Ex Parte Schollenberger

PETITION for a mandamus to the judges of the Circuit Court of the United States for the Eastern District of Pennsylvania.

Schollenberger, a citizen of Pennsylvania, brought sundry suits in said Circuit Court against certain foreign insurance companies, upon policies which they had severally issued upon his property situate in that State and within the jurisdiction of the court.

Each company, before the issue of its policy, had accepted the provisions of the statute of the State, and, in compliance therewith, appointed its agent residing there, on whom process of law against it could be served. So much of the statute as bears on the question here involved is set out in the opinion of this court.

The service of the writs, which were sued out by Schollenberger, and executed, in accordance with the State law, on the agents of the several companies by them respectively specified for the purpose, and residing within the jurisdiction of the court, was quashed by the Circuit Court. On his petition, setting forth the foregoing facts, a rule was awarded upon the judges of that court to show cause why a writ of mandamus should not be issued out of the office of this court, commanding them to hear and determine the suits so brought in the said Circuit Court, and also to strike from the record certain orders dated the thirteenth day of April, 1878, whereby the service of the said writs was quashed, and thereupon to make such disposition of the suits as ought to have been made, had the said orders not been entered.

The judges, in their return, answered, that the facts were truly stated in the petition; that the respondents declined to hear and determine the said suits, because, in their opinion, the said Circuit Court had no competent jurisdiction thereof, the defendants not having appeared therein, or in any wise submitted to the jurisdiction of the court, and not having been at the commencement of the respective suits, or at any time, inhabitants of or found in the said district, within the meaning of the act of Congress of March 3, 1875, re-enacting a like provision of the eleventh section of the act of Sept. 24, 1789; that the question under this enactment being one of jurisdiction, and not of mere procedure, the statute of Pennsylvania, mentioned in the said petition, was, in the opinion of the respondents, inapplicable. The service of the process in the said suits was, therefore, set aside, as unauthorized.

Mr. R. C. McMurtrie and Mr. A. Sydney Biddle for Schollenberger.

1. The jurisdiction of the Circuit Court over the parties is indisputable. Schollenberger was a citizen of Pennsylvania. The corporations were created by other States, and by entering their appearance to the actions would have become subject to that jurisdiction, which would not be the case if the requisite citizenship of the parties to the record did not exist. Jones v. Anderson, 10 Wall. 327.

2. Mandamus is the appropriate remedy.

That writ goes to the archbishop, if exercising judicial functions, Reg. v. Canterbury, 11 Q. B. 483; to a court declining to exercise judicial functions imposed by law, Reg. v. West R. Justices, 1 New Sess. Cas. 247; to compel making a warrant of distress, St. Lukes v. Middlesex, 1 Wils. 133; on a refusal to act because of a statute which did not apply to the case, Reg. v. Bingham, 4 Q. B. 877; on a refusal to hear an appeal for reasons which were not legal ones, Reg. v. Middlesex, 2 B. C. R. 82; on a refusal because of an erroneous opinion as to sufficiency of grounds, Reg. v. Carnarvon, 1 G. & D. 423; or on erroneous point of practice, Reg. v. Kistevan, 3 Q. B. 810; on a refusal of the Circuit Court to take jurisdiction of a cause removed to it from a State court, Railroad Company v. Wiswall, 23 Wall. 567; on a refusal to grant an appeal to which a party is entitled, Ex parte Cutting, 94 U.S. 14; Ex parte Jordan, id. 248.

3. The State had a right to impose the prescribed conditions to the transaction of the business of insurance within her territory by the companies. Doyle v. Insurance Company, 94 U.S. 535; Lafayette Insurance Co. v. French, 18 How. 404; Railroad Company v. Harris, 12 Wall. 65. The latter having accepted them, and subsequently issued the policies which are the subject-matter of the suits in question, were bound to specify, and did specify, agents residing within the State upon whom process could be served. Service in the mode prescribed by the State law, upon such agents actually within the jurisdiction of the court, was, therefore, good under the act of Congress (17 Stat. 197), and had the same effect as if personally made within the eastern district of Pennsylvania upon the respective companies.

4. Each of the companies had, therefore, a habitat for the purposes of jurisdiction within that district, and was found there, within the meaning of the act of Congress of March 3, 1875 (18 Stat. 470). Knott v. Southern Life Insurance Co., 2 Woods, 479; Railroad Company v. Harris, supra.

Mr. Richard P. White, contra.

1. Mandamus is not the proper remedy.

The question raised on the motion below to quash the service of the writs was one of jurisdiction, and the judges in passing upon it were obviously acting in a judicial, and not in a ministerial, capacity. The proceeding may be reviewed on error; but it is not the office of a mandamus to compel an inferior court to reverse a decision made in the exercise of its legitimate jurisdiction. Ex parte Flippin, 94 U.S. 348.

2. The service of the writs was properly quashed. Each of the defendants was a foreign corporation, not having an existence, nor its officers any official character, outside the limits of the State which created it. Bank of Augusta v. Earle, 3 Pet. 519; Ohio & Mississippi Railroad Co. v. Wheeler, 1 Black, 286. It could not, therefore, be found within the district. Although the pretended service was according to the State law, the act of Congress requiring conformity of process and procedure did not make it good, if a court of the United States had no power to issue the writ, or proceed in the cause. That power cannot be derived from State legislation, Toland v. Sprague, 12 Pet. 300; Levy v. Fitzpatrick, 15 id. 167; Insurance Company v. Morse, 20 Wall. 445; and Congress, so far from conferring it, has prohibited a suit in the Circuit Court against a person not an inhabitant of nor found within the district.

The writs, for the service of which the statute of Pennsylvania provides, are, by an express limitation, confined to those sued out in actions brought in the tribunals of that State.

If, however, each company, by its acceptance of that statute, was constituted, pro tanto, a Pennsylvania corporation, then the Circuit Court had no jurisdiction, as both parties were, for the purposes of the suit, citizens of the same State. Where a corporation exists in two States, it cannot be sued in a Federal court by a citizen of either of them. Ohio & Mississippi Railroad Co. v. Wheeler, supra.

The decision of the Circuit Court is sustained by Pomeroy v. New York & New Haven Railroad Co., 4 Blatchf. 120; Day v. Newark India-rubber Manufacturing Co., id. 628; Southern Atlantic Telegraph Co. v. The New Orleans, Mobile, & Texas Railroad Co., 2 Cent. Law Jour. 88; and Stilwell v. The Empire Fire Insurance Co., 4 id. 88.

Railroad Company v. Harris, upon which great reliance is placed on the other side, was a suit brought in the District of Columbia against a foreign corporation doing business there, under an act which provided that service might be made upon the agent. Congress may undoubtedly regulate the mode of serving process in the courts of that District, and prescribe the conditions upon which foreign corporations may there transact business. Its power in that regard is the same as that of the several States within their respective limits, and no one questions that Pennsylvania can determine the manner in which writs issued by her own courts may be executed. That case differs essentially from this. Congress, by an act solely applicable to a specific territory, extended the jurisdiction of its courts to suits against a foreign corporation doing business there, when process should be served in the mode prescribed; while by the act of March 3, 1875, which governs here, it withholds from the Circuit Court jurisdiction over a defendant not an inhabitant of or found within the proper district.

The opinion in that case must, therefore, be understood with reference to the facts. Although not relating to the effect of State legislation upon the service of Federal writs, it evidently misled the learned judge of the fifth circuit in Knott v. Southern Life Insurance Co. It should also be borne in mind that the statute which he had under consideration differs from that of Pennsylvania, in requiring the foreign company doing business in Alabama to consent that service upon its agents there shall be sufficient, without restriction as to the courts out of which the writ may issue.

MR. CHIEF JUSTICE WAITE delivered the opinion of the court.