Riley v. New York Trust Co

• Decision Date: 16 February 1942
• Docket Number: No. 81,81
• Parties: RILEY et al. v. NEW YORK TRUST CO. et al
• Court: U.S. Supreme Court

315 U.S. 343

62 S.Ct. 608

86 L.Ed. 885

RILEY et al.

v NEW YORK TRUST CO. et al.

No. 81.

Argued Dec. 16, 1941.

Decided Feb. 16, 1942.

Rehearing Denied Mar. 16, 1942.

See 315 U.S. 829, 62 S.Ct. 903, 86 L.Ed. —-.

Mr. Dan MacDougald, with whom Messrs. James A. Branch, Robert S. Sams, and Aaron Finger were on the brief, for petitioners.

[Argument of Counsel from pages 343-345 intentionally omitted] Mr. Marion Smith, of Atlanta, Ga., for respondents.

Mr. Mortimer M. Kassell, of Albany, N.Y., for State Tax Commission of New York, as amicus curiae by special leave of Court.

Mr. Justice REED delivered the opinion of the Court.

Coca-Cola International Corporation, incorporated in Delaware, filed a bill of interpleader in a Delaware Court of Chancery against Julian Riley and Hughes Spalding, petitioners here, the Executors of Mrs. Julia M. Hungerford, with letters testamentary issued by the Court of Ordinary of Fulton County, Georgia, and against The New York Trust Company, the respondent, a New York corporation, as temporary administrator (afterward administrator c.t.a.) of the same decedent, appointed by the Surrogate's Court for New York County, New York.

The Georgia executors and the New York administrator each claim the right to have transferred to them in their representative capacity stock in the Coca-Cola corporation now on its books in the name of the decedent. The outstanding certificates are in Georgia in the hands of the Georgia executors. The parties are agreed, and it is therefore assumed that Delaware is the situs of the stock. In accordance with the prayer of the bill, the Delaware court directed the adversary claimants to interplead between themselves as to their respective claims.

The Georgia executors assert that original domiciliary probate of Mrs. Hungerford's will in solemn form was obtained by them in Georgia with all beneficiaries and heirs at law of testatrix, including her husband, Robert Hungerford, actual parties by personal service. These, it is conceded, were all the parties under the law of Georgia entitled to be heard on the probate of the will. The respondent administrator c.t.a. was not a party. The record of probate includes a determination by special finding, over the objection of the caveator, the husband, that the testatrix was domiciled in Georgia. The special finding was specifically approved as an essential fact to determine the jurisdiction of the Court of Ordinary by the highest court of Georgia in its affirmance of the probate. Hungerford v. Spalding, 183 Ga. 547, 189 S.E. 2.

These facts were alleged by petitioners in their statement of claim to the stock filed below in response to the decree of interpleader. Exemplified copies of the probate record of the several Georgia courts were pleaded and proven as were the applicable Georgia statutes governing domiciliary probate. From the facts alleged, petitioners inferred the conclusive establishment of the place for domiciliary distribution against 'all persons' and prayed the issue to them of new certificates. An offer was made to pay all Delaware taxes or charges on the stock. At the trial petitioners relied upon Article IV, Section 1, of the Federal Constitution,¹ the full faith and credit clause, as determinative of their right to the new certificates. The pleading and trial contention adequately raised the Constitutional question. Tilt v. Kelsey, 207 U.S. 43, 50, 28 S.Ct. 1, 3, 52 L.Ed. 95.

Respondent admitted that all parties entitled under the law of Georgia to be heard in opposition to probate were actually before the Georgia courts. It denied that Mrs. Hungerford was domiciled in Georgia or that the Georgia judgment of domicile and probate was binding on it, and averred testatrix' domicile at death was New York. It further averred that there were New York creditors of the estate interested in the proper and lawful administration of the estate, and that New York had certain claims for inheritance and estate taxes. Its own subsequent appointment by the Surrogate's Court of New York County, New York, on the suggestion of testatrix' husband and the State Tax Commission, was pleaded with applicable provisions of New York probate and estate tax law. By stipulation it was established that petitioners and the heirs and beneficiaries of testatrix, except her husband who was an actual party, were notified of the New York proceedings for probate only by publication or substituted service of the citation in Georgia and did not appear. As a domiciliary administrator c.t.a. the respondent prayed the issue to it of new certificates for the stock in controversy.

The trial court concluded from the evidence adduced at the hearings that the testatrix was domiciled in Georgia. It was therefore, as the court stated, unnecessary for it to consider the binding effect of the Georgia judgment.² The Supreme Court of Delaware reversed this finding of fact, determined that New York was testatrix' domicile and denied petitioners' contention that Article IV, Section 1, of the Constitution required the award of the certificates of stock to the Georgia executors. The Coca-Cola Corporation was directed to issue its stock certificate to the respondent, the New York administrator c.t.a. New York Trust Co. v. Riley, Del.Sup., 16 A.2d 772. Because of the importance of issues previously undecided by this Court, certiorari was granted to review the alleged error, to wit, the asserted denial of full faith and credit to the Georgia judgment. 313 U.S. 555, 61 S.Ct. 1105, 85 L.Ed. 1517.

The constitutional effect of the Georgia decree on a claim in his own name in another state by a party to the Georgia proceedings is not here involved.³ The question we are to decide is whether this Georgia judgment on domicile conclusively establishes the right of the Georgia executors to demand delivery to them of personal assets of their testatrix which another state is willing to surrender to the domiciliary personal representative⁴ when another representative, appointed by a third state, asserts a similar domiciliary right. For the purpose of this review the conclusion of Delaware that the testatrix was in fact domiciled in New York is accepted. The answer to the question lies in the extent to which Article IV, section 1, of the Constitution, as made applicable by R.S. § 905,⁵ nevertheless controls Delaware's action.

This clause of the Constitution brings to our Union a useful means for ending litigation. Matters once decided between adverse parties in any state or territory are at rest. Were it not for this full faith and credit provision so far as the Constitution controls the matter, adversaries could wage again their legal battles whenever they met in other jurisdictions. Each state could control its own courts but itself could not project the effect of its decisions beyond its own boundaries. Cf. Pennoyer v. Neff, 95 U.S. 714, 722, 24 L.Ed. 565. That clause compels that controversies be stilled so that where a state court has jurisdiction of the parties and subject matter, its judgment controls in other states to the same extent as it does in the state where rendered. Roche v. McDonald, 275 U.S. 449, 451, 48 S.Ct. 142, 72 L.Ed. 365, 53 A.L.R. 1141. This is true even though the cause of action merged in the judgment could not have been enforced in the state wherein the enforcement of the judgment is sought. Christmas v. Russell, 5 Wall. 290, 302, 18 L.Ed. 475; Fauntleroy v. Lum, 210 U.S. 230, 236, 28 S.Ct. 641, 643, 52 L.Ed. 1039.⁶ By the Constitutional provision for full faith and credit, the local doctrines of res judicata, speaking generally, become a part of national jurisprudence, and therefore federal questions cognizable here.

The Constitution does not require, McElmoyle v. Cohen, 13 Pet. 312, 328, 10 L.Ed. 177; Milwaukee County v. M. E. White Co., 296 U.S. 268, 276, 56 S.Ct. 229, 233, 80 L.Ed. 220, nor does Delaware provide that the judgments of Georgia have the force of those of her own courts. A suit in Delaware must precede any local remedy on the Georgia judgment. Subject to the Constitutional requirements, Delaware's decisions are based on Delaware jurisprudence. Her sovereignty determines personal and property rights within her territory. Subject to Constitutional limitations, it was her prerogative to distribute the property located in Delaware or to direct its transmission to the domiciliary representative of the deceased. State of Iowa v. Slimmer, 248 U.S. 115, 121, 39 S.Ct. 33, 34, 63 L.Ed. 158. The full faith and credit clause allows Delaware in disposing of local assets to determine the question of domicile anew for any inter- ested party who is not bound by participation in the Georgia proceeding. Thormann v. Frame, 176 U.S. 350, 356, 20 S.Ct. 446, 448, 44 L.Ed. 500; Overby v. Gordon, 177 U.S. 214, 227, 20 S.Ct. 603, 608, 44 L.Ed. 741; Burbank v. Ernst, 232 U.S. 162, 34 S.Ct. 299, 58 L.Ed. 551; Baker v. Baker, Eccles & Co., 242 U.S. 394, 400, 37 S.Ct. 152, 154, 61 L.Ed. 386. It must be admitted that this reexamination may result in conflicting decisions upon domicile, but that is an inevitable consequence of the existing federal system which endows its citizens with the freedom to choose the state or states within which they desire to carry on business, enjoy their leisure or establish their residences. Worcester County Co. v. Riley, 302 U.S. 292, 299, 58 S.Ct. 185, 187, 82 L.Ed. 268.⁷ But while allowing Delaware to determine domicile for itself, where any interested party is not bound by the Georgia proceedings, the full faith and credit clause and R.S. § 905, note 5, supra, do require that Delaware shall give Georgia judgments such faith and credit 'as they have by law or usage' in Georgia.

We note but need not discuss at length the respondent's contention that our application of Georgia law is limited to the statutes, decisions and usages of that state pleaded or proven in the Delaware proceedings⁸ and that for such further...