YPSILANTI PAPER CO.
(Circuit Oourt. E. D. Michigan. January 3, 1888.)
COURTS-FEDERAL JURISDICTION-ASSIGNMENT-CITIZENSHIP-ACT OF MARCH
8. 1887. An action to recover damages for a refusal to accept and pay for merchandise purchased under an oral contract, is a suit to recover the contents of a cho8e in action, within the meaning of the act of March 3,1887, and the circuit court has no jurisdiction of such suit in favor of an assignee, unless it might have been prosecuted in such court if no assignment had been made. (Syltabu8 by the CQurt.)
On Motion to Set Aside Nonsuit. action upon contract to recover damages for the refusal This was of the defendant, the Ypsilanti Paper Company, to accept and pay for 300 tons of rags which it had agreed to buy of the firm ofS. Simons & Son. One member of this firm being a citizen of Michigan, the firm as· signed the cause of action to the plaintiff, the other mem ber of the firm, who was averred in the declaration to be a citizen of Russia, and a subject of the czar of Russia. Defendant pleaded to the jurisdiction, and upon the trial plaintiff submitted to a nonsuit, and thereupon made this motion to set the same aside. Conely & .Lucking, for plaintiff. Charles R. WhitrtWll/, and George S. Hosmer, for defendant. BROWN, J. The only question raised upon the trial relates to the capacity of the plaintiff, who is an alien, to maintain this action as the assignee of S. Simons & Son, one of which firm was, and still is, a citizen of this state. By the aet of March 3, 1887, the circuit court has no jurisdiction "of any suit except upon foreign bills of exchange to recover the contents of any promissory note or other chose in action in favor of any assignee, or of any subsequent holder, of [if] such instrument be payable to bearer, and be not made by any corporation, unless such suit might have been prosecuted in such court to recover the said contents, if no assignment or transfer had been made." The precise point in this case is whether an action for damages for the refusal of the defendant to accept and pay for goods purchased by it under an oral contract is an action to recover the contents of a chose in action within the meaning of this act. These words, it must be admitted, are not very happily chosen, and it would have conduced somewhat to the clearness of a very obscure and unintelligible act if the simple language of the statute of 1875, "founded upon contract," had been retained. These words, however, were taken from the original judiciary act of 1789, and in the 85 years which elapsed between the passage of that act and the act of 1875 their meaning was settled by repeated judicial interpretations. Primarily they were intended to apply to commercial instruments, such as promissory notes, acceptances, and bonds, in which the sum promised to be paid is familiarly spoken of as the "contents" of such instrument. But the words v.33F.no.4-13 .
"other chose in action" suggested a much broader meaning; and as early as 1810, in Sere v. Pitdt, 6 Cranch, 332, it was held.that a suit by the assignee of an insolvent deboor for the collection of llccounts and unliquidated claims was within the exception ofthe statute. The: main objeetio,n to the jurisdiction was based upon the ground that the words of the aCt wei'Edrit'en'd.'Eld to apply only to: assignments made by 'the party himself,andnQt to the general assignee of an insolvent company, and in deChief Justi<:e MARSHALL observes "that the term is broad. en0!lgh to comprElh\:lI\<teither case, and the worddoonteDts'is too ambiguous in its import to restrain that general term. The contents of a note are the sum it shows 'to be due, and the same may, without much violence to language, be said of an account. ,t The same .l>rinciple was applied Wilkinson Y. Wilkinson, 2 Curt. 582, tOaill1ctioli by an assignee'to recover the proceeds of sitltisof mortgaged property, ilnd in Bradley v. Rhiriea'Adm'rs, 8 Wall. 39S;tG> an action upon a lease and f6rltnoliey had alld received. These cases s'rafull authority for the position that if the defendant had actually' accepted and received the rags in question this suit could 'not have been mamtained to recover the putchase price. In ShelilMtv,"SUl, 8 How. 441, a ·bill in equity to foreclose a mortgage was helcHo'bea suit to recdverthe contents of a chose ib.'actiOn, and not maintainable by an assignee who had taken title from. Ii Citizen of the · same state as the defendant. Mr. JusticeGRI-ER observed that the term "chose in actioril'wasoneof comprehensive import;· "it includes the infinite variety of contracts, covenants, and promises which confer on one party a right tdrecover a persQnlilohattel, or sum Of money from another byaction.";· That the ootirt subsequently receded from.ll·portion of this language is evident from the Case of Deshler v. Dodge, 16 How. 622, in . which ,an action 'of replevin· Was held not to be within the exception of the statute.! the phrase "right to recover a personal chattel," used in. the opinion in 'Sheldon v. Sill, was not intended' to authorize a recovery in: Ipeci,e, or ;damages 'for a tortious injury to property, but ll. remedy on the contratlt for the breach of it,whether such contract'was for the payment ofmoney or the deliveryofa personal chattel. It was held, tbatthe restrictI-ve words of ·the statute applied only to cases in which a suit was brought to recover the contents: or to enforce the contract contained in the instrum'ent· assigned. We know of no case, however, where the court has intimated that an action upon an express contract was not 'within the exception of the statute· . The cases whioh are claimed to have a different bearing, and are chiefly relied upon ·15y the plaintiff here, are Barney v. Bank,: 5 :Blatchf. 107, and BushneU v/Kennedy, 9 Wall; 387,.' The first of these bases waBan action against a corporation to recover..dkmages for a bretitlh Of an implied con;; tract in neglecting to protest and give notice in regard to certain drafts forwarded to it by acorrespondetlt';bank, and .It: was held that· the Buit was not one tore.cover the contents of achose in action in fuvor of an assignee. The court takes an Qbvious and clear distinction between rights . ofaction founded upon contracts-which contracts within them-
selves sonie pton'lise"otdritytobe perfdrIned-and' J:Ilere naked rights of action founded upon some wrongfulact;-some neglect or breach ofduty to which the'la,\lattaches'damages. , "A suit," said Judge SlUPMAN, "to compel the performance of thatptomise or duty byseeuring to the plaintiffthat which is withheld by the defendant is a. suit to recover the conmere right ofaction to recoverdamages tents of a chose in action;" imposed by la.w for a delinquency is not within the prohibition of the statute,and:the obJectidD to the jurisdiction fails. ' It is difficult by anyamplificationofthislanguage to make the' distinction any clearer than it is made by the learned judge himself in delivering this opinion. In Bushnell v. Kennedy, this opinion was quoted with approval, and the chief justice reiterates the language of the previous cases, that under the comprehensive description of suits to recover the contents of chose in ac,tion was included lIan debts, and all claims'for damages for breach of contract, or for torts' connected with contract." The case, however, went off on a different point. We perceive nothing in either of these cases militating againstthe position assumed by the defendant here. That there was no intention on the part of the court to throw discredit upon Serey.f,itQt, is evident from the still more'recent case of (Jo'rbiii 'to County oj Elack Hawk, 105 U. S. 659, in which a suit to compel thespecific performance ofa contract, or to enforce its other stipulations, was held to be a suit to recover the contents of a chose in action, and was not maintainable in the circuit court by an assignee, if it could not have been prosecuted there by the assignor, had no assignment been made. The contents of a contract as a chose in action were defined to be "the rights created by it in favor of the party in whose behalf stipulations are made in it which he has a right to enforce in a suit founded upon thecontract, and a suit to enforce such stipulations is a suit to recover such contents." ,With regard to the case upder consideration it was said that the promise to receive the money stipulated in these contracts to be paid by the purchaser was, so far as this suit was concerned, the essence of the conto entract; and a suit to compel the acceptance of that money was a force such promise, and therefore a suit to recover the contents of the contracts. Most of the previous cases are quoted and affirmed, and there is nothing to indicate that the court intended to qualify in any way its previous definitions. From this summary of decided cases it is quite evident that when the action is founded upon an express promise between the original parties it cannot be prosecuted by the assignee of the original promisee, unless the action would have lain by the assignor; but that the statute does not apply to actions ofreplevin to recover specific chattels, and perhaps also to actions UPOll implied promises which involve the breach of a legal duty, and which also might be brought in tort as well as in contract. No distinction is intimated between oral and written contracts, and none can be justly inferred from the language of the act. The words "or of any sub'sequent holder, if suchirietrument be payable to bearer, and be llotmade by any corporation," were not intended as anew limitation, and are re'fe-rable only to the written 'instruments previously mentioned. The clause
was introduced for the purpose of nullifying a series of decisions under the act of 1789, which held that promissory notes and other written instruments payable to a person named "or bearer" were not within the exceptions of the statute, because the promise was in law made directly to the bearer, and he did not take by assignment from the person named. We are clear in our opinion that it was not intended to qualify or limit in any way the words "other chose in action." A right of action upon an oral contract is as much a chose in action as if the contract were in writing. The motion to set aside the nonsuit, and for a new trial, must be denied.
CITY OF NEW ORLEANS. STEWART t7. SAME. NEW ORLEANS PACKING & CANNING Co.
(Ofrcuit Oourt; E. D. Louisiana.
COURTS-FEDERAL JURISDICTION-AcT OF MARCH
Held, that where the transfer of choses in action requires an assignment, the court has no jurisdiction over cases where an assignee is plaintiff. unless the court would have had jurisdiction llad the action been brought by the assignor.
Hela" that where the transfer of choses in action may be made by delivery. and the obligation is made to bearer, and by a corporation, and the parties to the suit are citizens of different states, the court has jurisdiction, although had the suit been brought by a former holder the court would ha.ve had no jurisdiction.
(SyUabu8 by th8, Oourt.)
At Law. On plea to the jurisdiction. Herman Newgass, a German citizen, sued the city of New Orleans on certain claims assigned to him by citizens of New Orleans; John Garrity, a citizen of Kentucky, sued the New Orleans Packing & Canning Company, a corporation of the state of Louisiana, on certain claims asto him by citizens of Louisiana; and C. H. Stewart, a citizen of Alabama, sued the city of New Orleans on certain certificates of indebtedness issued by the city, and payable to bearer. Charles Louque, for plaintiffs Newgass, Stewart, and Garrity. W. H. Rogers,' for defendant city of New Orleans. Nicholls & Carroll, for defendant New Orleans Packing and Canning Company.
BILLINGS, J. These cases are submitted .upon the same exceptions; i. e., upon the same plea to the jurisdiction. In each case is presented for construction that part of the act of 1887 which restricts the jurisdie-