Hartford Life Ins. Co. v. Johnson

• Decision Date: 28 June 1920
• Docket Number: 5447.
• Citation: 268 F. 30
• Parties: HARTFORD LIFE INS. CO. v. JOHNSON.
• Court: U.S. Court of Appeals — Eighth Circuit

268 F. 30

HARTFORD LIFE INS. CO. v. JOHNSON.

No. 5447.

United States Court of Appeals, Eighth Circuit.

June 28, 1920

James C. Jones, of St. Louis, Mo. (Jones, Hocker, Sullivan &amp Angert, of St. Louis, Mo., on the brief), for appellant.

Peyton A. Parks, of Clinton, Mo., and M. A. Fyke, of Kansas City Mo., for appellee.

Before HOOK and CARLAND, Circuit Judges, and TRIEBER, District Judge.

TRIEBER District Judge.

This is an appeal from an order dissolving a temporary restraining order and denying a temporary injunction to enjoin the appellee from enforcing a judgment of the circuit court of Henry county, Mo., affirmed by the Supreme Court of that state (271 Mo. 562, 197 S.W. 132), in favor of appellee's intestate against the appellant. The hearing was on the complaint and exhibits thereto. For convenience the parties will be referred to as they appear in the court below; the appellant as plaintiff, and the appellee as defendant.

The complaint alleges that the defendant was engaged in the business of life insurance under the assessment and mutual or co-operative plan, maintaining and operating a department of said insurance business known and designated as 'Men's Division of the Safety Fund Department,' organized and existing under the laws of the state of Connecticut, having its domicile in that state. The members of this department, and Johnson was one of them, were issued certificates of membership like unto policies of life insurance. The certificates of membership were conditioned on the payment of quarterly assessments, and provided a mortuary fund, from which death claims are to be paid; a safety fund is also provided for, which becomes available for equal distribution to all the members, if the mortuary fund is found to be insufficient to pay the death claims. This fund is accumulated out of one payment made by each member equal to $10 per thousand of the death claim payable to him. Whenever the fund shall amount to $1,000,000, the subsequent premiums therefor shall be divided by said company among all the holders of certificates in force, who shall have contributed, five years prior to the date of such division their stipulated proportion of said fund, by applying the same to the payment of their future dues and assessments. The members were required to pay $30 per annum on each $1,000 indemnity, and to pay, within 30 days from the date on which notice bears date, all mortality calls at the home office of the company in Connecticut, and upon failure to do so the certificate shall be null and void. The insurance company was the trustee of the mortuary fund, which was maintained in the state of Connecticut. On or about May 2, 1902, the plaintiff levied a mortuary assessment upon the members of said division, including the assured, Johnson. The amount payable by him upon this assessment was $74.55. This assessment was designated as quarterly assessment call No. 95, but this assessment was never paid. On or about October 19, 1906, one Chas. H. Dresser, and various other members of said division residing in various states, filed their bill, in behalf of themselves and all other members of said division, in the superior court of New Haven, in the state of Connecticut, to which action the said Johnson was by representation a party complainant.

In said bill the members of said division complained that various and sundry prior assessments and calls, including quarterly call No. 95, were illegal and excessive, and were not properly levied and demanded by the plaintiff; that the company had no right to maintain a mortuary fund and to assess the members to replenish it, but could only make such assessments when death losses occurred, and when there were no moneys in the mortuary fund, or not enough to meet accrued outstanding death losses; that on July 10, 1907, the said James B. Johnson died, and said Nannie N. Johnson, who was a citizen of the state of Missouri, instituted her action against this plaintiff in the circuit court of Henry county, Mo., seeking recovery of the sum of $5,000, the face of the policy of which she was the beneficiary; that in that cause the plaintiff in its answer asserted, among other things, that by reason of the terms of said certificate the membership of the said James B. Johnson was forfeited, by reason of his failure to pay the quarterly call No. 95. On May 12, 1909, the cause was heard upon that issue, and upon a trial to a jury a verdict rendered in favor of Mrs. Johnson for the full amount of the policy. On March 23, 1910, the Dresser suit, pending in the superior court of New Haven county, in the state of Connecticut, came on to be finally heard, and it was there adjudged and decreed that the prior assessments made by the company for mortuary purposes, including quarterly call No. 95, had been legally and properly made, and not in any excessive amounts; that the plaintiff had a right under the charter to maintain the surplus which it was then maintaining in the mortuary fund, and to levy mortuary assessments upon members of the division to replenish the same; that at no time had the safety fund been in excess of $1,000,000, and that therefore members of the division had no right to insist that the company resort to it in reduction or discharge of their mortuary assessments; that said judgment is now in full force and effect; that the judgment of the circuit court of Henry county, Mo., in favor of Nannie N. Johnson, was appealed to the Kansas City Court of Appeals, and afterwards to the Supreme Court of Missouri; that this plaintiff exhibited to said court a certified copy of the record and proceedings of the superior court of New Haven county, state of Connecticut, rendered after the judgment of the circuit court of Henry county, Mo., as being res adjudicata and a final conclusive determination of the rights of said Nannie N. Johnson, and that court refused to notice or consider the same, because, under the law and practice on appeals pending in the Supreme Court of Missouri, matters not appearing in the record of the lower court, but transpiring subsequently, could not be brought into the record of the appeal, and thereupon affirmed the judgment of the circuit court.

It is then claimed that, unless the court shall interfere by granting the injunction to restrain the defendant from issuing execution on the judgment of the Supreme Court of Missouri, great injustice will be done to the plaintiff. Copies of the certificate of insurance on the life of Mr. Johnson, of the record in the suit by Nannie N. Johnson against the plaintiff in the circuit court of Henry county, and an exemplified copy of the Dresser suit before the superior court of New Haven county, Conn., against the plaintiff, and the decree of the court in that case, together with the opinions of the judges, were filed as exhibits.

That a court of the United States, by virtue of its general equity powers, has jurisdiction to enjoin the enforcement of a judgment of a state court, if there is a diversity of citizenship, or a federal question involved, and the amount involved exceeds $3,000, if the allegations in the complaint state a proper cause of action, is beyond doubt. But this does not authorize such a court to enjoin the judgment for errors committed in the trial of a cause, in construing a statute of another state, not affecting the validity of such statute. Johnson v. New York Life Ins. Co., 187 U.S. 491, 496, 23 Sup.Ct. 194, 47 L.Ed. 273; Finney v. Guy, 189 U.S. 335, 340, 23 Sup.Ct. 558, 47 L.Ed. 839; Allen v. Alleghany Co., 196 U.S. 458, 463, 25 Sup.Ct. 311, 49 L.Ed. 551; Western Indemnity Co. v. Rupp, 235 U.S. 261, 275, 35 Sup.Ct. 37, 59 L.Ed. 220.

It is claimed in behalf of the plaintiff that the circuit court of Henry county was without jurisdiction to hear that action, by reason of the fact that by the construction of the charter of the plaintiff by the superior court of New Haven county, Conn., the certificate of insurance was payable only out of the mortuary fund, which was kept in the state of Connecticut, and an action could only be maintained in a court of that state. The argument of counsel was ingenious, but not convincing. The jurisdiction of the Missouri court of the person of the plaintiff is undisputed, as it was not only served with proper process in the state of Missouri, but entered its appearance and litigated the action. Nor can there be any doubt that the court had jurisdiction of the subject-matter. The jurisdiction of the subject-matter of a court depends on allegations and not on facts. United States v. Arredondo, 31 U.S. (6 Pet.) 691, 709, 8 L.Ed. 547; Evers v. Watson, 156 U.S. 527, 532, 15 Sup.Ct. 430, 39 L.Ed. 520; In re Lennon, 166 U.S. 548, 553, 17 Sup.Ct. 658, 41 L.Ed. 1110; Flanders v. Coleman, 250 U.S. 223, 227, 39 Sup.Ct. 472, 63 L.Ed. 948; In re First National Bank, 152 F. 64, 69, 81 C.C.A. 260, 11 Ann.Cas. 355; Van Fleet on Collateral Attack, Sec. 60. In the Arredondo Case it was held:

'The power to hear and determine a cause is jurisdiction; it is 'coram judice,' whenever a case is presented which brings this power into action; if the petitioner states such a case in this petition, that on a demurrer, the court would render judgment in his favor, it is an undoubted case of jurisdiction; whether on an answer denying and putting in issue the allegations of the petition, the petitioner makes out his case, is the exercise of jurisdiction conferred by the filing of a petition containing all the requisites and in the manner prescribed by law.'

In Re First National Bank this court said:

'Jurisdiction of the subject-matter and of the parties is the right to hear and determine the suit or proceeding in favor of or against the respective parties to it.

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