Sherwood v. United States

Citation112 F.2d 587
Decision Date03 June 1940
Docket NumberNo. 306.,306.
PartiesSHERWOOD v. UNITED STATES.
CourtUnited States Courts of Appeals. United States Court of Appeals (2nd Circuit)

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Milton U. Copland, of New York City (M. Carl Levine and Morgulas & Foreman, all of New York City, on the brief), for plaintiff-appellant.

Sidney J. Kaplan, Sp. Asst. to Atty. Gen. (Harold M. Kennedy, U. S. Atty., of Brooklyn, N. Y., and Francis M. Shea, Asst. Atty. Gen., Maurice W. Hibschman, Atty., Dept. of Justice, of Washington, D. C., and Vine H. Smith, Asst. U. S. Atty., of Brooklyn, N. Y., on the brief), for the United States.

Before L. HAND, AUGUSTUS N. HAND, and CLARK, Circuit Judges.

CLARK, Circuit Judge.

This is an action by Jacob Sherwood, as judgment-creditor of Frederick Kaiser, brought against the United States of America and Kaiser, to recover damages claimed to be due Kaiser upon the latter's contract with the United States for the construction of a post office. Suit is brought in the district court upon the theory that the claim was one properly cognizable under the Tucker Act, 28 U.S.C.A. §§ 41(20) and 250, by which the United States consents to be sued in certain cases, in either the district court or the court of claims.1 Sherwood and Kaiser are both residents of the State of New York. Sherwood obtained his judgment against Kaiser in the New York Supreme Court, and pursuant to New York Civil Practice Act, § 795, he procured an order from that court permitting him to bring an action against the United States as a debtor of Kaiser, his judgment-debtor. Purporting to act under the New York order, he then brought the present action, wherein he joined Kaiser as a party defendant, as the New York statute provides.2 The motion of the United States to dismiss the complaint was granted and plaintiff appeals.

When this action was brought there was pending in the court below an action brought by the United States against Kaiser and the surety on his bond to recover damages for nonperformance of this same construction contract. The parties herein stipulated for the consolidation of this action with the earlier one and an order of consolidation was entered. Then the Government, though it had sought the consolidation, came to doubt the validity of that step and obtained a vacation of this action. Appellant did object to the vacating of the consolidation order, but does not press his objection here, being apparently quite content to keep his claim separate from the claim of the United States against Kaiser. But if we are correct in the views we set forth hereinafter, consolidation was a matter well within the discretion of the court. We shall refer to it because of the obvious procedural economy of judicial action it here presents. Unless we are prevented by some positive rule of law which embodies an overriding public policy, we think it in the public interest that these conflicting claims arising out of a single matter — Kaiser's performance or nonperformance of his contract with the United States — should be settled in one action. That is the trend of modern procedural reform, as exemplified by the new federal rules of civil procedure, in the development of which high officials of the appellee itself assumed such effective leadership.

Indeed, if the new rules are applicable, they justify the procedure which the court below originally followed. They furnish a reply to appellee's first contention that New York Civil Practice Act, § 795, ex proprio vigore, cannot confer any power to sue in the federal courts. We think Rule 17(b), Rules of Civil Procedure, is against this contention. That rule states that "the capacity of an individual, other than one acting in a representative capacity, to sue or be sued shall be determined by the law of his domicile." Compare Bicknell v. Lloyd-Smith, 2 Cir., 109 F.2d 527. Nothing in the law of the State of New York limits the capacity to sue conferred by Section 795 to a capacity to bring actions in the state courts alone.

It is argued that the new rules do not apply to Tucker Act cases brought in the district court. The intent that they should apply is made manifest throughout the rules. Rules 1 and 81 carefully provide that they shall apply to all suits of a civil nature, whether cognizable as cases at law or in equity, except those specifically excepted; and the character of the proceedings which it was thought necessary to except by express statement in Rule 81, as well as the language of these rules, shows that the new "civil action" includes actions against the United States. Careful protection of the rights of the United States as a party is made in various provisions, such as those giving the United States 60 days to plead, instead of the 20 days allowed the ordinary litigant, Rule 12(a); and see also Rules 4(d) (4), 13(d), 25(d), 37(f), 39(c), 45(c), 54(d), 55(e), 62(e), and 65(c). The official notes of the Advisory Committee show the Committee's view that while certain of the procedural provisions of the Tucker Act were continued intact others were modified by the rules.3 See also 1 Moore's Federal Practice 248-250.

We are cited to the high authority of Lynn v. United States, 5 Cir., 110 F.2d 586, as holding otherwise; and the court there seems prepared to go to the length of holding the rules wholly inapplicable to Tucker Act cases, although it is not clear that so broad a ruling was required in the case there presented. With all deference we cannot go so far; and we think the statute, 28 U.S.C.A. § 761, which was the court's authority for its view, persuades to the contrary. Only five sections of the statutes deal directly with procedure in Tucker Act cases. 28 U.S.C.A. §§ 761-765, Act of Mar. 3, 1887, §§ 4-7, 10, 24 Stat. 506, 507. Of these, 28 U.S.C.A. § 761 states that "The course of procedure for the district courts and the court of claims in cases under section 41, paragraph 20, and section 250 of this title, in so far as applicable and not inconsistent with sections 762 to 765, and the procedure prescribed for the court of claims shall be in accordance with the established rules of said respective courts, and of such additions and modifications thereof as said courts may adopt." Sections 762-765 contain no inconsistencies presently relevant.4 It has been held that so far as the rules modify these sections the rules prevail, United States v. American Surety Co., D.C.E.D.N.Y., 25 F.Supp. 700, but that question is not before us. If the new district court procedure does not apply under Section 761, we may well ask what procedure the district courts are to follow in adjudicating on claims against the United States. In Bates Mfg. Co. v. United States, 303 U.S. 567, 571, 58 S.Ct. 694, 696, 82 L. Ed. 1020, the Supreme Court pointed out that the Tucker Act was originally passed to relieve the congestion of claims in the court of claims for which the Government was to be justly censured, and to provide "adequate opportunity for expeditious and orderly determination of claims against the Government." To effectuate such a purpose, procedure carefully designed to secure orderly and expeditious settlement for all litigation would appear to be peculiarly apt.

Appellee reinforces its contention that the new rules are inapplicable by pointing out a difference in form of trial between this action and that with which it was originally consolidated. Under 28 U.S.C.A. § 41(20), trial of Tucker Act claims must be to the court without a jury, and Rule 39(c) expressly preserves that right. On the other hand, an action brought by the United States for breach of contract may be claimed for jury trial, and the Government's action against Kaiser and his surety has been claimed for such trial by the defendants. But it is a commonplace of the state code action, with its possible numerous and diverse issues, that different forms of trial may be necessary for different issues. Such necessity does not prevent the all-inclusive nature of the action and the procedural gains which result from a settlement of all angles of a dispute in a single adjudication. The new federal rules expressly adopt this practice. Form of trial is determined for each issue, not for the action as a single unit. Rules 38 and 39; James, Trial by Jury and the New Federal Rules of Procedure, 45 Yale L.J. 1022; Pike and Fischer, Pleadings and Jury Rights in the New Federal Procedure, 88 U. of Pa.L.Rev. 645.

Appellee goes further, however, and urges that with respect to claims against the United States the district courts exercise a special jurisdiction concurrent with the court of claims and similarly circumscribed. The Supreme Court cases make clear that this similarity is one of the substance of the rights and privileges of the claimants; there is nothing in them which asserts the necessity of identic procedure. Bates Mfg. Co. v. United States, supra; United States v. Pfitsch, 256 U.S. 547, 41 S.Ct. 569, 65 L.Ed. 1084. True, some cases in the court of claims refer to procedural obstacles as though they were jurisdictional. Thus in Waite v. United States, 57 Ct. Cl. 546, that court suggests its lack of jurisdiction to allow an intervening defendant to come into a suit on a claim before it. But a distinction should be made between the grant of power to adjudicate a claim against the United States and the manner or procedure by which that power shall be exercised. The statutory provision here, 28 U.S.C.A. § 41(20), 24 Stat. 505, allows the district court to hear claims "upon any contract, express or implied, with the Government of the United States, or for damages, liquidated or unliquidated, in cases not sounding in tort, in respect to which claims the party would be entitled to redress against the United States, either in a court of law, equity, or admiralty, if the United States were suable." This is a general grant of power in the circumstances stated, without limitation as to procedure. Indeed, the statute quoted above, 28 U.S.C.A. § 761, contemplates...

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  • United States v. Sherwood, 500
    • United States
    • U.S. Supreme Court
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    ...the District Court dismissing the complaint for want of jurisdiction was reversed by the Circuit Court of Appeals for the Second Circuit, 112 F.2d 587, which held that under Rule 17(b) of the Federal Rules of Civil Procedure, 28 U.S.C.A. following section 723c, respondent's 'capacity to sue......
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