1. An allegation that a defendant in the district court is a
"resident" of the state in which the suit is brought is not a
sufficient allegation of citizenship there, but the defect is
amendable when such citizenship is conceded, and on appeal the
amendment will be considered as made, rather than send the case
back for that purpose. P.
268 U. S.
399.
2. A suit for specific performance of the covenants of a lease
is a suit to recover upon a chose in action within the meaning of
Jud.Code
Page 268 U. S. 399
§ 24, "First," and cannot be maintained in the district court on
the ground of diverse citizenship if the plaintiff sues as assignee
of the lease and seeks only such additional relief as is purely
incidental to the main object. P. 400.
294 F. 541 affirmed.
Appeal from a decree of the district court dismissing a bill for
specific performance for want of jurisdiction.
MR. JUSTICE SUTHERLAND delivered the opinion of the Court.
The jurisdiction of the court below was invoked upon the ground
of diverse citizenship, Judicial Code, § 24, subd. 1, and the court
dismissed the bill under the limiting clause contained in that
subdivision:
"No district court shall have cognizance of any suit (except
upon foreign bills of exchange) to recover upon any promissory note
or other chose in action in favor of any assignee, or of any
subsequent holder if such instrument be payable to bearer and be
not made by any corporation, unless such suit might have been
prosecuted in such court to recover upon said note or other chose
in action if no assignment had been made."
294 F. 541.
The bill alleges that appellant is a Delaware corporation and
appellee a "resident" of Michigan. This is not a sufficient
allegation of appellee's Michigan citizenship.
Robertson v.
Cease, 97 U. S. 646,
97 U. S. 648;
Wolfe v. Hartford Life Ins. Co., 148 U.
S. 389;
Oxley state Co.
v.
Page 268 U. S. 400
Butler County, 166 U. S. 648,
166 U. S. 655.
It was, however, conceded by appellee in the court below, as well
as here, that she was in fact a citizen of Michigan, and the court
below assumed the point. Since the defect may be cured by amendment
and nothing is to be gained by sending the case back for that
purpose, we shall consider the amendment made and dispose of the
case.
Norton v. Larney, 266 U. S. 511,
266 U. S.
515-516;
Howard v. De Cordova, 177 U.
S. 609,
177 U. S.
614.
Shortly stated, the bill alleges that appellee was the owner of
certain real property in Michigan which she had leased to the
Clifford Land Company, a Michigan corporation; that the Clifford
Land Company had undertaken to finance for appellee the erection of
a building upon such property. That appellant had executed and
delivered to appellee two conveyances of other real property in
Michigan as security for the erection of such building in
accordance with the promises of the land company; that appellee had
violated the terms of the lease in certain particulars set forth,
and that appellant, "in order to protect its rights and property in
the premises," etc., procured an assignment to it from the land
company of the said lease. The specific relief prayed is a decree
for "specific performance by the said defendant of her said several
undertakings" and for an injunction against interferences with
appellant under the lease.
The assignor, being a Michigan corporation, could not have
prosecuted the suit in a federal court if no assignment had been
made. The phrase "to recover upon any . . . chose in action," under
the decisions of this Court, includes a suit to compel the specific
performance of a contract or otherwise to enforce its stipulations.
Corbin v. County of Black Hawk, 105 U.
S. 659,
105 U. S. 665;
Shoecraft v. Bloxham, 124 U. S. 730;
Plant Investment Co. v. Key West Railway, 152 U. S.
71,
152 U. S. 76;
New Orleans v. Benjamin, 153 U. S. 411,
153 U. S. 432.
An examination
Page 268 U. S. 401
of the bill of complaint discloses that the suit is primarily
for a specific performance of the covenants of the lease.
Additional relief sought is purely incidental to this main object.
The case therefore falls within the doctrine of the foregoing
decisions, and the court below was right in adjudging a dismissal.
Kolze v. Hoadley, 200 U. S. 76,
200 U. S. 83
et seq.; Citizens' Savings Bank v. Sexton, 264 U.
S. 310,
264 U. S. 314.
The cases relied upon by appellant are not in point.
Brown
v. Fletcher, 235 U. S. 589, was
a suit against a trustee by an assignee to recover an interest in
an estate under an assignment by the
cestui que trust.
This Court held that the relation between trustee and
cestui
que trust was not contractual; that the rights of the
beneficiary depended upon the terms of the will creating the trust,
and that a suit by the beneficiary or his assignee against the
trustee for the enforcement of rights in and to the property held
for the benefit of the beneficiary could not be treated as a suit
on a contract or a chose in action. The Court then said (p.
235 U. S.
599):
"The beneficiary here had an interest in and to the property
that was more than a bare right and much more than a chose in
action. For he had an admitted and recognized fixed right to the
present enjoyment of the estate with a right to the corpus itself
when he reached the age of fifty-five. His estate in the property
thus in the possession of the trustee, for his benefit, though
defeasible, was alienable to the same extent as though in his own
possession and passed by deed. [Citing cases.] The instrument by
virtue of which that alienation was evidenced -- whether called a
deed, a bill of sale, or an assignment -- was not a chose in action
payable to the assignee, but an evidence of the assignee's right,
title, and estate in and to property. Assuming that the transfer
was not colorable or fraudulent, the federal statutes have always
permitted the vendee or assignee to sue in the United States courts
to
Page 268 U. S. 402
recover property or an interest in property when the requisite
value and diversity of citizenship existed."
Crown Orchard Co. v. Dennis, 229 F. 652, was a suit by
the grantee of standing timber to enjoin the cutting and conversion
of the timber -- in effect, a suit to prevent waste. There was no
attempt to enforce any contractual obligation, and the court very
naturally held that the case did not fall within the exception in §
24 of the Judicial Code. It was expressly assumed by the court
that, if the suit had been to enforce a contract or for specific
performance, the rule would have been otherwise.
The distinction is between a cause of action arising out of the
ownership or possession of property transferred by the assignment
of a contract -- in which case the remedy accrues to the person who
has the right of property or of possession at the time -- and a
suit to enforce the obligations of the assigned contract.
Deshler v.
Dodge, 16 How. 622,
57 U. S. 631;
Ambler v. Eppinger, 137 U. S. 480. The
present suit falls within the latter class. It is brought not to
recover property or to redress an injury to property which
appellant had acquired through an assignment of a lease, but to
enforce contractual obligations of the lease. No direct relief is
sought in respect of appellant's lands conveyed as security, and
they are affected only collaterally and incidentally.
See Kolze
v. Hoadley, supra.
Judgment affirmed.