Petri v. Commercial Nat Bank of Chicago

• Decision Date: 18 January 1892
• Citation: 142 U.S. 644,35 L.Ed. 1144,12 S.Ct. 325
• Parties: PETRI et al. v. COMMERCIAL NAT. BANK OF CHICAGO
• Court: U.S. Supreme Court

142 U.S. 644

12 S.Ct. 325

35 L.Ed. 1144

PETRI et al. v. COMMERCIAL NAT. BANK OF CHICAGO.

January 18, 1892.

STATEMENT BY MR. JUSTICE FULLER.

The Commercial National Bauk of Chicago, a national banking association, duly organized under the laws of the United States in that behalf, and located in Illinois, brought suit, May 6, 1890, in the circuit court of the United States for the northern district of Texas, against A. C. Petri and Oswald Petri, citizens of the state of Texas, and doing business in that state under the firm name and style of A. C. Petri & Bro., to recover the amount of several drafts, held by the bank, drawn by Meyer & Sons Company, a corporation of Illinois, on the defendants and accepted by them.

The defendants demurred on the ground that the circuit court was without jurisdiction to entertain the suit, and also interposed certain defenses not drawn in question here. The demurrer was overruled, and final judgment given in favor of plaintiff for the sum of $3,328.66, with interest and costs, whereupon the defendants prosecuted a writ of error from this court to review the action of the circuit court upon the question of jurisdiction.

W. Hallett Phillips, for plaintiffs in error.

[Argument of Counsel from pages 644-647 intentionally omitted] John Selden, for defendant in error.

Mr. Chief Justice FULLER, after stating the facts in the foregoing language, delivered the opinion of the court.

The question is whether a national bank located in one state may bring suit against a citizen of another state in the circuit court of the United States for the district wherein the defendant resides, by reason alone of diverse citizenship.

National banks are empowered to sue and be sued, complain and defend, in any court of law and equity, as fully as natural persons. Rev. St. § 5136. The first national banking act—that of February 25, 1863, (12 St. c. 58, pp. 665, 681)—provided in section 59 that suits by and against banks organized thereunder might be brought in any 'circuit, district, or territorial court of the United States held within the district in which such association may be established;' and by the act of June 3, 1864, c. 106, § 57, (13 St. 99, 116,) there was added to this: 'Or in any state, county, or municipal court in the county or city in which said association is located, having jurisdiction in similar cases.' Both these provisions were carried into section 5198 of the Revised Statutes by the amendatory act of February 18, 1875, c. 80, (18 St. 316, 320.)

Following section 11 of the judiciary act, the first subdivision of section 629, Rev. St., conferred jurisdiction on the circuit courts of all suits of a civil nature at common law or in equity, where the matter in dispute, exclusive of costs, exceeded the sum or value of $500, and the suit was between a citizen of the state where it was brought and a citizen of another state; and by subdivision 10 jurisdiction was given 'of all suits by or against any banking association established in the district for which the court is held, under any law providing for national banking associations.'

Under section 1 of the act of March 3, 1875, determining the jurisdiction of circuit courts of the United States, and regulating the removal of causes from state courts, (18 St. 470,) the circuit courts had original cognizance of suits arising under the constitution, laws, or treaties of the United States, as well as of those in which there were controversies between citizens of different states; and by section 2 jurisdiction by removal in like cases was conferred.

Suits by or against national banks might therefore be brought or removed upon the ground of diverse citizenship, or of subject-matter, since, as they were created by congress, and could acquire no right, make no contract, and bring no suit, which was not authorized by a law of the United States, a suit by or against them was necessarily a suit arising under the laws of the United States. Osborn v. Bank, 9 Wheat. 738, 823; Bank v. Cooper, 120 U. S. 778, 781, 7 Sup. Ct. Rep. 777; Pacific Railway Removal Cases, 115 U. S. 1, 5 Sup. Ct. Rep. 1113. And of course national banks as well as state banks and individuals might bring or remove suits otherwise arising under the constitution, laws, or treaties of the United States. By the proviso to the fourth section of the act of congress of July 12, 1882, entitled 'An act to enable national banking associations to extend their corporate existence, and for other purposes,' it was provided 'that the jurisdiction for suits hereafter brought by or against any association established under any law providing for national banking assoclations, except suits between them and the United States, or its officers and agents, shall be the same as, and not other than, the jurisdiction for suits by or against banks not organized under any law of the United States which do or might do banking business where such national banking associations may be doing business when such suits...