When leave to intervene in an equity case is asked and refused,
the order denying leave is not regarded as a final determination of
the merits of the claim on which the intervention is based, but
leaves the petitioner at full liberty to assert his rights in any
other appropriate form of proceeding. The action of the court
below, in denying the petitions to intervene, was an exercise of
purely discretionary power, and was not final in its character.
On October 9, 1893, Oliver Ames, 2d and Samuel Carr, executors
of Frederick L. Ames, deceased, and Peter B. Wyckoff and Edwin F.
Atkins, filed in the Circuit Court of the United States for the
Eighth Circuit a bill of complaint against the Union Pacific
Railway Company and a number of other companies in which the Union
Pacific Railway Company had interests praying for the appointment
of receivers, the enforcement of certain alleged liens, and the
administration of the properties of the Union Pacific Railway
Company. On October 13, 1893, S. H. H. Clark, Oliver W. Mink,
Ellery Anderson were appointed receivers, and on November 13, 1893,
upon petition of the Attorney General of the United States, John W.
Doane and Frederick R. Coudert were appointed additional
receivers.
On January 21, 1895, a bill of complaint was filed in the said
circuit court by F. Gordon Dexter and Oliver Ames, 2d as trustees
of the first mortgage of the Union Pacific Railway Company, to
foreclose that mortgage.
Page 177 U. S. 312
At the May term, 1897, the United States filed, in a Circuit
Court of the United States for the Eighth Judicial Circuit, a bill
of complaint against the Union Pacific Railway Company, and against
S. H. H. Clark, Oliver W. Mink, Ellery Anderson, John W. Doane, and
Frederick R. Coudert, who had theretofore, on October 13, 1893, in
the suit brought in said court by Oliver Ames, Samuel Carr, and
others against the said Union Pacific Railway Company, been
appointed receivers therefor, and against F. Gordon Dexter and
Oliver Ames, as trustees, the Union Trust Company of New York, as
trustee, J. Pierpont Morgan and Edwin F. Atkins, trustees, the
Central Trust Company of New York, as trustee. The object of this
bill was to secure a decree of foreclosure of the subsidy lien of
the United States upon the property of the Union Pacific Railway
Company between Council Bluffs, Iowa, and a point five miles west
of Ogden, Utah.
On April 28, 1897, the Credits Commutation Company, a
corporation of the State of Iowa, filed a petition in each of said
three cases praying for leave to intervene therein as a party, and
to be heard to assert certain alleged rights and interests. On May
22, 1897, the Combination Bridge Company, a corporation of the
State of Iowa, also filed petitions in said cases for leave to
intervene therein for the same reasons set forth at length in the
petitions of the Credits Commutation Company. On May 24, 1897,
after hearing the counsel of the respective parties, an order was
entered by the circuit denying the prayers for leave to intervene,
and on the same day an appeal was allowed to the Circuit Court of
Appeals for the Eighth Circuit. On December 7, 1898, motions by the
appellees to dismiss said appeals were sustained, and said appeals
were accordingly dismissed, and thereupon the appellants in open
court prayed an appeal to this Court, which was allowed.
Credits Commutation Co. v. Ames, 91 F. 570. Motion to
dismiss or affirm was submitted.
MR. JUSTICE SHIRAS delivered the opinion of the Court.
The Credits Commutation Company and the Combination
Page 177 U. S. 313
Bridge Company, corporations of the State of Iowa, filed
petitions for leave to intervene in three suits against the Union
Pacific Railway Company. The object of those suits was to enforce
by foreclosure the payment of bonds secured by mortgage and of a
debt due to the United States created by certain subsidy bonds,
and, pending such proceedings, the appointment of receivers to
prevent the disintegration of properties of the railway
company.
The Combination Bridge Company is the owner of a bridge across
the Missouri River at Sioux City. The Credits Commutation Company
is the owner of the stock of the bridge company, and also of
interests in the capital stock of certain railroads connected by
the said bridge. The petition alleges that the Credits Commutation
Company was organized for the purpose of connecting said bridge and
railroads with the Union Pacific Railway.
The Union Pacific Railway Company is a consolidated company,
composed of the Union Pacific Railroad Company and the Kansas
Pacific Railway Company, and Congress, by the Act of July 1, 1862,
in order to "secure to the government the use of the same,"
conferred upon said companies grants of large and valuable tracts
of the public lands, and further subsidized said companies by an
advance to them of the public credit in the form of bonds of the
United States. The fifteenth section of the said Act of July 1,
1862, was in the following terms:
"And be it further enacted that any other railroad company now
incorporated, or hereafter to be incorporated, shall have the right
to connect their road with the road and branches provided for by
this act at such places and upon such just and equitable terms as
the President of the United States may prescribe. Wherever the word
'company' is used in this act, it shall be construed to embrace the
words 'their associates, successors, and assigns,' as if the words
had been properly added thereto."
The petition alleges that the Credits Commutation Company was
organized in the latter part of 1894, but admits that said company
has abstained from making any application to the President of the
United States to fix the place at which and the
Page 177 U. S. 314
just and equitable terms upon which said company should build a
railroad to connect with the road of the Union Pacific Railway
Company, because the latter company had been embarrassed and all
its property was in the hands of receivers, and bills to foreclose
in behalf of the holders of mortgage bonds and to enforce the
creditor rights of the United States had been filed. It seems to be
the theory of the petitioners that, under the provisions of the act
of Congress, they have a right to connect their railroads, now or
to be constructed, with the railroad of the Union Pacific Railway
Company, and that they have therefore a right to intervene in the
foreclosure proceedings in order to protect their right to so
connect and to protect the right of the public in such railroad
connections.
As heretofore stated, the circuit court denied the petitions for
leave to the intervene, and upon appeal to the circuit court of
appeals, that court dismissed the appeals. The view of the circuit
court of appeals was that the order of the circuit court refusing
leave to intervene was not a final judgment or decree from which an
appeal could be taken, and that, at any rate, the action of the
lower court in refusing leave to intervene was not reviewable on
appeal, inasmuch as it rested in the sound discretion of the
chancellor to admit or reject the intervention. 91 F. 570, 571.
To show that the circuit court, in denying the petition for
leave to intervene, was not exercising the usual discretion of a
chancellor in passing upon a petition of an outside party for leave
to intervene, but adjudicated the petitioners' rights asserted in
the petitions, as if upon demurrer thereto, we are pointed to the
language used:
"Ordered that the prayers of the petitioners for leave to
intervene herein be and the same are hereby denied, not as matter
of discretion, but because said petitions do not state facts
sufficient to show that the petitioners, or either of them, have a
legal right to intervene."
It is urged that the circuit court declined to treat the subject
as of one of discretion, and elected to determine the legal rights
of the petitioners, so as to preclude them from resorting
thereafter to some other tribunal, and that therefore its judgment
was a final one and properly reviewable on appeal.
Page 177 U. S. 315
We cannot accept this view of the meaning and effect of the
order in question. What was sought in the petitions was leave to
intervene in a pending and undetermined cause, and that right alone
was determined. The very terms used by the court, that the facts
stated were "not sufficient to show that the petitioners, or either
of them, have a legal right to intervene," shows that what was
considered was the right to intervene. That right refused, the
petitioners were left free to assert such other rights as they
might possess in any other tribunal. That this was the view of
Judge Sanborn himself is seen in the following language of his
opinion:
"Whatever the petitioner's right or interest may be, it is
nothing more than a contingent, speculative, future possibility. It
is contingent because it is conditioned upon the construction of a
railroad. It is speculative because it depends for its existence
upon the question whether or not capitalists shall see sufficient
profit in the construction of such a railroad to induce them to put
in the necessary money for that purpose. It is future because it
has not yet come into existence, and it is possible because it may
come into existence. Courts of equity are not accustomed, perhaps
they have not the power, to adjudicate upon possible rights which
are not in being and which are merely susceptible of coming into
being at some unlimited time in the future."
The question was well considered by the circuit court of
appeals, and we quote and adopt its statement, as follows:
"When such action is taken -- that is to say, when leave to
intervene in an equity case is asked and refused -- the rule, so
far as we are aware, is well settled that the order thus made
denying leave to intervene is not regarded as a final determination
of the merits of the claim on which the intervention is based, but
leaves the petitioner at full liberty to assert his rights in any
other appropriate form of proceeding. Such an order not only lacks
the finality which is necessary to support an appeal, but it is
usually said of it that it cannot be reviewed, because it merely
involves an exercise of the discretionary powers of the trial
court. . . . It is doubtless true that cases may arise where the
denial of the right of a third party to intervene therein would
be
Page 177 U. S. 316
a practical denial of certain relief to which the intervener is
fairly entitled, and which he can only obtain by an intervention.
Cases of this sort are those where there is a fund in court
undergoing administration to which a third party asserts some right
which will be lost in the event that he is not allowed to intervene
before the fund is dissipated. In such cases, an order denying
leave to intervene is not discretionary with the chancellor, and
will generally furnish the basis for an appeal, since it finally
disposes of the intervener's claim by denying him all right to
relief. The cases at bar, however, are not of that character. The
petitioners were under no obligation to intervene in the litigation
against the Union Pacific Railway Company to preserve their alleged
right to form a junction with the road of that company when they
should have completed their own road to a suitable junction point.
The question which they sought to litigate in the pending
litigation could, we think, with more propriety and with less
difficulty have been litigated by an independent bill after they
had completed, or were about completing, their line to a suitable
junction point. Prior to that time, the questions which they sought
to raise by means of the intervening petitions were speculative
questions which the lower court, as we think, very properly,
refused to consider or determine."
In
Connor v.
Peugh, 18 How. 394, it was said by Mr. Justice
Grier, giving the opinion of the Court:
"On the 5th of June, 1885, the tenant in possession came into
court for the first time and moved to set aside the judgment and
execution issued thereon, and to be allowed to defend the suit for
reasons set forth in her affidavit. The court refused to grant this
motion, 'whereupon the said Mary Ann Connor prayed an appeal.'"
"The tenant in possession having neglected to appear and have
herself made defendant and confess lease, entry, and ouster, the
judgment was properly entered against the casual ejector. No one
but a party to the suit can bring a writ of error. The tenant
having neglected to have herself made such cannot have a writ of
error to the judgment against the casual ejector. The motion made
afterwards to have the judgment set aside and for
Page 177 U. S. 317
leave to intervene was an application to the sound discretion of
the court. To the action of the court on such a motion no appeal
lies, nor is the subject of a bill of exceptions or a writ of
error."
In
Ex Parte Cutting, 94 U. S. 14, it was
held that an appeal does not lie from an order of the court below
denying a motion in a pending suit to permit a person to intervene
and become a party thereto.
Guion v. Liverpool, London &c.
Ins. Co., 109 U. S. 173, is
to the same effect.
Whether the contention of the petitioners that, under the
legislation of Congress, they and railroad companies similarly
situated had a right to connect with the road of the Union Pacific
Railway Company, or shall have such a right with respect to that
road in the hands of purchasers under the decree of foreclosure at
such places and upon such just and equitable terms as the President
of the United States may prescribe, were not questions that, under
the pleadings and evidence, were before the circuit court for its
determination, and as its action in denying the petitions to
intervene was an exercise of purely discretionary power, and not
final in its character as respects such alleged right to connect,
we think the circuit court of appeals was right in holding that the
appeals could not be entertained by that court, and its decree,
dismissing the same, is accordingly
Affirmed.
MR. JUSTICE McKENNA took no part in the decision of the
cases.