Source: http://openjurist.org/525/f2d/178
Timestamp: 2016-02-09 16:21:56
Document Index: 699216408

Matched Legal Cases: ['§ 1341', '§ 157', '§ 1341', '§ 1341', '§ 172', '§ 57']

525 F2d 178 Illinois Central Railroad Company v. J Howlett People of Illinois J Scott J | OpenJurist
525 F. 2d 178 - Illinois Central Railroad Company v. J Howlett People of Illinois J Scott J HomeFederal Reporter, Second Series 525 F.2d.
525 F2d 178 Illinois Central Railroad Company v. J Howlett People of Illinois J Scott J 525 F.2d 178
ILLINOIS CENTRAL RAILROAD COMPANY, Plaintiff-Appellee,v.Michael J. HOWLETT, Secretary of State of the State ofIllinois, Defendant-Appellant.PEOPLE OF ILLINOIS ex rel. William J. SCOTT, AttorneyGeneral, and Michael J. Howlett, Secretary ofState of the State of Illinois,Counter-Plaintiffs-Appellants,v.ILLINOIS CENTRAL RAILROAD COMPANY, an Illinois Corporation,et al., Counter-Defendants-Appellees.
No. 75-1013.
Argued Oct. 29, 1975.Decided Nov. 7, 1975.Rehearing and Rehearing En Banc Denied Dec. 8, 1975.
In Great Lakes Dredge & Dock Co. v. Huffman, 319 U.S. 293, 299, 63 S.Ct. 1070, 1073, 87 L.Ed. 1407 (1943), the Supreme Court said in regard to this provision:
Although neither the Secretary of State, nor the Attorney General on his behalf, raised 28 U.S.C. § 1341 in the district court or here, that statute cannot be waived by the parties2 and its application may be made sua sponte by the court of appeals. In Great Lakes, the Supreme Court said that "it is the court's duty to withhold (declaratory) relief" when, in the words of Section 1341, there is "a plain, speedy and efficient remedy . . . in the courts of" the state.3 319 U.S. at 300-301, 63 S.Ct. at 1074; City of Houston v. Standard-Triumph Motor Co., 347 F.2d 194, 198 (5th Cir. 1965), cert. denied, 382 U.S. 974, 86 S.Ct. 539, 15 L.Ed.2d 466 (1966).
The Illinois corporate franchise tax sought to be avoided by the complaint was assessed pursuant to the Illinois Business Corporation Act, Ill.Rev.Stats., ch. 32, § 157.131 et seq. Substantially the same tax as previously provided in Section 105 et seq. of the Illinois Corporation Act was at issue in Stratton v. St. Louis Southwestern Ry. Co., 284 U.S. 530, 52 S.Ct. 222, 76 L.Ed. 465 (1932), where the Supreme Court concluded that the State of Illinois provided legal remedies sufficient to preclude federal jurisdiction to adjudicate the validity of the franchise tax.4
The State of Illinois parties have argued that federal jurisdiction attached because of the approval of the Plan of Reorganization by the Interstate Commerce Commission under Section 5 of the Act. This argument was disposed of by the Supreme Court in Seaboard Air Line Railroad Co. v. Daniel, 333 U.S. 118, 122-23, 68 S.Ct. 426, 429, 92 L.Ed. 580 (1948):
Under the foregoing circumstances appellant was not compelled to wait until someone who had standing to attack the Commission's order might decide to seek its annulment in a federal district court. It properly sought relief from a court which could obtain jurisdiction of the parties whose refusal to recognize the order gave rise to its predicament. And the state court then had power, because of the issues raised by the complaint and because of the relief requested, to determine whether the order, properly interpreted, did exempt appellant from compliance with the state railroad corporation laws and, if so, whether the Commission had transcended its statutory authority in making the order. Illinois Cent. R. Co. v. Public Utilities Commission, 245 U.S. 493, 502-505 (38 S.Ct. 170, 173, 174, 62 L.Ed. 425). See Lambert Run Coal Co. v. Baltimore & Ohio R. Co., 258 U.S. 377, 381, 382 (42 S.Ct. 349, 350, 351, 66 L.Ed. 671); Central New England R. Co. v. Boston & A. R. Co., 279 U.S. 415, 420, 421 (49 S.Ct. 358, 359, 360, 73 L.Ed. 770) (emphasis added).
The Illinois parties' argument that Seaboard merely holds that federal courts do not have exclusive jurisdiction when Section 5 is involved, is undoubtedly true, but under 28 U.S.C. § 1341 the existence of such a plain, speedy and efficient remedy in the state court is enough to bring Section 1341 into operation. Inasmuch as the state courts had the power to act despite the presence of the Section 5 aspects of the case, there are no "special circumstances" (Stratton, supra, 284 U.S. at 534, 52 S.Ct. 222) nor is this an "exceptional case" (Great Lakes, supra 319 U.S. at 299, 63 S.Ct. 1070) preventing the normal application of 28 U.S.C. § 1341. All of the allegations and prayers of the complaint were intertwined with the ultimate collection or non-collection of the Illinois franchise tax.
In Samuels v. Mackell, 401 U.S. 66, 71, 91 S.Ct. 764, 767, 27 L.Ed.2d 688 (1971), the Court said: "The continuing validity of the Court's holding in the Great Lakes case has been repeatedly recognized and reaffirmed by this Court."
In Perez v. Ledesma, 401 U.S. 82, 128, 91 S.Ct. 674, 698, 27 L.Ed.2d 701 (1971), Mr. Justice Brennan (concurring in part and dissenting in part) said in n. 17:
The Supreme Court said 284 U.S. at 532-34, 52 S.Ct. at 223:
(Ill.Rev.Stats., ch. 127, § 172 does not) impair the existing legal remedy, but supplements it by providing a method under the local procedure for staying payment over of the tax money, so that it may be available for the satisfaction of any judgment obtained against the collector. See Interstate Iron & Steel Co. v. Stratton, 340 Ill. 422, 172 N.E. 705; O'Gara Coal Co. v. Emmerson, supra; Hump Hairpin Mfg. Co. v. Emmerson, 293 Ill. 387, 127 N.E 746; Id., 258 U.S. 290 (42 S.Ct. 305, 66 L.Ed. 622).
In addition, Illinois has a Declaratory Judgment Act of its own, Ill.Rev.Stats., ch. 110, § 57.1. See City of Houston v. Standard-Triumph Motor Co., 347 F.2d 194, 199 (5th Cir. 1965), cert. denied 382 U.S. 974, 86 S.Ct. 539, 15 L.Ed.2d 466 (1966).