National Sur. Co. v. Leflore County, Miss.

• Decision Date: 16 December 1919
• Docket Number: 3416.
• Citation: 262 F. 325
• Parties: NATIONAL SURETY CO. v. LEFLORE COUNTY, MISS., et al.
• Court: U.S. Court of Appeals — Fifth Circuit

262 F. 325

NATIONAL SURETY CO. v. LEFLORE COUNTY, MISS., et al.

No. 3416.

United States Court of Appeals, Fifth Circuit.

December 16, 1919

[Copyrighted Material Omitted]

John R Tyson, of Montgomery, Ala., for appellant.

R. C McBee, A. F. Gardner, and E. V. Hughston, all of Greenwood, Miss., for appellee.

Before WALKER, Circuit Judge, and GRUBB and ERVIN, District Judges.

GRUBB District Judge.

This is an appeal from a final decree, dismissing appellant's bill of complaint, which was filed to cancel a bond executed by appellant, as surety, in favor of Leflore county, in the state of Mississippi, a municipal corporation, appellee, and also by the Itta Bena Banking & Trust Company, as principal, and granting to appellee Leflore county relief on its cross-bill, which sought the enforcement of the bond against the appellant and its codefendant, the Itta Bena Banking & Trust Company. The Itta Bena Banking & Trust Company had acted as depository of the public funds of Leflore county, under a designation claimed by appellant to have been void, because its selection was by a bare quorum of the board of supervisors, one of whom was incapacitated to act, because he was a director and stockholder of the Itta Bena Banking & Trust Company.

It was called to the attention of the court upon the hearing of the appeal that the Itta Bena Banking & Trust Company had not joined in the appeal, and that there had been no summons and severance as to it. This court has held, in the case of The Bylands, 231 F. 101, 145 C.C.A. 289, that the failure of a codefendant, where the judgment is joint, to join in the appeal, in the absence of a summons and severance, was fatal to the jurisdiction of the court, and would be noticed by it, though no motion to dismiss the appeal had been made, following the case of Estis v. Trabue, 128 U.S. 225, 9 Sup.Ct. 58, 32 L.Ed. 437. In that case, however, the Supreme Court stated that the rule would not apply if the judgment or decree was distributive, so that it could be regarded 'as containing a separate judgment against the claimants and another separate judgment against the sureties. ' Judgments and decrees, under the law of Mississippi, are joint and several, and not merely joint.

It has also been held that on proper application the writ of error or appeal may be amended by the insertion of the omitted parties. Inland Co. v. Tolson, 136 U.S. 572, 10 Sup.Ct. 1063, 34 L.Ed. 539; The Mary B. Curtis, 250 F. 9, 162 C.C.A. 181; The Seguranca, 250 F. 19, 162 C.C.A. 191. In the case of Winters v. United States, 207 U.S. 564, 28 Sup.Ct. 207, 52 L.Ed. 340, the Supreme Court, speaking of a case in which five of the defendants, who had defaulted, were not joined in the appeal of other defendants, who had answered and defended the bill, said:

'The rule which requires the parties to a judgment or decree to join in an appeal or writ of error, or be detached from the right by some proper proceeding, or by their renunciation, is firmly established. But the rule only applies to joint judgments or decrees. In other words, when the interest of a defendant is separate from that of other defendants, he may appeal without them.' The Supreme Court held that the default of the defendants, who did not join in the appeal, separated their interest from that of the defendants who answered and defended the bill, and, for that reason, excused the appellant from joining them in the appeal. The Supreme Court in that case said:

'Joinder in one suit did not necessarily identify them. Besides, the defendants other than appellants defaulted. A decree pro confesso was entered against them, and thereafter, according to equity rule 19 (29 Sup.Ct. xxvii), the cause was required to proceed ex parte and the matter of the bill decreed by the court. Thomson v. Wooster, 114 U.S. 104 (5 Sup.Ct. 788, 29 L.Ed. 105). The decree was in due course made absolute, and, granting that it might have been appealed from by the defaulting defendants, they would have been as said in Thomson v. Wooster, absolutely barred and precluded from questioning its correctness, unless on the face of the bill it appeared manifest that it was erroneous and improperly granted. Their rights, therefore, were entirely different from those of the appellants; they were naked trespassers, and conceded by their default the rights of the United States and the Indians, and were in no position to resist the prayer of the bill. But the appellants justified by counter rights, and submitted those rights for judgment. There is nothing, therefore, in common between appellants and the other defendants. The motion to dismiss is denied, and we proceed to the merits.'

In the case of Orleans-Kenner Electric Ry. Co. v. Dunbar, 218 F. 344, 134 C.C.A. 152, this court said, in overruling a motion to dismiss an appeal for nonjoinder of appellants:

'The interest of the railway company which was affected by the decree rendered was so separate and distinct from that of the other defendant that the former is entitled to maintain an appeal in which the latter does not join. Obviously, the pecuniary or proprietary interest acquired or claimed by the grantee of such a privilege is very different from that of the public governmental body which undertook to confer the privilege. * * * The beneficial proprietary interest which the latter has in the privilege which it claims to have acquired entitles it to maintain an appeal from a judgment or decree adversely affecting its interest, though the official body which undertook to confer the privilege, and which was also a party defendant to the cause, does not join in the appeal. Where the respective interests of several defendants, which are affected by a judgment or decree against all of them, are separate and different, one of them may appeal without joining the others.'

In this case, the Itta Bena Banking & Trust Company answered appellant's original bill of complaint by denying the facts stated in it, and that appellant was entitled to the relief asked in it; i.e., the cancellation of the bond. There was therefore no identity of interest between appellant and the Itta Bena Banking & Trust Company in the subject-matter of the decree upon the original bill. The Itta Bena Banking & Trust Company did not answer or defend the cross-bill of the appellee Leflore county, and was in default upon the cross-bill. There was nothing, therefore, in common between its position and that of appellant, even upon the decree upon the cross-bill, for it had arrayed itself on the other side of the litigation from appellant. It was not, therefore, necessary that it be joined in the appeal, or a severance had as to it.

The question on the merits of the appeal is whether the invalidity of the proceeding through which the Itta Bena Banking & Trust Company was selected as a depository for the funds of Leflore county avoided the bond executed by appellant as surety, for the purpose of securing the funds of the county deposited with the bank. It may be conceded...