COUNTY- OF .
GOLD MIN. CO.
COUNTY OF YUBAV. PIONEER GOLD MIN; Qo. and others.
(Circuit Court, N. D·. Ca,lifornia. August l;l9,1887.) 1.
REMOVAL OF CAUBES"-AcT OF MARCH
S, 1887. Under section 1 of !tIle removal act, as amended by an act of March 3, 1887, the circuit court c<annot of a suit brought against a party in a district of which he is not an mhabitant; and section 2 does the removal of a suit brought in a state court against 8 party not an:inhabitant of the district.
Section 2 of said act, as amended, does not authorize the removal of a suit from a stiLte court to the United States circuit court, which could not have boen,originally brought.in said circuit court. ' . < St!uabtU by the Co'urt.). ri
SAWlER, J., (FmLD, Justice, and SABIN, J.,C(mcttmng.) The county ofYllba-a county of the state of. California-brought a suit inequity, in the superior court of Yuba county, against the Pioneer Gold Mining Compa,ny, and the Cleveland & Sierra Gold Mining Gompany,-two corporations,-both organized in the state of Nevada, and existing under the laws of that state. The defendant,thePioneer Gold Mining Company, .removed the case from the state court to the United States circuit courh under the act of :March 3,1887, on the ground that the complainant is a citizen of the :Qf .California, and the defendants are. citizens of the state of Nevada. The'question now presented, is, whether the act March 3,1887, removal of this case? and we are all of the opinion that it does not. So far as applicable to this question, the act of 1.8&7 ,.§ 1, provides that, "the circuit courts oithe United States shall ,have the courts of the several states,of all .original cogniutnce, concurrent. 13uits of: a. civil nature, at law, or in equity, * * * in which there shall be a controversy between. citizens of different states, * * * and no civil suit shall be brought before either of said courts, against any by any original' process of [doubtless, intended to be l 01: '] proceeding, in any other district tlwn that whereof he is an inhabitant." The habitation of ,a corporation, is: necessarily, in the state under whQse laws it It can have no other, and it is only recognized in states and countries, upon principles of comity. Clearly, under the express and pointed prohibitory clause quoted, under this section alone, could not have originally brought in this court j and it could not have original jurisdiction, or, in the language of the act, "original cognizance," because a slJ,it anywhere in the state of California, would not of the defendants is an inhabitant. be in the district whereof It is insisted on the partoUhe that the prohibitory Cll,tUlle is limited by the words, "original process of proceedingj" that
the prohibition does not extend to cases brought before the court by any other than "original process of proceeding," and does not prohibit a re-· moval of a suit from a state court. But section 1, to which we must look for jurisdiction, does not provide for, or authorize, the obtaining of jurisdiction by removal, or otherwise. It defines and limits the jurisdiction of the courts, and goes no further. Section 2 is the section, that authorizes removals, anddeclll:1'es what cases may be removed. . The ,of section 2 which covers this 98Se, if any, authorizes the removal of "any other suit of a civil nature, at law or in equity, of which the circuit courts of the United State8. are given jurisdiction by the preceding sedim," to say,by section LBut section 1 does not give jurisdiction of a suit brought against defendants, who are :not inhabitants of the district wherein the suit is brought. Such a s'.1it cannot be brought in the circuit court, nor can the court obtain jurisdiction under section 1. Strike section 2 from the act, and no jurisdiction at all could be obtained. If the court can have jurisdiction by removaktheiefore; it must get it :by virtue of the provisiolls:ofsection 2, and not of the provisions of section 1; and section 2 only authorizes a removal of a case over which Jurisdiction is given by section 1, thUll referring to section 1 for the classes 'Ofcases that areauthor.ized to be removed. Section 2, therefore, does not reach this case. It iselear to our minds, that congress only intended to authorize the removal of such cases, as could be brought originally, in the United States courts, and in the court to which the removal is to;be made. A consideration of the statute, it stood before the amendment, and the practice under it apparently sought to be changed, sustains this view. The limiting prohibition in section of the old statute, was in these words: "And no civil suit shall be .brought before either of said courts, against any person by any original process or proceeding in any other district than that whereof he is an inhabitant, 01' in which he shall be found at the time of serving lfUch process, or commencing si"Ch proceeding." Thus, a party under the old act, could be sued out of the district of his residence, provided he could be found, and served in another district, where the suit was brought. But this last clause was cut off by the amendment, and now he cannot be sued, at all in the national courts, out of the district whereof he is an inhabitant. So, under section 2, of the act before the amelldment, in the case of "any suit at law, or in equity," with the other necessary requisites "between citizens of different states," "either party may remove said· suit into the circuit court,': ete., without any limitation by reference to the first section giving jurisdiction. Under this act, it was the practice, to bring a: suit in the state court, get such service as they could, by publication of summons, and :the defendants would often, then, appear, and remove the case, or the plaintiff, after appearance of defendant, would remove it; and thus it large number of cases, which could not be originally brought in the circuit courts, was brought into those courts from the state courts in this roundabout way. The present act was, apparently intended to abolish this practice, and in many other respects to limit the jurisdiction of the
DOW 'l1. MEMPHIS & L. R. R. CO.
chcuit courts. One mode of limiting the jurisdiction WIlS to cut off, by amendment, the authority to entertain jurisdiction of aU cases against parties residing out of the district, whether found in the district or not, by omitting the clause quoted from section 1; and another" was, by amending the general language of section 2, by introducing the limitation of the right of removal to suits over which the courts had jurisdiction by section 1; that is to say, to such suits as could be, originally, brought in the circuit court. If this be not the proper construction, then it is difficult to what office these amendments, making such express limitations. were intended to perform. They were, certainly, introduced for a purpose, and that purpose seems obvious to us. The clause in section 1, "where the jurisdiction is founded only on the fact that the action is between citizens of different states, suits shall be brought only in the district of the residence of either plaintiff, or defendant," is prohibitory in form. It does not enlarge the jurisdiction, or confer jurisdiction in a case otherwise expressly prohibited. We are of opinion that the removal of this case is not authorized by the statute, and it was improperly removed. It follows that the case must be remanded to the state court, with costs, and it is so ordered.
Dow and others
& L. R. R. Co.
(Oircuit Oourt, 8. Dl N(Jlf) York, January 19, 1885.)
RAILROAD COMPANIES-MoRTGAGE-COMPENSATION OF TRUSTEES.
A mortgage for $2,600,000, given to trustees for the security of the holders of the mortgage bonds, provided that the trustees should be allowed a reason· able oompensation for executing their trust. Held that, in the defense of an action to !let aside the mortgage, the trustees were entitled to only 1 per cent., the compensation allowed by Rev. St. N. Y. 8th Ed. pt. 2, o. 6, art.. 3, § 58, to trustees for receiving and paying out sums of more than $10,000.
In Equity. PlaU & Bawers, for plaintiffs. DiJ1an & Swayne, for defendant.
WALLACE, J. The defendant filed a bill to set aside a mortgage for $2,600,000 to trustees, for the holders of the mortgage bonds. 22 Blatchf. 48,19 Fed. Rep. 388. The mortgage, among other things, provided that the trustees should receive a reasonable compensation for executing their trust. The trustees filed the present cross-bill, and obtained a decree adjudging the complainant to pay to the amount of compensation to which they are entitled, and the costs, charges, and expenditures which they have incurred in defending their trust, by reason of the suit brought to set aside the mortgage. It was referred to a master to take an account and report. He has reported that they should be allowed the sum of $17,000 for counsel fees, and an additional sum