Brophy v. Kelly

• Decision Date: 10 February 1914
• Docket Number: 2463.
• Citation: 211 F. 22
• Parties: BROPHY v. KELLY et al.
• Court: U.S. Court of Appeals — Fifth Circuit

211 F. 22

BROPHY v. KELLY et al.

No. 2463.

United States Court of Appeals, Fifth Circuit.

February 10, 1914

This is an appeal from a decree of the District Court for the Southern District of Texas in equity, dismissing appellant's (plaintiff's) bill of complaint after a hearing upon the merits. The decree also dismissed the cross-bill of the appellee John C. Kelly, who was one of the defendants and a cross-complainant in the court below; but no cross-appeal has been taken from that part of the decree.

The original bill was filed, so far as its purposes are here material, for the purpose of setting aside and vacating, as fraudulent and void, a judgment order of sale and a sale thereunder of a state court, which was asserted by the appellant to be a cloud on his title to certain lands in Hidalgo county, Tex. The judgment was obtained by one of the defendants, L. W. Campbell, in a suit instituted by him as plaintiff in the district court of Dallas county, Tex against the appellant and the appellee John C. Kelly, as defendants. The purpose of this suit was to recover on a note executed by the appellant to the appellee Kelly for $2,525.85, and indorsed by Kelly to the plaintiff, in that suit, Campbell, and to enforce a vendor's lien upon the land for a part of the purchase money of which the note was given. There was a default taken against the appellant, and on the 14th day of February, 1911, the default was made final by a judgment in the district court of Dallas county. The final judgment was for the foreclosure of the vendor's lien on the land, for part of the purchase money of which the note sued on was given, and, as well, a personal judgment against the defendant John C. Kelly, as indorser on the note. There was no personal judgment taken against the appellant Brophy. The appellant Brophy, at the time of the beginning of that suit and of the rendition of the judgment therein, was a resident of Illinois and a nonresident of Texas. He was served with the notice of the suit personally in the state of Illinois in pursuance of articles 1230 to 1234, inclusive, of the Revised Statutes of Texas, on the 9th day of January 1911, and by the terms of the citation was required to appear and answer upon the first Monday in February, 1911. Appellant made no appearance or answer. At the time of the bringing of the suit appellant's codefendant Kelly was a resident of Texas. Citation was issued to him but not served upon him. On February 14, 1911, Kelly entered a voluntary appearance in the district court of Dallas county in the cause and consented to a judgment against him, as prayed for in plaintiff's petition, and personal judgment was entered against him on that day. On March 10, 1911, an order of sale founded on the judgment, was issued from the clerk's office, directing the sheriff of Hidalgo county to seize and sell the land to satisfy the vendor's lien. The sheriff thereupon duly advertised the land for sale, and sold it at public outcry at the county seat of Hidalgo county on the first Tuesday of May, 1911, pursuant to the advertisement, and returned the order for the seizure and sale to the district court of Dallas county, having executed a deed to the purchaser. The purchaser was the defendant, John C. Kelly, and the amount realized therefor was $676.

The purpose of the bill was to have (1) the judgment declared void and removed as a cloud on plaintiff's title to the land, or (2) to have the sale made by the sheriff under it set aside and declared void, because of alleged collusion and fraud between the execution creditor Campbell and the purchaser Kelly, who was one of the defendants.

Noah Allen, of San Antonio, Tex., and E. F. Thompson, of Chicago, Ill., for appellant.

Coke K. Burns, of Houston, Tex. (Andrews, Ball & Streetman, of Houston, Tex., on the brief), for appellee John C. Kelly.

Before PARDEE and SHELBY, Circuit Judges, and GRUBB, District Judge.

GRUBB District Judge (after stating the facts as above).

1. The bill assails the judgment because, as it alleges, the district court of Dallas county did not acquire jurisdiction of the defendant Brophy or of his land; he being a nonresident of Texas and personally served in the state of his residence, Illinois, and the land involved not being situated wholly or partly in Dallas county, in which county the suit was brought. As to defendant Brophy, it is contended that the judgment was void, whether the action be one in personam or one in rem. It is also alleged that the defendant Brophy was deprived of due process of law by being deprived of his land under the judgment, because the Texas statute, under which service was obtained, failed to afford reasonable time for appearance and answer by a nonresident defendant when personally served beyond the limits of the state. The statute provided that the citation should be served ten days before the return term, and answer was required to be made by the defendant on or before the second day of the return term, and before the call of the appearance docket on said second day. Revised Statutes Texas, art. 1263.

It is not contended by the appellee that service by personal citation upon a nonresident defendant under article 1230 of the Revised Statutes of Texas, outside the limits of the state, would be a sufficient predicate for a personal judgment against him. Pennoyer v. Neff, 95 U.S. 714, 24 L.Ed. 565. No personal judgment was rendered against defendant Brophy in that case, and the only question is whether such service is effective to sustain a judgment foreclosing a vendor's lien; the land being situated within the jurisdiction of the court.

Constructive service may be a sufficient foundation for a judgment or decree in rem. So personal service upon a nonresident defendant, when he is out of the state, in which the suit against him is pending, may avail to support a judgment in that state, if its effect is limited to property of his within the jurisdiction of the court. This is as true of actual service upon a nonresident when out of the state of the forum, as it is of constructive service upon a nonresident. A suit may be one in rem either by virtue of its purpose being to enforce an existing lien or foreclose an existing mortgage on property of the nonresident defendant, situated within the state of the forum, or because of the creation in the suit itself by attachment or other process of a legal lien on the property of the nonresident defendant found within the jurisdiction of the court.

In the case of Roller v. Holly, 176 U.S. 398-405, 20 Sup.Ct. 410, 412 (44 L.Ed. 520) the Supreme Court said:

'The substance of these cases is that if the plaintiff be in possession, or have a lien upon land within a certain state, he may institute proceedings against nonresidents to foreclose such lien or to remove a cloud from his title to the land, and may call them in by personal service outside of the jurisdiction of the court, or by publication, if this method be sanctioned by the local law. In suits for the foreclosure of a mortgage or other lien upon such property, no preliminary seizure is necessary to give the court jurisdiction. The cases in which it has been held that a seizure or its equivalent, an attachment or execution upon the property, is necessary to give jurisdiction are those where a general creditor seeks to establish and foreclose a lien thereby acquired.'

That the suit in the district court of Dallas county and the judgment rendered therein are to be construed, so far as they affected the defendant Brophy, as being in rem only, is apparent from the fact that no relief against Brophy was obtained, except an order for the seizure and sale of his land. That service by personal citation upon a nonresident defendant, in the state of his residence, is sufficient to support a judgment in rem, foreclosing a lien on his land situated within the state of the forum and within the jurisdiction of the court, is the holding of the case of Roller v. Holly, supra. That case also holds that article 1230, Texas Revised Statutes, the one relied on by appellee in this case, applies to suits for the foreclosure of liens or mortgages on lands, as construed by the courts of Texas, a construction adopted by the Supreme Court in that case.

The appellant, however, contends: (1) That the land being in a county different from that in which the suit was brought and the judgment obtained, and the Texas statute requiring suits for foreclosure of liens on land to be brought in the county where the land was located, partly or wholly (Revised Statutes Texas, art. 1194, subd. 12), the district court of Dallas county had no jurisdiction of the rem, and, having no jurisdiction of the person of the defendant Brophy, was without jurisdiction altogether; and (2) that article 1230, Texas Revised Statutes, providing for service on nonresidents, allowing the citation to be returnable at a term to be held within ten days after service, the Texas law requiring the defendant to answer on or before the second day of the term makes it possible that a nonresident defendant have but 12 days in which to appear and answer the citation, which might be an unreasonably short time, depending upon the distance the residence of the defendant is from the place of trial, and that the statute, for this reason, deprives nonresident defendants of due process, and is violative of the fourteenth article of amendment to the federal Constitution for that reason.

2. The district court of Dallas county is by the Constitution and laws of Texas vested with general original jurisdiction in all suits for the enforcement of liens on lands (Constitution of State of Texas, art.

5, Sec 8; Revised Statutes of Texas 1895, art. 1098), where the amount in controversy...