Wilson v. Am. Palace Car Co. of N.J.

• Decision Date: 22 September 1903
• Citation: 55 A. 997,65 N.J.E. 730
• Parties: WILSON et al. v. AMERICAN PALACE CAR CO. OF NEW JERSEY et al.
• Court: New Jersey Supreme Court

55 A. 997

65 N.J.E. 730

WILSON et al.

v. AMERICAN PALACE CAR CO. OF NEW JERSEY et al.

Court of Errors and Appeals of New Jersey.

Sept. 22, 1903.

(Syllabus by the Court.)

Appeal from Court of Chancery.

Bill by Wallace Wilson and others against the American Palace Car Company of New Jersey and others. Decree for plaintiffs (54 Atl. 415), and defendants appeal. Appeal dismissed.

Edward Q. Keasbey, for complainants.

Robert H. McCarter, for defendants.

DIXON, J. The bill in this case was filed by several stockholders in the American Palace Car Company of Maine, on behalf of themselves and such other stockholders as should come in, to restrain the American Palace Car Company of New Jersey from disposing of the property and assets of the Maine company, which, it alleged, had been transferred to the New Jersey company in August, 1897. By an amendment of the bill made in September, 1901, the Maine company was made a party defendant, and afterwards, by a supplemental bill, the American Palace Car Company of New York and George A. Denham, one of its incorporators and directors, were brought into the suit as defendants, For the purpose of objecting to the jurisdiction of the court, these three defendants have filed a joint and several plea, averring that none of them has any property or claims any right to any property within this state; that the property concerning which the suit is brought is not located within the state; that Denham is a resident and citizen of the state of Massachusetts; that the corporations exist under and by virtue of the laws of the states of Maine and New York, respectively, and have never made application for the right or privilege of transacting business under the laws of New Jersey; that neither of them has, or ever had, any office, agent, agency, or place of business within this state; and that no process or notice of the suit has been served upon any of these three defendants within the state. Not denying any of these averments, the complainants have procured an order overruling the plea and requiring the defendants to answer the bill, and from that order this appeal is taken.

The right of a defendant to raise the question of the jurisdiction of a court of equity, and to demand in limine the judgment of the court whether he should answer the bill, is clear. If the matter showing lack of jurisdiction appear on the face of the bill, the question is to be raised by demurrer; if not, a plea setting forth the matter is the proper course. Story's Eq. Pi. §§ 712, 714. Commonly, in former times, such a plea in the English courts of general jurisdiction was required to name another court in which the complainant might lawfully seek the relief desired, but this practice sprang out of the fact that those courts regarded every person as subject to their jurisdiction, unless he could designate a particular tribunal wherein, as a special privilege, he was to be sued. But in this country that fact cannot be predicated of either the federal or the state courts, or even of the governments under which they exist. The judicial authority over persons belonging to the Union is confined by the terms in which it has been delegated, and that belonging to each state is limited by the restriction which the federal Constitution imposes.

Hence, when a plea to the jurisdiction of a federal court shows the defendant to he outside of the delegated authority, or such a plea in a state court shows him to he within the restricted class, it becomes unimportant whether any other tribunal can afford the relief sought. Moreover, no such special privilege as was required to oust the general jurisdictions in England exists among us. Accordingly, in the latest form book, issued by a gentleman presumably skilled in practice, we find that the designation of another tribunal in such a plea is omitted. 1 Loveland's Forms of Fed. Prac. 47. The reason given in the court below for the order in question was that it was necessary or proper for the complainants to make these persons defendants in the bill, and that they ought to have an opportunity to defend the suit. This may be conceded, but it by no means follows that they can be obliged to submit to the jurisdiction, or that their presence is necessary to enable the court to deal with the rights of other parties in the suit. Mr. Daniel, in his excellent book on Chancery Practice, makes the following statements, which are supported by the cases to which he refers: "It is the constant aim of a court of equity to do complete justice by deciding upon and settling the rights of all persons interested in the subject of the suit, so as to make the performance of the order of the court perfectly safe to those who are compelled to obey it, and to prevent future litigation. For this purpose all persons materially interested in the subject ought generally, either as plaintiffs or defendants, to be made parties to the suit, or ought, by service upon them of a copy of the bill or notice of the decree, to have an opportunity afforded of making themselves active parties...