#### David Spear v. James Campbell et al.

Error to Sangamon.

1. Parties to Action — rule in chancery. It is a rule universally recognized in courts of equity, that all persons are to be made parties to the suit, who have any subr stantial, legal, or beneficiál interest in the subject matter of the litigation, and who are to be materially affected by the decree which may be pronounced, (a)

2. Equity — multiplicity of suits, It is a favorite object of a court of equity to do full and complete justice, and thus avoid a multiplicity of actions.

3. Creditor's Bill — necessary parties. The judgment debtor is a necessary and indispensable party to a creditor’s bill filed to set aside a fraudulent conveyance, where such conveyance contains covenants of warranty.

4. Practice in Chancery — defect of parties. The correct practice, where the *440want of proper parties is apparent on the face of the bill, is to take advantage of it by demurrer. If the objection does not thus appear it may be settled by plea, or insisted on in the answer. Where the parties thus omitted are mere formal parties, or notabro-lutely necessaty to a decision of the case, the court will not listen to the objection at the hearing. But where the rights of parties not before the court are inseparably connected with the subject matter in dispute, so that a final decision cannot be made without materially affecting their interests, the objection may be taken at the hearing, or on appeal, or by writ of error. (b)

This cause was heard in the court below, at the March term, 1842, before the Hou. Samuel H. Treat.

S. Steong, S. W. Robbins, and A. K. Smedes, for the plaintiff in error.

S. T. Logan and A. Lincoln, for the defendants in error.

1. It was not necessary to make J. P. Spear, defendant's grantor, a party to the suit; or if necessary on demurrer, this decree ought not to be reversed because he is not a party.

This case is not now presented as if on demurrer to the bill, nor is it governed by the same rules. We have obtained a particular decree, and the question now is, was Isaac P. Spear a necessary party to that decree ? Are any of the rights of the defendant, or any of the rules of equitable proceedings violated by this decree, by reason of the absence of a proper party ? Not whether they would have been bad some other decree been made. Story’s Eq. Plead. §§ 127, 139.

The objection for. want of parties ought not to prevail on final hearing, except in strong cases, when a necessary and indispensable party is wanting. The objection should be taken at an earlier stage of the proceeding, before the loss of time and accumulation of costs. The rule is established lor the convenient administration of justice; is subject to many exceptions, and ought to be restricted to parties whose interest is involved in the issue, and to be affected by the decree. 1 Peters 305; 4 Paige 314.

The reason for making all proper parties is in order that no injustice may be done either to the parties before it, or to others ; to prevent future litigation by taking away the neees-[*425] sity for a multitude of suits. Story’s Eq. Plead. 74, § 72. '

The rule as to parties is a rule of convenience merely, and may be dispensed with in proper cases; and is confined to the parties to the interest involved in the issue, and who must necessarily be affected by the decree. 1 Johns. Ch. R. 848, 437; 2 Johns. Ch. R. 197; 3 Paige 23, 379; 3 Peters’ Dig. 161.

The defendants may object for want of proper parties. “ IE

*441they may be subjected, to undue inconvenience or to danger of loss, or to future litigation, or to a liability under the decree more extensive and direct than if the absent parties were before the court. Story's Eq. Plead. § 138; see § 72.

The defendant or the court may make the objection. Ibid. §76.

There is in this case no reason to object by either. Isaac P. Spear cannot object; he has voluntarily parted with all his interest in the land, and has no right left to be protected. Ballen-tine et al. v. Beall, 3 Scam. 203.

The deed on its face is absolute. The bill treats it as absolute, and makes no question except whether it is bona fide or fraudulent. The defendant, David Spear, suggests that it is a mortgage; but this is in no wise responsive to the bill, and cannot avail defendant to show a want of proper parties. 4 Paige 33.

Whether the deed is bona fide or fraudulent, it is good against Isaac P. Spear.

If the deed is set aside as fraudulent, David Spear has no recourse on Isaac. Surlo-tt v. Beddoe, 3 Monroe 111.

No person should be made a party to a suit who has no interest in the suit and ¿gainst whom no decree can be made. Story’s Eq. Plead. § 231; 3. Peters’ Dig. 164.

The rule does not extend to all who may be consequentially interested. Story’s Eq. Plead. § 226.

If a judgment creditor bring a bill to set aside a fraudulent assignment for the benefit of creditors, he need not make the creditors parties. Rogers v. Rogers, 3 Paige 379; 4 Paige 23.

In a suit to set off a demand against assignor on writing it is not necessary to make him a party. 7 Monroe 346.

Where a mortgagor has conveyed his equity of redemption the assignee only need be made a party to the bill to foreclose. Story’s Eq. Plead. 182, §§ 197, 199.

In a bill to redeem it is only necessary to make the last assignee under the mortgage a party. Story’s Eq. Plead. 175, § 189.

In this case we have obtained a lien by our judgments. Our debts are judicially ascertained. We do not even enforce that lien, but remove an impediment; and there can be no more danger to the defendant, or of future litigation, than in the cases before cited.

(a)

Cases Citing Text. Persons materially interested in result of suit should be made parties. Scott v. Bennett, 1 Gilm. 646; Prentice v. Kimball, 19 Ill. 320, 322; Zelle v. Workingmen's Banking Co. 10 Bradw. 335, 339.

Rule enforced, court holding that in suit by vendor of land, against two vendees to enforce specific performance of contract, it is fatal error to dismiss suit as to one vendee. Bruff v. Leder, 5 Gilm. 210.

Wherepersons interested in controversy are numerous and in part unknown, e. g, are communicant members of congregation, suit in chancery may be by some on behalf of all, or if any refuse to be complainants, they should be made defendants although their names are unknown. Whitney v, Mayo, 15 Ill. 251, 254.

On bill to set aside deed got by fraud and series of later conveyances made to aid the fraud, heirs of intermediate grant- or, who conveyed with wárranty, are not necessary parties unless it appears that they have assets by descent. Craig v. Smith, 94 Ill. 469, 474.

Bill by creditor of intestate, to have chancery assume administration of estate, should join as parties, other creditors who have probated their claims. Wood v. Johnson, 13 Bradw. 548, 555.

(b)

Omission to join persons materially interested, is cause for reversal in court of appeal, although objection was not made below. Scott v. Bennett, 1 Gilm. 646.

Want of proper parties may be taken advantage of a', hearing or on appeal or error. Zelle v. Workingmen’s Banking Co. 10 Bradw. 335, 339.

Teeat, Justice,

delivered the opinion of the court: Campbell and Dabney filed their bill in chancery against [*426] David Spear, alleging, in substance, that they had severally obtained judgments at law against Isaac P. Spear; that while said Isaac P. Spear was indebted to them, and before the recovery of the judgments, he was seized in fee of certain real estate, which he conveyed to the defendants without any valu*442able consideration, and for the fraudulent purpose of avoiding the payment of his debts to the complainants and others. The prayer of the bill was that the conveyance might be declared fraudulent and void and the lands held subject to the payment of the complainants’ judgments. The answer of the defendant admitted the rendition of the judgments and the making of the conveyance, but insisted that it was made in good faith and without any fraudulent intention. There was a replication to the answer. The cause was heard on the pleadings and exhibits, and the court held the conveyance fraudulent and void as to the complainants, and declared the real estate conveyed to the defendant, subject to sale on the executions to be issued on the complainants’ judgments.

To reverse that decree a writ of error is prosecuted. One of the errors assigned presents the question whether the judgment debtor was a necessary party to the proceeding.

It is a rule universally recognized in courts of equity that all persons are to be made parties to the suit who have any substantial, legal, or beneficial interest in the -subject matters of the litigation, and who are to be materially affected by the decree which may be pronounced. It is a favorite object of a court of equity to do full and complete justice, and thus avoid a multiplicity of actions. In order to do this effectually it must have all the parties interested before it, so. that all of their rights can be seen and ascertained and a decree made with a full knowledge of the case. A decree thus rendered will properly bind all of the parties, can be safely carried into effect, and will effectually prevent all further litigation. This, general rule is subject to some exceptions and modifications, none of which aré necessary to be stated, for a proper determination of this case. Was the judgment debtor a necessary party? We think he was. The payment of judgments recovered against him was sought to be enforced out of property which he had conveyed with covenants of title, apparently for a valuable consideration, and without fraud or collusion. He ought, under such circumstances, to have an opportunity of showing that the judgments had been paid or otherwise discharged. He should be permitted to contest the right of the complainants to the peculiar remedy they were pursuing. He might be interested in sustaining the conveyance which he had made, and he certainly should be allowed the privilege of insisting and proving that it was made in good faith, for a valuable consideration, and with- [* 427] out any design to defraud the complainants, or hinder or delay them in the collection of their debí s. A decree invalidating his conveyance might result in an eviction of his grantee, who would turn upon him and seek to make him liable for the failure of title. Such a decree, made in a proceeding to which *443he was not in any manner a party, and of which he had no notice, actual or constructive, might be productive of gross and glaring injustice. In every point of view, we are clearly of the opinion that the judgment debtor was not only a necessaiy, but an indispensable party.

It is to be remarked, that this objection was not made in the circuit court, but'is now for the first time interposed. It was insisted, on the argument, that it should have been taken at an earlier stage of the proceeding, and that it comes too late in .this court.

The correct practice, where the want of proper parties is apparent on the face of the bill, is to take advantage of it by demur-, rer. If the objection does not thus appear, it may be set up by plea, or insisted on in the answer. Where the parties thus omitted are mere formal parties, or not absolutely necessary to a decision of the case, the court will not listen to the objection at the hearing ; but where the rights of parties not before the court are inseparably connected with the subject matter in dispute, so that a final decision cannot be made without materially affecting their interests, the objection may be taken at the hearing, or on appeal or error. Story’s Eq. Plead. §§ 236, 541; Mallows v. Hinds, 12 Wheat. 193; Hallett v. Hallett, 2 Paige 15; Herrington v. Hubbard, 1 Scam. 569.

The decree of the circuit court must be reversed, and the cause remanded for further proceedings. The complainants, on the filing of the transcript in the circuit court, have leave to amend their bill by making Isaac P. Spear a party defendant.

The costs of this writ of error are to be paid by. the complainants.

Decree reversed.