1. A citizen of Alabama brought suit in an Alabama state court
against a citizen of Maryland and a citizen of Alabama, whereupon
the Circuit Court for the Northern District of Alabama ordered the
removal of the case on the petition of the citizen of Maryland
alleging prejudice or local influence. A motion to remand was
denied, and the case went to trial and judgment. That judgment was
affirmed by the circuit court of appeals, and a writ of error from
this Court was thereupon prosecuted.
Held: that as the
jurisdiction of the circuit court as exercised was dependent
entirely on diversity of citizenship, the judgment of the circuit
court of appeals was final, and the writ of error could not be
maintained.
2. But, this Court having granted the writ of certiorari in
order to pass upon the question of the jurisdiction of the circuit
court,
held:
(a) That the clause of the applicable statute treating of
removal because of prejudice or local influence does not furnish a
separate and independent ground of federal jurisdiction, and
describes only a special case comprised in the preceding
clauses.
(b) That those suits only can be removed of which the circuit
courts are given original jurisdiction, and that the right of
removal because of diversity of citizenship can only to exercised
by a defendant who is a citizen, or by defendants who are citizens,
of a state other than that in which the suit is pending.
(c) That as, in the present case, suit was brought in
plaintiff's state against a citizen of the same state and a citizen
of another state, it could not have been originally brought in the
circuit court, and the removal was improvidently granted.
(d) As the removal was had on the application of the nonresident
defendant, the costs of this Court and of the circuit court must be
paid by that party.
This action was brought January 21, 1902, in the City Court of
Montgomery, Alabama, by the County of Montgomery, one of the
counties of the State of Alabama, against John J. Cochran, a
citizen of that county and state, and Fidelity & Deposit
Company of Maryland, a corporation
Page 199 U. S. 261
of the State of Maryland, Cochran being the treasurer of the
plaintiff county, and the Fidelity & Trust Company of Maryland
being the sole surety on the official bond of said Cochran as such
county treasurer, to recover damages for certain alleged breaches
of said official bond. Cochran was charged with the conversion of
amounts belonging to the general fund of the county, and of amounts
belonging to the road and bridge fund. Demurrers to the complaint
were severally filed by defendants in the state court.
February 15, 1902, the Fidelity & Deposit Company presented
to the District Judge of the United States for the Middle District
of Alabama, holding the circuit court, its petition for the removal
of the cause into the circuit court of the United States for that
district, alleging, among other things, that the matter in dispute
exceeded the sum of $2,000 exclusive of interest and costs, and
that the said controversy is between citizens of different states,
in that the plaintiff was at the time of the commencement of said
suit, and still is, a citizen of the State of Alabama, and your
petitioner, The Fidelity & Deposit Company of Maryland, was at
the time of the commencement of said suit, and still is, a citizen
of the State of Maryland, and of no other state, having its
principal office in the City of Baltimore, in the State of
Maryland, and that your petitioner desires to remove this suit,
which is now pending and undetermined in said state court, before
the trial thereof, into the Circuit Court of the United States to
be held in the Middle District of Alabama.
The petition then averred that, from prejudice or local
influence in favor of the plaintiff and adverse to this defendant,
it will not be able to obtain justice in said court or in any other
state court to which the defendant may, under the laws of this
state, have the right to remove said cause, on account of said
prejudice or local influence; that the suit was against John J.
Cochran, the treasurer of said county, and petitioner, a surety
company and a surety on the official bond of said Cochran as such
treasurer, to recover the sum of $120,000,
Page 199 U. S. 262
the full penalty of the bond, and that, by reason of the nature
of said suit, all the residents and citizens of said Montgomery
County have a direct interest in the recovery by the said plaintiff
of the amount claimed.
It was further alleged that Cochran was "practically financially
irresponsible," and therefore "practically only a nominal party to
the suit," because the surety company "would be obliged to meet
practically the whole claim should judgment be rendered against
defendants," and then set forth certain circumstances tending to
show that there was local prejudice against the surety company "in
any county in the State of Alabama in which said case should be
tried." On the filing of the petition, the judge entered an order
finding that it appeared to the court "that, from local prejudice
or local influence," the surety company would not be able to obtain
justice in the City Court of Montgomery, or in any other state
court to which the company might have the right to remove the
cause, and that the court was of opinion that it should be removed
to the circuit court on the giving of bond in the penalty of
$1,000, and ordered the removal of the cause accordingly. The case
came on to be heard in the circuit court at the May term, 1902,
when the plaintiff moved to remand upon the ground that the federal
court was without jurisdiction, one of the defendants being a
citizen of the same state as the plaintiff. This motion was
overruled. 116 F. 985. On the trial, the plaintiff amended the
complaint by adding four additional counts, to which demurrers were
sustained, and the case was tried on the original complaint and the
general issue and certain special pleas interposed by defendants.
The result was a judgment in favor of plaintiff for the amount of
the general fund converted, but, under the rulings of the court,
there was no recovery on account of the road and bridge fund. On
writ of error sued out by plaintiff, this judgment was reversed and
a new trial ordered by the court of appeals. 121 F. 17. On a second
trial, May 28, 1903, the complaint was amended in certain
particulars,
Page 199 U. S. 263
and three new counts added. The second trial resulted in a
judgment in favor of plaintiff for an amount less than the amount
claimed. On this judgment, cross-writs of error were sued out from
the circuit court of appeals, and the judgment reversed on the writ
brought by plaintiff, and a new trial ordered. 126 F. 456. The
third trial, February 3, 1904, resulted in a judgment in favor of
plaintiff for the full amount of the road and bridge fund converted
by Cochran, with interest, less certain admitted payments made by
him, and not including the amount of the general fund, which had
been, in the meantime, voluntarily paid by the company. On this
last judgment, defendants sued out a writ of error to the court of
appeals, and the judgment was affirmed. 128 F. 1019. And thereupon
the present writ of error was allowed. The case is numbered 37.
Application for certiorari was made, and is numbered 112.
Page 199 U. S. 267
MR. CHIEF JUSTICE FULLER, after making the foregoing statement,
delivered the opinion of the Court.
The first question is whether this Court can entertain
jurisdiction of this writ of error, and this must be answered in
the negative if the ground on which the jurisdiction of the circuit
court was invoked was "dependent entirely upon the opposite parties
to the suit or controversy being . . . citizens of different
states," because in such case the judgment of the circuit court of
appeals was final. Act of March 3, 1891, 26 Stat. 828, c. 514, §
6.
By section one of the Judiciary Act of 1887, as corrected in
1888, 25 Stat. 433, c. 866, the circuit courts of the United States
are given
"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 exceeds, exclusive of interest and
costs, the sum or value of two thousand dollars, and (1) arising
under the Constitution or laws of the United States, or treaties
made, or which shall be made, under their authority; or (2) in
which controversy the United States are plaintiffs or petitioners;
or (3) in which there shall be a controversy between citizens of
different states, in which the matter in dispute exceeds, exclusive
of interest and costs, the sum or value aforesaid; or (4) a
controversy between citizens of the same state claiming lands under
grants of different states; or (5) a controversy between citizens
of a state and foreign states, citizens, or subjects, in which the
matter in dispute exceeds, exclusive of interest and costs, the sum
or value aforesaid, . . . and no civil suit shall be brought before
either of said courts against any person by any original process or
proceeding in any other district than that, whereof he is an
inhabitant, but where the jurisdiction is founded only on the fact
that the action is between citizens of different states, suit shall
be brought only in the district of the residence of either the
plaintiff or the defendant. "
Page 199 U. S. 268
Section 2 of the act provides for the removal of causes, as
follows:
"That any suit of a civil nature at law or in equity, arising
under the Constitution or laws of the United States, or treaties
made, or which shall be made, under their authority, of which the
circuit courts of the United States are given original jurisdiction
by the preceding section, which may now be pending, or which may
hereafter be brought, in any state court, may be removed by the
defendant or defendants therein to the circuit court of the United
States for the proper district."
"Any other suit of a civil nature at law or in equity, of which
the circuit courts of the United States are given jurisdiction by
the preceding section, and which are now pending or which may
hereafter be brought in any state court may be removed into the
circuit court of the United States for the proper district by the
defendant or defendants therein, being nonresidents of that state.
And when, in any suit mentioned in this section, there shall be a
controversy which is wholly between citizens of different states,
and which can be fully determined as between them, then either one
or more of the defendants actually interested in such controversy
may remove said suit into the circuit court of the United States
for the proper district. And where a suit is now pending, or may be
hereafter brought, in any state court, in which there is a
controversy between a citizen of the state in which the suit is
brought and a citizen of another state, any defendant, being such
citizen of another state, may remove such suit into the circuit
court of the United States for the proper district at any time
before the trial thereof, when it shall be made to appear to said
circuit court that, from prejudice or local influence, he will not
be able to obtain justice in such state court, or in any other
state court to which the said defendant may, under the laws of the
state, have the right, on account of such prejudice or local
influence, to remove said cause:
Provided, That if it
further appear that said suit can be fully and justly determined as
to the other defendants in the state court, without
Page 199 U. S. 269
being affected by such prejudice or local influence, and that no
party to the suit will be prejudiced by a separation of the
parties, said circuit court may direct the suit to be remanded, so
far as relates to such other defendants, to the state court, to be
proceeded with therein."
Section 3 of the act provides that, under the first three
clauses of section 2, the petition for removal must be filed in the
state court at the time or any time before the defendant is
required, by the laws of the state or the rule of the state court
in which such suit is brought, to answer or plead to the
declaration or complaint.
In
Smith v. Rhines, 2 Sumn. 338, Mr. Justice Story held
that, under the Judiciary Act of 1789, such cases were only liable
to removal from a state to the circuit court "as might, under the
law, or at all events, under the Constitution, have been brought
before the circuit court by original process." And Mr. Justice
Washington, in
Beardsley v. Torrey, 4 Wash. C.C. 286, and
Mr. Justice Thompson, in
Ward v. Arredondo, 1 Paine 410,
expressed views to the same effect. In
Gaines v. Fuentes,
92 U. S. 10, it was
ruled that this was otherwise under the Act of March 2, 1867.
But the act of 1887 restored the rule of 1789, and, as we have
heretofore decided, those suits only can be removed of which the
circuit courts are given original jurisdiction.
Mexican
National Railroad Company v. Davidson, 157 U.
S. 201;
Tennessee v. Union and Planters' Bank,
152 U. S. 454,
152 U. S. 461.
And, on the face of this record, it is apparent that the
jurisdiction of the circuit court, as invoked, could only rest on
diversity of citizenship. The case does not come within any other
ground of original jurisdiction as defined by the act. It is true
that one of the defendants was a citizen of the same state as the
County of Montgomery, but the learned judge below held that, where
removal was sought on the ground of prejudice or local influence,
the right of removal was not affected by another defendant and
plaintiff being citizens of the same state as that where the suit
was brought. 116 F. 985.
Page 199 U. S. 270
Whether that view was correct or not, jurisdiction was exercised
as resting on diversity of citizenship -- that is, as between the
plaintiff and the removing defendant.
But while the judgment of the circuit court of appeals must be
regarded as final, and the writ of error dismissed, we deem it our
duty to grant the writ of certiorari, to which the record on the
writ of error may stand as a return, in order to pass upon the
question of the jurisdiction of the circuit court, in the exercise
of one of the essential functions of this Court -- the
determination of the jurisdiction of the courts below.
Defiance
Water Co. v. Defiance, 191 U. S. 184,
191 U. S. 195.
In applications for removal under clauses one and two of section
two of the act of 1887, all the defendants were required to join in
the application.
Chicago, R.I. & P. R. Co. v. Martin,
178 U. S. 245;
Gableman v. Peoria, D. & E. R. Co., 179 U.
S. 335. Under clause three, relating to cases of
separable controversy, and clause four, all the defendants need not
join. But the fourth clause, treating of removals because of
prejudice or local influence, does not furnish a separate and
independent ground of federal jurisdiction, and, as Mr. Justice
Bradley said in
In re Pennsylvania Company, 137 U.
S. 451,
137 U. S. 456,
"describes only a special case comprised in the preceding clauses."
In that case, we referred to the opinion of Mr. Justice Harlan in
Malone v. Richmond & Danville Railroad Company, 35 F.
625, as expressing the correct view of the law. The question was
whether the pecuniary limit was applicable under the fourth clause,
and that involved consideration of the other clauses. Mr. Justice
Harlan there said:
"It is clear from the above clauses, construing them all
together, that the right of removal at any time before trial, on
the ground of prejudice or local influence, is restricted by the
act of 1887 to suits in which there is a controversy between
citizens of different states; also that such right, in suits of
that character, involving no federal question, now belongs only to
the defendant who is a citizen, or to the defendants who are
citizens, of a state other than that in which the suit is
brought.
Page 199 U. S. 271
And I think it is equally clear that the right of removal on the
ground of prejudice or local influence does not exist in any case
unless the sum or value of the matter in dispute exceeds $2,000,
exclusive of interest and cost. The clauses of the second section
of the act of 1887, defining the different kinds of suits that may
be removed, preserve the same element of the value of the matter in
dispute as is found in the first section, relating to the original
jurisdiction of circuit courts. This is done by the provision
giving the right of removal in suits 'of which the circuit courts
of the United States are given original jurisdiction by the
preceding [first] section.' . . . The subsequent clause, relating
to prejudice and local influence, does not describe a new class of
suits, removable from the state courts, but only specifies a
distinct ground for removing one class of the suits previously
defined, namely, that class in which there is a controversy between
citizens of different states. And that ground the defendant is at
liberty to set up 'at any time before the trial,' whereas, by the
third section of the act, the right to remove upon any other ground
will be lost if not exercised at the time or before 'the defendant
is required by the laws of the state or the rule of the state
court' in which the suit is brought 'to answer or plead to the
declaration or complaint of the plaintiff.' The clause prescribing
prejudice or local influence as ground for the removal of a suit
'in which there is a controversy between a citizen of the state in
which the suit is brought and a citizen of another state' cannot
well be separated, in the process of interpretation, from the
preceding clause in the same section, which, by referring to the
first section, requires as a condition of the removal of a suit
because of diverse citizenship -- the only kind of suit in which
the existence of prejudice or local influence, as affecting the
right of removal, is of any consequence -- that the matter in
dispute shall exceed in value $2,000, exclusive of interest and
costs."
The first subdivision of section 639 of the Revised Statutes was
a reenactment of the twelfth section of the Judiciary Act,
Page 199 U. S. 272
the second subdivision of the Act of July 27, 1866, and the
third subdivision, of the Act of March 2, 1867. The Act of March 3,
1875, repealed the first and second subdivisions, but left
subdivision three unrepealed.
Baltimore and Ohio Railroad
Company v. Bates, 119 U. S. 464,
119 U. S. 467.
The Act of March 3, 1887, repealed the act of 1867, or subdivision
three of section 639.
Fisk v. Henarie, 142
U. S. 467. In describing the class of suits removable on
the ground of prejudice or local influence, the language in the act
of 1887 is identical with that of 1867 -- that is, suits "in which
there is a controversy between a citizen of the state in which the
suit is brought and a citizen of another state." The settled
construction of the language of the act of 1867 and of the Revised
Statutes was that the clause included cases wherein the controversy
was between citizens of the state wherein the suit was pending and
citizens of other states. The use of the identical language in the
act of 1887-1888 showed that Congress intended the same
construction should be applied, although, under the act of 1887,
the plaintiff could not remove a cause, while any defendant, being
a citizen of a state other than that in which the suit was pending,
might.
The circuit court was of opinion that the words "any defendant,
being such citizen of another state, may remove," etc., implied
that there might be defendants who were not citizens of another
state and yet the cause be removable; but while the words, standing
alone, are susceptible of that construction, we think it was not
intended to change the meaning of the terms as previously
determined (by the decisions under the act of 1789, and so on
down), and that the class of cases removable on the ground of
prejudice and local influence is confined to those in which there
is a controversy between a citizen or citizens of the state in
which the suit is pending and a citizen or citizens of another or
other states, and that the clause did not include cases wherein the
controversy was partly between citizens of the same state. To hold
otherwise brings the language of the clause into conflict with the
rule
Page 199 U. S. 273
that a suit, to be removable, must be within the original
jurisdiction of the circuit court, departs from the settled former
construction, and ignores the main purpose of the act of 1887,
which was to restrict the jurisdiction of the circuit court.
Hanrick v. Hanrick, 153 U. S. 192;
Anderson v. Bowers, 43 F. 321; Moon, Removal of Causes, §
189 and notes.
And there does not seem to be any escape from this conclusion in
view of the provision of the first section of the act of 1887 that,
when the jurisdiction is founded solely on diversity of
citizenship, suit can be brought "only in the district of the
plaintiff or the defendant."
If brought in the district of the plaintiff or plaintiffs, the
defendant or defendants (the singular embraces the plural) must
necessarily be a citizen or citizens of another state than that of
plaintiff or plaintiffs. If brought in the district of defendant or
defendants, no removal can be had, because it is only defendants
who are "nonresidents" who can remove under clause two, or under
clause four, prejudice or local influence not being an independent
ground of jurisdiction. But in order that a defendant entitled to
remove might not be cut off from the exercise of that right by his
codefendants declining to join in the application, the fourth
clause provided that "any defendant" might remove, and out of
abundant caution the words were added, "being such citizen of
another state," apparently to prevent misconstruction of the words
"any defendant," in possible enlargement of the jurisdiction.
The main purpose of the act of 1887 was, as has been repeatedly
said, to restrict the jurisdiction, and this was largely
accomplished in the matter of removals by withholding the right
from plaintiffs, and only according it to defendants when sued in
plaintiffs' district.
In the present case, suit was brought in the plaintiff's state
against Cochran, a citizen of the same state, who was a necessary
party, and the surety company, a citizen of Maryland. It could not
have been brought in the Circuit Court for the
Page 199 U. S. 274
Middle District of Alabama.
Sweeney v. Carter Oil Co.,
199 U. S. 252.
And, this being so, the case was improvidently removed, and
should have been remanded.
As the removal was made on the application of the surety
company, that company must pay the costs of this Court and of the
circuit court.
Writ of error dismissed; certiorari granted, record on writ
of error to stand as return to certiorari; judgment reversed, and
cause remanded to circuit court with a direction to remand to the
state court; costs of this Court and of the circuit court to be
paid by the Fidelity & Deposit Company.
