Irvine v. Lowry - 39 U.S. 293 (1840)
U.S. Supreme Court
Irvine v. Lowry, 39 U.S. 14 Pet. 293 293 (1840)
Irvine v. Lowry
39 U.S. (14 Pet.) 293
An action was brought by foreign attachment in the Court of Common Pleas of Warren County, Pennsylvania, in the name of a citizen of Pennsylvania for the use of the Lumberman's Bank, at Warren, Pennsylvania, against a citizen of New York. The suit was on a note given by the defendant to the plaintiff, to be paid "in the office notes of the Lumberman's Bank at Warren." Some of the stockholders of the Lumberman's Bank at Warren were citizens of the State of New York. The defendant appeared to the action by counsel, and having given bond with surety to the court of common pleas, removed the cause to the Circuit Court of the United States for the Western District of Pennsylvania. A motion was made in the circuit court to remand the cause to the Court of Common Pleas of Warren County, the circuit court having no jurisdiction of the cause on the ground that the real party in the suit was the Lumberman's Bank at Warren, an aggregate corporation, some of the stockholders of the bank being citizens of the State of New York. It was held that the circuit court had jurisdiction of the case.
The decisions of the Supreme Court have been uniform, and as declared at the present term in the case of Commercial & Railroad Bank of Vicksburg v. Slocomb, that the courts of the United States cannot exercise jurisdiction when some of the stockholders in a corporation established in one state are citizens of another state of which the party sued by the corporation is a citizen.
A note to be paid "in the office notes of a bank" is not negotiable, by the usage or custom, of merchants. Not being a promissory note by the law merchant, the Statute of Anne, or the kindred act of assembly of Pennsylvania, it is not negotiable by endorsement, and not being under seal, it is not assignable by the act of assembly of Pennsylvania on that subject relating to bonds. No suit could be brought upon it in the name of the endorser. The legal interest in the instrument continues in the person in whose favor it has been drawn, whatever equity another may have to claim the sum due on the same, and he only is the party to a suit at law on the instrument.
On 6 May, 1839, a writ of foreign attachment was issued out of the Court of Common Pleas of Warren County, Pennsylvania, in the name of Guy C. Irvine for the use of the Lumberman's Bank at Warren against Nathaniel A. Lowry, requiring bail in eighty thousand dollars. The action was founded on a promissory note in the following terms:
"$53,000 Warren, Pa., Sept. 6, '37"
"There months after date I promise to pay to the order of Guy C. Irvine, Esq., fifty-three thousand dollars in office notes of the Lumberman's Bank at Warren and payable at their banking house in Warren."
"N. A. LOWRY"
"Endorsed on side 'GUY C. IRVINE'"
The Sheriff of Warren County attached certain real estate in the county, and also returned that he had attached the goods and chattels of Nathaniel A. Lowry in the hands of certain persons named in the return. Among the garnishees was Guy C. Irvine.
On 24 October, 1839, Nathaniel A. Lowry, the defendant, presented a petition to the Court of Common Pleas of Warren County stating that he was at the commencement of the action, and at the time of filing the petition, a resident and citizen of the State of New York and that Guy C. Irvine, the plaintiff in the suit, is and was at the commencement of the suit a citizen of the State of Pennsylvania, and asking the court to accept the security offered for entering his appearance in the circuit court of the United States, and in all things complying with the acts of Congress in such cases made and provided; he prayed the court to proceed no further in the cause and to allow the removal of the cause to the Circuit Court of the United States for the Western District of Pennsylvania.
The court of common pleas granted leave for the removal of the cause to the circuit court, and the defendant gave a bond with security for the entry of the cause in the circuit court.
On the same day on which the petition of Nathaniel A. Lowry was presented to the Court of Common Pleas of Warren County, the affidavits of Robert Falconer, President of the Lumberman's Bank at Warren, and of Walter W. Hodges, were filed.
The affidavit of Mr. Falconer stated that at the date of the note on which the action was founded, he was president of the bank, and the note was received from the defendant at the time it bears date as a security for his previous indebtedness to the institution, and that Guy C. Irvine had not then or at any time since any interest in the said note except as guarantor for the payment of the same and the solvency and sufficiency of the drawer of the note.
The affidavit of Mr. Hodges stated that William Hall, Vine Elderken, Brown and Buckland, Starkweather and Brown, and sundry other persons, were stockholders in the Lumberman's Bank at Warren, and at the time of the institution of the suit were citizens of the State of New York residing in that state.
The case being in the Circuit Court of the United States for the Western District of Pennsylvania, at the November sessions of the court, Mr. Biddle, for the plaintiff, moved to remand the cause to the Court of Common Pleas of Warren County for want of jurisdiction.
On the hearing of this motion before the circuit court, Mr. McCandless, the counsel for the Lumberman's Bank at Warren, produced to the court an Act of the Assembly of Pennsylvania passed 28 February, 1834, for chartering the bank; also an Act of Assembly of Pennsylvania of 21 March, 1813, entitled, An act to recharter certain Banks, and it was admitted that the bank commenced the business of banking at Warren, in Pennsylvania, having been organized under the act of 1824. The counsel for the bank also produced the note on which the suit had been brought.
The counsel for the bank stated, and the defendant's counsel admitted, that this suit was founded on the note.
"Whereupon, it appearing to the court that this suit is founded on the note aforesaid, dated 6 Sept., 1837; that Guy C. Irvine was, at the date of the institution of this suit, a citizen of Pennsylvania,
and that N. A. Lowry was at the same date a citizen of the State of New York, that said bank was erected and duly organized at Warren, in Pennsylvania, under the Act of February 28, 1834, aforesaid, and that six persons mentioned in the record and sundry other stockholders thereof were, at the date of said suit, citizens of the State of New York, and due consideration being had of the premises, the court is divided in opinion, one of the judges thereof being of opinion that this Court has no jurisdiction of the case; that the rule, granted as aforesaid, be made absolute and the record of this suit remanded to the court of Common Pleas of the county of Warren; the other judge being of opinion that the court has jurisdiction of the case and that the rule granted as aforesaid be denied."
The judges of the circuit court certified this division of opinion to the Supreme Court of the United States.