Lewis v. Peck

• Decision Date: 17 April 1907
• Docket Number: 1,335.
• Citation: 154 F. 273
• Parties: LEWIS v. PECK et al.
• Court: U.S. Court of Appeals — Seventh Circuit

154 F. 273

LEWIS v. PECK et al.

No. 1,335.

United States Court of Appeals, Seventh Circuit.

April 17, 1907

Rehearing Denied May 17, 1907.

This writ of error brings for review a judgment of the Circuit Court and sentence of imprisonment against the plaintiff in error, James Hamilton Lewis, upon finding of contempt of court, in the violation of an injunctional order of such court. The proceedings in which the injunctional order was issued were under the title of consolidated actions of Farmers' Loan & Trust Company, Trustee, and United Waterworks Company, Limited, v. New England Waterworks Company, Alton Waterworks Company et al.-- one a bill for foreclosure of a mortgage and the other a creditors' bill-- upon which decree had theretofore been entered, which is the same decree appealed from in New England Waterworks Co. v. Farmers' Loan & Trust Co., 136 F 521, 69 C.C.A. 297, and affirmed by this court, and the general nature of the bills and decree are sufficiently described in the opinion there filed and reported.

Upon the coming in of the master's report of sale under that decree, objections to confirmation of the sale were interposed by one Allen A. Brown and other persons, as individual bondholders under a trust deed, made by the Boston Water & Light Company (a defendant in such decree) to the International Trust Company, trustee (also a defendant therein), setting up, among other grounds, that they were not made parties to such suits, had no notice thereof, and were 'being deprived of their property without notice and without due process of law'; also that the purchase price was grossly inadequate. The plaintiff in error appeared for and represented these bondholders in opposing the confirmation. On May 5, 1905, the court entered an order or decree of confirmation of the sale, as reported, to Samuel L Peck, G. R. Leighton, Charles G. Sanford, and Russell Frost a committee representing bondholders, for the price named. The order recites, among other matters, that the purchaser moved to strike out the objections filed by Brown and others and then orders 'that the said objections and exceptions of the said Allen A. Brown and others be and the same are hereby overruled and held for naught,' and that the sale is thereupon confirmed; and the following is the concluding provision:

'And it is further ordered, adjudged, and decreed that, upon the completion of the payment of the purchase price by the said purchasers, the delivery to them of the deed of the said master and the delivery of the property to them by the said receiver, that the title to the said property and assets as against each and every party to this action, and all persons claiming, or to claim, under them, or either of them, be vested absolutely in the said purchasers and their assigns, and all parties to this suit, and all persons claiming, or to claim, by, through, or under them, be, and they and their and each of their attorneys, solicitors, officers, and agents are, forever prohibited and enjoined from setting up any pretended or alleged title, as against the title of the said purchasers acquired by means of said master's deed in this decree mentioned, and which said pretended or alleged title may have arisen by, through, or under any of the said parties to the said cause, and from in any way interfering with or disturbing the said purchasers, or their assigns, in the full and free use and occupation and enjoyment of all the said property so acquired by said purchasers by means of said sale and said deed from the said master.

'It is further ordered, adjudged, and decreed that the said purchasers have leave at the foot of this decree to apply for further directions and for any amendment thereof until the last day of the next term of this court, and for that purpose this cause will, upon adjournment of the present term of this court, stand continued upon the docket of this court until the last day of the next term thereof.'

The objecting bondholders then made application to Mr. Justice Day of the Supreme Court for allowance of an appeal to that court, but the appeal was disallowed with a letter addressed to the plaintiff in error, which is made a part of the record, stating in effect that the bondholders were not named as parties, so that they were not entitled to a review on appeal, remarking that 'their rights, if invaded, must in my opinion be worked out in an original proceeding. ' Subsequently, Brown and other bondholders filed a bill in the circuit court of Madison county against the Boston Water & Light Company and other defendants, including the purchasers under the foreclosure decree above mentioned, for foreclosure of their alleged mortgage, and the plaintiff in error appeared therein as solicitor for the complainants. Thereupon the purchasers under the foreclosure decree petitioned for a rule to be entered by the Circuit Court of the United States, upon the plaintiff in error, to show cause why he should not be punished for contempt of court for filing such bill and issuing summons thereupon, in alleged violation of the injunction of that court. The petition was entertained by the court, under the title of the original consolidated suits, upon an order 'that said causes be redocketed for the purposes of said petition,' and that a citation issue thereupon.

The plaintiff in error submitted his sworn answer to such rule, disclaiming 'any intention on his part to violate any lawful orders or decrees entered by' the court, and stating that he represented Brown and other bondholders, as their duly authorized attorney; and having applied for an appeal to the Supreme Court, which was denied with an opinion by Mr. Justice Day which is annexed to the answer, he so proceeded in behalf of such bondholders, believing that they were neither parties to nor affected by the decree of this court and were entitled to so proceed. The court on April 16th entered the order appealed from, which reads (after the title) as follows:

'In the matter of the petition of Samuel Peck, G. Ralph Leighton, Charles G. Sanford, and Russell Frost for a rule against James Hamilton Lewis to show cause why he should not be punished for a contempt of court in violating the injunction contained in the decree made and entered in the above-entitled consolidated cause on the 5th day of May, A.D. 1905.

'The above-entitled matter coming on to be further heard and the court being now fully advised finds that the said James Hamilton Lewis did file in the circuit court of Madison county, Ill., a certain bill wherein Allen A. Brown, trustee, Robert B. Wason, Harriet N. Houghton, James Schouler, C. A. Damon, Joseph C. Foster, Chas. M. Page, George W. Fairbank, M. C. Grier, Sabra Hodgkins, Wm. B. Trask, and Mary A. Evans are complainants and Boston Water & Light Company, a corporation, International Trust Company, a corporation, Alton Waterworks Company, a corporation, George W. Sumner, and Chester B. Sumner, executors of the estate of Wm. H. Sumner, James Howe, Orin Warren, Alice G. Page, John Farquhar, administrator of estate of Benjamin F. Dudley, deceased, George F. Lovett, Vernon Prouty, Frank Dromgoole, the C. H. Venner Co., a corporation, Cidele Venner, Samuel Peck, G. Ralph Leighton, Charles G. Sanford, Russell Frost, and unknown parties claiming an interest in the property described in the said bill, are defendants, praying for the foreclosure of a certain mortgage executed October 1, 1897, by the Boston Water & Light Company, of the state of Maine to the International Trust Company of the state of Massachusetts, to secure the payment of 200 bonds bearing same date for $1,000 each. The court further finds that said action is in violation of the injunction order of the Circuit Court of the United States entered May 5, 1905. It is therefore ordered that said James Hamilton Lewis be and is hereby held to be in contempt of this court and is sentenced to be imprisoned in the Sangamon county, Ill., jail for 60 days or until further order of this court. In case the above-described cause now pending in the circuit court of Madison county, Ill., is dismissed within five days from this date, said sentence of imprisonment is to be suspended.'

On April 17th, under compulsion of such order, the plaintiff in error dismissed the suit so commenced in Madison county circuit court, and advised the Circuit Court of the United States of such dismissal, pursuant to and under the compulsion of such order, to save himself from the imprisonment thus imposed.

For jurisdiction to enter the injunctional order contained in the order or decree of confirmation, paragraphs 22, 25, 26, and 27 of the original decree are relied upon. Paragraph 22 provides that the purchaser thereunder, after delivery of the premises and property, 'shall hold possession and enjoy the same with all rights, privileges, immunities, and franchises pertaining thereto as fully as said Alton Waterworks Company, the New England Waterworks Company, and Boston Water & Light Company, or the receiver therein, now hold or enjoy the same, or held or enjoyed, or were entitled to hold or enjoy the same at any time heretofore, and shall hold the same free and discharged' from the lien or incumbrance of all the mortgage trust deeds in this decree mentioned, and free from all claim or claims of every kind and nature of all parties to this cause and those claiming under them.

The other paragraphs read as follows:

'(25) All questions not hereby disposed of, including the settlement of the accounts of the receiver and his discharge and the amounts to be allowed said receiver and his counsel and the amounts to be allowed said trustee, complainants, and their solicitors, and the amount to be allowed the master, and the application of...