Fred Macey Co. v. Macey

• Decision Date: 23 February 1905
• Docket Number: 1,366.
• Citation: 135 F. 725
• Parties: FRED MACEY CO., Limited, v. MACEY.
• Court: U.S. Court of Appeals — Sixth Circuit

135 F. 725

FRED MACEY CO., Limited, v. MACEY.

No. 1,366.

United States Court of Appeals, Sixth Circuit.

February 23, 1905

Albert Crane, for appellant.

A. C Denison, for appellee.

Before LURTON, SEVERENS, and RICHARDS, Circuit Judges.

LURTON Circuit Judge.

This is a bill in equity filed in a circuit court of the state of Michigan for the county of Kent. The complainant is described therein as 'a limited partnership association organized and existing under the laws of the state of Michigan, and having its principal office and place of business at Grand Rapids, in said county of Kent and state of Michigan. ' The only defendant is Frank Macey, who is described in the bill 'as a resident of the city of Grand Rapids aforesaid. ' This defendant seasonably filed his petition for the removal of the suit into the Circuit Court of the United States for the Western District of Michigan. The ground for removal, if any exists, is diversity of citizenship. The petition upon this subject alleges that he (the petitioner), 'at the time of the commencement of the suit was, and still is, an alien, and a subject of the King of Great Britain and Ireland. ' The averments concerning the citizenship of the plaintiff were as follows:

'(3) That the controversy in this suit is between a citizen of the state of Michigan and a citizen of a foreign state.

'(4) That the complainant, at the time of the commencement of this suit was, and still is, a partnership association organized and existing under and by virtue of the laws of the state of Michigan, with the location of its business at the city of Grand Rapids, in the state of Michigan.

'(5) That the Fred Macey Company, Limited, within the meaning of section 11 of article 15 of the Constitution of the state of Michigan, and the organic act of the association, at the time of the commencement of this suit had, and now has, the powers and privileges of a corporation, not possessed by individuals or partnerships, and within the meaning of such constitutional provision and such organic act at the commencement of this suit was, and now is, a corporation.'

Upon the filing of this petition, and the removal bond required by law, an order was entered in the state court allowing a removal, and the transcript of the record was duly filed in the court below. Thereupon the defendant filed a demurrer upon the ground that there was a plain and adequate remedy at law. This ground of demurrer was sustained and the bill dismissed. From this decree the plaintiff has appealed.

But preliminary to any consideration of the questions arising upon the decree of the court below there arises upon the face of the record the question of the jurisdiction of the court from which the appeal has been taken. This is a question which this court, as well as every court of the United States, must ask and answer for itself. The fact that no objection was made in the court below and that no objection has been made here cannot relieve the court from the duty of saying whether the record exhibits a case properly removable from the state court into the court below. Great Southern Fire Proof Hotel Co. v. Jones, 177 U.S. 449, 453, 20 Sup.Ct. 690, 44 L.Ed. 842, and cases therein cited. The right of removal depends solely upon the existence of diverse citizenship. The defendant's petition for removal very plainly and explicitly avers his own alienage, and, if the plaintiff below is a corporation of the state of Michigan within the rule that a suit by or against a corporation in a court of the United States is conclusively presumed, for jurisdictional purposes, to be one by or against citizens of the state creating the corporation, then the requisite diversity of citizenship exists and the case was properly removed. The averment of the sixth paragraph that the complainant was and is 'a citizen of the state of Michigan' is insufficient unless it is a corporation of the state of Michigan. Such an allegation in respect of a plaintiff elsewhere styled a 'partnership association organized and existing under the laws of the state of Michigan,' unless such organization be a corporation within the jurisdictional rule, has 'no sensible meaning attached to it,' in the absence of some further averment concerning the citizenship of the members of the association. Lafayette Ins. Co. v. French, 18 How. 404, 405, 15 L.Ed. 451; Chapman v. Barney, 129 U.S. 677, 682, 9 Sup.Ct. 426, 32 L.Ed. 800; Great Southern Fire Proof Hotel Co. v. Jones, 177 U.S. 449, 454, 20 Sup.Ct. 690, 44 L.Ed. 842; Thomas v. Board of Trustees, 195 U.S. 207, 25 Sup.Ct. 24, 49 L.Ed.-- .

But it is urged that the fifth paragraph of the petition for removal, set out above, avers the complainant 'was and now is a corporation,' and that this is an averment of fact which must be accepted. But this language is explained, and, taken in connection with its context, is nothing more or less than a conclusion of law made by the pleader. Reading all of the relevant parts of the petition together, we find it clearly enough stated that the complainant is 'a partnership association' organized and existing under and by virtue of the laws of the state of Michigan. The averment then comes only to this: that under the laws of Michigan the complainant association is a corporation. But it is the duty of this court to take judicial notice of the statute law of Michigan under which such associations are organized, and determine whether the circuit court was entitled to take jurisdiction of this case upon the ground that the association, under those laws, was a corporation within the meaning of the rule for jurisdiction as defined in Great Southern Fire Proof Hotel Co. v. Jones, cited above. In the case just cited the court, after referring to the rule that, for the purpose and within the meaning of the clause of the Constitution extending the judicial power of the United States to controversies between citizens of different states, a corporation was to be deemed a citizen of the state creating it, said:

'No such rule, however, has been applied to partnership associations, although such associations may have some of the characteristics of a corporation. When the question relates to the jurisdiction of Circuit Court of the United States as resting on the diverse citizenship of the parties, we must look, in the case of a suit by or against a partnership association, to the citizenship of the several persons composing such association.'

Unless therefore, such associations, under the law of Michigan, are substantially different from similar organizations under the law of Pennsylvania, they are not corporations within the rule for jurisdiction, and this case must be governed by the case of the Great Southern Fire Proof Hotel Co. v. Jones, cited above, wherein the opinion of this court in respect of such associations in Andrews Bros. & Co. v. Youngstown Coke Co., 58 U.S.App. 444, and 86 F. 585, 30 C.C.A. 293, is overruled. The law of Michigan provides for 'limited partnerships,' and also for 'partnership associations' in which 'the capital subscribed is alone responsible for the debts of the association.' 2 Comp.Laws Mich.pp. 1883, 1888. But an examination of the act last referred to and its amendments, Pub. Acts 1903, pp. 398-404, No. 244, exhibits a striking likeness between associations created under the Michigan law to those organized under the Pennsylvania law. Andrews Bros. & Co. v. Youngstown Coke Co., 58 U.S.App. 444, 86 F. 585, 30 C.C.A. 293. That they are not declared by the statute to be corporations is a striking and significant fact. Neither can it be denied that...