Manufacturers' Land & Improvement Co. v. United States Shipping Board Emergency Fleet Corp.

• Decision Date: 28 September 1922
• Docket Number: 2852.
• Parties: MANUFACTURERS' LAND & IMPROVEMENT CO. v. UNITED STATES SHIPPING BOARD EMERGENCY FLEET CORPORATION et al. [1]
• Court: U.S. Court of Appeals — Third Circuit

284 F. 231

MANUFACTURERS' LAND & IMPROVEMENT CO. v. UNITED STATES SHIPPING BOARD EMERGENCY FLEET CORPORATION et al. ^[1]

No. 2852.

United States Court of Appeals, Third Circuit.

September 28, 1922

Wescott & Weaver, of Camden, N.J., and Samuel B. Scott, of Philadelphia, Pa., for plaintiff in error.

Frederic M. P. Pearse, Asst. U.S. Atty., of Newark, N.J., and E. E Jacobsen and Wm. Y. C. Anderson, both of Philadelphia, Pa for defendants in error.

Before BUFFINGTON, WOOLLEY, and DAVIS, Circuit Judges.

DAVIS Circuit Judge.

This writ of error was sued out to review a judgment of 'no cause of action,' entered on a verdict directed by the court, on an action in ejectment begun by the plaintiff in error in the New Jersey Supreme Court and removed by defendants to the District Court. The land in question was requisitioned and used under the authority of the Acts of Congress of March 1, 1918 (40 Stat. 438 (Comp. St. 1918 Comp. St. Ann. Supp. 1919, Sec. 8146t)), and April 22, 1918 (40 Stat. 535 (Comp. St. 1918, Comp. St. Ann. Supp. 1919 Secs. 3115 1/16d, 3115 1/16dd)). That act authorized the United States Shipping Board Emergency Fleet Corporation, hereinafter called the Fleet Corporation, to purchase or requisition any land suitable for the construction thereon of houses for the use of employees of shipyards and their families, to determine and make just compensation therefor, and, if the amount determined was unsatisfactory to the person entitled to receive it, to pay 75 per centum thereof. Whereupon the owner was entitled to sue the United States for such further sum as he thought would be just compensation for the property taken. The Second Act amends the Emergency Shipping Fund Act of June 15, 1917 (40 Stat. 182), by adding a new provision authorizing the President to take possession and control of any street railroad or interurban railroad and all appurtenances commonly used in connection with the operation thereof necessary for the transfer and transportation of employees of shipyards engaged in the construction of ships for the United States. The act also contained the same provision for payment and suit against the United States as did the earlier act, and gave the President authority to exercise the powers conferred by the act through the several departments of the government and through such agencies as he should determine from time to time. The power and authority vested in the President by the act were conferred upon the Fleet Corporation by executive order dated June 18, 1918, 21 days after the requisition was issued and 13 days before it was recorded.

Some time after the executive order was issued the Fleet Corporation had a street railway track or loop constructed on the land in question, and entered into a contract with the Public Service Railway Company to run its cars upon this loop for the purpose of transporting employees to the yards of the New York Shipbuilding Company, in which ships for the United States were being constructed.

The plaintiff contends that, since the Fleet Corporation could requisition and condemn the land for one specific purpose only, the erection of houses thereon in which employees of shipyards could live, it could not thereafter, by virtue of another act of Congress, use it for the construction of a trolley track on which to carry employees of shipyards; that such use so soon after it was taken indicates that the land was originally taken for this purpose, which was not included in the Housing Act, and therefore the land was taken without authority. 'As it is clear,' complainant says, 'that the condemnation was for the purpose or the use to which the land was actually subjected, namely, trolley use, it is the position of the plaintiff in error that the whole proceeding was a nullity, since it was the taking of land from the very beginning for a use not authorized. ' The real question is whether or not the Fleet Corporation could, on May 28, 1918, requisition land 'suitable for the construction thereon of houses' under the Housing Act of March 1, 1918, and thereafter, under the power and authority given to the President and delegated by him to the Fleet Corporation, by the act of April 22, 1918, devote the land to a purpose other than that embraced in the Housing Act.

The Fleet Corporation filed a motion to dismiss the writ of error on the ground that the District Court was without jurisdiction because the New Jersey Supreme Court from which the cause was removed was without jurisdiction, for the reason that the United States, which may not be sued without its consent, is the real party in interest, and not the Fleet Corporation; that the United States has not given its consent to be sued in the state court, and consent is not conferred by removal. If this contention can be sustained, it is dispositive of the case, and it should therefore be considered before coming to the merits of the case.

The acts under which the land in question was requisitioned, provide, as before stated, that in case the amount of compensation determined by the Fleet Corporation was unsatisfactory to the owner, he should be paid 75 per centum, and thereafter be entitled to sue the United States, not the Fleet Corporation, for such further sum as would be just compensation for the property. The United States attorney in his official capacity is defending the Fleet Corporation. All of the shares of stock of the Fleet Corporation but seven, 499,993, are held by the United States Shipping Board for the United States, and the seven are held by the seven directors of the Fleet Corporation to qualify them as directors, and have never been paid for. It is evident that the United States is operating through the Fleet Corporation.

Ward v. Foulkrod (C.C.A.) 264 F. 627, 638. Therefore the Fleet Corporation contends that it is only a nominal defendant, and that the real defendant, though not named in the complaint, is the United States of America. Wells v. Roper, 246 U.S. 335, 38 Sup.Ct. 317, 62 L.Ed. 755. The suit being really against the United States, it cannot be sued except as provided in the act under which the land was requisitioned, in the District Court of the United States or the Court of Claims.

When a statute creates a right and provides a remedy, that remedy is exclusive. Wilder Manufacturing Co. v. Corn Products Co., 236 U.S. 165, 174, 175, 35 Sup.Ct. 398, 59 L.Ed. 520, Ann. Cas. 1916A, 118; United States v. Babcock, 250 U.S. 328, 331, 39 Sup.Ct. 464, 63 L.Ed. 1011. The act of March 1, 1918, created a right and provided a remedy which did not include the Supreme Court of New Jersey. Therefore it was excluded, and did not have jurisdiction if the United States is the real defendant. If the Supreme Court of New Jersey was without jurisdiction, the United States District Court did not acquire jurisdiction by removal although it might, in a like suit originally brought therein, have had jurisdiction. Courtney v. Pradt, 196 U.S. 89, 92, 25 Sup.Ct. 208, 49 L.Ed. 398; American Well Works v. Layne, 241 U.S. 257, 258, 36 Sup.Ct. 585, 60 L.Ed. 987; Lambert Run Coal Co. v. Baltimore & Ohio Railroad Co., 258 U.S. 377, 42 Sup.Ct. 349, 66 L.Ed. . . ., No. 153, October term, 1921, decided April 10, 1922.

It is true that when such officer of the government as the Postmaster General in his official capacity enters into a contract for the performance of government work, the interests of the government are so directly involved as to make the United States a necessary party, and in effect the real party, although not named in the bill. Wells v. Roper supra. But the Fleet Corporation occupies a different position. The act under which the corporation was organized was a war measure, and...