HAUKE v. COOPER, 108 F. 922

After stating the facts as above, the opinion of the court was delivered by PARDEE, Circuit Judge. “Neither the benefit of judgments on the one side, nor the obligations on the other, are limited exclusively to parties and their privies. Or, in other words, there is a numerous and important class of persons who, being neither parties upon the record nor acquirers of interests from those parties after the commencement of the suit, are nevertheless bound by the judgment. Prominent among these are persons on whose behalf and under whose direction the suit is prosecuted or defended in the name of some other person..

As is illustrated by the case of trustee and cestui que trust, the real party in interest cannot escape the result of a suit conducted by him in the name of another. The fact that an action is prosecuted in the names of nominal parties cannot devest the case of its real character, but the issues made by the real parties, and the actual interests involved, must determine what persons are precluded from again agitating the question, and who are estopped by the previous decision.

Whenever one has an interest in the prosecution or defense of an action, and he, in the, advancement or protection of such interest, openly takes substantial control of such prosecution or defense, the judgment, when recovered therein, is conclusive for and against him to the same extent as if he were the nominal, as well as the real, party to the action.”

Section 174, Preem. Judgm. Greenleaf, in his treatise on the Law of Evidence (volume 1, § 523), states the rule applicable to this class of cases thus: “Under the term ‘parties,’ in this connection, the law includes all who are directly interested in the subject-matter and had a right to make defense or to control the proceedings and to appeal from the judgment. This right involves, also, the right to adduce testimony and to cross-examine the witnesses adduced on the other side. Persons not having these rights are regarded as strangers to the cause.

But, to give full effect to the principle by which parties are held hound by a judgment, all persons Who are represented by the parties and claim under them, or in privity with them, are equally concluded by the same proceedings. We have already seen that the term ‘privity’ denotes mutual or successive relationship to the same rights of property. The ground, therefore, upon which persons standing in this relation to the litigating party are bound by the proceedings to which he was a party is that they are identified with him in interest; and whenever this identity is found to exist all are alike concluded.

Hence all privies, whether in estate, in blood, or in law, are estopped from litigating that which Is conclusive on him with whom they arc in privity.” The correctness of this statement has often been affirmed by this court (Lovejoy v. Murray, 3 Wall. 1, 19, 18 L. Ed. 129; Robbins v. City of Chicago, 4 Wall. 657, 673, 18 L. Ed. 427); and the principle lias been recognized in many cases. Indeed, it is elementary. Hale v. Finch, 104 U. S. 261, 265, 26 L. Ed. 732; Brooklyn City & ST. R. Co. v. National Bank of the Republic of New York, 102 U. S. 14, 22, 26 L. Ed. 61; Butterfield v. Smith, 101 U. S. 570, 25 L.

Ed. 868; Litchfield v. Goodnow’s Adm’r, 123 U. S. 549, 550, 551, 8 Sup. Ct. 210, 31 L. Ed. 199. In the suit of Brown Hardware Company against Westgaard et al., and particularly on the intervention of the Provident National Bank, the validity of Hauke’s title to the land in controversy was directly in issue, and as there was evidence tending to show that M. A.

Cooper was directly interested in the subject-matter presented in the intervention, and had by agreement control of the proceedings through counsel employed by himself, and had the right and opportunity to, and did, adduce testimony, and had the rigid: to cross-examine witnesses adduced on the other side, and as J. D. Cooper, the plaintiff below, after said suit was concluded, derived his title from M. A.

Cooper and was in privity ¡with him in successive relationship to the same rights of property involved in said suit, we are of opinion that the question of estoppel, by reason of the judgment rendered in the case of Brown Hardware Company against Olaf Westgaard et al., was proper for the jury’s consideration and should have been submitted under instructions substantially as requested. The other matters contested in this case are in many respects the same as in Nelson v.

Cooper (just decided by this court) 108 Fed. 919, and we refer to the opinion in that case for our views on the assignments of error not herein specifically dealt with. The judgment of the circuit court is reversed, and the cause is remanded, with instructions to grant a new trial.