Cohen v. Solomon

• Decision Date: 05 March 1895
• Citation: 66 F. 411
• Parties: COHEN et al. v. SOLOMON et al.
• Court: U.S. District Court — District of Kansas

66 F. 411

COHEN et al. v. SOLOMON et al.

United States Circuit Court, D. Kansas, Second Division.

March 5, 1895

Henry Wollman and Harris & Vermilion, for complainants.

W. E Stanley and T. B. Wall, for defendants.

WILLIAMS District Judge.

In this case, Hardy Solomon, being the owner of the premises in question, with his wife, executed a mortgage upon the property to Bernd, the complainants' testator, which mortgage is by this suit sought to be foreclosed. At the time suit was commenced, the property had become delinquent for taxes for one year, and had been sold, and a certificate of purchase issued upon the tax sale. Subsequently the holder of the tax certificate of purchase brought suit in the state court of Kansas to quiet his title to the premises in controversy, obtained service against the mortgagee and mortgagor by publication under the state statute, and afterwards obtained a decree in the state court by default quieting title in him, as against the said parties defendant thereto. The complainants herein, becoming apprised of the proceedings in the state court suit for the first time after the said decree was obtained, thereupon filed a supplemental bill of complaint in this suit, making the plaintiff in the said state court suit and his assignee parties defendant, and praying that the said tax title may be set aside. It is herein stipulated and agreed that the said tax deed is voidable under the laws of Kansas, where the lands lie. By the terms of the said mortgage, it is made the duty of the mortgagor to pay all assessments on the property. It is agreed that the assignee of the certificate of purchase Wallenstein, is the brother-in-law of the mortgagor, Solomon. Wallenstein is the party who brought suit to quiet title in the state court.

The main question is as to the effect of the said suit brought in the Kansas court. At the time this suit was commenced and Solomon and wife made parties defendant thereto. Wallenstein held only the lien or equitable title of a purchaser at a tax sale to the premises in controversy. Having this lien or claim upon the property involved in the litigation, he was charged with constructive notice of the pendency of this suit, and it was incumbent on him to apply and be made a party to this suit, in which he could have enforced any claim he might have to the mortgaged premises.

The supreme court has several times held that a tax title to the mortgaged property may be litigated, enforced, or set aside in the foreclosure suit.

In Mendenhall v. Hall, 134 U.S. 559, 10 Sup.Ct. 616, it is held that in a suit to establish a mortgage, and for a sale thereunder, it is competent to unite as defendants both the mortgagor and the party claiming the property adversely to the lien of the mortgage by virtue of proceedings for a sale for taxes had subsequently to its execution. Justice Harlan speaking for the court says:

'If the plaintiff was entitled to have the property sold in satisfaction of the debt secured by the mortgage, it was his right to have it sold, freed from any apparent claim thereon wrongly asserted by the holder of the tax title. Such relief could not be had without making the latter a party to the suit.'

Again, in Hefner v. Insurance Co., 123 U.S. 747, 8 Sup.Ct. 337, the supreme court, by Justice Gray, examine this question, collect the authorities holding both ways, and decide that: 'Upon principle, it was within the jurisdiction and authority of the court, upon a bill in equity for the foreclosure of the plaintiff's mortgage, to determine the validity or invalidity of Callanan's tax title; and he was a proper, if not a necessary, party to such bill.'

This doctrine is so held in the case of a tax title arising, as does the present one, after the date of the mortgage, although recognizing the general rule that:

'As a general rule, a court of equity, in a suit to foreclose a mortgage, will not undertake to determine the validity of a title prior to the mortgage and adverse to both mortgagor and mortgagee, because such a controversy is independent of the controversy between the mortgagor and mortgagee as to the foreclosure or redemption of the mortgage, and to join the two controversies in one bill would make it multifarious.'

Wallenstein could have enforced all his rights under the certificate of purchase, and under the tax deed, which he obtained soon after the commencement of this suit, by becoming a party hereto, and appealing to this court for his remedy, if he had any. Not having chosen to do so, the inquiry arises whether it was competent for him to obtain the relief he sought through the action of the state court. The practical effect of the course pursued, if allowed to have full operation, has been to utterly defeat the remedy sued for in this tribunal, nullify its action, and remove from its cognizance the very subject-matter before it. Can this be done consistently with the relative powers of courts of different jurisdictions, the independence allowed to each, and the harmony that should exist among them? No principle is more firmly entrenched in the law than the doctrine that, when one court acquires jurisdiction and power over the res, no other court can interfere with its possession or control. This doctrine has been affirmed and applied by the supreme court in a long line of adjudications, which have established this as one of the cardinal principles governing the proceedings of courts. Heidritter v. Oilcloth Co., 112 U.S. 294, 5 Sup.Ct. 135; Wiswall v. Sampson, 14 How. 52; Peale v. Phipps, Id. 368; Hagan v. Lucas, 10 Pet. 400; Williams v. Benedict, 8 How. 107; Pulliam v. Osborne, 17 How. 471; Taylor v. Carryl, 20 How. 583; Youley v. Lavender, 21 Wall. 276; Bank v. Calhoun, 102 U.S. 256; Barton v. Barbour, 104 U.S. 126; Covell v. Heyman, 111 U.S. 176, 4 Sup.Ct. 355. In these cases the general doctrine is laid down that where one court has acquired the custody or possession or control of the subject-matter of the controversy through its receiver or marshall, by writ of attachment or other process, no other court can in any manner interfere with that possession or control. Is the principle therein declared broad enough to embrace the present case? Here suit is brought to foreclose a mortgage in which the court has power to adjudicate all liens and claims against the res, ascertain their amount, order a sale of the property, confirm the sale, direct a deed of conveyance to the purchaser at the sale, and, by its writ of assistance, remove the occupant, and place the purchaser in absolute possession of the property. Not only so, but the court, moreover, may, at any time when it deems it equitable and right so to do, appoint a receiver of the property pending the suit, and thereby assume actual legal custody of the same through its officer.

While the question thus presented is probably a new one in some of its aspects, it seems to involve no unreasonable extension of the recognized doctrine. In Wallace v. McConnell, 13 Pet. 136, this principle was applied in the case of an ordinary action upon a promissory note, brought in the federal court, where the state court in Alabama had issued a garnishment against the defendant, and thereby sought to apply a portion of the indebtedness due on the note to satisfy the claim attempted to be enforced by attachment proceedings in the state court. Justice Thompson, in delivering the opinion of the court, says:

'The next point presents the question as to the effect of the proceedings under the attachment law of Alabama, as disclosed in the plea. The plea shows that the proceedings on the attachment were instituted after the

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