N. & G. Taylor Co. v. Anderson

• Decision Date: 04 June 1926
• Docket Number: No. 3556.,3556.
• Citation: 14 F.2d 353
• Parties: N. & G. TAYLOR CO., Inc., v. ANDERSON et al.
• Court: U.S. Court of Appeals — Seventh Circuit

14 F.2d 353 (1926)

N. & G. TAYLOR CO., Inc., v. ANDERSON et al.^*

No. 3556.

Circuit Court of Appeals, Seventh Circuit.

June 4, 1926.

Henry S. Drinker, Jr., of Philadelphia, Pa., for plaintiff in error.

H. P. Young, of Chicago, Ill., for defendants in error.

Before ALSCHULER, EVANS, and PAGE, Circuit Judges.

PAGE, Circuit Judge.

N. & G. Taylor Company, a copartnership, made with the defendants a nonnegotiable written contract. After defendants had defaulted thereon, the copartnership, on February 1, 1917, sold all of its assets, including its rights under the contract, to appellant, called plaintiff, and plaintiff brought suit thereon in the Northern district of Illinois. After the time had run under the applicable statute of limitations, plaintiff amended its declaration by setting out the written contract and making allegations under oath, so as to enable it to maintain its suit under section 18 of the Illinois Practice Act (chapter 110, Cahill's R. S. Ill. 1923), as assignee of the contract.

The sole question, raised by a plea of the statute of limitations, is: Did the amendment state a new cause of action? It is urged that, because of the broad powers of amendment given by section 954 of the Revised Statutes (Comp. St. ß 1591), the practice in the federal courts differs from that in the state courts. The authority under the Illinois statutes to make amendments is broad enough to permit such amendments to be made either before or after the running of the statute of limitations, because in Illinois the statute is raised by affirmative plea. If not so raised, the amendment is as effective as though the statute had not run. The power to make the amendment is not here in question.

It is also urged, on the authority of certain language used in N. Y. Cent. R. Co. v. Kinney, 260 U. S. 340, 345, 43 S. Ct. 122, 67 L. Ed. 294, that the plea of the statute of limitations is less effective in the federal courts than in state courts. There the recovery was under Employers' Liability Act April 22, 1908, 35 Stat. 65, c. 149 (Comp. St. ß 8657-8665). The pleadings are not set out, but the court said: "The original complaint set forth facts that would have given a cause of action at common law, under the statutes of New York or the act of Congress." The amendment alleged: "That at the time of the collision the plaintiff and defendant were engaged in interstate commerce." The statute did not require that fact to be stated, and if, without that amendment, a good cause of action was stated under the statute, then, as section 1 of that statute (Comp. St. ß 8657), gives the remedy only against common carriers engaged in interstate commerce, it necessarily follows that the amendment did not state a new cause of action. The language of the opinion relied on was not, we think, material to the decision of the case.

Plaintiff most strongly relies upon Missouri, K. & T. Ry. v. Wulf, 226 U. S. 570, 33 S. Ct. 135, 57 L. Ed. 355, Ann. Cas. 1914B, 134. In that case the mother, as sole beneficiary, sued the railway company under the Kansas statute to recover for the death of her son. Under that statute she might lawfully sue in her individual capacity. Subsequently she had herself appointed administratrix of her son's estate and in that capacity joined in the suit. The Supreme Court held that the action was under the federal Employers' Liability Act, and not barred, even though the first appearance of the administratrix as plaintiff was two years after the cause of action arose. The court said: "The change was in form rather than in substance" citing Stewart v. B. & O. R. Co., 168 U. S. 445, 18 S. Ct. 105, 42 L. Ed. 537. Concerning that case, the Supreme Court, in U. S. Fidelity Co. v. Kenyon, 204 U. S. 349, 356, 27 S. Ct. 381, 383 (51 L. Ed. 516), said that the court's observation on that point was made "in the course of the discussion of the controlling questions in that case."

The Stewart Case was bottomed on Browne v. Strode, 5 Cranch, 303, 3 L. Ed. 108, McNutt v. Bland, 2 How. 9, 11 L. Ed. 159, State of Maryland v. Baldwin, 112 U. S. 490, 5 S. Ct. 278, 28 L. Ed. 822, and Gaither v. Farmers & Mechanics Bank, 1 Pet. 37, 42, 7 L. Ed. 43. In those cases, neither the question of the statute of limitations nor the question as to whether there was a new cause of action was either present or considered. The question was as to who, for jurisdictional purposes in the federal court, on the ground of diversity of citizenship, should be considered the party plaintiff in interest in suits on bonds, where the state or some public official is named as obligee; that is, whether it should be the obligee in the bond or the person for whose benefit the bond was given.

The McNutt Case is typical of the class of cases there in question. By the laws of Mississippi, sheriffs were required to give bonds to the Governor for the faithful performance of their duties. Suit was brought on such a bond in the federal court in Mississippi, in the name of the Governor, for the benefit of citizens of New York, against a citizen of Mississippi, and the court held that, notwithstanding the fact that the Governor and the defendant were residents of the state of Mississippi, the controversy was between citizens of New York, for whose benefit the suit was brought, and the Mississippi defendant, and that there was the required diversity of citizenship. The court said: "Where the real and only controversy is between citizens of different states, or an alien and a citizen, and the plaintiff is by some positive law compelled to use the name of a public officer who has not, or ever had any interest in, or control over it, the courts of the United States will not consider any others as parties to the suit, than the persons between whom the litigation before them exists."

In further elucidation of the question, the court said: "Executors and administrators are not in this position, they are the actors in suits brought by them; the personal property of the decedent is vested in them; the persons to whom they are accountable, for whose benefit they act, can bring no suit to assert their rights against third persons, be the cause of action what it may; nor can they interfere with the conducting of the suit to assert their rights to the property of the decedent, which do not vest in them. The personal representative is therefore the real party in interest before the court (Clarke v. Mathewson, 12 Pet. 171 9 L. Ed. 1041), and succeeds to all the rights of those they represent, by operation of law; and no other persons are capable, as representatives of the personalty, of suing or being sued. They are contradistinguished, therefore, from assignees who claim by the act of the parties, and may sue in the federal courts in cases where the decedent could not. Childress v. Emory, 8 Wheat. 668 5 L. Ed. 705; Chappedelaine v. Dechenaux, 4 Cranch, 308 2 L. Ed. 629."

See, also, Irvine v. Lowry, 14 Pet. 293, 297, 10 L. Ed. 462.

Even in those cases, the suits were brought in the name of the obligee for the use of those interested. Unless the Wulf Case is to the contrary, the Supreme Court, on the question of the federal jurisdiction invoked because of diverse citizenship, seems always to have held that executors and administrators are the real parties in interest. See Ingersoll v. Coram, 211 U. S. 361, 29 S. Ct. 92, 53 L. Ed. 208, and cases there cited.

In the hearing of the Wulf Case in the Supreme Court, Union Pac. Ry. Co. v. Wyler, 158 U. S. 285, 15 S. Ct. 877, 39 L. Ed. 983, was relied on, but, the court distinguished between the Wulf Case and the Wyler Case by pointing out that the Wulf Case was simply one where a person who was entitled to the whole of the recovery had brought a suit under a Kansas statute, and by the amendment made no change except to join herself as administratrix, so as to bring the case under the federal statute, where she could not sue as an individual, whereas in the Wyler Case plaintiff, who had sued upon the common-law charge that the defendant had negligently employed and retained in its employ a fellow servant of the plaintiff, and that the injuries sued for arose from such negligence, by amendment, abandoned the common-law charge and "rested the cause of action exclusively upon the negligence of Kline, as a fellow servant, for the reason that a right of action was given in such case by the law of Kansas, where the accident occurred." Thus the court held that the amendment introduced a substantially new cause of action to which the bar of the statute of limitations applied. We are of opinion that the difference between the Wyler Case and the Wulf Case is one of the material differences between the Wulf Case and the case at bar.

In the case at bar, independent of the Illinois statute, no suit could be maintained in a court of law other than by the copartnership. There was no suit ever commenced in its name, nor in its name for the use and benefit of another. The Supreme Court of Illinois, in construing section 18 of the Illinois Practice Act, under which plaintiff is attempting to maintain its suit, held: "A declaration in a suit by an assignee of a chose in action does not state a cause of action in favor of the plaintiff, unless it contains the allegations required by section 18, showing the assignment of the chose in action, the actual ownership thereof by him, and setting forth how and when he acquired title. A declaration which fails to allege a fact without whose existence the plaintiff is not entitled to recover does not state a cause of action. Walters v. City of Ottawa, 240 Ill. 259 88 N. E. 651; Prouty v. City of Chicago, 250 Ill. 222 95 N. E. 147." Gallagher v. Schmidt, 313 Ill. 40, 44, 144 N. E. 319, 321; Allis-Chalmers Mfg. Co. v. Chicago, 297 Ill. 444, 130 N. E. 736.

From this holding, it necessarily follows that, as prior to the amendment there was no attempt to bring the case within the provisions of section 18, there was up to...