Chase Nat Bank v. City of Norwalk, Ohio, No. 290

CourtUnited States Supreme Court
Writing for the CourtBRANDEIS
Citation78 L.Ed. 894,291 U.S. 431,54 S.Ct. 475
Docket NumberNo. 290
Decision Date05 March 1934
PartiesCHASE NAT. BANK v. CITY OF NORWALK, OHIO

291 U.S. 431
54 S.Ct. 475
78 L.Ed. 894
CHASE NAT. BANK

v.

CITY OF NORWALK, OHIO.

No. 290.
Argued Jan. 18, 19, 1934.
Decided March 5, 1934.

Page 432

Mr. George D. Welles, of Toledo, Ohio, for petitioner.

Messrs. G. Ray Craig, of Norwalk, Ohio, and H. C. Laughlin and Walter A. Eversman, both of Toledo, Ohio, for respondent.

Mr. Justice BRANDEIS delivered the opinion of the Court.

This case is here on certiorari to the United States Circuit Court of Appeals for the Sixth Circuit, 290 U.S. 614, 54 S.Ct. 73, 78 L.Ed. —-. Whether the injunction granted in this cause by the federal court for northern Ohio stays a judgment of ouster rendered by the Court of Appeals of the state in violation of Judicial Code § 265 (28 USCA § 379) is the main question requiring decision. 1

In May, 1925, the Ohio Electric Power Company acquired the electric light and heating system then serv-

Page 433

ing a part of the residents of the city of Norwalk, Ohio; and by a duly recorded mortgage deed of trust, transferred the property to a trustee to secure an issue of bonds. In March, 1926, the city council passed a resolution in terms requiring the Power Company to remove from the streets, alleys and other public places within 30 days, its poles, wires and other electric equipment. These had been erected and were being maintained pursuant to an ordinance of the city, dated October 7, 1890. The city claimed that the Power Company had no right so to occupy the streets, alleys and public places, because the franchise granted by the ordinance was for a limited term and that term had expired without extension or renewal. The Power Company refused to comply with the city's demand, claiming that it had, under legislation of the state, acquired a perpetual franchise.

In May, 1926, the state brought, in the Court of Appeals of Ohio, at the relation of the prosecuting attorney for Huron county, an action in quo warranto against the Power Company to oust it from such use of the streets, alleys, and public places. That court, holding that the franchise granted had expired, entered a judgment of ouster. State ex rel. Martin v. Ohio Electric Power Co., 35 Ohio App. 481, 172 N.E. 615; and the judgment was affirmed by the Supreme Court of the state. Ohio Electric Power Co. v. State ex rel. Martin, 121 Ohio St. 235, 167 N.E. 877. The action had been instituted at the request, and had been prosecuted with the aid, of the city; but it was not a party thereto. The mortgage given by the Power Company and the bonds thereby secured were then (and still are) outstanding. But the state did not make the trustee a party respondent; and the trustee did not intervene, or seek to intervene, in the action. Neither the state nor the Power Company made mention of the existence of the mortgage either in its plead-

Page 434

ings or otherwise. Whether the state, the relator, or the city knew of the mortgage, and whether the trustee knew of the action in quo warranto, does not appear.

Before any step had been taken by the state to enforce the judgment of ouster, the then trustee under the mortgage deed of trust, a citizen and resident of New York, brought this suit in the federal district court for northern Ohio. The Chase National Bank, likewise a citizen and resident of New York, has since been substituted as trustee and plaintiff. The city of Norwalk alone was made defendant. The bill set forth in addition to the facts stated above, that the plaintiff as such trustee is entitled to the continued use of the poles, wires, and electrical equipment by the Power Company; that the judgment of ouster has not yet been executed; that the Power Company is still serving the Norwalk public; that the city is threatening to destroy, or forcibly remove, the poles, wires, and equipment from the streets, alleys, and public places and to prevent the operation of the system or to seek to have enforced the judgment of ouster; and that such acts would result in irreparable injury to the plaintiff.

The District Court held that the plaintiff has as mortgagee a good and valid lien upon the poles, wires, and electrical equipment, and the rights and franchises to use the streets, alleys, and public places therefor; that 'for the purpose of protecting, preserving and enforcing the lien of the mortgage' the Power Company 'is and was at the time of the filing of the bill of complaint herein the owner'; that these rights were granted 'in perpetuity as against any right or power of the City of Norwalk with reference thereto * * *'; and that the 'franchises, rights and physical properties will be destroyed and rendered worthless' unless a permanent injunction issues. The decree enjoined the city, its officers, agents, and employees, 'and all persons whomsoever to whom notice of this order shall come,' from destroying, or interfering with the con-

Page 435

tinued operation by the Power Company of, the plant and distribution system; 'from taking any steps or action of any kind whatever to cause the enforcement or carrying out by the Sheriff of Huron County, Ohio, * * * of the judgment of ouster'; and 'from applying to any of the courts of the State of Ohio for any writ, process or order of any kind whatever for the purpose of enforcing and carrying out said judgment of ouster.' The injunction was granted to continue only as long as the plaintiff or its successor, or holders of bonds under the mortgage, should have any interest in or lien upon the properties and franchises of the Power Company in the city of Norwalk.

The Circuit Court of Appeals did not pass upon the question whether the plaintiff has, as mortgagee, an interest in or lien upon the alleged property and rights; nor upon the question whether the Power Company retains for the protection of the mortgagee, an existing right to use the streets, alleys, and public places as claimed; nor specifically upon the question whether the franchises granted had expired. It held, one judge dissenting, that, although the District Court had jurisdiction of the parties and of the subject-matter, that court ws not justified in granting an injunction; and it reversed the decree with directions to dismiss the bill, 63 F.(2d) 911, for the following reasons:

(a) That the proceedings in the District Court came within the inhibitions of Judicial Code, § 265 (28 USCA § 379) in that the effect of the decree was to stay the quo warranto proceeding in the state courts.

(b) That the case does not fall within the exceptions which permit a federal court to interfere with the judgment of a state court, because there was no showing that the judgment in the action in quo warranto was void for lack of jurisdiction, or was based upon fraud or upon such accident or mistake as made its enforcement unconscionable.

Page 436

(c) That because the plaintiff has not shown that it lacked knowledge of the action in quo warranto, or that it could not have intervened therein as mortgagee, and have asserted therein the claim which it presents now as the basis of the relief sought, it has failed to make the necessary showing of diligence.

There was error in the decree entered by the District Court; but the Circuit Court of Appeals was not justified in ordering that the bill be dismissed.

First. Independently of the prohibition of Judicial Code, § 265, the decree entered by the District Court was clearly erroneous in so far as it enjoined 'all persons to whom notice of the order of injunction should come from taking any steps or action of any kind to...

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148 practice notes
  • State ex Inf. McKittrick v. Mo. Utilities Co., No. 34073.
    • United States
    • United States State Supreme Court of Missouri
    • September 8, 1936
    ...Company are indispensable parties to this action. State ex rel. Bevan v. Williams, 291 S.W. 481, 316 Mo. 665; Chase Natl. Bank v. Norwalk, 291 U.S. 431, 78 L. Ed. 894. (6) The doctrine of equitable estoppel and laches is applicable to municipal corporations in matters pertaining to governme......
  • Casa Marie, Inc. v. Superior Court of Puerto Rico for Dist. of Arecibo, Nos. 91-1053
    • United States
    • United States Courts of Appeals. United States Court of Appeals (1st Circuit)
    • March 2, 1992
    ...258 (1980); Hale v. Bimco Trading, Inc., 306 U.S. 375, 378, 59 S.Ct. 526, 527, 83 L.Ed. 771 (1939); Chase Nat'l Bank v. City of Norwalk, 291 U.S. 431, 440, 54 S.Ct. 475, 479, 78 L.Ed. 894 (1934); Garcia v. Bauza-Salas, 862 F.2d 905, 909 (1st Cir.1988). The "strangers" exclusion presumably e......
  • Pepsico, Inc. v. FTC, No. 294
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • November 20, 1972
    ...Furthermore, I say the absent bottlers who may choose not to intervene will not be "bound." Chase National Bank v. City of Norwalk, 291 U.S. 431, 54 S.Ct. 475, 78 L.Ed. 894 (1934); Western Union Tel. Co. v. Foster, 247 U.S. 105, 38 S.Ct. 438, 62 L.Ed. 1006 (1918); New Orleans v. Warner, 175......
  • Stone v. Williams, Docket No. 91-7706
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • July 13, 1992
    ...'a person not a privy may rest assured that [the] judgment ... will not affect his legal rights' ") (quoting Chase Nat'l Bank v. Norwalk, 291 U.S. 431, 441, 54 S.Ct. 475, 479, 78 L.Ed. 894 (1934)) (emphasis added); Parklane Hosiery, 439 U.S. at 327 n. 7, 99 S.Ct. at 649 n. 7 (due process vi......
  • Request a trial to view additional results
148 cases
  • State ex Inf. McKittrick v. Mo. Utilities Co., No. 34073.
    • United States
    • United States State Supreme Court of Missouri
    • September 8, 1936
    ...Company are indispensable parties to this action. State ex rel. Bevan v. Williams, 291 S.W. 481, 316 Mo. 665; Chase Natl. Bank v. Norwalk, 291 U.S. 431, 78 L. Ed. 894. (6) The doctrine of equitable estoppel and laches is applicable to municipal corporations in matters pertaining to governme......
  • Casa Marie, Inc. v. Superior Court of Puerto Rico for Dist. of Arecibo, Nos. 91-1053
    • United States
    • United States Courts of Appeals. United States Court of Appeals (1st Circuit)
    • March 2, 1992
    ...258 (1980); Hale v. Bimco Trading, Inc., 306 U.S. 375, 378, 59 S.Ct. 526, 527, 83 L.Ed. 771 (1939); Chase Nat'l Bank v. City of Norwalk, 291 U.S. 431, 440, 54 S.Ct. 475, 479, 78 L.Ed. 894 (1934); Garcia v. Bauza-Salas, 862 F.2d 905, 909 (1st Cir.1988). The "strangers" exclusion presumably e......
  • Pepsico, Inc. v. FTC, No. 294
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • November 20, 1972
    ...Furthermore, I say the absent bottlers who may choose not to intervene will not be "bound." Chase National Bank v. City of Norwalk, 291 U.S. 431, 54 S.Ct. 475, 78 L.Ed. 894 (1934); Western Union Tel. Co. v. Foster, 247 U.S. 105, 38 S.Ct. 438, 62 L.Ed. 1006 (1918); New Orleans v. Warner, 175......
  • Stone v. Williams, Docket No. 91-7706
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • July 13, 1992
    ...'a person not a privy may rest assured that [the] judgment ... will not affect his legal rights' ") (quoting Chase Nat'l Bank v. Norwalk, 291 U.S. 431, 441, 54 S.Ct. 475, 479, 78 L.Ed. 894 (1934)) (emphasis added); Parklane Hosiery, 439 U.S. at 327 n. 7, 99 S.Ct. at 649 n. 7 (due process vi......
  • Request a trial to view additional results

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