Berg v. Fidelity & Casualty Co. of New York

• Decision Date: 02 June 1921
• Docket Number: 5534.
• Citation: 274 F. 311
• Parties: BERG et al. v. FIDELITY & CASUALTY CO. OF NEW YORK.
• Court: U.S. Court of Appeals — Eighth Circuit

274 F. 311

BERG et al. v. FIDELITY & CASUALTY CO. OF NEW YORK.

No. 5534.

United States Court of Appeals, Eighth Circuit.

June 2, 1921

R. W Blair, of Topeka, Kan. (Z. C. Millikin, of Salina, Kan., and T. M. Lillard, of Topeka, Kan., on the brief), for appellants.

E. H Gamble, of Kansas City, Mo. (G. A. Spencer, of Salina, Kan and Robert Stone, George T. McDermott, and Robert L. Webb all of Topeka, Kan., on the brief), for appellee.

Before SANBORN and STONE, Circuit Judges, and TRIEBER, District Judge.

SANBORN Circuit Judge.

This is an appeal from an injunction against further procedure by Alex Berg, guardian of the estate of Ellen Amelia Shute, James H. Shute, and Thomas L. Bond, executor of A. F. Shute, deceased, in an action in the district court of Saline county in the state of Kansas. The injunction is the result of the pendency of two actions between the same parties in two courts of concurrent jurisdiction, and it was issued to prevent the defendants in the suit in the federal court from interfering by means of proceedings in the state court with the exercise of the jurisdiction which the federal court claims over the specific real estate described in the complaint in the suit in that court.

The question the case presents is: Did the district court of Saline county, in the state of Kansas, or the United States District Court of the District of Kansas first acquire jurisdiction over and dominion to seize and apply the real estate of Ellen Amelia Shute to the payment of the claim of the Fidelity & Casualty Company, a corporation, the plaintiff in the suit in the federal court. The rule of law by which the answer to this question must be determined is that the court which first acquired the lawful jurisdiction of specific property by the seizure thereof, or by the due commencement of a suit from which it appears that it is or will become necessary to a determination of the controversy involved, or to the enforcement of its judgment or decree therein, for that court to seize, to charge with a lien or trust, to sell or exercise like dominion over it, thereby withdraws that property from the jurisdiction of every other court, so far as necessary to accomplish the purpose of the suit, and entitles that court to retain the control of it requisite to effectuate its final judgment or decree therein, free from the interference of every other tribunal. Mound City v. Castleman et al. (8th C.C.A.) 187 F. 921, 924, 110 C.C.A. 55; Lang v. Choctaw, Oklahoma & Gulf Ry. Co., 160 F. (8th C.C.A.) 160 F. 355, 359, 87 C.C.A. 307; Brun et al. v. Mann (8th C.C.A.) 145, 152, 80 C.C.A. 513, 12 L.R.A. (N.S.) 154; Sullivan v. Algrem (8th C.C.A.) 160 F. 369, 370, 87 C.C.A. 318; McKinney et al. v. Landon et al., 209 F. 300, 305, 126 C.C.A. 226.

The facts which condition the answer are these: A. F. Shute died seized of large tracts of real estate, all of which he devised to his widow, Ellen Amelia Shute, subject to his debts, which exceeded $50,000. His personal property was insufficient to pay his debts, and Thomas L. Bond, the executor of his will, instituted an authorized proceeding in one of the probate courts of Kansas to sell this real estate and apply its proceeds to the payment of the debts of the decedent. Section 4603 of the General Statutes of Kansas of 1915 provided that an order for the sale of real estate of such a decedent should not be granted, if any of the persons interested in his estate should give a bond in a sum and with sureties approved by the court to pay his debts and the expenses of the administration of his estate. James H. Shute, a son of the decedent, gave such a bond, with the Fidelity & Casualty Company as a surety thereon, the probate court approved this bond, and on February 10, 1917, ordered that the proposed sale should not be made. James H. Shute did not pay the debts, and on June 21, 1917, Thomas L. Bond, the executor of the will of the decedent, brought a suit on this bond in the district court of Saline county, Kan., against James H. Shute, the Fidelity & Casualty Company, and Alex Berg, the guardian of the estate of the widow, Ellen Amelia Shute, who was a person of feeble mind.

In his complaint the executor alleged the facts which have been recited, that the widow was the owner of all the property of which A. F. Shute died seized, that she was a person of feeble mind, and Alex Berg was the guardian of her estate, and prayed for judgment against all the defendants for $50,000 and interest. This complaint stated no cause of action against Alex Berg, the guardian, or the widow. On August 10, 1918, the Fidelity Company filed its answer and cross-petition. It set forth certain defenses not now material, and averred that all the debts referred to in the complaint were debts against the estate of the decedent, that the widow was the 'sole devisee, legatee, and beneficiary by reason of the payment thereof,' and that if the Fidelity Company, by reason of the judgment of the court, should be compelled to pay these debts, it should 'in equity and justice be subrogated to the rights of the creditors against the property of the estate of the said A. F. Shute, deceased'; and it prayed for the judgment of the court that, if a judgment should be obtained against it on its bond, it should be subrogated to the rights of the creditors against the property of the estate for any and all amounts which it might be compelled to pay to such creditors, and for such other and further relief as to the court might seem right and just in the premises.

On September 9, 1918, Alex Berg, guardian, filed his reply and answer to the answer and cross-petition of the Fidelity Company, and stated therein that he denied all the allegations of the answer and cross-petition, except that he was the guardian of the widow's estate, that she was of feeble mind, and that she was the sole devisee, legatee, and beneficiary under the last will of A. F. Shute, deceased. On December 20, 1918, the district court of the state rendered a judgment in favor of Thomas L. Bond, the executor, and against James A. Shute and the Fidelity Company upon their bond, for the sum of $50,000, interest and costs. No judgment or order against or in favor of Alex Berg,...