Court Opinion

ID: 8864579
Source: CourtListenerOpinion
Date Created: 2022-11-26 18:00:28.775982+00
Date Added: 2024-06-11T17:05:57.124310
License: Public Domain

PARLANGE, District Judge
(dissenting).
The plaintiff below alleged that the Middlesex Banking Company bound itself to advance him $8,000, and knew that he intended, with the larger part of the money, to build certain houses. He alleged that the Middlesex Banking Company failed and refused to comply with its obligation to furnish the money, the result being that the plaintiff below was unable to build the houses. He claimed damages to the amount of $7,800, consisting of the following items: Loss of rent which plaintiff below claimed he would have received if he had not been prevented from building the houses, $6,000; increase of the cost of building the houses caused by delay in obtaining money, $1,600; loss on the sale of bricks, which, on account of the failure of the Middlesex Banking-Company to furnish the money, the plaintiff below was compelled to sell at a sacrifice, $200. The defendant below having filed a general demurrer and also four special exceptions, the first of which was to the claim for speculative rents, amounting as stated to $6,000, the trial court sustained said first special exception. The remaining, claim in the suit (increase in cost of building and loss on bricks) amounted only to $1,800. Upon the refusal of the plaintiff below to amend his pleadings, the trial court dismissed the suit on the ground that, the amount then involved being less than $2,000, the court had no jurisdiction.
*463I agree fully with this court that the claim for speculative rentals could not, as matter of law, be sustained. I also agree with this court that it was error to dismiss the suit as to the remaining claims, aggregating $1,800. But it is clear to me that the cause in its entirety should have been remanded to the state court, and I am constrained to dissent from the proposition that the circuit court should have proceeded with the suit and tried the remaining claims. In my opinion, it is apparent upon the face of the pleadings, as matter of law, that the circuit court had no jurisdiction, because of the insufficiency of the amount involved. It is elementary, of course, that in the federal courts the jurisdiction must appear plainly and affirmatively on the face of the pleadings. - I need not cite authorities to show the particularity which is required of pleaders in this respect. But the case at bar is not one in which the jurisdiction is merely nonapparent. This court being unanimous in the opinion that the claim for speculative rentals -was not recoverable as matter of law, it follows that the petition shows upon its face that the trial court had no jurisdiction.
In the case of Vance v. W. A. Vandercook Co., 170 U. S. 468, 18 Sup. Ct. 645, the supreme court has said:
“In determining from tlie face of a pleading whether the amount really in dispute is sufficient to confer ,jurisdiction upon a court of the United States, it is settled that if, from the nature of the case as stated in the pleadings, there could not legally he a judgment for an amount necessary to the jurisdiction, jurisdiction cannot attach, even though the damages he laid in the declaration at a larger sum.”
In that case the demand was for $1,000, alleged to be the value of certain property taken from the complainant, and in addition for $10,000 damages. The supreme court, after a full examination of the law and authorities bearing on the point, having reached the conclusion that the claim for damages could not be sustained as a matter of law, held that, upon the face of the pleadings, the circuit court had no jurisdiction, because, after striking out the claim for damages, the remaining claim did not exceed $2,000. The supreme court further said:
“'The courts of South Carolina, as we have seen, have held that in the action of trover consequential damages are not recoverable, and have also held that in the action of claim and delivery damages for the detention must have re-siled to the property, and to a direct injury arising from the detention. Destruction of business not being of the latter character, it follows that the .special damages averred in the complaint were not recoverable. It results that as the plaintiff’s action was solely one for claim and delivery of property alleged to have been unlawfully detained, and for damages for the detention thereof, the amount of recovery depended first upon the alleged value of the property, which in the present case was one thousand dollars, and such damages as it was by operation of law allowed to recover in the action in question. As, however, by way of damages in an action of this character, recovery was only allowable for the actual damages caused by the detention, and could not embrace a cause of damage which was not, in legal contemplation, the proximate result of the “wrongful detention, and such recovery was confined, as we have seen, to interest on the value of the property, if results that there was nothing in the damages alleged in the petition, and properly recoverable, adequate, when added to the' value of the property, to have conferred upon the court jurisdiction to have entertained a consideration of the suit. Upon the face of the complaint, therefore, the circuit *464court was without jurisdiction oyer the action, and it erred in deciding to the contrary.”
I am unable to differentiate the case at bar from the case of Vance v. W. A. Vandercook Co., just referred to. Both cases involve claims for damages the recovery of which is impossible as matter of law.
' In the early case of Wilson v. Daniel, 3 Dali. 407, Chief Justice Ellsworth, dealing with the question of the amount in dispute necessary to confer jurisdiction, summarized the matter thus:
“The proposition, then, is simply this: Where the law gives no rule, the .demand of the plaintiff must furnish one; but, where the law gives the rule, the legal cause of action, and not the plaintiff’s demand, must be regarded.”
Chief Justice Ellsworth also said in that case that if, in an action of debt on a bond for £100, the principal and interest are put in demand, the plaintiff can recover no more, though he may lay his damages at £10,000. He further said that the form of action gives in that case the legal rule, but that in an action of trespass or assault and battery, where the law prescribes no limitation as to the amount to be recovered, and the plaintiff has a right to estimate his damages at any sum, the damage stated in the declaration is the thing put in demand, and presents the only criterion to which, from the nature of the action, resort can be had in settling the question of jurisdiction.
With all due respect for the opinion of my learned brothers, I cannot comprehend how the jurisdiction can be sustained in the case at bar, either under the language quoted from Vance v. W. A Vandercook Co., or from the proposition stated by Chief Justice Ellsworth. It is plain that, as a matter of law, — on which point this court is unanimous, — the complaint itself manifestly shows that there could not legally be a judgment for an amount necessary to the jurisdiction. It is also plain to me that in the case at bar the law, as declared by this court, furnishes the rule which strikes out the speculative rentals from the aggregate amount of damages claimed. The case of Barry v. Edmunds, 116 U. S. 550, 6 Sup. Ct. 501, does not, in my opinion, sustain the jurisdiction in the case at bar. On the contrary, it draws a clear distinction, as does Wilson v. Daniel, supra; between those cases in which, ex necessitate, the plaintiffs statement of the amount of his claim must be accepted for the purpose of jurisdiction, and the other class of cases, in which' the amount stated is not determinative of jurisdiction. Barry v. Edmunds was an action of trespass on the case, in which certain damages were claimed. Substantially, the trial judge dismissed the cause for the reason that, in his individual judgment, the plaintiffs could not recover damages in a sum as large as the jurisdictional amount. The supreme court, with evident correctness, said that the amount of recovery in such a case was for the jury, and not for the judge. But in that case the supreme court was careful to say that:
“In some cases it might appear, as matter of law, from the nature of the case as stated in the pleadings, that there could not legally be a judgment recovered for an amount necessary to the jurisdiction, notwithstanding the damages were laid in the declaration at a larger sum.”
The case of Wilson v. Daniel, supra, was cited and affirmed.
*465In my opinion, there is nothing deducible from Schunk v. Moline, Milburn & Stoddart Co., 147 U. S. 500, 33 Sup. Ct. 416, which would support the jurisdiction in the case at bar. The substance of the opinion in that case is that even if, from the plaintiff’s own pleadings, it appears that his action is barred by limitation, or even if, from those pleadings, a perfect defense to the suit should appear, the court would still have jurisdiction, if the amount claimed is sufficient. This is evidently clear and sound doctrine, but it does not, in my opinion, apply in any manner to the case at bar. It is perfectly true that a trial judge, in determining the real amount involved, cannot supply a plea of limitation, or speculate whether defenses, even though clearly apparent, will be made. But the case at bar is not one in which a defense appears from the plaintiff’s pleadings, within the doctrine of Schunk v. Moline, Milburn & Stoddart Co., supra. A valid and substantial right may not entitle its owner to a recovery, if at the trial it should develop that, by reason of something which took place after the right originated, the right had become extinguished or otherwise nonenforceable. A debt which is valid and binding when contracted may become extinguished by payment or other cause. Still, the right or the debt had a valid existence at some time; and an adjudication concerning it may be claimed from a court, even though upon the trial it may be ascertained that the cause of action is extinguished, or its scope has been diminished. But in the case at bar, in the unanimous opinion of this court, there never was a time when any cause of action for the speculative rentals existed, and a judgment for their recovery is, and has always been, a legal impossibility.
Smith v. Greenhow, 109 U. S. 669, 3 Sup. Ct. 421, was an action in trespass vi et armis, in which personal property worth PI 00, and damages in the sum of §6,000, were claimed. The main question decided was that a federal question was involved, which supported a removal of the ease to the federal court. At the close of the opinion the court said:
“There is a ground of remanding the cause suggested by the record, but not sufficiently apparent to justify us in resorting to it to support the action of the circuit court,. The value of the property taken is stated in the declaration to be but $100, although the damages are laid at $0,000. The petition for removal does not allege the sum or value of the matter in dispute, otherwise than by the statement of the amount of the claim for damages. We cannot, of course, assume, as a matter of law [italics mine], that the amount laid, or a less amount, greater than $500, is not recoverable upon the ease stated in the declaration.”
In my opinion, Smith v. Greenhow, far from supporting the jurisdiction in the case at bar, is an authority against sustaining the jurisdiction, and is in accord with Vance v. W. A. Vandercook Co., supra. See, also, Gorman v. Havird, 141 U. S. 206, 11 Sup. Ct. 943.
I ain well aware that there are several cases in which courts, having come to the conclusion that litigants had franduléntly or intentionally inilated the amount of their claims in attempts to have the courts take jurisdiction, denied the jurisdiction aud dismissed the suits. The dominant idea in this line of cases is that parties will not be allowed to commit a fraud upon the jurisdiction. But there is another and *466distinct class of cases in which the jurisdiction is denied, not because of any fraud attempted to be eommitted upon the jurisdiction, but because the case, as stated by the plaintiff himself, as strongly as he can and as favorably to himself as possible, discloses, without the necessity of any evidence being heard, and without any regard to the opinion of the judge as to what would be a reasonable recovery in the cause, but simply as a pure matter of law, a case which under none of its aspects could support a judgment for the jurisdictional amount. Such was Vance v. W. A. Vandercook Co., supra, in which there was not even an intimation that the plaintiff in the suit was in bad faith. In fact, the conclusion may readily be reached that he was in perfect good faith. He obtained a judgment from the learned trial judge. But the litigant was conclusively presumed to know the law, and his error of law, however honest it might be, could not confer jurisdiction. The case at bar, in my opinion, comes under the -doctrine of Vance v. W. A. Vandercook Co., supra.
As to the action of the trial judge in passing upon the question of jurisdiction, and acting thereon, ón his own motion, I am clear that it was not only his right, but his duty, to do so. Hartog v. Memory, 116 U. S. 588, 6 Sup. Ct. 521, and Morris v. Gilmer, 129 U. S. 315, 9 Sup. Ct. 289, make it plain, in my opinion, that under section 5 of the act of March 3, 1875, the trial judge could and should have acted on his own motion, and remanded the whole cause to the state court. Upon ascertaining that the suit “did not really and substantially involve a dispute or controversy properly within the jurisdiction” of the court, he should have set aside his action on the special exception, and remanded the case, in its entirety, to the state court. In this connection, see Wetmore v. Kymer, 169 U. S. 115, 18 Sup. Ct. 293, which was a case originating in the'federal court, and in which, after verdict and judgment, the trial judge set aside the verdict and judgment, and passed, without a jury, on the question of the jurisdictional amount involved, which in that case was a question of fact, and dismissed the case for want of jurisdiction. While it is true that on writ of error the supreme court reversed the action of the trial judge, that court did so for the reason that it came to a different conclusion on the facts from that which the trial judge had reached. I am unable to see how the fact that this was a cause which originated in a state court, and was removed to the federal court, can affect the question under discussion. If this cause had originated in the federal court, it should, if my views are correct, have been dismissed for want of jurisdiction, either on the application of the defendant, or mero motu by the judge. I do not see how the jurisdiction can be assisted by the fact that the cause was removed from the state court. The fifth section of the act of 1875 applies, in terms, to “any suit commenced in a circuit court or removed from a state court to a circuit court.” I note what is said in Black’s Dillon on Removal of Causes (Ed. 1898, § 47) as to the strictness with which the statute providing for removals from the state courts must be construed on the question of the jurisdictional amount. I also note that it has been held that when a cause is removed to a federal court, if at any time after the removal a substantial doubt arises as to.the jurisdiction of the federal *467court, the cause should he remanded. Fitzgerald v. Railway Co., 45 Fed. 812-820; Hutcheson v. Bighee, 56 Fed. 329; Coal Co. v. Haley, 76 Fed. 882; In re Foley, 76 Fed. 390-392; Kessinger v. Vannatta, 27 Fed. 890; also, Mining Co. v. Largey, 49 Fed. 291. In Black, Dill. Rem. Causes, § 216, it is said that:
“Notwithstanding an order made by the state court allowing the removal, the federal court must determine for itself the question of jurisdiction, and send bach the cases, unless it clearly appears that the defendant is entitled to the removal.”
To my mind, the matter is summarized in this question: Can a litigant create jurisdiction in a federal court, as regards the jurisdictional amount, hy setting out in his complaint a demand for damages, the nonexistence of which, in law, he is conclusively presumed to know, and for which a legal recovery is an impossibility? It is clear to me that there can he hut one answer to the question, and that in the negative.