Woodworth v. Northwestern Mutual Life Insurance Company

The question arising for decision in this cause is embodied in the following certificate from the United States circuit court of appeals for the eighth circuit:

'The United States circuit court of appeals for the eighth circuit, sitting at the city of St. Louis, Missouri, on this 27th day of December, 1900, hereby certifies that upon the record on file in said court in the aboveentitled causes, wherein Lucian Woodworth, Frank D. Brown, and George N. Clayton are plaintiffs in error, and the Northwestern Mutual Life Insurance Company is defendant in error, and Lucian Woodworth, Frank D. Brown, and George N. Clayton are appellants, and the Northwestern Mutual Life Insurance Company is appellee, and which causes are now pending before this court on writ of error to and appeal from the circuit court of the United States for the district of Nebraska, the following facts appear, namely:

'On August 26, 1896, the Northwestern Mutual Life Insurance Company filed its bill of complaint in the circuit court of the United States for the district of Nebraska against Lucian Woodworth and others to foreclose a mortgage given by Woodworth and his wife to said company, upon certain real estate situated in the state of Nebraska. A decree on said bill was entered on December 3, 1896, in said circuit court, foreclosing the mortgage, directing that a master in chancery of the court sell the premises, and upon confirmation of the sale by the court execute a deed to the purchaser, and ordering that the purchaser of the premised at said sale be put in possession thereof, and that any of the parties to said cause who might be in possession of said premises, or any person claiming under them or either of them, should deliver possession to the purchaser on production of the master's deed of said premises and a certified copy of the order confirming the report of said sale, after such order had become absolute. On February 14, 1898, said real estate was sold by the master under said decree, and was purchased at said sale by the Northwestern Mutual Life Insurance Company for $39,152, a sum less than the amount of the debt secured by the mortgage and the costs in the suit. The master made his report of sale to the court on February 15, 1898. On March 15, 1898, said circuit court confirmed said report of sale, directed that the master convey said real estate to the purchaser at said sale, awarded a writ of possession to put said purchaser in possession thereof, and rendered a deficiency judgment for the sum of $2,696.90 and interest in favor of the Northwestern Mutual Life Insurance Company and against said Woodworth. On March 30, 1898, said Woodworth was allowed an appeal from this order of confirmation to the United States circuit court of appeals for the eighth circuit, and thereafter, on April S, 1898, he filed his appeal bond in the sum of $5,500 with Frank D. Brown and George N. Clayton as sureties thereon, which bond was conditioned for the payment of 'all damages and costs which it (the Northwestern Mutual Life Insurance Company) may incur by reason or on account of said appeal,' and worked a supersedeas of the order of confirmation. The United States circuit court of appeals on January 24, 1899, affirmed said order of confirmation of sale, and on March 29, 1899, its mandate was duly issued to, and filed in, said circuit court. On June 19, 1899, the deficient judgment and the costs taxed in said cause in the United States circuit court of appeals were fully paid and satisfied. On September 16, 1899, the defendant in error, the Northwestern Mutual Life Insurance Company, filed its petition in said circuit court against Lucian Woodworth, and the sureties on said appeal bond, Frank D. Brown and George N. Clayton, alleging, among other things, that the possession and use of said real estate was withheld from said company by reason of the superseding of the order of March 15, 1898, during the pendency of the appeal therefrom, that the value of such use and possession during the pendency of said appeal amounted to $3,750, and praying that Woodworth and the sureties Brown and Clayton be cited to appear and show cause why judgment should not be summarily entered against them for said $3,750 and interests and costs. On September 16, 1899, an order to show cause against said Woodworth, Brown, and Clayton was made on said petition as prayed for therein, and on October 2, 1899, they filed their showing in resistance to said petition, alleging that 'damages for the rents and profits of the premises, or use and detention thereof pending appeal, are not recoverable on a supersedeas bond, and that the bond in question was not given as security, or for the payment of rents and profits, or the use or detention of the property pending appeal,' and praying for the dismissal of said petition. On December 9, 1899, said circuit court entered a judgment and decree against the plaintiffs in error, Woodworth, Brown, and Clayton, as prayed for in said petition. Afterwards, in due season, to wit, on January 31, 1900, said last-named judgment and decree having been rendered on December 9, 1899, the record in the proceedings on said petition was removed by writ of error and also by appeal to the United States circuit court of appeals for the eighth circuit, where it still remains, the cause being as yet undecided.

'And the said United States circuit court of appeals hereby certifies that to the end that it may properly decide said case, it desires the instruction of the Supreme Court of the United States upon the following question or proposition of law arising therein which is duly raised and presented by the record in said case, said question being as follows:

'Is the obligee in a bond which supersedes an order confirming a sale of real estate and directing the immediate execution of a deed and delivery of possession thereof to the purchaser, entitled, after that order has been affirmed on the appeal, to recover as damages for the breach of the obligation of the bond the value of the use and possession, that is to say in this case, the rents and profits of the real estate during the time the purchaser is kept out of the possession and use of the real estate by the supersedeas bond and the appeal in which it was allowed?'

Mr. John N. Baldwin for plaintiffs in error and appellants.

Mr. Howard Kennedy, Jr., for defendant in error and appellee.

Mr. Justice White, after making the foregoing statement, delivered the opinion of the court: