TEXAS & P R. CO. v. EASTIN & KNOX(1909)
This action was instituted by defendant in error against plaintiff in error, the Texas & Pacific Railway Company, hereinafter called the Texas & Pacific Company, and J. M. Tucker, its agent, for wrongfully billing and shipping 712 head of cows and calves via one road, though they were requested to be shipped via another, whereby they were required to go twice as far, and were seriously injured and damaged thereby.
It is alleged in the original petition that plaintiffs in the action, defendants here, were residents of the county of Jack, state of Texas; that Tucker resided in the county of Palo Pinto in said state, and that the Texas & Pacific Company 'is a body corporate, duly incorporated under the Federal statutes, with an office and station in the counties of Palo Pinto and Parker, in the state of Texas.' [214 U.S. 153, 154] The Texas & Pacific Company filed an answer, and, at the same time, filed a petition and bond to remove the cases to the circuit court of the United States for the northern district of Texas, sitting at Fort Worth. The petition alleged as the ground of removal that Tucker was improperly and wrongfully joined with the company for the sole and only purpose of preventing it from removing the case to the United States circuit court. That the suit against the company was a suit arising under the laws of the United States, and more especially under the law of the United States constituting the charter of the company, under which it was incorporated. Tucker adopted the statements of the petition and joined in the application for removal. The application was denied, and an exception was entered to the ruling. The Texas & Pacific Company, protesting against the right of the court to hear and determine the suit, filed its amended original answer, among other defenses alleging that 'it carried and delivered the cattle to Paris, Texas, safely and carefully on reasonable time,' and further alleging that the St. Louis & San Francisco Company was duly incorporated and operated its line of railway in Lamar county, Texas, and had a local agent at Paris, and that most of the damage complained of by plaintiff (defendant in error) occurred on the line of that road. The Texas & Pacific Company asked that the St. Louis & San Francisco Railroad Company be made a party defendant, and that citation be served on it; that it be required to answer in the case, and that, if plaintiff should recover against the Texas & Pacific Company, the latter have judgment against the St. Louis & San Francisco Company for all such damages as were caused by it.
Subsequently, a second amended original answer was filed by the Texas & Pacific Company, in which it enlarged its defenses, and, in what it called a 'special and separate answer,' averred its careful transportation of the cattle, and again averred the negligence of the St. Louis & San Francisco Company, and that, but for such negligence, the damages of [214 U.S. 153, 155] which plaintiffs complain would not have occurred. The prayer of the answer was as follows:
A citation was issued in accordance with this prayer, and the St. Louis & San Francisco Company was summoned to appear 'to answer the said amended answer of the Texas & Pacific Railway Company, filed as aforesaid on the 7th day of April, A. D. 1904.' The citation was duly served, together with certified copies of plaintiff's original petition and the amended answer of the Texas & Pacific Company, as directed by the citation. The St. Louis & San Francisco Company appeared in the action. In what is called its first amended original answer it demurred 'generally to the answer and cross action' of the Texas & Pacific Company, on the ground that the same failed to show a cause of action. The answer also denied all the allegations of the 'said pleadings of the Texas & Pacific Company,' set up other defenses, [214 U.S. 153, 156] and alleged that, if the cattle were damaged by delay in shipment, 'that the fault or liability' was that 'of the Texas & Pacific Railway Company in not routing said cattle as requested by the plaintiffs and as demanded by the exigencies of the shipment,' and 'prayed to be hence dismissed with its costs.' The issue thus made up was tried by the court, and resulted in a judgment against the Texas & Pacific Company and Tucker for $3,600, and a judgment against the St. Louis & San Francisco Company in favor of the Texas & Pacific Company for $1,800. All the defendants appealed to the court of civil appeals for the second judicial district, sitting at Fort Worth. That court reversed the decision, and remanded the case holding that the trial court erred in overruling the application for removal, and entertaining jurisdiction of the case. A motion for rehearing was made and denied, and the plaintiffs (defendants in error here) applied to the supreme court of Texas for writ of error, which was dismissed for want of jurisdiction, but was, on motion for rehearing, granted, and, on the 2d of May, 1906, the supreme court reversed the court of civil appeals, deciding that the case was not removable, and remanded the case for decision on the other questions.
On the return of the case to the court of civil appeals, that court, on the 16th of June, 1906, affirmed the judgment of the district court. A motion for rehearing was denied, and, on writ of error to the supreme court, the latter court affirmed the judgment of the court of civil appeals.
Messrs. W. L. Hall, Rush Taggart, and John F. Dillon for plaintiffs in error.
[214 U.S. 153, 157] Messrs. Thomas D. Sporer and H. C. McClure for defendants in error.
Mr. Justice McKenna, after stating the facts as above, delivered the opinion of the court:
The assignments of error present the question of the right of the Texas & Pacific Company to a removal of the case to the circuit court of the United States (1) Because, being a corporation chartered under an act of Congress, the suit was one arising under the laws of the United States, and that this character was not taken from it by joining a local defendant when it was an action to establish a joint liability. (2) Where the facts stated in the petition for removal show a cause properly removable from a state to a Federal court, the state court has no jurisdiction to pass finally upon them; that right is one for the Federal court, it having exclusive province of passing upon such questions of fact. [214 U.S. 153, 159] The first proposition is sustained in Re Dunn, 212 U.S. 374 , 53 L. ed.-, 29 Sup. Ct. Rep. 299; the second proposition is sustained in Chesapeake & O. R. Co. v. McCabe, 213 U.S. 207 , 53 L. ed.-, 29 Sup. Ct. Rep. 430. The latter case also decides that, if an application for removal be denied, the petitioner loses no right by being compelled to stay in the state court. In other words, that the petitioner may stay in the state court and defend the action against him, and, if the judgment go against him, bring the case to this court, and have the question of removal determined. But plaintiffs in error did not defend only against the cause of action. They instituted a cause of action against the St. Louis & San Francisco Railroad Company, in which the defendant in error had no concern, and recovered a judgment against that company in the sum of $1,800. By doing so they invoked the jurisdiction of the state court on their own account and for their own purpose, and the case is brought within the ruling in Merchants' Heat & Light Co. v. J. B. Clow & Sons, 204 U.S. 286 , 51 L. ed. 488, 27 Sup. Ct. Rep. 285.
The single question in this court in that case was the jurisdiction of the circuit court from which the case came. The Merchants Heat & Light Company, an Indiana corporation, contended that no jurisdiction had been obtained over it by the service which was made upon one Schodd, who, it was asserted by the plaintiff in the action, was an agent of the company. A motion to quash the return of service was made and overruled, and thereupon the company, after excepting, appeared as ordered and pleaded the general issue, and also a recoupment or set-off of damages under the same contract sued upon, and overcharges in excess of the amount ultimately found due to the plaintiff. There was a finding for the plaintiff of $9,082.21.
Whether the company was doing business in the state of Illinois within the meaning of the statutes of that state under which service was made, this court did not decide; but it did decide that the company, 'by setting up its counterclaim . . . became a plaintiff in its turn, invoked the jurisdiction of the [214 U.S. 153, 160] court in the same action, and, by invoking, submitted to it.' And this, notwithstanding the counterclaim arose, as it was said, 'out of the same transaction that the plaintiff sued upon, and so to have been in recoupment rather than in set-off proper.' It was further said: 'There is some difference in the decisions as to when a defendant becomes so far an actor as to submit to the jurisdiction, but we are aware of none as to the proposition that when he does become an actor in a proper sense he submits.' And the Texas & Pacific Company was an actor against the St. Louis & San Francisco Company upon a cause of action upon which it was its own choice to bring into the suit. On that cause of action it obtained a judgment against the St. Louis & San Francisco Company, and succeeded in having it affirmed by the supreme court of the state.
It would be carrying too far the right of a party who has petitioned for removal of a case to extend it beyond what is necessary to defend against the cause of action asserted against him. He should not be permitted to invoke the jurisdiction for affirmative relief and deny it afterwards. It must be remembered how amply his right of removal is protected. He may file the record in the circuit court of the United States, and thereby completely take jurisdiction from the state court.
Mr. Justice Peckham and Mr. Justice Day dissent.