This case is here upon a motion by appellees (defendants below) to dismiss the appeal of appellant (plaintiff below) on the ground that the court is without jurisdiction to entertain the appeal for the reason that there is lacking a necessary and indispensable party.
Appellant brought suit in the court below to condemn certain real property belonging to appellees for highway purposes. In order to obtain immediate possession of the premises, pending the litigation, appellant, pursuant to the provisions of 1941 Comp., Sec. 25-918, filed a bond, with the American Employers' Ins. Co., as surety, in the penal sum of $15,000.00 to the benefit of appellees. The bond was conditioned:
"That if the said principal shall well and truly pay unto each of the said defendants the adjudged value of the premises owned by each defendant, together with damages suffered by the defendant by reason of the taking of the said property in case the property is condemned or to well and truly pay to each of the said defendants any and all damages which each defendant shall suffer by reason of the occupation of the premises owned by such defendant before judgment, in case the premises are not condemned, then these presents and this obligation shall become void, otherwise they remain in full force and effect." (Emphasis supplied).
The order authorizing immediate possession of the premises was made conditioned upon the plaintiff filing with the Clerk of the Court a bond to the benefit of the defendants, with sureties to be approved by the Court "conditioned to pay the adjudged value of the premises and damages in case the property is condemned." As to whether a bond so conditioned would impose a primary liability upon the sureties in case the property is condemned, we express no opinion, since the defendants were apparently satisfied with the bond conditioned as heretofore quoted, which apparently contemplates a secondary liability of the sureties.
From an order confirming the report of the commissioners, appellant, Board of County Commissioners of Santa Fe County, appealed to the district court, where the question of damages was tried de novo to the court, without intervention of a jury, upon a stipulation of facts filed in the case. The trial court entered judgment in favor of appellant condemning the property for highway purposes and vesting title thereto in appellant; and also, judgment in favor of appellees against appellant and its surety on the bond, the American Employers' Ins. Co., in the sum of $11,000, together with interest at the rate of 6% per annum from June 17, 1942, without notice to the surety, who was not a party to the cause.
From this judgment appellant (Board of County Commissioners of Santa Fe County), alone, appeals.
Two propositions are presented for our consideration in disposing of the motion. *Page 135
1. Was the trial court without jurisdiction to enter judgment against the surety on the bond?
2. If the first proposition be answered in the negative, is the surety a necessary and indispensable party to this appeal?
We find it unnecessary to discuss the second proposition because our conclusion is that the first must be answered in the affirmative.
The suit is pursuant to the following portion of Sec. 25-918, supra:
"And in all cases where the plaintiff is the state of New Mexico, or any of the departments or commissions thereof, or any county in the state of New Mexico, and where the lands sought to be acquired are to be used for the improvement, or constuction, of a public highway, or where the plaintiff is a municipality of the state of New Mexico, and where the lands sought to be acquired are to be used for an airport or cantonment or for any other purpose in connection with the National Defense Program, the plaintiff may move the court at any time after the filing of the petition on notice to the defendant if he is a resident of the state, or appeared by attorney in the action, otherwise by serving a notice directed to him on the clerk of the court, for an order permitting the plaintiff to occupy the premises sought to be condemned, pending the action, and to do such work thereon as may be required for the easement, title, or other interest, sought, according to its nature. The court shall take proof by affidavit, or otherwise, of the value of the premises sought to be condemned and of the damages which will accrue from the condemnation and of the reasons for requiring a speedy occupation, and shall grant or refuse the motion according to the equity of the case and the relative damages which may accrue to the parties. If the motion is granted, the court shall require the plaintiff to execute and file in the court a bond to the benefit of the defendant with sureties to be approved by the court in a penal sum to be fixed by the court, not less than double the value of the premises sought to be condemned and the damages which will ensue from such condemnation, as the same may appear to the court on the hearing, and conditioned to pay the adjudged value of the premises and all damages in case the property is condemned, and to pay all damages arising from occupation before judgment, in case the premises are not condemned."
Appellant argues that, in the absence of a statute authorizing such a procedure, the court has no power to enter a summary judgment against sureties on bonds of this nature and cites by way of analogy the rule found in 3 Am.Jur. p. 776, Sec. 1303.
The Territorial Supreme Court in Rice v. Schofield, 9 N.M. 314,51 P. 673, adopted this view, saying:
"It appears that, pending the hearing, a paper purporting to be a bond to answer any judgment Champion might recover, was `filed' in the cause, and, after the master's report was confirmed, the court rendered judgment against the persons *Page 136 purporting to be sureties on the bond. The bond does not appear to have been acknowledged before the court or judge. It is manifest that these persons never were in any sense before the court. They were not parties to the cause, and were not given any notice of the proceedings against them. If the signatures were forgeries, or if the paper had never been delivered, these persons were given no opportunity to avail themselves of such defense. `It is an acknowledged general principle that judgments and decrees are binding only upon parties and privies. The reason of the rule is founded in the immutable principle of natural justice, that no man's right should be prejudiced by the judgment or decree of a court, without an opportunity of defending the right.' Hollingsworth v. Barbour, 4 Pet. 466 [7 L. Ed. 922]. To argue that, by the terms of the bond, they consented to become parties, to submit to the jurisdiction of the court and to the rendition of the judgment by it, is to assume they have consented. As to whether they have consented is the very point which the court had no power to determine in their absence. Whether a bond so `filed' in a cause can be enforced at all, without a new and independent action, it is unnecessary to decide at this time."
Examination of the record in that case discloses that the appellee there made an argument quite similar to that of the appellee in the case at bar. In the Rice case a motion for rehearing was filed and in support thereof it was argued:
"The sureties, when they executed the bonds, did all they could to make themselves parties as they declared themselves to be in court in the cause as if they had been originally made parties thereto, so as to be subject to the orders and decrees of the court in the cause. The court merely took them at their word when it ordered them to pay over the assets of the partnership which they said they had in their possession; and at that time, if it never had before, declared them to be parties and recognized them as having been such parties from the time of the execution of the bond."
The motion for rehearing was denied.
We have examined the statute with care and we do not discover therein any language that would authorize the court to render a summary judgment against the sureties, who have not been made parties to the proceedings, and without notice to them.
In Arkansas Anthracite Coal Land Co. v. Stokes (8 Cir., 1924, while we were a part thereof), 2 F.2d 511, it was decided:
"Where no valid judgment can be rendered against one because not personally served, nor subject to personal service, and who did not enter an appearance, and where no writ of attachment could issue against his property, he is not a necessary party appellant, no judgment being entered against his property, and his failure to join in an appeal does not require its dismissal." *Page 137
From all of the foregoing it follows that the motion to dismiss the appeal should be overruled, and it is so ordered.
SADLER, C.J., and MABRY and BRICE, JJ., concur.