Court Opinion

ID: 6672740
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:13:41.169041+00
Date Added: 2024-06-11T16:00:35.946425
License: Public Domain

The opinion of the Court was delivered by
Moses, C. J.
Robb, a citizen of New York, and Lowndes, a citizen of South Carolina, brought their aetiou in the Circuit Court, for the County of Charleston, against Parker, a citizen of Michigan, as assignees of a bond execuied by Parker to Wagner, who is a citizen of South Carolina.
Parker (at the time of his appearance) filed a petition in the said Court, praying that the cause may be removed for trial into the next Circuit Court of the United States, to be held in the District where the same was pending, pursuant to the statutes of the United States in such case made and provided. The order having been granted by the presiding Judge of the Circuit Court of the said County of Charleston, the plaintiffs, by appeal, move this Court for its reversal, and among the grounds is the following:
“That one plaintiff being a citizen of the State of New York, and the defendant a citizen of the State of Michigan, the Circuit Court of the United States, in the State of South Carolina, has not jurisdiction of the cause.”
By the eleventh Section of the Judiciary Act, (1 Stat., 78,) it is provided, “ that the Circuit Courts shall have original cognizance, concurrent with the Courts of the several States, of all suits of a civil nature at common law, or in equity, where the matter in dispute, exclusive of costs, exceeds the sum or value of $500, and the United States are plaintiffs or petitioners, or an alien is a party, or the suit is between a citizen of the State where the suit is brought, and a citizen of another State.” The jurisdiction so conferred is controlled by a limitation, which denies “ cognizance of any suit to recover the contents of any promissory note, or other chose in action, in favor of an assignee, unless a suit might have been prosecuted in such Court to recover the said contents, if no assignment had been made, except in cases of foreign bills of exchange.”
The twelfth Section of the same Act provides for the removal of causes from State Courts, by the following enactment: “ That if a suit be commenced in any State Court against an alien, or by a citizen of the State in which the suit was brought against a citizen of another State, and the matter in dispute exceeds the aforesaid sum of $500, * * * and the defendant shall, at the time of entering his appearance in such State Court, file a petition for the removal of the cause for trial into the next Circuit Court to be held in the District where the suit is pending, * * it shall then be the duty of the State Court to accept the surety *69and proceed no further in the cause; and the cause shall then proceed in the same manner as if it had been brought there by original process.”
The petition must be considered as claiming the removal of the cause from the Circuit Court of the State to that of the United States, under the said twelfth Section, because there is no averment in his petition, which can bring its prayer within any of the provisions of the other Acts of Congress in relation to the same subject-matter.
The eleventh Section of the Act of 1798 defines the jurisdiction of the Circuit Courts, and it would seem to be a proposition too evident by its mere announcement to require the support of argument, that no cause could by virtue of the twelfth Section be transferred from a State to a Circuit Court, which was not originally cognizable in such Court.
The same principles which govern its jurisdiction, under the eleventh Section, regulate the right of removal under the twelfth.
The case of Bushnell vs. Kennedy, 9 Wal., 387, holds that the limitation of jurisdiction impossed by the eleventh Section of the Act, in cases of assignment, does not apply to causes under the twelfth Section. This is a different construction from that which had theretofore been supposed to be given by the Supreme Court. It has, however, no application to the matter submitted for our judgment, because Wagner, while he held the bond, could have sued Parker in the Court of the United States. It may be of significance in one regard, and that is, that the Court which is of final authority in questions of this character, in the construction of the statutes which regulate the jurisdiction of the Circuit Courts, is more disposed to make the citizenship of the parties before such Courts, the test, than that of those who may have an interest in the issue involved, but yet are not in the cause, either seeking to enforce rights as plaintiffs, or resisting demands as defendants.
It has been held in various cases that only such parties as by original process might have been brought before the Circuit Court are removable to it from the State Court, under the said 12th Section.—Smith vs. Rines, 2 Sum., 238; Beardesly vs. Torrey, 4 Wash. Cir. Rep., 286; Wilson vs. Blodgett, 4 McLean, 363.
The Federal Courts have no jurisdiction, unless each of the parties be competent to sue, or liable to be sued, in those Courts.—New Orleans vs. Winter, 1 Wh., 91; Ward vs. Arredondo, Paine, 410; Coal Company vs. Blatchford, 4 Wall., 172.
*70Chief Justice Marshall, delivering the opinion of the Court, in Strawbridge et al. vs. Curtiss et al., 3 Cranch, 267, said : “ The words of the Act of Congress are, ‘ where an alien is a party, or the suit is between a citizen of a State where the suit is brought and a citizen of another State.’ The Court understands these expressions to mean that each distinct interest should be represented by persons, all of whom are entitled to sue, or may be sued in the Federal Court; that is, that where the interest is joint each of the persons concerned in that interest must be competent to sue, or liable to be sued, in those Courts.”
The argument on the part of the petitioner is, that under the 11th Section of the Judiciary Act, the assignor of a chose in action not negotiable is to be deemed the party plaintiff, and if he is competent to sue the defendant the United States Court has jurisdiction.
This proposition not only so connects the 11th and 12th Sections as to make them indivisible, in the face of the ruling in Bushnell vs. Kennedy, but subjects the rights of the assignees to the relation which the assignor once bore to the instrument, although by the assignment he has parted with his interest by an absolute transfer. It is also urged that the question always is, who are the real parties in interest ? In responding to that question, is the Court to look beyond the record, and extend its inquiry outside of the facts which the brief before it presents ?
It is not difficult to understand, in Brown vs. Strode, 5 Cranch, 303, and McNutt vs. Bland, 2 How., 10, where it appeared by the pleadings who were the real parties in interest, how the Court sustained the jurisdiction, though the suits were in the name of a nominal plaintiff of the same State as that of which the defendant was a citizen. It was because, by positive law, the real parties could not use their own names, but were obliged to sue in those of a public officer, who had no interest in, or control over, the case.
The character of the parties must in general be ascertained by the record. What rights or interests did Wagner, so far as appears by the pleadings, have in the bond ? The assignment transferred whatever he so had therein to Robb & Lowndes, and the Act of 1798, 5 Stat. at Large, 330, empowered them to bring suits in their own names, reserving to the obligor any discount or defence which he would be entitled unto, had the action been brought in the name of the obligee. The plaintiffs in the suit below had the legal right to the bond. Our Act of 1798 “turned the right of the assignee of such an instrument as the Act relates to from an equitable to a legal *71right, so as to enable him to sue in his own name.”—See Jervay vs. Strauss, 2 Rich., 382.
Such has always been considered by our own Courts the effect of an assignment under the Act. Wagner and Lowndes thus appear in the action with the legal title and the right to sue in the State Courts ; and yet it is contended that although they are themselves incapable of suing in the United States Courts, they can be transferred to that jurisdiction because their assignor, if he had retained the bond, might have there brought action upon it.
Can the right of action by these plaintiffs in the United States Court be determined by the relation which Wagner, the assignor, bore to the defendant Parker ? What control could Wagner exercise over the suit if it was removed as prayed ? So far as appears by the record, he did not originate it, cannot discontinue it, or otherwise direct the course of its proceedings. Without the ordinary power of a plaintiff oyer his own suit, his relation to the cause is to be regarded so potential, that it is actually to be the test through which its cognizance by the Courts of the United States is to be determined.
Does the Judiciary Act, in regulating the jurisdiction of the Circuit Courts as between citizens of different States, depend on the character of those having the real interest, or of those who are the parties directly before them? Let the clear and emphatic language of Chief Justice Marshall, in Osborne vs. The Bank of the United States, 9 Wheat., 856, decide: “The judicial power of the Union is also extended to controversies between citizens of different States; and it has been decided that the character of the parties must be shown on the record. Does this provision depend on the character of those whose interest is litigated, or of those who are parties on the record? In a suit, for example, brought by or against an executor, the creditors or legatees of his testator are the persons really concerned in interest; but it has never been suspected that if the executor be a resident of another State, the jurisdiction of the Federal Courts would be ousted by the fact that the creditors or legatees were citizens of the same State with the opposite party. The universally received construction is, that jurisdiction is neither given or ousted by the relative situation of the parties concerned in interest, but by the relative situation of the parties named on the record. Why is this construction universal? No case can be imagined in which the existence of an interest out of the party on the record is more unequivocal than in that which has been just *72stated. Why, then, is it universally admitted that this interest in no manner affects the jurisdiction of the Court? The plain and obvious answer is, because the jurisdiction of the Court depends, not upon this interest, but upon the actual party on the record.”
Holding that the 12th Section of the Act of 1798 does not include the parties to the cause, the motion is granted, and it is ordered and adjudged that the order of the Circuit Court be reversed and annulled.
Willard, A. J., and Wright, A. J., concurred.