Pilger v. United States Steel Corp.
| Decision Date | 08 January 1925 |
| Citation | 127 A. 103 |
| Parties | PILGER v. UNITED STATES STEEL CORPORATION et al. |
| Court | New Jersey Court of Chancery |
Suit by Adolph Pilger against the United States Steel Corporation and others. Decree in accordance with opinion.
Arthur H. Bissell, of Montclair, and Boardman Wright and A. W. Lafferty, of New York City, for complainant.
Lindabury, Depue & Faulks, Richard V. Lindabury, and John W. Bishop, Jr., all of Newark, and William Averell Brown, of New York City, for defendant United States Steel Corporation.
Treacy & Milton and John J. Treacy, all of Jersey City, and Frederic R. Coudert and Mahlon B. Doing, both of New York City, for defendant Public Trustee and Custodian of Enemy Property for England and Wales.
FOSTER, V. C. Complainant, who is a subject and resident of Germany, by his amended bill seeks a decree determining that he is the owner of 500 shares of the stock of the defendant United States Steel Corporation, and asks that the Steel Corporation be decreed to transfer these shares to him upon its books, and to issue to him new certificates therefor, and, further, that this corporation be decreed to pay to him all accumulated dividends in its possession on this stock, and that the defendant Public Trustee be decreed to surrender for cancellation certificates for this stock now in his possession, and that the Public Trustee be further directed to pay to complainant all dividends he may have received on these shares of stock.
The defendant United States Steel Corporation, which is admitted to be a corporation of this state, by its answer asks in effect for the court's protection in the event that the relief sought by complainant is granted. A motion has been made by complainant to strike from the answer of this defendant the second, third, fourth, and fifth defenses presented therein. In view of the conclusion I have reached on the issue of jurisdiction, I will advise that this motion to strike be denied at this time.
The defendant Public Trustee appearing specially, under substituted service, has filed an answer in lieu of a plea to the jurisdiction of the court, alleging in effect that he is or represents the sovereignty of Great Britain, and that through him the Crown is being sued without its consent.
To these answers complainant has filed special replications. The matter is now before the court on the question of jurisdiction raised by these pleadings, and on complainant's motion to strike out the answer filed by the Public Trustee. The controversy is based upon the following facts set forth in the pleadings:
The shares of stock in question were originally owned by Shearson, Hammill & Co., a New York brokerage house, in whose name the certificates were issued. The certificates were duly indorsed in blank and sold by Shearson, Hammill & Co., and were finally bought by complainant, who deposited them some time prior to 1914 at the London Branch of the Dresdner Bank, a German corporation. At the outbreak of the Great War, these certificates were seized or taken possession of by the defendant, the Public Trustee, as Custodian of Enemy Property. This official still retains these certificates, and, like complainant, he claims to be the owner of the shares in the steel corporation which they represent. The Public Trustee denies jurisdiction in this court to determine the ownership of these shares, contending that he is immune from suit at the instance of complainant, a German national.
The grounds for this claim to immunity may be summarized as follows:
(1) The suit against him as Public Trustee is in effect against him as Custodian of Enemy Property for England and Wales, and is therefore a suit against the British government;
(2) a sovereign state cannot be sued in any court without its consent, and that the Crown has not consented to be sued herein; (3) the Public Trustee, as Custodian, is an indispensable party to the action, and as the court is without authority to obtain jurisdiction over the foreign sovereign state, by its process, and is likewise powerless to enforce its decree against a foreign sovereign, it is therefore without authority to hear and determine the issues involved in these proceedings; and
(4) that as the United States, in the Treaty of Berlin with Germany incorporated therein the provisions of the Treaty of Versailles granting immunity to this government and its agencies from any claim or action by Germany or any of its nationals for any matter or thing done during the war, that it must be held that this government incorporated these provisions for immunity for the benefit of itself, and also for the benefit of its Allies, as against the common enemy and its nationals.
In support of these contentions, the court's attention has been directed to two test suits, which were recently heard on an agreed state of facts, involving the claim of ownership made by certain German nationals to shares of stock in the steel corporation, in which action the Public Trustee was a party. These cases were decided in favor of the British government, by the Honorable Learned Hand, in the federal court in the Southern district of New York, and they are now on appeal in the United States Supreme Court.
The disposition of these cases affords no assistance in the present controversy, not only because as complainant contends they did not include or dispose of all of the issues involved herein, but because the question of jurisdiction over the Public Trustee was not raised nor considered in either case. *
The merits of the contentions presented by the Public Trustee questioning the jurisdiction of the court must be determined by the nature of the action and the relief which is sought, and this problem is simplified by the withdrawal, on the brief, of complainant's claim for a personal judgment against the Public Trustee. The withdrawal of this claim leaves the sole question for determination on final hearing, should the case reach that stage, the ownership of these shares of stock. And with this single question for determination the action is now what our courts have termed a proceeding quasi in rem. Andrews v. Guayaquil & Quito Ry. Co., 69 N. J. Eq. 211, 60 A. 568, affirmed 71 N. J. Eq. 768, 71 A. 1133; Sohege v. Singer Mfg. Co. 73 N. J. Eq. 567, 68 A. 64; Amparo Mining Co. v. Fidelity Trust Co., 74 N. J. Eq. 197, 71 A. 605, affirmed, 75 N. J. Eq. 555, 73 A. 249. Considering the suit as a proceeding quasi in rem, does the plea of the Public Trustee to immunity deprive the court of jurisdiction to hear and determine it? The answer to this question depends upon whether the Public Trustee as custodian is in fact a sovereign power, and, if he is, can he claim the privilege of non-suability in a proceeding of this nature?
The Public Trustee of England is an officer somewhat analogous to the office of public administrator in New York, but with much more extensive powers over property of the living as well as of the dead.
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- Pilger v. United States Steel Corp.
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Pilger v. U.S. Steel Corp.
...from Court of Chancery. Suit by Adolph Pilger against the United States Steel Corporation and the Public Trustee. From an adverse decree (127 A. 103), defendant Public Trustee appeals. John Milton, of Jersey City, and Frederick R. Coudert, of New York City, for appellant. Arthur H. Bissell,......