Central Trust Company v. Seasongood/Opinion of the Court

The motion of appellee to dismiss this appeal is denied. If, as contended by him, the order of December 8, 1883, was one from which an appeal would lie, the appeal prayed and allowed on the 20th of November, 1885, would bring that order before us; for, although the bond required by the court was made to operate as a supersedeas only of the order of the latter date, the appeal asked and granted was 'of this cause,'-that is, of the whole cause as far as it had then progressed. Conceding appellee's lien on the lots to be prior to its lien on so much of the railroad as crossed those lots, the appellant denies that appellee had a lien upon the entire road of the Cincinnati Northern Railway Company. The proceeds of the sale of the whole road, it is insisted, must be distributed between the appellant and the appellee, upon the basis of the proportionate value of the parts upon which their respective liens rested; not necessarily the mathematical proportion of the 320 feet of the railroad covering the lots in question to the entire length of the road,-42 miles,-but in the proportion of the fair value, all things considered, of the former to the latter. The precise mode of ascertaining this value was not suggested in the argument. We are of opinion that the appellant is not in a condition to raise the question just stated. It was a party to the suit in the state court, the decree in which provided for a sale of the entire road in the event the sum found to be due the present appellee was not paid by the sale of such parts of the lots in question as were not needed for the railroad. That decree, even if erroneous, was binding upon all the parties to the suit in which it was rendered, until modified or reversed by the supreme court of Ohio. It was not open to collateral attack by any of those parties in a separate suit brought by them in the circuit court of the United States after the jurisdiction of the state court attached. No order in the former court could interfere with or suspend the sale which the state court had directed to be made. The only way in which such suspension could have been effected was by means of an arrangement that would be satisfactory to the present appellee, in whose behalf the state court had ordered a sale of the entire road. The order made in the circuit court on the 8th of December, 1883, shows upon its face that that court was informed as to the exact relation of the parties to the suit in the state court. It declared, without objection by any of the parties, that the sale then about to take place of the entire road, under the order of the state court, 'would be contrary to the best interests of all concerned,' and that it was necessary to the operation of the road by the receiver of the circuit court that the proceedings in the state court for a sale be stopped. The mode adopted to effect that end is indicated in the above order. We need not, however, stop to inquire whether it was proper for the circuit court to issue receiver's certificates for claims of the character of those held by the appellee. Upon that subject we express no opinion. We are relieved of any duty to consider that question, because it is apparent that the order of December 8, 1883, was the result of an agreement or arrangement between the appellee and the Central Trust Company,-the latter representing in this cause the holders of bonds secured by the mortgage of November 17, 1880,-and also because of the surrender by the appellee, in consideration of the receiver's certificate for the amount of his claims, of the rights accorded to him by the decree in the state court. The appellee cannot be restored to his rights under the decree of the state court, and it would be inequitable to permit the appellant, representing those who purchased the property under the decree of the circuit court, now to raise any question as to the validity of the receiver's certificates, which it agreed might be issued to the appellee. It remained quiet for nearly two years, and until after the property had been sold, and after the sale had been confirmed to those it represented, before making an issue as to the propriety or validity of the order of December 8, 1883. The bondholders are concluded, under the circumstances disclosed in the record, by what their representative did, or assented to being done, in order to induce the appellee to surrender the rights secured by the judgment of the state court. The decree of the circuit court is affirmed.