PACIFIC RAILROAD REMOVAL CASES

• Citation: 115 U. S. 1
• Decision Date: 04 May 1885
• Court: United States Supreme Court

Pacific Railroad Removal Cases

Argued November 20-21, 1884

Decided May 4, 1885

115 U.S. 1

N ERROR TO THE CIRCUIT COURT OF THE UNITED

STATES FOR THE DISTRICT OF KANSAS

Page 115 U. S. 2

Syllabus

Corporations of the United States, created by and organized under acts of Congress, are entitled, under the Act of March 3, l875, 18 Stat. 470, to remove into the circuit court of the United States suits brought against them in state courts on the ground that such suits are suits "arising under the laws of the United States."

The Union Pacific Railway Company is, as to its road, property and franchises in Kansas, a corporation de facto created and organized under acts of Congress, and as to the same in Nebraska, it is strictly and purely a corporation deriving all its corporate and other powers from acts of Congress.

The Texas & Pacific Railway Company is also a corporation, deriving its corporate powers from acts of Congress.

These companies are entitled, under the Act of March 3, 1875, to have all suits brought against them in state courts removed to circuit courts of the United States on the ground that they are suits arising under the laws of the United States.

An objection that a petition for removal was not verified by oath or that there was delay in filing it may be waived by delay in taking the objection.

In Missouri, a proceeding before a mayor of a city and a jury to take land for widening a street and to ascertain the value of the land taken and to assess the cost thereof on the property benefited is not, while pending there, a suit at law within the meaning of the Act of March 3, 1875, authorizing the removal of causes, but it becomes such a suit at law when transferred to the circuit court of the state on appeal.

In proceedings, under the Act of the Legislature of Missouri, passed in 1875, for the widening the streets of Kansas City, the Union Pacific Railway Company had a controversy distinct and separate from like controversies of other owners of land affected by the proceedings, and the fact that the removal of the controversy of the railway company to the circuit court of the United States may have an indirect effect upon the proceedings in the state courts as to the other owners furnishes no good reason for depriving the company of its right to remove its suit.

The questions argued and decided in these cases arose under the statutes regulating the removal of causes from state courts. The facts in regard to each case are stated in the opinion of the Court.

Page 115 U. S. 3

MR. JUSTICE BRADLEY delivered the opinion of the Court.

The principal question involved in these cases is whether a suit brought in a state court against a corporation of the United States may be removed by such corporation into the circuit court of the United States, on the ground of its being a corporation organized under a law of the United States. The plaintiff in error in four of the cases is the Union Pacific Railway Company, and in the other three cases is the Texas & Pacific Railway Company. They contend that they have such a right of removal, either under the removal Act of July 27, 1868, 15 Stat. 227, now forming § 640 of the Revised Statutes, or under the Act of March 3, 1875, entitled "An act to determine the jurisdiction of circuit courts of the United States, and to regulate the removal of causes from state courts, and for other purposes," 18 Stat. 470, or both. Whether the corporations of the United States, organized under acts of Congress, have or have not this right of removal is the principal question in these cases.

The suits were all brought in state courts against the said corporations severally. In the first case, Myers, a switchman at Armstrong, in Kansas, sued the company for an injury alleged to

Page 115 U. S. 4

have been sustained by him through the carelessness of the company or its agents in the construction of the coupling of its cars. The company filed an answer, and at the same time a petition for the removal of the cause to the Circuit Court of the United States for the District of Kansas, and the proper bond required by the law. The petition for removal stated that the petitioner was a corporation other than a banking corporation, and organized under a law of the United States, namely, an act of Congress entitled

"An act to aid in the construction of a railroad and telegraph line from the Missouri River to the Pacific Ocean, and to secure to the government the use of the same for postal, military, and other purposes,"

"approved July 1, 1862, and that, in accordance with said act and the acts amendatory and supplemental thereto, the petitioner had exercised and did exercise its corporate functions and powers. The petition then proceeded as follows:"

"That February 1, 1880, pursuant to § 16 of the said Act of July 1, 1862, and of the Act of July 2, 1864, the Kansas Pacific Railway Company, a corporation created by the Territorial Legislature of Kansas and organized under the laws of said territory, and the Denver Pacific Railway & Telegraph Company, a corporation created and organized under the laws of the Territory of Colorado, both of which said companies are mentioned in said acts of Congress, and their said railroads by said acts made a part of the Union Pacific Railroad system, were, by agreement, consolidated with the Union Pacific Railroad Company. Your petitioner and said consolidated company, by agreement, as by said acts authorized, assumed and adopted the name of the Union Pacific Railway Company, which company consolidated, assumed, took, and from thenceforth had and has by virtue of said agreement of consolidation possession and ownership of all the railroads and other property, real and personal, of said constituent companies, and has and does operate and manage the same under and by authority of said acts of Congress, and is governed and controlled by said acts, and is to all intents and purposes, and in fact, a corporation under the laws of the United States. "

Page 115 U. S. 5

"That the plaintiff, Abram Myers, has sued your petitioner, the Union Pacific Railway Company, process in this suit having been served on its agents, and your petitioner has appeared thereto and filed its answer; that the matter and amount in this suit above entitled exceeds, exclusive of costs, the sum or value of five hundred dollars; that your petitioner has a defense to said action arising under and by virtue of the aforesaid laws of the United States; that said suit has not been tried, nor has it been ready for or stood for trial, and the present is the first term of the court at which it could have been tried."

The petition concluded with the proffer of the proper bond, and a prayer for an order of removal, and that the court would proceed no further in the cause. The bond was approved and an order of removal was made. On filing the record in the circuit court of the United States, a motion was made to remand the cause to the state court, and it was remanded accordingly, the circuit judge holding that the suit was not one arising "under the Constitution and laws of the United States" within the meaning of the Act of Congress of March 3, 1875, and that a suit cannot be removed from a state to a federal court upon the sole ground that it is a suit by or against a corporation organized under the laws of the United States. To the judgment remanding the cause, the writ of error was sued out in this Court.

The next case, Union Pacific Railway Company v. City of Kansas, was a proceeding instituted by the common council of said city by ordinance passed in April, 1880, for widening a street through the depot grounds of the company, and thereby taking a portion of its said grounds and the property of many other persons. A jury was summoned in November, 1880, before the mayor to inquire and find the value of the property taken for the street and to assess the amount upon surrounding property benefited thereby. On December 12, 1880, this jury found the value of the company's property taken equal to ,305, and assessed, as benefits, upon the remaining property of the company the sum of ,325 toward paying the damages for widening the street. The verdict was confirmed by the mayor and common council February 25, 1881. The laws

Page 115 U. S. 6

of Missouri give to any party dissatisfied with the award of the jury in such cases an appeal to the Circuit Court of Jackson County (in which Kansas City is situated), and the Union Pacific Railway Company and some other dissatisfied parties filed separate appeals, and the proceedings were certified to the said court, where the said appeals were by the law directed to be tried "in all respects, and subject to the same rules and the same law as other trials had in the circuit court, and the same record thereof made and kept." After the case was certified to the circuit court of Jackson County, the company in due time, April, 1881, filed a petition for removal of the case to the Circuit Court of the United States for the Western District of Missouri. The petition, as in the case of Myers, set out the incorporation of the company and the consolidation of the three companies before mentioned under the acts of Congress, before referred to, by the name of the "Union Pacific Railway Company." The petition then proceeds to state as follows:

"And your petitioner, by agreement of said constituent companies, succeeded to, had, and possessed all the rights and privileges and property, real and personal, which was of said constituent companies, or either of them, and that at the time of commencement of this proceeding, your petitioner had owned and possessed, exclusive of all other rights and claims, the tract of land described in said proceeding, as follows [it then describes the land of the company taken for the street, and then states as follows:] and that the same had been acquired by the Kansas Pacific Railway Company for depot and other railway purposes by authority of law, and that your p...