Hudson v. Newell

• Decision Date: 24 February 1949
• Docket Number: No. 12417.,12417.
• Parties: HUDSON et al. v. NEWELL et al.
• Court: U.S. Court of Appeals — Fifth Circuit

172 F.2d 848 (1949)

HUDSON et al. v. NEWELL et al.

No. 12417.

United States Court of Appeals Fifth Circuit.

February 24, 1949.

Ben F. Cameron and Lester E. Wills, both of Meridian, for appellants.

R. E. Wilbourn, of Meridian, Miss., Irwin W. Coleman, W. Calvin Wells, J. Morgan Stevens, and Garner W. Green, all of Jackson, Miss., and W. S. Welch, Sam V. Pack, J. R. Buchanan and A. S. Scott, all of Laurel, Miss., for appellees.

Before SIBLEY, HOLMES, and McCORD, Circuit Judges.

SIBLEY, Circuit Judge.

On Dec. 11, 1945, the appellants as plaintiffs filed in the District Court four suits concerning four contiguous tracts of land in Mississippi, each of which was claimed by different defendants, with the oil therefrom, which was being extracted by two oil companies also named as defendants. On March 16, 1946, amendments were made to each suit adding two additional counts and asking additional relief. The plaintiffs claimed all the lands under the same title and the pleadings in the four suits and the relief prayed were nearly identical. The defendants filed motions to dismiss for want of jurisdiction because certain persons were interested who were not made parties, who would if made parties destroy the diversity of citizenship on which federal jurisdiction was invoked. Because similar questions were involved in them all, the four suits were consolidated. The district judge made findings of fact on the motions and upheld jurisdiction. The motions were later renewed because of the decisions of this court in Keegan v. Humble Oil & Ref. Co., 5 Cir., 155 F.2d 971, and Calcote v. Texas & Pacific Oil & Coal Co., 5 Cir., 157 F.2d 216. After an extensive hearing findings of fact and conclusions of law were again made, and the suits were dismissed "for absence of indispensable parties who, if brought in, would destroy diversity of citizenship and oust the court of jurisdiction." This appeal followed.

1. In this court a motion to dismiss the appeal is made by some of the appellees on the ground that the controversy is moot, because the issues have been adjudicated in a suit to which all were parties in the Chancery Court of Mississippi by a final decree affirmed by the Supreme Court of Mississippi on April 21, 1947, Hudson et al. v. Gulf Refining Co. et al., Miss., 30 So.2d 66; Id., Miss., 30 So.2d 421, and certiorari denied by the Supreme Court of the United States Oct. 13, 1947, 332 U. S. 775, 68 S.Ct. 84. The final decree of the Chancery Court is said to have been pleaded as res judicata and as a basis for summary judgment in the case before us, and to be discoverable in this record though not printed, and we are asked to notice judicially the actions of the Supreme Courts of Mississippi and of the United States as shown in their published reports. Appellants do not concede the case is moot, and vigorously argue that since the lower court did not reach the plea of res judicata and motion for summary judgment, but held only that it had no jurisdiction, no such question can be raised on this appeal; and they further argue that for reasons they urge they are not bound by the Chancery Court judgment. We think on well settled principles this appeal reaches only the correctness of the dismissal for want of jurisdiction, and that the question of res judicata stands for an orderly first trial in the court below if there is jurisdiction. McDonald v. Smalley, 1 Pet. 620, 7 L.Ed. 287; Thomas v. Thomas, 5 Cir., 165 F.2d 332; Tucker v. Phillips, 5 Cir., 148 F.2d 904. The controversy is not moot. The motion to dismiss the appeal is overruled.

2. The cases of Keegan v. Humble Oil & Ref. Co., 5 Cir., 155 F.2d 971, and Calcote v. Texas Pacific Coal & Oil Co., 5 Cir., 157 F.2d 216, 225, are not revolutionary. They overruled no older decisions, and are but two among many dealing with the question here presented. Each case must be determined on its own facts. The fundamental principles are simple. They are: (1) Where federal jurisdiction rests on diversity of citizenship the diversity must be complete, and to see whether it is, all parties will be aligned as plaintiffs or defendants according to their real interests; (2) A court cannot adjudicate the rights of persons who are not parties before it; they will be brought in if possible and if they will not destroy diversity. (3) If diversity will be thereby destroyed the court will not require them to be brought in, but will enquire if there is any relief it can properly give without them; if there is, it will give it without prejudice to the rights of the absent; if none can be given the suit will be dismissed. In the latter event the dismissal is not for want of federal jurisdiction, but for lack of indispensable parties. See Federal Rules of Civil Procedure No. 19, 28 U.S.C.A.

3. We are of opinion that federal jurisdiction exists in each of the four suits as they are brought, complete diversity existing and the principal amount involved being sufficiently alleged to be more than $3,000. The relief prayed is multiform. The original complaints asked a decree that the plaintiffs are the true owners of the land and of the mineral rights therein and of the oil and gas removed from it by the defendant oil companies. If they can prove the land and oil are theirs we see no reason why they should not have judgment for them against those sued; possible claimants not in court would not of course be bound by the result. If such claimants' title is shown as a defense their interests can be saved from the decree. But the next prayer that all the adverse deeds be cancelled cannot be granted if there are any persons interested under them who are not before the Court. The prayer that the oil companies discover what oil they have taken out can be granted if the plaintiffs prove they have some interest in it, though not the whole interest.

4. The second counts prayed a declaratory judgment as to the meaning and effect of leases made between the plaintiffs and the oil companies; and particularly that a provision in those leases that plaintiffs' right to one-eighth of the oil should be determined in a named suit between all the claimants then pending in the State Chancery Court (the same mentioned above in connection with res judicata) did not mean just that, but that this federal court was equally a court of competent jurisdiction to determine plaintiffs' right; and if necessary that the leases be reformed to express the latter intent; and for an accounting with the oil companies under these leases. If these prayers had related only to these leases and the lessees, the other claimants of the land not being signers of these leases, there would be no need of further parties; but the leases promise to pay the plaintiffs only on a compromise or an adjudication in a named suit to which all claimants were parties. The effort to make this federal case a substitute for the State case to get an adjudication could not succeed unless all the claimants to this land were parties to it. The question of parties must be faced.

The third counts also are based on the leases and the prayers are substantially the same. The first counts thus seek to establish title to the land and by consequence to the oil. The second and third counts seek an account of one-eighth of the oil by reason of the leases made by plaintiffs to the oil companies.

5. The title of plaintiffs, according to their pleadings, is derived, as is that of all adverse claimants, from one Noah L. Hudson, who in 1878 conveyed all the lands involved to his wife for her life. The deed is lost or destroyed and the public record of it also...