5 tiently to represent all legatees, creditors and next of kin in suits brought by or against them in their representative capacity, except when they are made defendants to a suit by a residuary legatee for his share of the estate, or when the rights of the legatees or next of kin between one another are in question, or where they are sued for collusion with a legatee who should then be made a party, or, perhaps, when an executor or administrator is charged with a breach of trust and an accounting is required; but the executors do not represent the heirs at law in a suit affecting the real estate, and the devisees were held to be indispensable parties to a suit to foreclose a mortgage made by an executor. It has been held that where a suit is brought to determine the ownership of a fund in the hands of the trustee of an intestate, an administrator of the decedent's estate must first be appointed, and it is error to decree that the fund be paid "to such person as may hereafter be appointed administrator." 10 So a bankrupt or insolvent debtor and his creditors 12 are not usually necessary parties to a suit brought by or against his assignee. It has been held improper for a creditor of an estate to join with its receiver in a suit concerning it.13 13 A corporation need not be, although it usually is, joined as a co-defendant to a suit against its receiver to foreclose a lien upon its property where no personal relief is sought against it." It has been held that the Comptroller of the Currency and the 4 Brown v. Dowthwaite, 1 Madd. 448; Potter v. Gardner, 12 Wheat. 499; Burton v. Smith, 4 Wash. C. C. 522; Dandridge v. Washington's Ex'rs, 2 Pet. 370, 377; Wainwright v. Waterman, 1 Ves. Jr. 313; Anon., 12 Mod. 522; Glover v. Patten, 165 U. S. 394. 5 Atwood v. Hawkins, Rep. temp. Finch, 113; Faithful v. Hunt, 3 Anst. 751; Calvert on Parties (2d ed.), 206, 208. But see McArthur v. Scott, 113 U. S. 340, 345; Martin v. Fort, 83 Fed. R. 19. 14 8 Wooslin v. Cooper (N. J. Ch., 1897), 36 Atl. R. 281. But see Alger v. Anderson, 78 Fed. R. 729, 733. 9 Detweiler v. Holderbaum, 42 Fed. R. 337. 10 Read v. Bennett (N. J. Errors & Appeals, 1897), 37 Atl. R. 75; infra, § 58. 11 De Wolf v. Johnson, 10 Wheat. 367, 384; Van Reimsdyk v. Kane, 1 Gall. 371; Calvert on Parties (2d ed.), 24. 6 Kendall v. Hardenbergh, 94 Fed. 72. R. 911. 12 Spragg v. Binkes, 5 Ves. 587. 14 Central Trust Co. v. Chicago, K. 7 Attorney-General v. Wynne, Mos. & T. Ry. Co., 54 Fed. R. 598. Treasurer of the United States are not necessary parties to a suit to recover from the receiver of a national bank, appointed by the comptroller, the amount of an assessment erroneously made by the comptroller, paid by the complainant to the receiver, and paid by him into the Treasury.15 It has been held that a receiver appointed upon a creditor's bill should not be made a defendant to an ancillary foreclosure suit; 16 that a receiver of a corporation is a necessary party to a suit to enforce a corporate right of action; " that a receiver of a bank is a proper, but not a necessary, party to a suit in equity instituted before his appointment to recover from the bank money obtained by it through fraud; 18 that a receiver is an improper party to an action at law for a tort committed before his appointment, but that he is a necessary party to such an action when he holds a policy insuring the corporation from loss by the tort and the plaintiff has joined the insurer with the receiver's corporation as a co-defendant; 20 and that he and the corporation may be joined as defendants to a bill to enjoin infringements of a patent and for an accounting of the profits made by infringements before and after his appointment; that the creditors of an insolvent bank are necessary parties to a suit by a stockholder against the bank and its receiver to have his certificate canceled; 22 and that after the discharge of a receiver and the transfer of the property to a corporation, which, as part consideration for the purchase, agreed to pay all valid claims against the receiver, the purchaser is the only proper party to a suit to collect such a claim.23 21 In suits by or against strangers affecting the partnership property, surviving partners need not join with them the personal representatives of their deceased associate. The English 15 Brown v. Tillinghast, 84 Fed. R. 17. 16 Continental Tr. Co. v. Toledo, St. L. & K. C. R. Co., 82 Fed. R. 642. 17 Porter v. Sabin, 149 U. S. 473. But see Palestine W. & P. Co. v. City of Palestine, 91 Tex. 540; s. c., 44 S. W. R. 814; s. c., 40 L. R. A. 203. 18 Denton v. Baker (C. C. A.), 79 Fed. R. 189; Speckart v. German Nat. Bank, 85 Fed. R. 12. 19 Northern Pac. R. Co. v. Heflin (C. C. A.), 83 Fed. R. 93. 24 20 Moore v. Los Angeles I. & S. Co., 89 Fed. R. 73. But see Palestine W. & P. Co. v. City of Palestine (Tex.), 44 S. W. R. 814; s. C., 40 L. R. A. 203. 21 Union S. & S. Co. v. Philadelphia & R. R. Co., 69 Fed. R. 833. 22 Dunn v. State Board Minn., 61 N. W. R. 27. 23 Thompson v. Northern Pac. Ry. Co., 93 Fed. R. 384. 24 Pagan v. Sparks, 2 Wash. C. C. 325. 26 rule was that "a court of equity in many cases considers the tenant in tail as having the whole estate vested in him, at least for the purposes of suit; and for these purposes does not look beyond the estate tail in a suit aiming by the decree to bind the right to the land." 25 "Those in remainder were considered as cyphers." "It appears that this rule was originally founded upon analogy to common law. As a tenant in tail might bar subsequent remainder-men, in fact, might at any moment make himself master of the entire estate, it was considered by the court that he might be assumed to offer a satisfactory defense for all those subsequent interests. The court has, however, gone one step farther, and has treated infants as sufficient representatives of the inheritance, although they are unable, by reason of infancy, to bar remainder-men. In truth the court has gone to the full extent which is requisite for convenience in practice." It has been held that a tenant for life and the contingent remainder-man in fee may represent the inheritance in a bill for specific performance, if the children of the remainder-man will inherit if he does not.28 But the court refused to decide whether a will conveyed a fee or a life estate, when the parties were not in existence who would take the remainder if the estate were for life only.29 Lord Eldon said that in most cases respecting trust property the beneficiaries of the trust were necessary parties. The expression naturally suggests the inquiry, In what cases are they not to be made parties? There are some cases in which the existence or enjoyment of property is affected by the prayer of the suit. There are others in which the existence of the property is not affected, and the only object is to transfer it into the hands of the trustees.31 In the latter cases the beneficiaries of the trust need not, although it seems they may, be made parties." In the former, when not too numerous, their presence was always 27 25 Lord Eldon in Lloyd v. Johnes, Ves. 65. 32 Franco v. Franco,3 Ves. 76; Carey v. Brown, 92 U. S. 171; Calvert on 26 Lord Camden in Reynoldson v. Parties (2d ed.), 277, 278. Perkins, Ambler, 564. 27 Calvert on Parties (2d ed.), 56. 33 Harrison v. Rowan, 4 Wash. C. C. 202; McCampbell v. Brown, 48 Fed. R. 795; Hayes v. Pratt, 147 U. S. 557. Contra, Consolidated Water Co. v. City of San Diego, 92 Fed. R. 759. 34 required before the equity rules. The rules, however, following an English chancery order,35 provide that: "In all suits concerning real estate which is vested in trustees by devise, and such trustees are competent to sell and give discharges for the proceeds of the sale, and for the rents and profits of the estate, such trustees shall represent the persons beneficially interested in the estate, or the proceeds, or the rents and profits, in the same manner and to the same extent as the executors or administrators in suits concerning personal estate represent . the persons beneficially interested in such personal estate; and in such cases it shall not be necessary to make the persons beneficially interested in such real estate, or rents and profits, parties to the suit. But the court may, upon consideration of the matter on the hearing, if it shall so think fit, order such persons to be made parties."" "It seems doubtful, however," says Daniell of the English order, "whether this order will apply to cases where a mortgagee seeks to foreclose the equity of redemption of estates which are subject to such trusts."" Trustees under a railroad mortgage,38 or under any other trust-deed of a similar nature securing the rights in real property of a large number of beneficiaries," are held, in all proceedings affecting the property which they thus hold, adequately to represent the latter, who will be bound, in the absence of fraud, by notice given, or a decree entered against them, although the court may in its discretion make any of such beneficiaries a party to the suit at his application.40 A bondholder cannot sue to foreclose where there is a trustee under his mortgage in existence without making the trustee a defendant and alleging his refusal to sue, or at least his unwillingness to sue, and such a state of facts as to make the request an idle ceremony." 34 Whistler v. Webb, Bunb. 53; Greene v. Sisson, 2 Curt. 171; Oliver v. Piatt, 3 How. 333; s. c., 2 McLean, 268; Cross v. De Valle, 1 Wall. 5. 35 30th Order of August, 1841. 36 Rule 49. 37 Daniell's Ch. Pr. (2d Am. ed.) 304. See also Wilton v. Jones, 2 Y. & C. 244; Cross v. De Valle, 1 Wall. 1. 38 Shaw v. Railroad Co., 100 U. S. 605, 611; Beals v. Illinois, Mo. & T. R. Co., 133 U. S. 290; Elwell v. Fosdick, 134 U. S. 500; Leavenworth County Com'rs v. Chicago, R. L. & P. Ry. Co., 134 U. S. 688. 39 Van Vechten v. Terry, 2 Johns. Ch. (N. Y.) 197; Kerrison v. Stewart, 93 U. S. 155; McKee v. Lamon, 159 U. S. 317. 40 Williams v. Morgan, 111 U. S. 684; Thomas v. Brownville, F. K. & P. R. Co., 109 U. S. 522; infra, § 201. 41 Consol. Water Co. v. San Diego, 89 Fed. R. 272. It was held that a 42 43 And even where the mortgage can only be foreclosed at the request of a majority of the bondholders, the trustee need not join with him in the suit any of those who have made the request. A provision requiring the request of the holder of one-fourth of the bonds before a foreclosure was held not to prevent a foreclosure at the suit of holders of a smaller number, when more than three-fourths were held by a party who had caused the default by misappropriating the earnings of the railroad. In a foreclosure suit brought by holders of a minority of bonds, where there is a claim that the consent of the holders of a majority is required, it is proper to join the majority as defendants." The fact that the same trust company represents two mortgages, the interest of the beneficiaries under which conflict, will make it proper to allow bondholders to be made parties to a foreclosure suit. In certain cases committees of bondholders have been made parties to railroad foreclosures. Under a railroad lease by which the lessee covenanted to pay to a bank selected by the lessor a sum sufficient to pay the interest upon the lessor's mortgage bonds and taxes, it was held that the bondholders might present their claim directly against the receivers of the lessee without the joinder of either the trustee under their mortgage or the receiver of the lessor who had been appointed by a State court."7 48 It has been held that to a bill against the heirs of a trustee to quiet the title to property conveyed by the trustee to the complainant, the beneficiary of the trust need not be joined as a party; and that the beneficiaries must be made parties to a bill by a stranger to set aside the deed of trust for fraud," and to a suit by one of several stockholders to set aside an agreement to pool their stock by depositing the same with trustees, the bondholder cannot be joined as a co-plaintiff with the trustee. Consol. Water Co. v. San Diego, 92 Fed. R. 759. 42 Grand Tr. Ry. Co. v. Central Vt. Ry. Co., 88 Fed. R. 622. See N. Y. S. & Tr. Co. v. Lincoln St. Ry. Co., 74 Fed. R. 67. 45 Farmers' L. & Tr. Co. v. Northern Pac. R. Co., 66 Fed. R. 169. 46 Farmers' L. & Tr. Co. v. Cape Fear & Y. V. Ry. Co., 71 Fed. R. 38. 47 Mercantile Tr. Co. v. Baltimore & O. R. Co., 94 Fed. R. 722. 48 Gridley v. Wynant, 23 How. 500. 49 Collin Mfg. Co. v. Ferguson & 43 Linder v. Hartwell R. Co., 73 Fed. Hutter's Trustee, 54 Fed. R. 721. R. 320. Contra, Vetterlein v. Barnes, 124 44 Toler v. East Tenn. & C. Ry. Co., U. S. 169. 67 Fed. R. 168. |