In the Matters of Howard/Opinion of the Court

There is no ground for supposing any intention on the part of the circuit judges, or of either of them, to evade or disobey the mandate of this court. Their action has been dictated entirely from an opinion held by them that parties asserting a right to share in a common fund in the custody of the court, and presenting a prim a facie case in support of such asserted right, are entitled to be heard at any time before its actual distribution, although a decree ordering such distribution in a litigation between other parties may have been entered. Whether in this opinion they are sustained by the law, is the question presented for our consideration. We are not called upon to determine the character of the claims presented, whether they constitute liens upon the fund in the hands of the receiver, or stand as simple debts against an insolvent company, or whether the right, if any ever existed, of the holders to share in the fund has been lost by their laches. The question is not as to the merits of the claims, but whether the Circuit Court was forbidden by the force of its previous decree, when affirmed by this court, from considering the claims at all.

Undoubtedly it is the duty of all inferior courts to yield a prompt obedience to the mandate of this court, or, in other words, to treat as conclusive the judgment of this court upon the law and facts presented to it in appropriate form for consideration. Any other conduct would be subversive of the relation which the Constitution intends that inferior tribunals shall hold to this court. But the obedience thus due is not a blind obedience, acting upon the letter of the judgment affirmed, or mandate ordered, without any consideration of the rights of persons not parties to the litigation in which the judgment was entered. The judgment of an inferior court, when affirmed by this court, is only conclusive as between the parties upon the matters involved. Viewed simply as an adjudication between them, it is not open to question. It must be followed and obeyed. The inferior court cannot reopen the case and allow new proceedings to be taken, or further evidence to be given, or new defences to be offered, upon any ground whatever. It must execute the judgment or decree, and only for that purpose has it any authority over it. Such is the purport of the numerous cases cited by the counsel for the relators. But they go no further. None of them suggest even the proposition that the judgment or decree affirmed concludes the rights of third parties not before the court, or in any respect affects their rights. It would have been against all principle and all reason had they asserted anything of the kind. There is, indeed, a class of cases affecting the personal status of parties, in which a judgment necessarily binds the whole world, but it is not of these we are speaking. We refer to judgments at law or decrees in chancery, affecting rights of parties to property. They bind only the parties before the court and those who stand in privity with them.

The counsel of the relators seek to apply the conclusive character of such judgments and decrees between parties to persons not parties, under the supposition, it would seem from their argument, that they require some additional efficacy from their affirmance by this court. But they acquire no additional efficacy by such affirmance. As adjudications upon the rights of the parties between themselves they have the same operation before as after their affirmance.

The decree in the case of Howard and others v. The City of Davenport and others, determined that the complainants and the intervening claimants were entitled to the fund in the hands of the receiver as against the defendants. It did not determine, and could not determine, that Foster and his associates had not equal or greater claims to the fund than either of those parties. They had, therefore, the same right to proceed by bill or other appropriate remedy, if there be one, to assert any claims or equity to the fund which they possessed, as they might have done if no such suit as that of Howard and others v. The City of Davenport and others, had ever been commenced or carried to final decree. And in the prosecution of their suit they were entitled, upon a proper showing, to all the remedies by injunction or order, which a court of equity usually exercises to prevent the relief sought from being defeated.

The general doctrine that where there is a fund in court to be distributed among different claimants, a decree of distribution will not preclude a claimant not embraced in its provisions, but, having rights similar to those of other claimants who are thus embraced, from asserting by bill or petition his right to share in the fund, is established by numerous authorities, both in England and the United States. Several of these are cited by counsel, to two of which we will refer. The first is that of Gillespie v. Alexander. That was a suit for the administration of the estate of General Gillespie. After several debts against the estate had been proved before a mater and been paid, the court, in January, 1825, decreed a distribution of the residue of the fund in court to the unsatisfied legatees. In November, subsequently, a party appeared claiming to be a creditor of Gillespite, and petitioned the court for liberty to prove his demand, and liberty was given. In July of the following year the master reported that there was due the petitioner over sixteen hundred pounds. In the meantime the fund had been apportioned under the decree, and part of it had been paid in discharge of some of the legacies. The master of the rolls ordered that the debt to the petitioner should be apportioned among the funds of the different legatees, whose legacies still remained in court, observing that the legatees were not without remedy, as they could call on the other legatees to contribute. From this order an appeal was taken to the chancellor, and the principal objection urged to the order was similar to the objection urged in this case, that the creditor was concluded by the decree directing distribution, but Lord Eldon, in deciding the appeal, said:

'Although the language of the decree, where an account of debts is directed, is that those who do not come in shall be excluded from the benefit of that decree, yet the course is to permit a creditor, he paying the costs of the proceedings, to prove his debt, as long as there happens to be a residuary fund in court, or in the hands of the executor, and to pay him out of that residue. If a creditor does not come in till after the executor has paid away the residue, he is not without a remedy, though he is barred the benefit of that decree. If he has a mind to sue the legatees and bring back the fund, he may do so, but he cannot affect the legatees except by suit, and he cannot affect the executor at all.'

And the chancellor ordered that the debt should be apportioned to the shares of all the legatees, and that the petitioner should be paid the sums apportioned to the shares remaining in court, and be at liberty to apply against the legatees who had been paid, and against funds which might subsequently come in, for the balance due him.

The other case to which we will refer is that of Williams v. Gibbes, decided by this court and reported in the seventeenth of Howard. In that case, the County Court of the Sixth Judicial District of Maryland had, by its decree, rendered in December, 1846, awarded to the executors of one Oliver, the proceeds of a share of one Williams in an association known as the Baltimore Company. Upon appeal to the Court of Appeals of the State, the decree of the County Court was, in this respect, affirmed. In 1852, six years after the entry of the decree, the administrator of Williams filed a bill, in the Suprem Court of Baltimore City, against the executors of Oliver, for the proceeds of Williams's share, averring that neither he nor Williams was present, or a party to, or bound by, any proceeding, or order, or decree of the County Court, or of the Court of Appeals, and that the settlement and adjustment of the amount of the partnership funds of the Baltimore Company, and of the charges, commissions, and costs to which they were liable in solido, and the distribution of the remainder of the funds by the decree of the court to the several shares, which the members of the company were entitled to, were not binding upon him or his intestate.

The case was transferred from the State court to the Circuit Court of the United States, where the bill was dismissed. On appeal to this court the decree of dismissal was reversed. Mr. Justice Nelson, speaking for the court, said:

'Now, the principle of well settled in respect to these proceedings in chancery, for the distribution of a common fund among the several parties interested, either on the application of the trustee of the fund, the executor or administrator, legatee, or next of kin, or on the application of any party in interest, that an absent party, who had no notice of the proceedings, and not guilty of wilful laches or unreasonable neglect, will not be concluded by the decree of distribution from the assertion of his right by bill or petition against the trustee, executor, or administrator; or in case they have distributed the fund in pursuance of an order of the court, against the distributees.'

And after referring to various cases from the English courts, and among others to that of Gillespie v. Alexander, already cited, said:

'The cases above referred to relate to the rights of creditors and next of kin; but the principle is equally applicable to all parties interested in a common fund brought into a court of equity for distribution among the several claimants.'

These cases, and the general principles governing courts of equity in the disposition of a common fund, of which there are several claimants, are sufficient to show that the judges of the Circuit Court were justified in authorizing Foster and his associates to file their consolidated bill, and thus present for consideration their claims to share in the fund in the hands of the receiver, and in withholding the distribution of the fund under the decree in the case of Howard and others v. The City of Davenport and others, until such claims could be considered and determined.

Whether in the determination of these claims the Circuit Court decided rightly or otherwise, can only be settled upon the hearing of the appeal from its decree.

It follows that the motion for a mandamus, and the motion to dismiss the appeal from the final decree, must both be

DENIED.