Page v. Wright

• Decision Date: 12 December 1940
• Docket Number: No. 7328.,7328.
• Citation: 116 F.2d 449
• Parties: PAGE v. WRIGHT.
• Court: U.S. Court of Appeals — Seventh Circuit

116 F.2d 449 (1940)

PAGE v. WRIGHT.

No. 7328.

Circuit Court of Appeals, Seventh Circuit.

December 12, 1940.

Gerald H. Page, of Peoria, Ill., and Wm. S. Warfield, Ill, and R. H. Merrick, both of Chicago, Ill., for appellant.

Morris Sider, Donald J. De Wolfe, and Harry D. Orr, Jr., all of Chicago, Ill., for appellee.

Before SPARKS, MAJOR, and TREANOR, Circuit Judges.

MAJOR, Circuit Judge.

This action was instituted by plaintiff, residuary legatee under the will of Georgia Owen Wright, to recover from the defendant, residuary legatee under the will of William Monroe Wright federal estate taxes alleged to have resulted from the improper inclusion in the estate of Georgia Owen Wright, for federal estate tax purposes, of a certain trust fund over which Georgia Owen Wright had a power of appointment under the will of William Monroe Wright. The District Court allowed plaintiff's motion for a summary judgment, entered March 25, 1940, from which this appeal was taken.

The validity of the judgment is assailed in numerous respects, including want of jurisdiction. A consideration of this question makes it unnecessary to state other issues or facts, except as they relate thereto.

Jurisdiction is claimed by reason of diversity of citizenship. Plaintiff's complaint, filed July 10, 1939, in the Northern District of Illinois, Eastern Division, after alleging that the "amount in controversy exceeds, exclusive of interest and costs, the sum of $3,000," states in Paragraph 1 "the plaintiff, Lucile Page, is a citizen of the State of Florida and the United States and is a resident of Coral Gables, Dade County, Florida"; and in Paragraph 2, "the defendant, Warren Wright, is a citizen of the State of Kentucky and of the United States, and resides in Fayette County, Kentucky." The oath attached to the complaint, made by plaintiff's attorney, states, "that the matters set forth in the foregoing complaint are true and correct, except as to the allegation of citizenship of the defendant, Warren Wright, which allegation is made upon information and belief." Defendant's answer, filed January 22, 1940, and subscribed to by defendant's attorney, in Paragraph 1, states: "This defendant admits that this court has jurisdiction of the parties hereto, and of the subject matter hereof." There is no other allegation or statement in the answer concerning jurisdiction.

Prior to the filing of this answer, however, defendant, by his attorney, on July 25, 1939, filed a motion to dismiss the action for failure to state a claim. Briefs were submitted by the respective parties, and on January 3, 1940, the court entered a memorandum opinion and overruled the motion to dismiss.

January 30, 1940, plaintiff filed a motion for summary judgment under Rule 56 of the Rules of Civil Procedure, 28 U.S.C.A. following section 723c. After oral argument, the court, on March 18, 1940, ruled for the plaintiff and ordered judgment. March 21, 1940, additional counsel appeared for the defendant and asked leave to withdraw the answer theretofore filed, and to file instanter an amended answer, which was presented to the court.

The only portion of the amended answer now material is that concerning jurisdiction, or, to be more specific, the citizenship of the defendant. The citizenship of the plaintiff was admitted as alleged in the complaint. As to the defendant, it stated: "Defendant denies that he is a citizen of the State of Kentucky, denies that he resides in Fayette County, Kentucky, and avers that he is a citizen and resident of the State of Florida, and resides in Miami Beach, Florida, and has so resided for more than two years last past." The answer alleged, in effect, that no diversity of citizenship existed inasmuch as both plaintiff and defendant were citizens and residents of the State of Florida. This proposed amended answer, subscribed to by the same attorney who subscribed to the original answer, further alleged: "That at the time of filing the original answer on behalf of the defendant in this cause, affiant failed to observe the allegation therein to the effect that the defendant, Warren Wright, was a citizen and resident of the State of Kentucky." The answer continued to the effect that the defendant also was not cognizant of the allegation in the complaint concerning his citizenship, and that when the defendant was apprised of the allegation in this respect, he instructed his attorney to correct the same.

March 25, 1940, defendant filed his motion to dismiss the cause for want of jurisdiction on the ground that there was no diversity of citizenship. This motion was supported by the affidavit of the defendant in which positive allegations were made that since the month of March, 1934, he had been a citizen and domiciled resident of Miami Beach, Florida, had exercised the rights of citizenship of that state, including the right to vote, and that he had never been a citizen of the State of Kentucky. March 25, 1940, the court denied leave to withdraw the original answer and to file the amended answer, and denied the motion to dismiss for want of jurisdiction.

It is defendant's contention that when it appeared to the court there was no diversity of citizenship, the cause should have been dismissed, or at least the court should have proceeded no further until the jurisdictional question was investigated and determined. On the other hand, it is contended by the plaintiff that inasmuch as the record disclosed jurisdiction, there was no duty upon the court to go behind the record even when offered proof that it was without jurisdiction. In this connection, it is argued by the plaintiff that under such circumstances, it was discretionary with the court as to whether it would permit the filing of a plea raising the jurisdictional issue.

In the beginning, we are dubious of the soundness of plaintiff's argument that the record, at the time the jurisdictional question was raised, was sufficient in that respect. Plaintiff's argument is predicated upon the premise that the defendant "specifically admitted the jurisdictional allegations of the complaint." This is an overstatement of defendant's admission. Defendant's admission was that the court had jurisdiction. Nothing was admitted regarding the factual allegations of the complaint upon which jurisdiction was claimed. In other words, the defendant admitted no facts from which the court could say, as a matter of law, that jurisdiction existed. Defendant's answer amounted to nothing more than consent on his part that jurisdiction be taken. As we shall later point out, jurisdiction can not be conferred in this manner. In addition, the plaintiff's allegation with reference to the citizenship of defendant was made only upon information and belief, so it appears there is nothing in the record to support the allegation that the defendant was a citizen of Kentucky except the belief of the attorney for the plaintiff. As stated, we have serious doubts as to whether a record of this character could be sustained in face of a direct jurisdictional attack. We need not come to a decision in this respect, however, and only discuss it in the beginning for the purpose of showing that plaintiff's premise of good jurisdictional averments is somewhat insecure.

Whether this premise be sound or otherwise, we now come to the more important question as to whether the court was duty bound to consider the jurisdictional question raised by the amended answer sought to be filed, or by the motion to dismiss supported by affidavit showing no diversity of citizenship. Defendant relies, of course, upon Section 5 of the Act of March 3, 1875, 28 U.S.C.A. § 80, and the decisions of the courts construing it. The pertinent language of the act provides: "If * * * it shall appear to the satisfaction of the said district court, at any time after such suit has been brought * * *, that such suit does not really and substantially involve a dispute or controversy properly within the jurisdiction of said district court, or that the parties to said suit have been improperly or collusively made or joined, either as plaintiffs or defendants, for the purpose of creating a case cognizable * * under this chapter, the said district court shall proceed no further therein, but shall dismiss the suit * * *."

In McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 56 S.Ct. 780, 80 L.Ed. 1135, the court made an extensive analysis of this provision, including a review of previous authorities. We do not regard the case as determinative of the question before us for the reason that the court was there dealing with a situation where the defendant had denied the jurisdictional averments. The case was reversed, the court holding that the burden was upon the plaintiff to prove its jurisdictional averments, which it had failed to do. In discussing the general question, however, the court used some pertinent language. On page 184 of 298 U.S., page 783 of 56 S.Ct., 80 L.Ed. 1135, it said: "* * The trial court is not bound by the pleadings of the parties, but may, of its own motion, if led to believe that its jurisdiction is not properly invoked, `inquire into the facts as they really exist.' * * *"

On page 189 of 298 U.S., page 785 of 56 S.Ct., 80 L.Ed. 1135, it said: "* * * The prerequisites to the exercise of jurisdiction are specifically defined and the plain import of the statute is that the District Court is vested with authority to inquire at any time whether these conditions have been met. * * * If his allegations of jurisdictional facts are challenged by his adversary in any appropriate manner, he must support them by competent proof. And where they are not so challenged the court may still insist that the jurisdictional facts be established or the case be dismissed, and for that purpose the court may demand that the party alleging jurisdiction justify his allegations by a preponderance of evidence. * * *"

In Morris v. Gilmer, 129 U.S. 315, 9 S. Ct. 289, ...