Brown v. State

• Decision Date: 22 July 1885
• Citation: 64 Md. 199,1 A. 54
• Parties: BROWN and another, Trustees, etc., v. STATE and another. STATE v. BROWN and another, Trustees, etc.
• Court: Maryland Court of Appeals

1 A. 54

64 Md. 199

BROWN and another, Trustees, etc.,

v. STATE and another.

STATE

v. BROWN and another, Trustees, etc.

COURT OF APPEALS OF MARYLAND.

Filed July 22, 1885.

Appeal from circuit court, Anne Arundel county, in equity.

Stewart Brown and S. Teackle Wallis, for the trustees.

Charles B. Roberts, Atty. Gen., for the State.

John Ireland and Charles Marshall, for the railroad.

BRYAN, J. We have heretofore decided a cause between the parties to this record. The state of Maryland filed a bill in equity, in which it was maintained that it had a lien on all the property and franchises of the Annapolis & Elkridge Railroad Company, and that said lien was prior to that created by the deed of trust in question, even if the deed were valid; and it was further maintained by the state that the deed of trust was wholly invalid, or else was valid only to the extent of creating a lien for such of the bonds secured by it as were used for the particular purposes expressed in the first section of the act of 1872, c. 425. The prayer of the bill was for an injunction to restrain the trustees from making sale of all or any part of the property of the railroad, and alternatively to restrain them from making sale until they had ascertained, by proper proceedings, the parts or proportions of these bonds which had in fact been used for the purposes expressed in the first section of the act of 1872. There were other prayers for relief, adapted to the different aspects of the case. The defendants in the cause were the Annapolis & Elkridge Railroad Company, and the trustees, Stewart Brown and Arthur George Brown. The answer of the trustees controverted the case made by the bill, and maintained the validity of the deed of trust, and its priority to the rights and claims of the state. It also alleged that more than $150,000 of these bonds, which had been duly issued under and in accordance with the terms of the deed of trust, had been negotiated through Alexander Brown & Sons, and were outstanding in the hands of bona fide purchasers for value; and that others of these bonds were outstanding in the hands of persons and corporations who claimed to be bona fide holders for value. The cause was heard on bill and answer; and this court decided, upon the facts which were shown by the proceedings in the cause, that the deed of trust was valid; and that bonds to an amount exceeding $150,000 had been duly negotiated, and were outstanding in the hands of bona fide purchasers for value; and that other bonds were in the hands of different persons, who alleged that they also were bona fide holders for value; and that the state was not entitled to any of the relief prayed. The bill was therefore dismissed. This case is reported in 62 Md. 439.

In the present case the bill is filed by the same complainant, and the same parties are defendants. It alleges that the deed of trust is null and void As a consequence, it is maintained that all the bonds issued under its provisions were invalid, and that the trustees have no power of sale. Certain of the bonds, amounting to $252,000, are specifically charged to have been issued and used in pursuance of a fraudulent agreement, and it is alleged that they are held by persons who had notice of the fraudulent character of the bonds at the time they received them. The relief prayed is that the deed of trust may be declared null and void, and that the trustees may be restrained by injunction from making sale of any of the property of the railroad.

It is manifest that the relief sought in each of these cases is the same. The present bill repeats the allegations of the former one, and supports and fortifies them by other charges. The scope and object of both bills is the same; all of their averments tend to the same conclusion. The purpose in each case was to strike down and defeat the power of sale contained in the deed of trust. It was entirely competent for the complainant to make in the first bill of complaint every allegation which was made in the second. It is not alleged that any of them were unknown at the time the first bill was filed; and, in point of fact, all of these additional allegations were contained in the petition for an injunction filed by the Annapolis & Elkridge Railroad in June, 1878, which petition was signed by the attorney general of the state, who appeared in the cause by order of the general assembly of the state and the board of public works.

According to well-settled principles, our decision in the first case finally determined, as between the parties to the suit, all matters then adjudicated. As between these parties, no matter then decided can ever again become the subject of controversy. "Where every objection urged in the second suit was open to the party within the legitimate scope of the pleadings in the first suit, and might have been presented in that trial, the matter must be considered as having passed in rem judicatem, and the former judgment in such a case is conclusive between the parties." Aurora City v. West, 7 Wall. 102. In a subsequent case in the same volume the supreme court of the United States, speaking of the principle of res judicata, say: "It extends not only to the questions of fact and of law which were decided in the former suit, but also to the grounds of recovery or defense which might have been, but were not, presented." Beloit v. Morgan, 7 Wall. 622. And in the same case the court quotes with approbation the striking language of the vice-chancellor in Henderson v. Henderson, 3 Hare, 115, as follows: "In trying this question I believe I state the rule of the court correctly, that where a given matter becomes the subject of litigation in, and of adjudication by, a court of competent jurisdiction, the court requires the parties to bring forward their whole case, and will not, except under special circumstances, permit the same parties to open the same subject of litigation in respect of a matter which might have been brought forward as a part of the subject in contest, but which was not brought forward only because they have, from negligence, inadvertence, or even accident, omitted a part of their case. The plea of res judicata applies, except in special cases, not only to the points upon which the court was required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties exercising reasonable diligence might have brought forward at the time."

It appears to us, therefore, inevitable that our decision in the former case must be conclusive between these parties of every matter which then passed...