South Carolina State PA v. Seaboard Air Line R. Co.

• Decision Date: 23 September 1954
• Docket Number: 3754.,3752,No. 3751,3751
• Citation: 124 F. Supp. 533
• Court: U.S. District Court — District of South Carolina
• Parties: SOUTH CAROLINA STATE PORTS AUTHORITY, Plaintiff, v. SEABOARD AIR LINE RAILROAD COMPANY and North Charleston Terminal Company, Defendants. SOUTH CAROLINA STATE PORTS AUTHORITY, Plaintiff, v. SOUTHERN RAILWAY COMPANY and North Charleston Terminal Company, Defendants. SOUTH CAROLINA STATE PORTS AUTHORITY, Plaintiff, v. ATLANTIC COAST LINE RAILROAD COMPANY and North Charleston Terminal Company, Defendants.

124 F. Supp. 533

SOUTH CAROLINA STATE PORTS AUTHORITY, Plaintiff, v. SEABOARD AIR LINE RAILROAD COMPANY and North Charleston Terminal Company, Defendants.

SOUTH CAROLINA STATE PORTS AUTHORITY, Plaintiff, v. SOUTHERN RAILWAY COMPANY and North Charleston Terminal Company, Defendants.

SOUTH CAROLINA STATE PORTS AUTHORITY, Plaintiff, v. ATLANTIC COAST LINE RAILROAD COMPANY and North Charleston Terminal Company, Defendants.

Nos. 3751, 3752, 3754.

United States District Court E. D. South Carolina, Charleston Division.

September 23, 1954.

COPYRIGHT MATERIAL OMITTED

Robert McC. Figg, Jr., Charleston, S. C., D. W. Robinson, Jr., Columbia, S. C., for plaintiff.

Buist & Buist, Charleston, S. C., James S. Cremins, Norfolk, Va., for defendant Seaboard Air Line R. Co.; Barnwell & Whaley, Charleston, S. C., for defendant Southern R. Co.; Hagood, Rivers & Young, Charleston, S. C., for defendant Atlantic Coast Line R. Co.; Coming B. Gibbs, Charleston, S. C., for defendant North Charleston Terminal Co.

WYCHE, District Judge.

These actions were removed from the Court of Common Pleas for Charleston County, South Carolina, under Section 1441(a), U.S.C.A., Title 28, which authorizes the removal of "any civil action * * * of which the district courts of the United States have original jurisdiction * * *." The question has arisen whether they are actions of which this Court has original jurisdiction, and the actions have been consolidated for the purpose of its determination.

At the outset it must be remembered that the United States District Court is a court of limited, not of general, jurisdiction; all presumptions are against the jurisdiction of a United States District Court so that the facts disclosing the jurisdiction must affirmatively appear upon the record; jurisdiction cannot be conferred by the mere consent of the parties to the suit and the question of jurisdiction, whether or not raised by the parties, is always, during the progress of the case, before the federal courts, both trial and appellate. Dobie on Federal Procedure, Section 16, page 25.

"Due regard for the rightful independence of state governments, which should actuate federal courts, requires that they scrupulously confine their own jurisdiction to the precise limits which the statute has defined." Healy v. Ratta, 292 U.S. 263, 270, 54 S.Ct. 700, 703, 78 L.Ed. 1248.

The petitions for removal allege that diversity of citizenship exists between the plaintiff and the petitioners, and also that the actions arise under the Interstate Commerce Act, § 1 et seq., U.S. C.A., Title 49, and are removable under §§ 1331 and 1337, U.S.C.A., Title 28.

The removing defendants Seaboard Air Line Railway Company, Southern Railway Company and Atlantic Coast Line Railroad Company are corporations created by the laws of states other than the State of South Carolina.

The plaintiff South Carolina State Ports Authority was created by legislation of the State of South Carolina. South Carolina Code of Laws 1952, § 54-1 et seq. It is governed by a board, the members of which are appointed by the Governor, with the advice and consent of the Senate. It has the powers of a body corporate, including the power to sue and be sued. Its property is not subject to any taxes or assessments, and "all net * * * earnings not necessary or desirable for the operation of its business shall be held subject to the further action of the General Assembly." The General Assembly has annually appropriated in the State's general appropriation acts for its operation since 1942, the year in which it was created, including a total of $750,000 appropriated specifically for "Operating Capital and Maintenance of Port Facilities." 44 St. at Large, pp. 1669, 1723; 45 St. at Large, pp. 683, 2177.

Section 54-11, Code of Laws of South Carolina 1952, provides that "Through the Authority the State may engage in promoting, developing, constructing, equipping, maintaining and operating the harbors or seaports within the State, namely Beaufort, Charleston and Georgetown, and works of internal improvement incident thereto, including the acquisition or construction, maintenance and operation at such seaports of * * * terminal railroads, as well as other kinds of terminal facilities, * * *." Section 54-13 provides that "The Authority is created as an instrumentality of the State for the accomplishment of" general purposes which include development and improvement of the harbors or seaports of Beaufort, Charleston and Georgetown for the handling of waterborne commerce from and to any part of the State and other states and foreign countries and the fostering of the shipment of freight and commerce through said ports, whether originating within or without the State. It is given broad power of eminent domain, and under Section 54-17 it may take, exclusively occupy, use and possess, insofar as may be necessary to carry out its functions, any areas of land owned by the State, not in use for State purposes, in the counties in which the State's seaports lie, including swamps and overflowed lands, bottoms of streams, lakes, rivers, bays, the sea and arms thereof and other waters of the State and the riparian rights thereto pertaining.

Like the South Carolina Public Service Authority (which was created earlier by similar legislation, S.C.Code of Laws, 1952, § 59-1 et seq.), the plaintiff Authority, "as an agency of the State, is also in a real sense a part of the State, and shares in its sovereignty;" and "is completely identified with the State in the performance of its public functions, which are unquestionably of a governmental character." Rice Hope Plantation v. South Carolina Public Service Auth., 216 S.C. 500, 59 S.E.2d 132, 138, 139; Cf. South Carolina Elec. & Gas Co. v. South Carolina Public Service, 215 S.C. 193, 54 S.E.2d 777, 786.

There is no statute which authorizes the removal of a suit between a state and citizens on the ground of diversity of citizenship, for a state cannot, in the nature of things, be a citizen of any state, Stone v. State of South Carolina, 117 U.S. 430, 6 S.Ct. 799, 29 L.Ed. 962; Query v. 206 Cases of Assorted Liquor, D.C., 49 F.Supp. 693, and the conclusion is inescapable that a suit by the South Carolina State Ports Authority is a suit by the State of South Carolina. Arkansas v. Texas, 346 U.S. 368, 74 S. Ct. 109, 98 L.Ed. ___; DuPont v. South Carolina Public Service Authority, D.C. E.D.S.C., 100 F.Supp. 778; Connor v. South Carolina Public Service Authority, D.C.E.D.S.C., 91 F.Supp. 262.

Section 1331, U.S.C.A., Title 28, provides that the district courts of the United States shall have original jurisdiction of all actions wherein the matter in controversy exceeds the requisite jurisdictional amount "and arises under the Constitution, laws or treaties of the United States." Section 1337 confers original jurisdiction on district courts "of any civil action or proceeding arising under any Act of Congress regulating commerce * * *." Under these sections, jurisdiction does not rest on diversity of citizenship. Cf. Mulford v. Smith, 307 U.S. 38, 46, 59 S.Ct. 648, 83 L.Ed. 1092; Owens v. Greenville News-Piedmont, D.C., 43 F.Supp. 785.

The complaints in the instant actions allege that each of the defendant carriers is engaged in South Carolina in its business of transporting, as a common carrier, freight and passengers for hire, including the transportation of freight to and from points of origin or destination within the Charleston switching limits; that the North Charleston Terminals of the plaintiff are port facilities in the port of Charleston, being deep water terminals located on the Cooper River in the Charleston switching limits, to and from which oceangoing steamships operate and at which they receive and discharge freight; that such terminals consist in part of a freight or marshalling yard, with which the tracks of the several carriers are connected, and from which railroad tracks run to the dock and shipside thereon and to warehouses and industries located therein; that on various dates between April 28, 1947, and March 31, 1953, "the plaintiff, at the instance and request of" the carriers, "switched * * * loaded freight cars, some of said freight cars being moved by the plaintiff from the aforesaid freight or marshalling yard (to which said cars had been moved by the defendants" to shipside on the said dock and to the said warehouses, and to the said industries located therein, as a part of and in completion of their transportation under the bills of lading issued thereon, and some of said freight cars being moved by the said plaintiff from shipside on the said dock, and from the said warehouses, and from the said industries located therein, to the said freight or marshalling yard (from which they were then moved by the defendants) as a part of and beginning their transportation under the bills of lading issued thereon"; and "that the services rendered by the plaintiff to the defendants in the switching of the said freight cars, as aforesaid, were reasonably worth and of the value of" amounts set forth in each complaint obviously arrived at in proportion to the number of cars switched for each carrier, for recovery of which amounts the plaintiff seeks judgment.

The claims stated in the complaints are based upon implied contracts on the part of the defendants to pay the reasonable worth of the services alleged to have been rendered by the plaintiff at their request. Cf. Blowers v. Railway, 74 S.C. 221, 54 S.E. 368, 369 (in which the Court recognized and applied the principle that "`where one who is under no legal or moral obligation to do so renders services to another at his request, or with his knowledge and acquiescence, the law raises an implied promise on the part of the person receiving the services to pay what they are reasonably worth'"); Klebe v. United States, 263 U.S. 188, 192, 44 S.Ct. 58, 68 L.Ed. 244, in which the Court recognized that the law will imply a...