Haynes v. Felder, 16044.

• Citation: 239 F.2d 868
• Decision Date: 01 March 1957
• Docket Number: No. 16044.,16044.
• Parties: Mrs. Elsie HAYNES, Appellant, v. William D. FELDER, Jr., et al., Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)

239 F.2d 868 (1957)

Mrs. Elsie HAYNES, Appellant, v. William D. FELDER, Jr., et al., Appellees.

No. 16044.

United States Court of Appeals Fifth Circuit.

January 9, 1957.

Rehearing Denied March 1, 1957.

W. L. Wray, Isabelle Albright, Dallas, Tex., for appellant.

Coke & Coke, Clinton Foshee, Dallas, Tex., for appellee First Nat. Bank in Dallas.

Stanley E. Neely of Locke, Locke & Purnell, J. J. Fagan, Asst. Dist. Atty., Dallas, Tex., for appellees William D. Felder, Jr. et al.

R. Matt Dawson, (of Dawson & Dawson) Corsicana, Tex., for appellee Jackson Davis.

Before HUTCHESON, Chief Judge, and RIVES and TUTTLE, Circuit Judges.

TUTTLE, Circuit Judge.

In this appeal from a summary judgment of the trial court in favor of the individual appellees and against appellant in an interpleader suit in which the plaintiff National Bank was a mere stakeholder, we are faced in limine with a jurisdictional question. This question, posed because of the citizenship of the claimants, though foreshadowed and at least partially answered in principle in three cases from this circuit, Dugas v. American Surety Co., 5 Cir., 82 F.2d 953; Maryland Casualty Co. v. Glassell-Taylor & Robinson, 5 Cir., 156 F.2d 519, 521; and United States v. Sentinel Fire Ins. Co., 5 Cir. (en banc), 178 F.2d 217, is one which we think has not, in its precise form, been expressly answered by any appellate court.

As appears from the interpleader petition filed by the First National Bank of Dallas, which for jurisdictional purposes is to be considered a citizen of Texas,¹ one Jackson Davis found a cache of money in the basement of William D. Felder, Jr., who had acquired the house, originally built by his father in 1909, upon the settlement of the father's estate. The house had never been occupied by anyone other than the Felders. William D. Felder, Jr. and his three sisters, being all of the descendants and next of kin of Felder senior, asserted a claim to $43,430 which had been taken from Davis and deposited in plaintiff bank by the sheriff of Dallas County. A Mrs. Elsie Haynes, individually and in her representative capacity as community survivor of her husband's estate, claimed the fund as having been taken from her deceased husband and hidden in the Felder basement by Davis. Suits were filed against the bank in the Texas state court by Davis and by Mrs. Haynes, and the Felders made written demand on the bank for the money. Thereupon the interpleader was filed, naming Davis, Mrs. Haynes, and the Felders, including the husbands of the three sisters. The trial court restrained further action in the state court. All of the defendants, except for one Felder sister and her husband who lived in Tennessee, were alleged to be citizens of Texas. Davis later abandoned his claim, leaving the real issue between Mrs. Haynes on the one hand and the four Felders on the other. The Felder claim was joint, since they all claimed as next of kin of their father and none of them claimed through any other source, although William was in possession of the residence where the money was found. The court, on motion for summary judgment, sustained the Felder claim, thus inferentially holding that no substantial issue of fact was raised in support of the Haynes claim. It also entered a permanent injunction against any further proceeding in the state court.²

On this appeal appellant questions the jurisdiction of the district court. It would, of course, be necessary for us to raise this question ourselves if it appeared in the record.³

In its simplest terms it is this: can a Texas plaintiff who is merely a stakeholder asserting no claim to the property⁴ bring interpleader against two rival sets of claimants, consisting of a citizen of Texas on the one side, opposed by four joint claimants of whom three are citizens of Texas and one is a citizen of Tennessee.

While we are in no doubt that the wording of the statute itself, the trend of the cases and of legal articles and books, combine to teach that such a plaintiff can do so, we think that it is worthwhile to set out with some particularity and fullness our reasons for holding so.

It is clear that such a proceeding could not be brought as a diversity action under 28 U.S.C.A. § 1332,⁵ which provides in part:

"1332. Diversity of citizenship; amount in controversy.

(a) The district courts shall have original jurisdiction of all civil actions where the matter in controversy * * * is between:

(1) Citizens of different States; * * *."

This is so similar to the language of the original diversity statute which Chief Justice Marshall construed in Strawbridge v. Curtiss, 3 Cranch 267, 7 U.S. 267, 2 L.Ed. 435, that it has consistently been held that this law requires that each party have such citizenship that he could sue in diversity every other actual or indispensable party properly aligned against him, City of Indianapolis v. Chase National Bank, 314 U.S. 63, 62 S.Ct. 15, 86 L.Ed. 47, and this requirement has been held applicable to non-statutory interpleader, Security Trust & Savings Bank of San Diego v. Walsh, 9 Cir., 91 F.2d 481; 3 Moore § 22.042 (1948 ed.); 2 Barron & Holtzoff § 552.

Here, with common citizenship between the bank and Haynes, entirely aside from the mixed citizenship of the Felder group and the original participation of Davis, also a Texan, such diversity as is required under § 1332 is lacking. Thus the only basis of federal jurisdiction here which is, or might be, claimed is the Interpleader Act, 28 U.S. C.A. § 1335. The pertinent language of this statute is:

"(a) The district courts shall have original jurisdiction of any civil action of interpleader or in the nature of interpleader * * * if

"(1) Two or more adverse claimants, of diverse citizenship as defined in section 1332 of this title, are claiming or may claim to be entitled to such money or property * * *."

This statute does not appear to require any diversity between the plaintiff and the defendant-claimants, and such an interpretation of the similarly conceived 1936 Interpleader Act was held to be both correct and constitutional in Treinies v. Sunshine Mining Co., 308 U.S. 66, 60 S.Ct. 44, 84 L.Ed. 85. However, as the Court there held, the Act is bottomed on the diversity jurisdiction of the United States courts, permitted by Art. III, § 2, cl. 1(7) of the Constitution,⁶ and thus it was necessary for Congress to specify some alternative form of diversity on which jurisdiction in particular cases could be grounded. This it did in the present Act by requiring "claimants, of diverse citizenship."

The question therefore is whether the diversity here existing among the claimants is sufficient to support jurisdiction. It might first of all be noted that there is insufficient diversity among the claimants to permit a regular diversity suit between them for even after Davis, also a Texan, was dismissed as a party to the suit, the two remaining interests were represented by a Texan on one side and three Texans and a Tennessean on the other. It might further be noted that this case appears to present the absolute minimum degree of diversity that can arise, especially when one considers that the plaintiff also was a Texas citizen. It must therefore be asked first whether this minimal diversity meets the statutory requirement, and second whether the statute so interpreted would be constitutional.

In analyzing the cases and authorities that have dealt with aspects of this question it must be kept in mind that many that appear to be superficially similar or use language broad enough to include the present situation actually involve a distinguishable jurisdictional issue. Interpleader suits may be attempted under Rule 22(1) (normal diversity — § 1332) or 22(2) (statutory interpleader — § 1335), or both, by plaintiffs (or defendants) who are disinterested (strict interpleader) or interested (bill in the nature of interpleader), and whose citizenship is totally, partially, or not at all diverse from that of all or some of the claimants. Restricting the present consideration as required by the facts of this case to statutory interpleader brought by a disinterested plaintiff on whose citizenship no diversity jurisdiction could be grounded, and all the claimants are either joint or rival (thus omitting the unusual situation suggested by the dissent in United States v. Sentinel Fire Ins. Co. 5 Cir. (en banc), 178 F.2d 217, of interests that are neither joint nor rival), it still appears necessary to analyze at least four situations arising from the different forms or degrees of diversity among claimants in multiparty actions.

(1) "Complete diversity," where any claimant whose interests are adverse to those of another also has diverse citizenship from him (e. g. three rival groups of joint claimants, one group each consisting of citizens of state A, B, and C). Thus there are no disputes among cocitizens and any phase of the controversy could independently have been started as a regular diversity suit. Contrasted to this, there are at least three types of "incomplete diversity."

(2) "Diversity by alignment," where it would be possible to align the claimants into at least two sides in such a manner that all on one side have citizenship different from and interests adverse to all those on the other — though on both sides there might be rivalries among some or all of the claimants, and co-citizenship among such rivals (e. g. four rival groups of joint claimants, two groups of citizens from state A and two from state B). Thus all the claimants on either of these contrived sides could have started a diversity suit against all the claimants on the other "side," and then could have cross-claimed among themselves under Rule 13(g) (though in a regular diversity suit in this Circuit cross-claims are apparently not permitted between co-citizens. Republic Nat. Bank & Trust Co. v. Massachusetts Bonding & Ins. Co., 5 Cir., 68 F.2d 445).

(3) "Partial diversity," where there...