Marrs v. Felton

• Decision Date: 23 June 1900
• Parties: MARRS v. FELTON et al.
• Court: United States Circuit Court, District of Kentucky

102 F. 775

MARRS v. FELTON et al.

United States Circuit Court, D. Kentucky.

June 23, 1900

Matt O'Doherty, for plaintiff.

Simrall & Galvin, for defendant Felton.

A. P Humphrey, for defendant Southern Railway of Kentucky.

On Motion to Remand to State Court.

EVANS District Judge.

The plaintiff, a citizen of Kentucky, has, in this action, sued jointly the Southern Railroad Company of Kentucky, a citizen of Kentucky, and S. M. Felton, the receiver of this court appointed in the suit of Samuel Thomas against the Cincinnati, New Orleans & Texas Pacific Railway Company, of which latter suit this court had jurisdiction solely upon the ground of diverse citizenship. The defendants here are charged with having, by their joint and concurrent negligence, caused the death of plaintiff's intestate in the concurrent negligence, caused the death of plaintiff's intestate in the yards at Lexington, Ky used jointly by the defendants, and by an engine operated by and in charge of, persons employed by them jointly. The receiver alone, a citizen of Ohio, removed the action to this court upon two grounds, viz.: First, that there is a separable controversy between him and plaintiff; and, second upon the ground that as he is the court's receiver, and sued as such, it is a suit 'arising under the constitution or laws of the United States. ' The plaintiff has moved to remand the case to the state court, and the very interesting questions arising on the motion, and growing out of the second ground for the removal, have received most careful consideration.

The first alleged ground of removal cannot be maintained, because there is no separable controversy. If the plaintiff and the receiver were the only parties to the action, the ruling made in Tompkins v. MacLeod (C.C.) 96 F. 927, would again be applied, even if the receiver were not a citizen of Ohio, not now so much because of the decision of Judge Taft in the case of Gilmore v. Herrick (C.C.) 93 F. 525, as upon the grounds presently indicated. However, in the absence of any other ruling in this circuit, and of any express decision on the exact point by the supreme court, I then felt bound by what Judge Taft had said. It is not altogether inadmissible, however, now to say that, upon further consideration, I am not altogether satisfied that the reasoning of the opinion in Tompkins v. MacLeod is entirely maintainable, although the result then reached was unavoidable, particularly as the necessary diverse citizenship of the parties to the suit in which the receivers had there been appointed was to be conclusively attributed to the parties to the suit then before me, and because the latter suit, being ancillary to the principal action, was controlled by cases like Pope v. Railway Co., 173 U.S. 577, 19 Sup.Ct. 500, 43 L.Ed. 814, and by removal drew to this court jurisdiction on those grounds. So that the result in Tompkins v. MacLeod was inevitable, whatever error there might be in the reasons given. The adverse citizenship attributed to the parties there and the ancillary character of the suit upheld the right of removal. The cases in which it has been held by the supreme court that a suit against a receiver of a federal court was, per se, one 'arising under the constitution or laws of the United States,' within the meaning of the removal acts, were cases where the corporation for which the receiver was appointed, was created under the laws of the United States; such, for example, as a soldiers' home (Butler v. National Soldiers' Home, 144 U.S. 66, 12 Sup.Ct. 581, 36 L.Ed. 346), or the Texas & Pacific Railroad Company (Railroad Co. v. Cox, 145 U.S. 593, 12 Sup.Ct. 905, 36 L.Ed. 829; Texas & P. Removal Cases, 115 U.S. 2, 5 Sup.Ct. 1113, 29 L.Ed. 319). But there does not seem to have been any case decided by the supreme court in which that doctrine was announced where the receiver was of a state corporation, though in Rouse v. Hornsby, 161 U.S. 590, 16 Sup.Ct. 611, 40 L.Ed. 818, the court incidentally, and possibly not authoritatively, as the question was not involved, remarked that 'if, as is said, the intervener, the railroad company, and the receivers were all citizens of Kansas, and this had been an action at law, and not a petition of intervention in the equity suit, the jurisdiction of the circuit court would nevertheless have been maintainable on the ground that it was one arising under the constitution and laws of the United States, in that the receivers were appointed by the circuit court, and derived their powers from, and discharged their duties subject to, those orders; and the right to sue as such, without leave of the court which appointed them, was conferred by section 3 of the act of March 3, 1887, c. 373 (24 Stat. 552). Railway Co. v. Cox, 145 U.S. 593, 12 Sup.Ct. 905, 36 L.Ed. 829; Tennessee v. Planters' Bank, 152 U.S. 454, 14 Sup.Ct. 654, 38 L.Ed. 511.'

An examination of the two cases last cited by the court will show that they do not in the slightest degree militate against what I have said, as in neither was there a receiver for a state corporation. Overlooking this fact, and the distinction which might thence arise, may have led to some uncertainty or misapprehension; and where, as in the case before us, the relief asked apparently depends upon principles of the general law, and not in any just sense upon the constitution or laws of the United States, it is quite difficult to see clearly how this suit is one which 'arises' under the constitution or laws of the United States. If the receiver, actually operating the railroad long after his appointment, negligently kills a man, the cause of action for damages therefor seems to arise out of that negligence, and not, in any easily perceived sense, to arise under the constitution or laws of the United States, even though previously thereto a federal court, in the exercise of its proper jurisdiction, had appointed the receiver, but the validity of whose appointment was not only not assailed, but, as here, was expressly recognized by the plaintiff in his pleading. It is true that the result of such action, if adverse to the receiver, must withdraw some of the assets from his hands as an officer of the court, and it just at this point, of course, that the legal question involved has arisen, many circuit courts holding that the suit in such cases against the receiver arises under the constitution or laws of the United States, because the receiver owed his existence as such, and his possession of the assets, to orders of the federal court. Landers v. Felton (C.C.) 73 F. 311; Sullivan v. Barnard (C.C.) 81 F. 886; Lund v. Railway Co. (C.C.) 78 F. 385; Gableman v. Railway Co. (C.C.) 82 F. 790; Gilmore v. Herrick (C.C.) 93 F. 525. Other circuit courts hold that the suit arose alone out of the acts complained of by the plaintiff, and that they could not be brought within the provisions of the removal act merely on account of the federal appointment of the receiver. Shearing v. Trumbull, 75 F. 33.

It seems to me, for the reasons presently to be stated, that the supreme court must be regarded as quite certain to hold that such cases arise under the constitution or laws of the United States only where the receiver is appointed under a statute of the United States, as in cases of national banks, or for corporations created by the laws of the United States, such as soldiers' homes and Pacific Railroad Companies, and not where a federal court, merely in the exercise of its general jurisdiction, has appointed a receiver for a corporation not existing under federal law, or for a partnership composed of individuals who, under the fourteenth amendment of the constitution, are citizens of the United States, and who would seem, for that reason, to have as good basis for removing a cause as would a receiver made such by mere judicial appointment. Reasoning to support a claim to remove such a case would appear but little less artificial than that which supports the doctrine now invoked. It may illustrate the proposition to note that in Society v Ford, 114 U.S. 635, 5 Sup.Ct. 1104, 29 L.Ed. 261, it was held that the mere fact that a suit in a state court is brought on a judgment recovered in a federal court does not entitle the defendant to remove, and the inquiry might be suggestive as to what would give more potency in this connection to an order of appointment of a receiver than to a judgment of the same court. Neither one is a 'law' of the United States. In Germania Ins. Co. v. Wisconsin, 119 U.S. 473, 7 Sup.Ct. 260, 30 L.Ed. 461, it was held that a suit cannot be said to be one arising under the constitution or laws of the United States until it has in some way been made to appear on the face of the record that some title, right, privilege, or immunity, on which the recovery depends, will be defeated by one construction...