Dougherty v. Mich. Bell Tel. Co.

• Decision Date: 16 June 1926
• Docket Number: Motion No. 475.
• Citation: 209 N.W. 200,235 Mich. 416
• Parties: DOUGHERTY, Atty. Gen., v. MICHIGAN BELL TELEPHONE CO.
• Court: Michigan Supreme Court

235 Mich. 416

209 N.W. 200

DOUGHERTY, Atty. Gen.,

v.MICHIGAN BELL TELEPHONE CO.

Motion No. 475.

Supreme Court of Michigan.

June 16, 1926.

Information in the nature of quo warranto by Andrew B. Dougherty, Attorney General, against the Michigan Bell Telephone Company. On petition for removal to federal court. Petition granted.

Argued before the Entire Bench.Andrew B. Dougherty, Atty. Gen., and Thomas J. Green, Asst. Atty. Gen., for plaintiff.

Stevenson, Butzel, Eaman & Long, of Detroit (Thomas G. Long and H. E. Spalding, both of Detroit, of counsel), for respondent.

PER CURIAM.

The Attorney General files by leave of court his information in the nature of a quo warranto to test the right of defendant to continue its business in the state, and to annul its charter. With considerable detail, the information sets up various acts of defendant which it is claimed justify a judgment of ouster, and which do not involve any questions of federal law, either constitutional or statutory. Many of these allegations have to do with dealings between defendant and the American Telephone & Telegraph Company and its subsidiaries. In addition to these allegations, the Attorney General further alleges:

‘That the said American Telephone & Telegraph Company, its officers, directors, and others, and the said Michigan Company, and its officers and directors, have conspired to control the transmission of intelligence by telephony, by wire and wireless, without governmental regulation, and as a monopoly throughout the state of Michigan and the entire United States, both interstate and intrastate, and with foreign countries.’

Defendant, before pleading, files its petition to remove the case to the federal court, claiming its right so to do under the provisions of the Judicial Code (section 1010, U. S. Comp. St.) which, among other things, provides:

‘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 district courts of the United States are given original jurisdiction by this title, 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 district court of the United States for the proper district.’

With its petition defendant filed the proper bond. It insists that the allegations of the information upon their face show that, in part, at least, the Attorney General's cause of action arises under the laws of the United States, and that under these circumstances defendant is entitled to the order of removal. Oral argument was ordered and had, and exhaustive briefs were filed. The exigencies of the case require a prompt decision. We conceive the questions before us may be disposed of under the following heads: (1) Is this proceeding ‘of a civil nature?’ (2) May removal be had where but a portion of the issues involved arises under the laws of the United States? (3) The duty of the state court.

1. If we look to our Judicature Act alone, we should be compelled to characterize the present proceeding as a civil action. Section 12350, C. L. 1915. If we turn to the court of last resort of the nation, we find that court has held that proceedings such as are here under consideration, based on an information in the nature of quo warranto, are civil proceedings, and removable as such to the federal court. Ames v. Kansas, 111 U. S. 449, 4 S. Ct. 437, 28 L. Ed. 482. This case has been many times cited, and, so far as we have been able to find, has not been deviated from by that court. If we turn to the well-recognized authority. Ruling Case Law, we must classify the present action as a civil proceeding. In 22 R. C. L. 657, it is said:

‘It is clear that the original common-law writ of quo warranto was a civil writ at the suit of the crown and not a criminal prosecution. The first process was summons, and the judgment never involved more than seizure of the franchise by the crown. The information which took its place was a criminal proceeding, and involved fine and imprisonment as well as the ouster of the defendant from the usurped franchise, but it early lost its character as a criminal proceeding in everything except form, and was applied to the mere purposes of trying the civil right, seizing the franchise, or ousting the wrongful possessor, the fine being nominal only. In England the criminal form of the procedure was retained until Stat. 47 & 48 Vict. c. 61, p. 15, which provided that proceedings in quo warranto should be deemed civil proceedings, whether for the purpose of appeal or otherwise. In many of the states the character of the writ as purely civil in substance has been recognized without special legislation to that effect, and in others statutory provisions have relieved the old civil remedy of the burden of the criminal form of proceeding and restored it to its original position as a civil action for the enforcement of a civil right. The right and the remedy are thus brought into harmony, and parties are not driven to the necessity of using the form of a criminal action to determine a civil right.’

See, also, 23 R. C. L. 621.

In Rhode Island (State v. Kearn, 17 R. I. 391, 22 A. 322, 1018), the proceedings are treated as criminal, and the early case of Donnelly v. People, 11 Ill. 552, 52 Am. Dec. 459, was to the same effect. We need not point out the later holdings of the Illinois court; federal courts sitting in that state at times recognized this holding, but in the lake front case (State of Illinois ex rel. Hunt, Attorney General, v. Illinois Central R. Co. [C. C.] 33 F. 721), Mr. Justice Harlan, sitting at circuit, and deciding a motion to remand after reviewing the Illinois cases, and considering the claim that, because a fine was authorized under the Illinois statute, it was, therefore, a criminal proceeding, held that Ames v. Kansas, supra, was controlling, and said:

‘Although the practice in Illinois in this class of cases is, in some respects, similar to that obtaining in criminal cases, and although informations in the nature of quo warranto may be of a ‘quasi criminal nature,’ under the statute defining and regulating the jurisdiction of the criminal court of Cook county (Wiggins v. City of Chicago, 68 Ill. 372;Naylor v. City of Galesburg, 56 Ill. 285), I am of opinion that, as the primary and only material object of the present proceeding is to enforce a civil right, it is to be regarded as a suit of a civil nature, within the principle of the decision in Ames v. Kansas, and within the meaning of the act of Congress; and this notwithstanding the court has a discretion, in addition to a judgment of ouster, to impose a fine.'

This case answers the contention of the plaintiff that the court in the alternative is authorized to impose a fine. Sections 13543, 13544, C. L. 1915; Attorney General v. National Cash Register Co., 182 Mich. 99, 148 N. W. 420, Ann. Cas. 1916D, 638. Numerous cases are cited to us where the action was brought under penal statutes to recover penalties, and which cases are held not to be removable. The case most strongly stressed of this character is Wisconsin v. Pelican Ins. Co., 127 U. S. 265, 8 S. Ct. 1370, 32 L. Ed. 239, in which the state brought an action of debt upon a judgment recovered for a penalty under a penal statute of the state, and in which the court held that, the original judgment having been obtained under such penal statute, the character of the claims was fixed, and the case was not removable. Not only is this claim that the present case is not civil but criminal in character answered by the two federal cases cited, but it is answered by the further fact that the Attorney General in this proceeding does not seek the recovery of a penalty or the imposition of a fine, but does seek the annulment of the defendant's charter, its exclusion from the state, and the suspension of its business of furnishing telephone service to the people of the state. We conclude that the first question must be answered in the affirmative.

2. The Judicial Code does not in terms require as a condition of removal that the case involve only federal questions. It was said by Chief Justice Marshall in Cohens v. Virginia, 6 Wheat. 264, 5 L. Ed. 257:

‘A case in law or equity consists of the right of the one party, as well as of the other, and may truly be said to arise under the Constitution or a law of the United States, whenever its correct decision depends on the construction of either.’

In Railroad Co. v. Mississippi, 102 U. S. 135, 26 L. Ed. 96, it was said:

‘* * * And, lastly, that it is not sufficient to exclude the judicial power of the United States from a particular case, that it involves questions which do not at all depend on the Constitution or laws of the United States; but, when a question to which the judicial power of the Union is extended by the Constitution forms an ingredient of the original cause, it is within the power of Congress to give the circuit courts jurisdiction of that cause, although other questions of fact or of law may be involved in it.’

And in General Investment Co. v. Lake Shore Ry., 260 U. S. 261, 43 S. Ct. 106, 67 L. Ed. 244, it was said:

‘The suit, according to the plaintiff's statement of its case as made in the bill, was one arising under the laws of the United States, and this was so although the claim to the relief sought was based in part on local Constitutions and laws.’

Other cases might be cited and quoted from to the same effect, but these statements from the court of last resort of the nation must be accepted as final. Obviously a case involves rights under federal laws, and arises under them when it either in whole or in part depends upon them and the proper construction of them, although mixed with them are right at common law or under state statutes....