Bullivant v. First Nat. Bank of Boston

• Decision Date: 26 September 1923
• Parties: BULLIVANT v. FIRST NAT. BANK OF BOSTON et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

246 Mass. 324

141 N.E. 41

BULLIVANT

v.FIRST NAT. BANK OF BOSTON et al.

Supreme Judicial Court of Massachusetts, Suffolk.

Sept. 26, 1923.

Report from Supreme Judicial Court, Suffolk County.

Suit by William M. Bullivant against the First National Bank of Boston and others, to enjoin the defendant named and certain other defendants from instituting proceedings to have the Northwestern Leather Company adjudged bankrupt, or to have a receiver appointed, and to enjoin certain of the defendants from voting at a stockholders' meeting. Reported for determination of the full court by a single justice, before whom the case came on master's report and plaintiff's exceptions thereto, and for final decree. Exceptions overruled, and decree entered, confirming the report and dismissing the bill.

G. L. Mayberry and J. M. Hallowell, both of Boston, for plaintiff.

E. F. McClennen, of Boston, for defendants Spalding, Murdock, Pope, Mosher, and Wood.

E. E. Blodgett, of Boston, for defendants First Nat. Bank and dwinnell.

RUGG, C. J.

This is a suit in equity. The bill alleges that the plaintiff is the owner of a large number of shares of the common and perferred stock in the Northwestern Leather Company (hereafter called the corporation). The corporation is alleged to be possessed of property of great value, which the defendants or some of them, through fraud and conspiracy set forth at length in the bill, are attempting to secure for themselves by the form of a sale without adequate payment. The prayers are for temporary and permanent injunctions against the institution of proceedings for bankruptcy or for receivership, against voting on shares held by a voting trust or by proxy at a stockholders' meeting for a proposed sale of the property of the corporation, and for other relief. The bill was filed in the Supreme Judicial Court for Suffolk county on June 27, 1922. Notice was issued, returnable June 29, 1922, and on that date the case came on for hearing on the prayer for preliminary injunction. On June 29, 1922, a stipulation to the effect that the defendants would not institute proceedings in bankruptcy or for receivership, and would not vote shares held under the voting trust or on proxies until the case was heard on its merits, in lieu of injunction, was entered into by the parties and filed of record. The pleadings were completed and on July 18, 1922, a master was appointed to hear the parties and make report of the facts. On July 25, 1922, it was ordered by the court that the hearing before the master proceed on Monday, July 31, 1922. On July 27, 1922, as a result of negotiations between the plaintiff and banks other than the defendant bank, creditors of the corporation, a receiver was appointed of the corporation by the superior court in another proceeding. Under these circumstances the plaintiff, on Thursday, July 27, 1922, being four days before the day fixed by order of the court for the hearing before the master, filed a motion, entitled ‘Plaintiff's Motion that the Bill be Dismissed without Prejudice.’ That motion sets out at length the stipulation entered into in lieu of hearing on prayer for temporary injunction, and the proceedings in the superior court resulting in the appointment of a receiver of the corporation. These were apparently adduced by the pleader as grounds for the action sought by the motion. After recitals of such historical matter covering more than a printed page of the record, the motion concludes with these word:

‘Wherefore the plaintiff moves that the bill of complaint be dismissed without prejudice and without costs and that the stipulation now in force be at the same time discharged, and the defendants relieved from their obligation thereof.’

That motion having been thus filed during the summer season, it could not by any possibility under the general order of the court concerning the conduct of its business be brought to the attention of the court for a hearing in ordinary course at a regular sitting until Tuesday, August 1, the day after Monday, July 31, on which by the special order of the court the master was to begin hearing the case on its merits.

The master refused, in the absence of any order to that effect from the court, to stop his hearing on Monday, July 31, and compelled the parties to go forward. The plaintiff's motion was brought to the attention of the single justice on Tuesday, August 1, who ‘ruled that the plaintiff had not the right as matter of law to dismiss his bill without prejudice since hearings had been begun before the master.’ The exception to that ruling is the first matter to be determined.

The right of a plaintiff in equity to dismiss his bill has been considered in several of our decisions. In Hollingsworth & Vose Co. v. Foxborough Water Supply District, 171 Mass. 450, 452, 50 N. E. 1037, it was said:

‘The general rule seems to be that the court, on the plaintiff's motion, will dismiss his bill on payment of costs as for want of prosecution, unless something has been done in the case which entitles the defendant, on equitable grounds, to have the suit finally disposed of on the merits.’

Numerous cases are there cited where the right of the plaintiff to have his bill dismissed before hearing is stated to be ‘upon payment of the costs.’ Kempton v. Burgess, 136 Mass. 192;Nashua & Lowell Railroad v. Boston & Lowell Railroad, 164 Mass. 222, 224, 41 N. E. 268,49 Am. St. Rep. 454;Chicago & Alton Railroad v. Union Rolling Mill Co., 109 U. S. 702, 713, 3 Sup. Ct. 594, 27 L. Ed. 1081;Saylor's Appeal, 39 Pa. 495.

In all our subsequent cases reference to the absolute right of a plaintiff in equity to dismiss his bill is coupled with the statement that it is a right ‘on paying costs' or on ‘payment of costs.’ Kyle v. Reynolds, 211 Mass. 110, 111, 97 N. E. 614;Lumiansky v. Tessier, 213 Mass. 182, 190, 99 N. E. 1051, Ann. Cas. 1913E, 1049;Keown v. Keown, 231 Mass. 404, 407, 121 N. E. 153.

This question was not before the court in Weston v. Railroad Commissioners, 205 Mass. 94, 97, 91 N. E. 303, 304, but arguendo it was said:

‘It is true that costs are allowed upon a nonsuit at law, and may be decreed when a bill in equity is dismissed without prejudice. * * *’

In Whitten v. Whitten, 5 Cush. 42, the court rather curtly denied a motion by the plaintiff to be allowed to discontinue without costs.

The result of our own decisions is indubitable that the ‘right’ of the plaintiff in equity to dismiss his bill is indissolubly joined with the obligation to pay costs. It is a condition of the exercise of the right that that obligation be performed.

Decisions in other jurisdictions are in accord with the rule established by our own cases. In Carrington v. Holly, 1 Dickens, 280, it was said by Lord Hardwicke that a plaintiff before issue tried may ‘apply to dismiss his bill upon payment of costs.’ In Cummins v. Bennett, 8 Paige (N. Y.) 79, at page 81, it was said by Chancellor Walworth:

‘It is a matter of course, to permit a complainant to dismiss his bill at any time, before an interlocutory or final decree has been made in the cause, upon payment of costs. * * * But the complainant cannot discontinue his suit in any case, except upon a special order of the court, after due notice * * * to the adverse party * * * unless it be upon the terms of paying the costs which have accrued therein, * * * and the suit is not absolutely out of court * * * until he has paid, or at least tendered or offered to pay, the costs to the adverse party.’

The opinion in Detroit v. Detroit City Railway Co. (C. C.) 55 Fed. 569, was written by the present Chief Justice of the United States while sitting as member of the Circuit Court of Appeals. It contains an elaborate discussion and holds that:

‘It is very clear from an examination of the authorities, English and American, that the right of a complainant to dismiss his bill without prejudice, on payment of costs, was of course except in certain cases. Chicago & A. R. Co. v. Union Rolling Mill Co., 109 U. S. 702, 3 Sup. Ct. Rep. 594.’

The exceptions are not relevant to the facts here disclosed. Bank v. Rose, 1 Rich. Eq. (S. C.) 294; Booth v. Leycester, 1 Keen, 247; Electrical Accumulator Co. v. Brush Electric Co. (C. C.) 44 Fed. 602;Manufacturing Co. v. Waring (C. C.) 46 Fed. 87;Western Union Tel. Co. v. American Bell Tel. Co. (C. C.) 50 Fed. 662, 664. See, for collection of cases to the same general point, 21 C. J. pp. 630, 631, § 798; 15 C. J. pp. 68, 69, 70, §§ 118, 119; 1917A, Ann. Cases, 1185, note; and 1 Whitehouse, Eq. Pr. s. 323.

In 1 Daniell, Ch. Pr. 791, it is said:

‘After appearance, and before decree, the plaintiff may, generally, obtain an order to dismiss the bill but only upon payment of costs,’ unless the adversary parties consent that it be without costs and where ‘there has been any proceeding in the cause which has given the defendant any right against the plaintiff, the plaintiff cannot dismiss his bill as of course.’

It further is said at the same page:

‘It seems, formerly, to have been considered, that the court had no power to make an order, on the application of the plaintiff, dismissing the bill without costs, except upon the defendant's consent actually given in court. It has now, however, been decided, that the Court has power to make such an order in a proper case, and such orders have been made where the defendant surrendered a lease, to obtain an assignment of which the bill was filed, and absconded; where the bill was filed under a mistake, under which both plaintiffs and defendants were at the time; where the defendants had assigned their interests to codefendants, after the bill was filed, and had joined in an answer with such other defendants and disclaimed; where the suit was rendered nugatory by the subsequent passing of an act of Parliament, or by the reversal of a case on the authority of which the bill was filed, or by any subsequent matter; and where the plaintiff had been misled by the act of the...