The equity jurisdiction of the federal courts is derived from
the federal Constitution and statutes, and is like unto that of the
High Court of Chancery in England at the time of the adoption of
the Judiciary Act of 1789; it is not subject to limitations or
restraints by state legislation giving jurisdiction to state courts
over similar matters.
While federal courts cannot seize and control property which is
in the possession of the state courts and have no jurisdiction of a
purely probate character, they can, as courts of chancery, exercise
jurisdiction, where proper diversity of citizenship exists, in
favor of creditors, legatees, and heirs, to establish their claims
and have a proper execution of the trust as to them.
Although complainant in this case asks in some of her prayers
for relief which is beyond the jurisdiction of the court as being
of a purely probate character if the allegations of the bill
support them the court may grant other prayers for relief which are
within its jurisdiction, and, as a court of equity, shape its
decree according to the equity of the case.
Where the bill does not seek to set aside the probate of a will
or interfere with the possession of the probate court, the federal
court of equity, in a case where diverse citizenship exists, may
determine as between the parties before the court their interests
in the estate and such decree will be binding upon, and may be
enforced against, the executor.
It will be assumed that the state probate court will respect the
decree
Page 215 U. S. 34
of the federal court having jurisdiction settling the rights of
parties in an estate, and the denial of effect of such a decree
presents a claim of federal right which can be protected by this
Court.
While a federal court of equity cannot, either under the
forty-seventh rule in equity or general principles of equity,
proceed to adjudication in the absence of indispensable parties, if
it can do justice to the parties before it without injury to absent
persons, it will do so and shape the decree so as to preserve the
rights of those actually before the court, without prejudice to the
rights of the absentees.
In this case, the absent party was not of the same state as
complainant and had no interest in common with complainant, and
while a proper, was not an indispensable, party, as his interests
were separate and could be protected by retention of his legacy by
the executors subject to adjudication in another suit.
The facts, which involved the jurisdiction of the circuit court,
are stated in the opinion.
Page 215 U. S. 38
MR. JUSTICE DAY delivered the opinion of the Court.
This case presents a question of jurisdiction concerning the
right of the United States circuit court to entertain a certain
bill in equity. Frances E. Waterman, wife of Charles A. Crane, a
resident of Chicago, in the State of Illinois, and a citizen of
that state, joined by her husband, also a citizen of Illinois,
brought the suit in the United States circuit court against the
Canal-Louisiana Bank & Trust Company, executor of the last will
and testament of Caroline Stannard Tilton, Deceased, a citizen of
the State of Louisiana and an inhabitant of the Eastern
Page 215 U. S. 39
District of Louisiana, and also against the Charity Hospital of
New Orleans, St. Ann's Asylum, Protestant Episcopal Orphan Asylum,
Home for Incurables, Christian Woman's Exchange, State Insane
Asylum of Jackson, Louisiana, City of New Orleans, and Louisiana
Retreat, conducted by the Society of the Daughters of St. Vincent
de Paul, all and each of them being institutions established under
the laws of Louisiana, and citizens of the State of Louisiana, and
inhabitants of the Eastern District of Louisiana; also against
Robert Waterman and Frederick Waterman, citizens of the State of
Louisiana, and inhabitants of the Eastern District thereof. The
bill set forth in substance that Caroline Stannard Tilton, widow of
Frederick W. Tilton, late of the City of New Orleans, duly made and
published her last will and testament and codicils thereunto
annexed, and by said will and codicils said Caroline Stannard
Tilton gave and bequeathed to Robert Waterman the sum of $3,000; to
the said Robert Waterman and his wife, fifteen premium bonds; to
Frederick Waterman, $3,000; to Frederick Tilton Davis, $1,000, and
the whole series of No. 5,963 premium bonds. That the said Caroline
Stannard Tilton departed this life on or about the sixth of July,
1908; that the Canal-Louisiana Bank & Trust Company, executor
in said will named, duly proved the same in the court of probate
jurisdiction in and for the Parish of Orleans, in the State of
Louisiana, and undertook the executorship thereof, and possessed
itself of the personal estate and effects to the said testatrix to
a very considerable amount, and more than sufficient to discharge
her just debts, funeral expenses, and legacies.
The complainant further avers that she is the sole surviving
niece, and that Robert and Frederick Waterman and Frederick Tilton
Davis are the sole surviving nephews, of said Caroline Stannard
Tilton, and that there are no other persons within the nearest
degree of kinship of the said testatrix, and that the said
Frederick Tilton Davis resides in the State of Alabama, outside of
the court's jurisdiction.
She avers that the said Robert Waterman, Frederick Waterman,
Page 215 U. S. 40
and Frederick Tilton Davis, legatees in said will, became
entitled to have and receive their said respective legacies, and
did receive the same, and, accordingly, by receiving said bequests,
have renounced the succession of said Caroline Stannard Tilton,
deceased, and, by taking said legacies, have renounced all their
rights as heirs at law, and are estopped and debarred from claiming
any portion of the estate undisposed of, because of certain
provisions of the will, which are set forth in the bill.
It is further averred by the complainant that, by reason of the
renunciation and estoppel of said legatees, the complainant remains
the sole heir at law of Caroline Stannard Tilton, and, as such, is
entitled to the shares which would have gone to Frederick and
Robert Waterman and Frederick Tilton Davis, of the same degree and
collateral line, by right of accretion.
She further avers that said will bequeathed to the Charity
Hospital of New Orleans, $2,000; St. Ann's Asylum, $2,000;
Protestant Episcopal Orphan Asylum, $2,000; Home for Incurables,
$2,000; Home for Insane, $3,000, and to the Christian Woman's
Exchange, $1,000, and that, after satisfaction of the foregoing
special legacies and bequests, and after payment of all costs and
expenses of settlement of the estate, if any remained thereof
undisposed of, the testatrix willed and directed that such residue
should be divided between the beneficiaries of the charitable
bequests heretofore made to the various institutions, the divisions
to be made
pro rata, in proportion to the amount of
special legacies already made to them, respectively. She avers
that, at the time of making said will and at the time of the death
of said testatrix, there was no such institution or corporation in
existence known as Home for Insane, nor was the testatrix capable
of incorporating any such institution under her will, and that said
special legacy for $3,000, and the
pro rata share of the
residue, remained undisposed of because of the facts stated, and
thereby the sum of $3,000 and the
pro rata share of the
proportion of the estate undisposed of devolved upon the
complainant as sole legal heir and next of kin to said Caroline
Stannard Tilton. And it was averred that
Page 215 U. S. 41
the Christian Woman's Exchange was not entitled to share in the
residue, because the bequest to it of $1,000 was not a charitable
bequest, and the said Christian Woman's Exchange was not one of the
institutions mentioned in the will to share in the residue.
Complainant states that the insane asylum situated at Jackson,
Louisiana, the Louisiana Retreat, conducted by the Society of the
Daughters of Charity of St. Vincent de Paul, and the City of New
Orleans, claim and assert their right to take and receive the
amount of said lapsed and caducous legacies, asserting that the
testatrix intended them as beneficiaries of her bounty, and as
particular legacies under her will, instead of the Home for Insane.
And the plaintiff denies, for reasons stated in the bill, that
either of them is entitled to receive such legacies intended for
the Home for Insane, and she charges that the amount falling to her
as sole legal heir and next of kin, because of her right to the
lapsed legacies bequeathed to the nonexisting Home for Insane's
share in the residue, together with that part and proportion of the
estate accessory and appurtenant thereto, exceeds the sum of
$90,000, which she is entitled to out of the estate. She charges
that the estate, after payment of the special legacies, charges,
and costs of administration, will amount to more than a residue of
$350,000. She charges that the executor refuses to do or make any
satisfaction whatever in respect to her just demands, and the
complainant avers that she has no sufficient remedy under the rules
of common law, and must resort to a court of equity for adequate
relief. And the prayer of the bill is:
"Wherefore, your oratrix prays that this Court do order,
adjudge, and decree that (1) that the particular legacy contained
in the last will and testament of Caroline Stannard Tilton,
deceased, to so-called 'Home for Insane,' and also the interest of
said legatee in the residue or residuum of said testatrix's estate,
be declared caducous, to have lapsed, because of the uncertainty
and nonexistence of said legatee; (2) that it be further declared
and decreed that Robert Waterman and Frederick
Page 215 U. S. 42
Waterman have renounced and abandoned all their right, title,
and interest as heirs of said Caroline Stannard Tilton, deceased,
in the said lapsed and caducous legacy made in favor of the
so-called 'Home for Insane;' (3) that it be further adjudged and
decreed that your oratrix, as the nearest sole heir and next of kin
of said Caroline Stannard Tilton, deceased, capable of inheriting,
is alone entitled to the amount of the caducous and lapsed special
legacy bequeathed to the said so-called 'Home for Insane,' for the
sum of three thousand dollars ($3,000), and to the proportionate
share of said nonexisting and uncertain legatee in the residue of
the estate of said Caroline Stannard Tilton, and that the
Canal-Louisiana Bank & Trust Company, executor of said
deceased, Caroline Stannard Tilton, be condemned to pay over and
deliver to your oratrix the whole amount of said caducous special
legacy, together with the proportionate share and interest to said
so-called 'Home for Insane' in the residue of the estate of said
deceased remaining after the payment of the particular legacies and
the costs of administration of her estate, and for such further sum
as the court may find to be justly due and owing unto your oratrix
as legal heir and next of kin of the said Caroline Stannard Tilton;
(4) and that it be further ordered and decreed that the Christian
Woman's Exchange is not a charitable institution, or entitled, as
such, under said will to participate or receive any share or
portion of the residue of the estate of said deceased; (5) and that
an account be taken of the personal estate and effects of the said
testatrix coming to the hands of the said executor, or of any
person or persons by its order or for its use, and also of the said
testatrix's funeral expenses, debts, legacies, and costs of
administration, and especially showing the residue remaining in the
hands of the said executor after making the aforesaid deduction,
and that the same may be applied in due course of administration,
and that, for these purposes, proper directions may be given."
"And your oratrix further prays for all general and equitable
relief, as well as all costs. "
Page 215 U. S. 43
From an early period in the history of this Court, cases have
arisen requiring a consideration and determination of the
jurisdiction of the courts of the United States to entertain suits
against administrators and executors for the purpose of
establishing claims against estates, and to have a determination of
the rights of persons claiming an interest therein. And this Court
has had occasion to consider how far the jurisdiction in equity of
the courts of the United States in such matters may be affected by
the statutes of the states providing for courts of probate for the
establishment of wills and the settlement of estates. We will not
stop to analyze or review in detail all these cases, as they have
been the subject of frequent and recent consideration in this
Court. The general rule to be deduced from them is that, inasmuch
as the jurisdiction of the courts of the United States is derived
from the federal Constitution and statutes, that, insofar as
controversies between citizens of different states arise which are
within the established equity jurisdiction of the federal courts,
which is like unto the High Court of Chancery in England at the
time of the adoption of the Judiciary Act of 1789, the jurisdiction
may be exercised, and is not subject to limitations or restraint by
state legislation establishing courts of probate and giving them
jurisdiction over similar matters. This Court has uniformly
maintained the right of federal courts of chancery to exercise
original jurisdiction (the proper diversity of citizenship
existing) in favor creditors, legatees, and heirs, to establish
their claims and have a proper execution of the trust as to them.
In various forms, these principles have been asserted in the
following, among other, cases:
Suydam v.
Broadnax, 14 Pet. 67;
Hyde v.
Stone, 20 How. 170,
61 U. S. 175;
Green v.
Creighton, 23 How. 90;
Payne v.
Hook, 7 Wall. 425;
Lawrence v. Nelson,
143 U. S. 215;
Hayes v. Pratt, 147 U. S. 557,
147 U. S. 570;
Byers v. McAuley, 149 U. S. 608;
Ingersoll v. Cogam, 211 U. S. 335.
The rule stated in many cases in this Court affirms the
jurisdiction of the federal courts to give relief of the nature
stated,
Page 215 U. S. 44
notwithstanding the statutes of the state undertake to give to
state probate courts exclusive jurisdiction over all matters
concerning the settlement of accounts of executors and
administrators in the distribution of estates. This rule is subject
to certain qualifications, which we may now notice. The courts of
the United States, while they may exercise the jurisdiction, and
may make decrees binding upon the parties, cannot seize and control
the property which is in the possession of the state court. In
Byers v. McAuley, supra, the rule was thus tersely stated
by MR. JUSTICE BREWER, delivering the opinion of the Court:
"A citizen of another state may establish a debt against the
estate.
Yonley v. Lavender, 21 Wall.
276;
Hess v. Reynolds, 113 U. S. 73. But the debt thus
established must take its place and share of the estate as
administered by the probate court, and it cannot be enforced by
process directly against the property of the decedent.
Yonley
v. Lavender, supra. In like manner, a distributee, citizen of
another state, may establish his right to a share in the estate,
and enforce such adjudication against the administrator personally,
or his sureties (
Payne v. Hook, 7 Wall. 425);
or against any other parties subject to liability (
Borer v.
Chapman, 119 U. S. 587), or in any other
way which does not disturb the possession of the property by the
state court. (
See the many cases heretofore cited.)"
In a late case, where the subject was given consideration in
this Court (
Farrell v. O'Brien, 199 U. S.
89), while the rule of the earlier cases was stated and
their binding force admitted, it was laid down that the circuit
court of the United States could not entertain jurisdiction of a
bill to set aside the probate of a will in the State of Washington,
because, by the statutes of that state, the proceeding was one
purely
in rem, and not a suit
inter partes,
sustainable in a court of equity. That case recognized what
previous cases had held -- that, in proceedings purely of a probate
character, there was no jurisdiction in the federal courts. This
was in harmony with the rule
Page 215 U. S. 45
therefore laid down in
Byers v. McAuley, supra, in
which it was held that the federal court could not exercise
original jurisdiction to draw to itself the entire settlement of
the estate of the decedent and the accounts of administration, or
the power to determine all claims against the estate. But it was
there decided that a circuit court of the United States could
entertain jurisdiction in favor of citizens of other states, to
determine and award by decrees binding
in personam their
shares in the estates.
In view of the cases cited, and the rules thus established, it
is evident that the bill in this case goes too far in asking to
have an accounting of the estate, such as can only be had in the
probate court having jurisdiction of the matter, for it is the
result of the cases that, insofar as the probate administration of
the estate is concerned in the payment of debts, and the settlement
of the accounts by the executor or administrator, the jurisdiction
of the probate court may not be interfered with. It is also true,
as was held in the court below in the case at bar, that the prior
possession of the state probate court cannot be interfered with by
the decree of the federal court. Still, we think there is an aspect
of this case within the federal jurisdiction, and for which relief
may be granted to the complainant, if she makes out the allegations
of her bill under the other prayers, and the prayer for general
relief therein contained. Under such prayer, a court of equity will
shape its decree according to the equity of the case.
Walden v.
Bodley, 14 Pet. 164.
The complainant, a citizen of a different state, brings her bill
against the executor and certain legatees named, who are likewise
citizens of another state, and are all citizens of Louisiana, where
the bill was filed, except one, who was beyond the jurisdiction
diction of the court; and, for the reasons stated in her bill, she
asks to have her interest in the legacy alleged to be lapsed and
the residuary portion of the estate established.
This controversy is within the equity jurisdiction of the courts
of the United States, as heretofore recognized in this
Page 215 U. S. 46
Court, and such jurisdiction cannot be limited or in anywise
curtailed by state legislation as to its own courts. The
complainant, it is to be noted, does not seek to set aside the
probate of the will, which the bill alleges was duly established
and admitted to probate in the proper court of the state.
The United States circuit court, by granting this relief, need
not interfere with the ordinary settlement of the estate, the
payment of the debts and special legacies, and the determination of
the accounts of funds in the hands of the executor, but it may, and
we think has the right to, determine, as between the parties before
the court, the interest of the complainant in the alleged lapsed
legacy and residuary estate, because of the facts presented in the
bill. The decree to be granted cannot interfere with the possession
of the estate in the hands of the executor, while being
administered in the probate court, but it will be binding upon the
executor, and may be enforced against it personally. If the federal
court finds that the complainant is entitled to the alleged lapsed
legacy and the residue of the estate, while it cannot interfere
with the probate court in determining the amount of the residue
arising from the settlement of the estate in the court of probate,
the decree can find the amount of the residue, as determined by the
administration in the probate court in the hands of the executor,
to belong to the complainant, and to be held in trust for her, thus
binding the executor personally, as was the case in
Payne v.
Hook and
Ingersoll v. Coram, supra.
It is to be presumed that the probate court will respect any
adjudication which might be made in settling the rights of parties
in this suit in the federal court. It has been frequently held in
this Court that a judgment of a federal court awarding property or
rights, when set up in a state court, if its effect is denied,
presents a claim of federal right which may be protected in this
Court.
The circuit court in this case construed the bill, in view of
its broad prayer for relief, as one which undertook to take the
Page 215 U. S. 47
entire settlement of the estate from the hands of the probate
court, and denied the jurisdiction of the circuit court of the
United States in the premises. We are of opinion that, to the
extent stated, the bill set up a valid ground for relief; and,
while all that it asks cannot be granted, enough was stated in it
to make a case within the jurisdiction of the federal courts within
the principles we have stated.
At the last term of the court, counsel in this case were invited
to file, on or before the first day of the present term of court,
briefs upon the question whether Frederick Tilton Davis, averred in
the bill to be a resident of the State of Alabama, and outside of
the jurisdiction of the court, is an indispensable party to the
suit, and, in his absence, a dismissal of the cause required for
want of jurisdiction in the court to proceed without him. These
briefs have been filed, and we come now to consider this branch of
the case. In so doing, it is essential to remember that the
complainant's cause of action is primarily against the executor of
the estate for a decree against it concerning the right of the
complainant to recover because of the alleged lapse of the legacy
to the Home for the Insane, and the consequent increase in the
residuary portion of the estate to be distributed to the heirs of
Mrs. Tilton because of the allegations contained in the bill. The
Watermans and Davis are made parties to the bill, and asked to be
excluded from a participation in the recovery because of the
alleged renunciation of their rights in the succession to Mrs.
Tilton. If it shall be found that they have not thus renounced
their interest, and a decree be rendered in complainant's favor,
they are entitled to participate in the recovery. They have no
interest in common, however, with the complainant, and the shares
of the complainant and other heirs are separate and distinct. The
question is, therefore, is Davis an indispensable party to this
suit, his absence creating a want of jurisdiction in the federal
court to proceed without him?
Section 737 of the Revised Statutes of the United States
provides:
Page 215 U. S. 48
"When there are several defendants in any suit at law or in
equity, and one or more of them are neither inhabitants of nor
found within the district in which the suit is brought, and do not
voluntarily appear, the court may entertain jurisdiction, and
proceed to the trial and adjudication of the suit between the
parties who are properly before it; but the judgment or decree
rendered therein shall not conclude or prejudice other parties not
regularly served with process nor voluntarily appearing to
answer."
To the same effect is the forty-seventh equity rule. This
statute and rule permit the court to proceed with the trial and
adjudication of the suit, as between parties who are properly
before it, and preserves the rights of parties not voluntarily
appearing, providing their rights are not prejudiced by the decree
to be rendered in the case. This rule has been said to be
declaratory of the already-established equity practice.
Shields v.
Barrow, 17 How. 130; 1 Street's Federal Equity
Practice § 533, and cases there cited. This rule does not permit a
federal court to proceed to a decree in that class of cases in
which there is an absence of indispensable, as distinguished from
proper or even necessary, parties, for neither the absence of
formal, nor such as are commonly termed necessary, parties will
defeat the jurisdiction of the court, provided, in the case of
necessary parties, their interests are such and so far separable
from those of parties before the court, that the decree can be so
shaped that the rights of those actually before the court may be
determined without necessarily affecting other persons not within
the jurisdiction. After pointing out that there may be formal
parties of whose omission the court takes no account, Mr. Justice
Miller, in delivering the opinion in
Barney v.
Baltimore, 6 Wall. 280, went on to say:
"There is another class of persons whose relations to the suit
are such that, if their interest and their absence are formally
brought to the attention of the court, it will require them to be
made parties, if within its jurisdiction, before deciding the case;
but, if this cannot be done, it will proceed to
Page 215 U. S. 49
administer such relief as may be in its power between the
parties before it. And there is a third class whose interests in
the subject matter of the suit and in the relief sought are so
bound up with that of the other parties that their legal presence
as parties to the proceeding is an absolute necessity, without
which the court cannot proceed. In such cases, the court refuses to
entertain the suit when these parties cannot be subjected to its
jurisdiction."
The relation of an indispensable party to the suit must be such
that no decree can be entered in the case which will do justice
between the parties actually before the court without injuriously
affecting the rights of such absent party. 1 Street's Fed. Equity
Practice § 519.
If the court can do justice to the parties before it without
injuring absent persons, it will do so, and shape its relief in
such a manner as to preserve the rights of the persons not before
the court. If necessary, the court may require that the bill be
dismissed as to such absent parties, and may generally shape its
decrees so as to do justice to those made parties, without
prejudice to such absent persons.
Payne v.
Hook, 7 Wall. 425.
Applying these principles to the case at bar, we are of opinion
that the presence of Frederick T. Davis as a party to the suit is
not essential to the jurisdiction of the federal court to proceed
to determine the case as to the parties actually before it. In
other words, that, while Davis is a necessary party, in the sense
that he has an interest in the controversy, his interest is not
that of an indispensable party without whose presence a court of
equity cannot do justice between the parties before it and whose
interest must be so affected by any decree to be rendered as to
oust the jurisdiction of the court.
With the parties before it, the court may proceed to determine
whether, because of the acts alleged in the bill, the heirs at law
of Mrs. Tilton were entitled to recover because of the lapsed
legacy. If it finds the issue in favor of the complainant, it may
proceed to determine the proportion in which the complainant
Page 215 U. S. 50
and the Watermans are entitled to share, without prejudice to
the rights of Davis. It may direct the retention of his share in
the hands of the executors, to be adjudicated in some other suit,
or may otherwise shape its relief so as to do justice to the
parties before the court without affecting his interest.
Upon the whole case, we are of opinion that that federal court
has jurisdiction for the purpose of ascertaining the rights of the
complainant to recover as against the executor, and the interest of
the persons before the court in the fund. While the court could
make no decree which would interfere with the possession of the
probate court, it had jurisdiction to entertain the bill and to
render a judgment binding upon the parties to the extent and in the
manner which we have already stated. We are therefore of the
opinion that the court below erred in holding that there was no
jurisdiction to entertain this suit, and the decree is reversed and
the cause remanded to the Circuit Court of the United States for
the Eastern District of Louisiana for further proceedings in
accordance with this opinion.
MR. JUSTICE WHITE dissents.