Shepherd v. St. Louis Public Service Co.

• Decision Date: 21 March 1933
• Docket Number: No. 9503.,9503.
• Citation: 64 F.2d 612
• Parties: SHEPHERD v. ST. LOUIS PUBLIC SERVICE CO.
• Court: U.S. Court of Appeals — Eighth Circuit

64 F.2d 612 (1933)

SHEPHERD v. ST. LOUIS PUBLIC SERVICE CO.

No. 9503.

Circuit Court of Appeals, Eighth Circuit.

March 21, 1933.

Thomas Bond, of St. Louis, Mo. (Hyman G. Stein, Jerome Duggan, and Carl M. Dubinsky, all of St. Louis, Mo., on the brief), for appellant.

Vance J. Higgs, of St. Louis, Mo. (T. E. Francis, of St. Louis, Mo., on the brief), for appellee.

Before STONE, VAN VALKENBURGH, and BOOTH, Circuit Judges.

STONE, Circuit Judge.

For some years the property of the street railway system in St. Louis was operated by a receiver, appointed in the Eastern District of Missouri. During such operation, and on August 27, 1921, appellant was injured while a passenger upon one of the street cars. He filed his suit in the state court against the receiver for the recovery of such injury and the receiver answered therein. Thereafter, all of the property in receivership was sold and delivered to the purchaser, the appellee here, on December 1, 1927, and the receiver discharged, on May 28, 1928. Within six months after delivery of possession to appellee, as purchaser, appellant presented his claim to appellee, gave notice of his claim, and, from the time appellee took possession, it took over the same claim department organization which had existed under the receiver and in which was the full record and investigation of the claim of appellant. Thereafter, and on February 20, 1929, a judgment was rendered in the state court in favor of appellant for $2,000; the receiver not appearing, and counsel for this appellee, without entering any appearance for appellee, stating to the court at that time that appellee would not defend.

On March 20, 1929, appellant filed, in the federal court, its petition for leave to file an intervening petition for the purpose of enforcement against appellee of the amount of the above judgment, with interest thereon. The basis of this proceeding in the federal court is that, in the final order of sale and the order confirming the sale to appellee, the court required the purchaser to pay claims incurred in the operation by the receiver, provided for enforcement of the decrees by a power in the court to retake and resell the properties, and retained the necessary jurisdiction. This petition was allowed and a petition in intervention filed. Thereafter, appellee filed its motion to dismiss the petition in intervention upon three grounds: That (1) the face of the petition showed the judgment was rendered after the discharge of the receiver; (2) there was an adequate remedy at law; and (3) laches. This motion was sustained. Thereafter, appellant filed a petition for leave to file an amended petition in intervention. That petition was allowed and an amended petition in intervention was filed. Thereafter, a motion to dismiss this amended petition was filed by appellee upon precisely the same grounds as in the prior motion to dismiss. This motion was sustained, and, appellant declining to plead further, an order was entered dismissing the petition, entering decree in favor of appellee, and according recovery of costs. From this decree the intervener brings this appeal.

There are three very brief oral opinions by the court; the first being upon allowance of the original intervention, the second in connection with sustaining the motion to dismiss the original petition in intervention, and the third in connection with sustaining the motion to dismiss the amended petition in intervener Unfortunately, these opinions are so brief and indefinite that it is difficult to know what were the grounds for the court's action. From the first of these opinions it appears that the early inclination of the court to permit the original petition to be filed was adverse, but that, out of caution and with the thought that the matter could be "fully and completely threshed out" thereafter, the leave was granted. In that opinion, the only intimations of the view of the court are as follows: "I am still casually of the opinion that there are other provisions in the decree, which are sufficiently full to provide a remedy of law, but on the casual examination that I have made of the decree I have not found those provisions; however, I am clearly of the opinion (which is bottomed upon my recollection, that there are such provisions. I gravely suspect that counsel for intervener has probably overlooked some required matter of notice; that he has delayed too long, or that he has made no legal efforts to get into court the successors of the Railways Company. By that I mean the old company. * * * I yet am doubtful, as I was in the beginning, and disposed to think that the tentative position first assumed by the Court was the correct one, and that the troubles, I repeat, have arisen from some failure to get the old company into court, so as to require them to answer in the original suit brought by Sheppard Shepherd against the old company."

The entire substance of the second opinion is as follows:

"It may well be that there are circumstances under which a bill of this sort, or bills of this sort, could be sustained, but in my opinion the present intervening petitions are lacking in averment, even assuming that the judgments in favor of interveners and against Rolla Wells, former Receiver of defendant Company, are good and valid.

"The two cases called to my attention, namely, the Wabash Railway Company Case, 200 Mo. App. 397, 207 S. W. 78, decided by the Kansas City Court of Appeals, and the Baer Case, 176 N. Y. 97, 68 N. E. 129, decided by the New York Court of Appeals, casually seem to go to the extent of holding that a judgment against a receiver, after he has been, by final order of court, denuded of all the property in his hands, is yet good.

"At this time I am not called upon to decide that question. Taking the entire decree as it stands, I am led to believe that assuming the validity of the judgments against the late Receiver, then interveners, if they have complied with the requirements of the decree, may bring an action at law against the present holder of the properties. I am not deciding this point, but merely suggesting it as a reason why, in my opinion, recourse at this time ought not to be had in the severe and serious way proposed in the interventions. As forecast, I know of but one contingency upon which such an action as here sought could be maintained, and that contingency does not appear in the petition."

The entire substance of the third opinion is as follows: "The Court has heretofore indicated the ground and the only ground, in the opinion of the Court, wherein the Court would be warranted in permitting the maintenance of an intervention such as this, upon the record in this cause. Counsel upon argument frankly conceded that those requirements, which the Court had indicated as necessary, were not fulfilled in the bill of complaint before me. This being the case, I see no reason to change the two former rulings."

Turning to the record, it is clear that appellant bases the right to intervene in the federal court solely upon provisions in the final decree ordering the sale of the properties and in the order of confirmation. The remedy he seeks to invoke is one he conceives to be accorded in those decrees.

The attacks upon this position, as shown in the motion to dismiss, which was sustained, are: (1) That the judgment in the state court is a nullity because rendered only against the receiver and after he had been fully discharged; (2) that there is an adequate remedy at law; and (3) laches.

The issues presented here are as follows: (1) Whether this order is an appealable order; (2) whether the judgment in the state court is subject to attack; (3) if subject to attack, whether the discharge of the receiver abated that action and rendered the judgment void; (4) whether appellant has an adequate remedy at law to which he must be relegated; and (5) whether appellant has been guilty of laches. We find it unnecessary to determine each of these separately.

The first matter requiring settlement is the contention of appellee that this is not an appealable order. There is no force in this position. It is true that where the order appealed from is an order denying leave to intervene, that order is usually, but not always, treated as not a final, appealable order. But here intervention was permitted and the order appealed from disposes, finally, of the merits of that intervention, which is a very different thing.

While the parties argue various matters here, the decree must be affirmed for the following reasons: The sole basis of this intervention is that the judgment in the state court constitutes an established claim which is, under the above decrees in the federal court, enforceable against the purchaser. The sole purpose of the intervention is to procure that enforcement. The motion to dismiss attacks the validity of the judgment on the ground that it was rendered against the receiver only, and after he had been finally discharged. There are two reasons why the intervention was properly held not to be maintainable.

The first reason is that the judgment in the state court is void. Whether that judgment is void, or not, depends upon state law. Appellant relies upon section 904, Revised Statutes Missouri 1929 (Mo. St. Ann. § 904), as establishing the validity of the judgment. That section is as follows: "Sec. 904. Interest in suit transferred, proceedings. — When an interest is transferred in any action now pending, or hereafter to be brought, other than that occasioned by death, marriage or other disability of a party, the action shall be continued in the name of the original party, if the party to whom the transfer is made will indemnify the party in whose name the suit is to be continued against all costs and damages that may be occasioned thereby, or the court may allow the person to whom the transfer is made to be substituted in the action; and in all such cases the party to whom the transfer is...