Gutensohn v. Kansas City Southern Ry. Co., 12679.

• Decision Date: 23 February 1944
• Docket Number: No. 12679.,12679.
• Citation: 140 F.2d 950
• Parties: GUTENSOHN et al. v. KANSAS CITY SOUTHERN RY. CO. et al.
• Court: U.S. Court of Appeals — Eighth Circuit

140 F.2d 950 (1944)

GUTENSOHN et al. v. KANSAS CITY SOUTHERN RY. CO. et al.

No. 12679.

Circuit Court of Appeals, Eighth Circuit.

February 23, 1944.

Hugh M. Bland, of Fort Smith, Ark., for appellants.

Ray Bond, of Joplin, Mo. (F. H. Moore, W. E. Davis, and C. H. Rimann, Jr., all of Kansas City, Mo., on the brief), for appellee Kansas City Southern Ry. Co.

John H. Flanigan, of Carthage, Mo. (Thomas J. Cole, of St. Louis, Mo., and McReynolds & Flanigan, of Carthage, Mo., on the brief), for appellee Guy A. Thompson, trustee of Missouri Pacific R. Co.

Before THOMAS and JOHNSEN, Circuit Judges, and OTIS, District Judge.

OTIS, District Judge.

Sixty-eight individuals, plaintiffs below, appellants here, who had been employees of the Fort Smith & Western Railway Company and thereafter of the receiver of that company, brought action in a state court under the Missouri Act (R.S.Mo. 1939, Art. XIV, Secs. 1126-1140, Mo.R. S.A.) praying a declaration that each was entitled to a judgment against The Kansas City Southern Railway Company and the trustee of Missouri Pacific Railroad Company, defendants below, appellees here, in a named amount. The total sum asked to be declared owing to plaintiffs was $304,139.50. The case was removed to the district court.¹ The defendant, The Kansas City Southern Railway Company, filed a motion to dismiss the petition for failure to state facts entitling plaintiff to the relief prayed. The defendant, the trustee of Missouri Pacific Railroad Company, filed a motion to dismiss for want of jurisdiction and for lack of venue. From the order of the district court dismissing the petition plaintiffs appealed.

It is alleged in the petition that plaintiffs are entitled to the benefits of what is called the "Washington Agreement," a contract entered into May 21, 1936, between certain carriers and their employees. The "Washington Agreement" is set out in an exhibit attached to and made a part of the petition. Its declared purpose is "to provide for allowances to defined employees affected by coordination of carriers." "Coordination" is defined as "joint action by two or more carriers whereby they unify, consolidate, merge or pool in whole or in part their separate railroad facilities or any of the operations or services previously performed by them through such separate facilities." The agreement provides that — "Any employee of any of the carriers participating in a particular coordination who is deprived of employment as a result of said coordination shall be accorded an allowance * * *." A method for determining the amount and duration of each such allowance is set out in the "Agreement."

Having alleged that plaintiffs were employees of the receiver of the Fort Smith and Western Railway Company, that they are entitled to the benefits provided for in the "Washington Agreement" for employees of "carriers participating in a particular coordination," the petition alleges, not that the Fort Smith and Western Railway Company and its receiver participated in any coordination, but that the defendants effected a coordination of their respective roads. It is alleged that defendants accomplished coordination by purchasing the properties of the Fort Smith and Western Railway Company at receiver's sale. By purchasing "key portions" of the Fort Smith and Western directly connecting "defendants' respective tracks and facilities," defendants brought about, it is alleged, their consolidation and coordination.

1. We consider first whether the order sustaining the motion of The Kansas City Southern to dismiss the petition for failure to state facts entitling plaintiff to relief was rightly entered. The problem is, if the facts alleged in the petition are taken as true, was there any such "coordination" of defendants as entitles the employees, not of the defendants or one of them, but of the receiver of a third railway company to the allowances provided for in the "Washington Agreement?"

A reading of the "Agreement" immediately suggests that employees in the position of plaintiffs are not within its coverage under the facts alleged in the petition. The benefits of the "Agreement" are for employees of "carriers participating in a * * * coordination," that is, where by their "joint action * * * they unify * * * their separate railroad facilities." But the facts here, as alleged in the petition, are that plaintiffs were not and never were employees of either of the two carriers charged to have effected a coordination. By what argument then do plaintiffs avoid the effect of the obvious interpretation of the Agreement?²

The argument is that there was "coordination between The Fort Smith & Western Railway Company and The Kansas City Southern Railway Company and Missouri Pacific Railroad Company," when the two companies last named purchased at receiver's sale separate properties of the first named company. But that argument departs from the petition. The petition does not charge that either The Fort Smith & Western Railway Company or its receiver participated in any coordination. On the contrary, it charges that the defendants conspired and coordinated between themselves "against the employer of these plaintiffs" and that they effected the "coordination of defendants' roads" by purchasing the properties of The Fort Smith & Western Railway Company at receiver's sale. Certainly a petition can not be amended, after a motion to dismiss has been sustained, by enlarging in a brief the theory which the petition presents. And if the theory advanced in the brief had been embodied in the petition probably it would not be sound. To develop that thought, however, would constitute a departure from the issues raised on this appeal.

2. The order of the district court sustaining The Kansas City Southern's motion to dismiss and dismissing the petition as to that defendant was clearly right. The motion of the trustee of Missouri Pacific, which also was sustained by the district court, did not challenge the sufficiency of the allegations of the petition, but asserted lack of jurisdiction and lack of venue. Plaintiffs in effect concede in their brief that the state court, whence the case was removed to the district court, did not have venue. If so, the district court did not acquire venue. But, of course, the petition cannot be dismissed on that account; only the service of process might be quashed, with the possibility of obtaining service on a new summons issued out of the district court.

The trustee's motion to dismiss for want of jurisdiction presents the theory that since the Missouri Pacific is in bankruptcy³ only the court having jurisdiction of the bankruptcy proceeding, the district court for the Eastern District of Missouri, has jurisdiction of any such case as this brought against the trustee. The statute, 11 U.S.C.A. § 205, sub. a, provides that during the pendency of a reorganization proceeding in bankruptcy the district court in which the proceeding is pending shall "have exclusive jurisdiction of the debtor and its property wherever located." The contention that a...