorities, that, where a court has jurisdiction, it has a right to decide every question which occurs in the cause, and whether its decision be correct or otherwise, its judgment, till reversed, is regarded as binding in every other court; and that where the jurisdiction of a court, and the right of a plaintiff to prosecute his suit in it, have once attached, that right cannot be arrested or taken away by proceedings in another court.' 7 How. 612, 624. The mere fact, therefore, that the Stouts commenced this suit in the Circuit Court before judgment was rendered in the State court in favor of the bank is of no importance. The point to be decided is whether the judgment in the State court binds the Stouts, they not having been parties to the suit in which it was rendered. The rule is, that where suits between the same parties in relation to the same subject-matter are pending at the same time in different courts of concurrent jurisdiction, a judgment on the merits in one...