Isaac Kubie Co. v. Lehigh Valley R. Co.

• Decision Date: 26 December 1919
• Citation: 261 F. 806
• Parties: ISAAC KUBIE CO. et al. v. LEHIGH VALLEY R. CO.
• Court: U.S. District Court — District of New Jersey

261 F. 806

ISAAC KUBIE CO. et al. v. LEHIGH VALLEY R. CO.

United States District Court, D. New Jersey.

December 26, 1919

Pitney Hardin & Skinner, of Newark, N.J., for plaintiffs.

Collins & Corbin, of Jersey City, N.J., for defendant.

RELLSTAB District Judge.

This suit is to recover damages for the loss by fire of raw sugar alleged to have been occasioned by the negligence of the defendant. One of the asserted grounds of negligence is that the defendant did not comply with the regulations of the Interstate Commerce Commission, prescribed for the handling and storing of explosives. The amount in controversy exceeds $200,000.

Isaac Kubie Company, one of the plaintiffs, is a corporation and citizen of the state of New York, and was the owner of the sugar at the time of its loss. The sugar was partly insured by the Liverpool & London & Globe Insurance Company, the other plaintiff, which is a corporation and subject of the kingdom of Great Britain and Ireland. The Insurance Company paid a part of the loss, and claims the right, under its policy, to be subrogated, to the extent of such payment, to the Kubie Company's right to recover. The defendant is a corporation of Pennsylvania and a citizen of that state.

The suit was begun in the Supreme Court of New Jersey, and removed into this court by the defendant, on the grounds that it was one arising under the laws of the United States regulating commerce; that it was between citizens of different states, or between a citizen of a state and a foreign citizen or subject; that the United States District Court had original jurisdiction thereof; and that there was a separable controversy between the defendant and the alien plaintiff (Insurance Company), which could be fully determined as between them without the presence of the Kubie Company, the other plaintiff. The plaintiffs appear specially, and move to remand the suit to the state court on the ground that this court is without jurisdiction, as none of the parties is domiciled in this district.

The cases on the right of removal, while not harmonious in all respects, uniformly hold that the right to remove is purely statutory and must be clear. Sections 24, 28, 29, and 51 of the Judicial Code (Act March 3, 1911, c. 231, 36 Stat. 1087 (Comp. St. Secs. 991, 1010, 1011, 1033)), regulate and control the jurisdiction of the United States District Courts in suits like the one here. Sections 24 and 51 deal with original jurisdiction. The former defines the character of suits, and the latter describes the district in which they may be brought. Section 28 authorizes removal to the District Court 'for the proper district' of suits brought in the state court, and which could have been originally brought in a United States District Court, and section 29 provides for the removal of such suits 'into the District Court to be held in the district where such suit is pending.' This court has had several occasions to pass upon the question of removal, and in Ostrom v. Edison, 244 F 228, we held that, in suits over which the federal and state courts had concurrent jurisdiction, the right of the plaintiff to bring such suit in the United States District Court and of the defendant to remove it there from a state court was not reciprocal.

Ex parte Wisner, 203 U.S. 449, 27 Sup.Ct. 150, 51 L.Ed. 264 held that no suit over which the federal courts were given jurisdiction could be removed into a selected federal court, unless that court originally could have taken cognizance thereof.

In Waterman v. Chesapeake & Ohio Ry. Co., 199 F. 667, we were constrained to overrule one of the contentions that we have now, viz., that as this is the district in which the suit is pending, and as there is no other district into which the suit could be removed, the suit is removable here.

Undoubtedly this suit originally could have been brought in a United States court, if the plaintiffs so desired, but not of this district, unless the defendant expressly or impliedly consented; but because the defendant might have consented does not entitle it to insist, through removal proceedings, to have it tried here.

So far as the plaintiff Kubie Company and the defendant are concerned, the relation of the parties, for jurisdictional purposes, is the same as that of the parties in the Wisner Case. In that case the opinion went farther than the facts required, and in some particulars has been modified by later cases. In re Moore, 209 U.S. 490, 28 Sup.Ct. 706, 52 L.Ed. 904, 14 Ann.Cas. 1164; Western Loan Co. v. Butte & Boston Min. Co., 210 U.S. 368, 28 Sup.Ct. 720, 52 L.Ed. 1101; In re Winn, 213 U.S. 458, 29 Sup.Ct. 515, 53 L.Ed. 873; Ex parte Harding, 219 U.S. 363, 31 Sup.Ct. 324, 55 L.Ed. 252, 37 L.R.A. (N.S.) 392.

However, the modifications declared by these cases do not change the rule, enunciated in the Wisner Case, that to remove a cause into a particular United States District Court, upon the ground of diversity of citizenship, the cause must not only be one over which a United States District Court is given original jurisdiction, but, unless the plaintiffs have expressly or impliedly consented to such removal, it must be one over which the selected court could have taken original jurisdiction in invitum. A different rule has been announced in some of the District Courts, for which see Louisville & N.R. Co. v. Western Union Tel. Co., 218 F. 91, and James v. Amarillo City L. & W. Co., 251 F. 337. Yet, as announced by this court in the Waterman and Ostrom Cases, supra, and now after further reflection reiterated, the rule just stated is still the law, and must govern the instant case, if applicable. A like view has been taken by other and later cases, of which I note only Peninsula Lumber Co. v. Royal Indemnity Co. (D.C.) 237 F. 297; Western Union Tel. Co. v. Louisville & N.R. Co. (D.C.) 201 F. 932; Guaranty Trust Co. of New York v. McCabe (C.C.A. 2) 250 F. 699, 163 C.C.A. 31 (certiorari denied 247 U.S. 505, 38 Sup.Ct. 427, 62 L.Ed. 1240).

A plaintiff, in the first instance, has the right of choice between a state and a United States court to try a controversy of this character, but the defendant's right to remove is not a matter of choice. Having exercised their choice, and selected a state court, the plaintiffs in the instant case can be deprived or prevented from prosecuting the suit in the state court only if they have expressly or impliedly consented to this court taking jurisdiction. The defendant contends that the plaintiffs have impliedly consented; that is, that they have waived their right to object to the jurisdiction of this court. No general appearance has been entered by either of the plaintiffs, and no step taken by them here, except to move to remand the case to the state court, for which they appear specially. The sole contention of the defendant in this...