Young v. Powell, 12483.

CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)
Writing for the CourtHUTCHESON, , McCORD and RUSSELL, Circuit
Citation179 F.2d 147
Docket NumberNo. 12483.,12483.
Decision Date10 January 1950

Richard T. Rives, and John C. Godbold, Montgomery, Ala., Joseph R. Bell, Hayneville, Ala., for appellant.

John O. Harris, Montgomery, Ala., for appellee.

Before HUTCHESON, Chief Judge, McCORD and RUSSELL, Circuit Judges.

HUTCHESON, Chief Judge.

While other errors are assigned and urged, the primary insistence of appellant is that the district judge erred in not dismissing the suit upon defendant's motion1 and in holding that plaintiff, one of several legatees, had the right, without joining as plaintiffs the other legatees and a representative of the estate, to sue alone for the cancellation of deeds, instruments, and acts of gift to defendant, made and done by decedent to the injury of her estate.

The matter comes up in this way. Appellee, plaintiff below, a citizen of Maryland, suing as one of the residuary legatees of Mrs. Low, who died in June, 1947, and without joining other legatees or a representative of the estate, brought this suit in the federal court against appellant, a citizen of Alabama, also a residuary legatee and the executor under her will, to set aside gifts of cash and of land the decedent had made to him in October, 1942, and December, 1944, respectively.

Setting out the names, residences, and relationships2 of the other legatees and beneficiaries under the will, and alleging that the gifts of lands and cash were void for undue influence on, and lack of mental capacity of, deceased, complainant sought a judgment,3 declaring them null and void, and requiring defendant to account to plaintiff for the moneys, and to pay them to the estate of the decedent for distribution to those entitled under the will.

The defendant moved to dismiss the action (1) because the plaintiff is not the owner of the cause of action sued on, is not the real party at interest and, therefore, not the proper party to bring this suit, and the complaint, therefore, fails to state a cause of action in favor of plaintiff against the defendant; and (2) for want of indispensable parties, Annie Laurie Rugeley, Josephine Powell Richardson, Louise Powell Mitchell, and the personal representative of the estate, who could not be made parties without depriving the court of jurisdiction.

The district judge, agreeing with defendant that the parties named as indispensable would, if made parties, divest the jurisdiction of the court, but, holding that they were not indispensable,4 denied the motion to dismiss, and the cause came on for hearing on the merits.

Finding that the gifts of $44,000.00 in money and the deed to the land had been procured by undue influence and that they should be cancelled and set aside, instead, however, of finding defendant indebted to plaintiff and obligated to account to him, the district judge found that he was "indebted to the estate of Sarah Irvin Low, deceased", and ordered him "to account to and pay to the estate the said sum of $44,000.00 for distribution in accordance with the provisions of her last will and testament".

As to the land, he ordered that the title to it be divested out of defendant and that "the land be and is hereby made a part of the estate of Sarah Irvin Low, and is to pass under the provisions of her last will and testament".

He further ordered that a copy of the decree be certified to the judge of probate of Lowndes County, Alabama.

Appealing from the judgment, defendant is here insisting primarily that it was error to deny his motion to dismiss and proceed to trial and judgment in the case.

To maintain this position, he puts forward several propositions and supports them with many cited cases. (1) In Alabama and elsewhere, unless all parties interested in the final settlement of an estate are before the court as parties to the proceedings, only the personal representative of the decedent has the right and authority to sue for personal property due the estate; a legatee or heir suing alone has no such right.5 (2) The appellee sought an accounting made to him individually for moneys claimed to be due the decedent and her estate. Such a cause of action belongs to the estate and must be brought by the personal representative, as the real party in interest.6 (3) In suits brought, as here, for the benefit, and therefore affecting the rights, of residuary legatees or next of kin, all members of a class must be made parties.7 (4) The estate is vitally interested in the suit, indeed the suit was brought for its benefit. It should in Alabama, since the executor was adverse, have been represented by an administrator ad litem, who must be a resident of the state.8 Finally, presenting the question of appellant's inability to sue from the standpoint of Federal Rules 17, the real party at interest rule, and 19, as to indispensability of parties, he insists that if appellee could have sued in his own name in the state court, he could not do so in the federal court, because in the suit as brought he was not the real party in interest, and because other parties indispensable to the suit were not joined. Because the joinder would have destroyed the requisite diversity of citizenship, he further insists that the district court would have had to dismiss the suit, not for want of federal jurisdiction but for lack of indispensable parties.9

Appellee meets these propositions with propositions of his own. (1) A state rule, that the real party in interest must sue, is not binding on the federal court. (2) If forced to go into the county of the residence of the defendant in the state court, the estate and the other legatees would be subject to local bias, and, therefore, he had the right as a non-resident to sue alone in the federal court without joining those whose joinder would defeat jurisdiction. (3) Finally, this is a case falling within the second sentence of Rule 19(b), authorizing the court to proceed without persons as parties, who, though necessary are not indispensable, if their joinder would deprive the Court of jurisdiction of the parties before it, "but the judgment rendered therein does not affect the rights or liabilities of absent persons".

We find ourselves in complete disagreement with appellee. The first proposition disregards the fact that Rule 17(a) of the Federal Rules of Civil Procedure, Real Party in Interest, "Every action shall be prosecuted in the name of the real party in interest" is the substantial equivalent of the rule in Alabama and in most of the states.10

The second proposition in effect that, because of local prejudice, he has a right which he would otherwise have, to sue and recover on a cause of action which is not his but the estate's, or the joint cause of action of all the legatees, is no better taken. He could not sue alone on this cause of action in the Alabama State Court. The fact that he would be met there by prejudice does not give him a right to sue on it in the Federal Court.

His final proposition that he can sue for the benefit of the estate and the other legatees and obtain a judgment in their favor is not supported by, it is in the teeth of, the very rule he invokes. This rule, in accordance with established federal jurisprudence, specifically excepts from its operation persons who are indispensable. In addition, even as to dispensable parties, it provides that their rights or liabilities are not to be affected by the judgment.

The cases appellee cites in support of his view,11 that he may sue alone, are not in point on their facts here. They are all cases where plaintiff sued, not for the benefit of others but for himself, to recover for himself his separate and divisible share. He was not enforcing an indivisible right of an estate or of his co-heirs. Those cases did not hold that a court could proceed in the absence of indispensable parties. They held that because of the separate and divisible nature of the plaintiff's demand in the particular case and the fact that the relief sought could not, and did not affect the rights or liabilities of those not made parties, the cause could proceed to judgment and the relief sought could be granted, without their presence.

No case is cited to us, we have found none, where, as here, one legatee has been allowed to maintain a suit, in behalf of the estate and all the legatees, to cancel completely in their interest, acts and instruments done and executed by the decedent, and, upon cancellation, to recover the entire property for the benefit of the estate.

On the contrary, as we have stated in Hudson v. Newell, 5 Cir., 172 F.2d at page 852, "We know of no exception to the rule that an instrument cannot be destroyed totally by a decree unless all parties to it, or their successors in interest, are before the court." (Emphasis supplied.) There the district judge at first denied defendant's motion to dismiss for want of indispensable parties, but the motion later renewed, on the authority of Keegan v. Humble, 5 Cir., 155 F.2d 971 and Calcote v. Texas & Pacific Coal & Oil Co., 5 Cir., 157 F.2d 216, granted it. On appeal, this court, holding that the court had jurisdiction of the suit to grant part of the relief prayed, but that, for want of indispensable parties, the relief of cancellation could not be granted, held that, though full relief could not be granted in the cause, it should be retained to inquire into what relief could be.

We think we cannot do better than to quote from that case a part of what was said in the course of the discussion: "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...

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