Harrison v. St. Louis & San Francisco Railroad Company

The St. Louis & San Francisco Railroad Company, a corporation chartered under the laws of Missouri, and a citizen and resident of that state, owned, controlled, or operated, for the purpose of interstate and intrastate commerce, many hundreds of miles of railway in Oklahoma, and extending into adjoining states and beyond. These lines existed and were operated by the company; some, it may be, before the territory of Oklahoma was organized, and most, if not all, before Oklahoma was endowed with statehood. The lines composing the system originated in various charters, some enacted by Congress, accompanied with grant of land, and others by territorial grant. The unified system resulted from foreclosures, consolidations, etc. In 1908 the company was sued by a citizen and resident of Oklahoma, in a court of that state. On the ground of diversity of citizenship a petition and bond in due form and seasonable time were filed by the company for removal to the circuit court of the United States for the western district of Oklahoma. What action was taken by the state court does not appear, but presumably the petition was denied,-the following document having been issued by the secretary of state: State of Oklahoma.

Revocation of Charter of St. Louis & San Francisco Railroad     Company in Oklahoma.

Guthrie, Oklahoma, August 29th, 1908.

In the District Court.

Gertrude Goode, Administratrix of the Estate of Frank R.     Goode, Deceased, Plaintiff,

vs.

St. Louis & San Francisco Railroad Company, a Corporation,     Defendant.

Petition for Removal and to the Circuit Court of the United     States.

State of Oklahoma,

Comanche County:

Having received due and legal notice from J. T. Johnson,     judge of the district court of Comanche county, that the      above-named corporation defendant, St. Louis & San Francisco      Railroad Company, has filed a petition for removal to the      United States court, a certified copy of which is on record      in the office of the secretary of state at the Capitol in the      city of Guthrie, in the state of Oklahoma.

Therefore, I, Leo Meyer, assistant secretary of state and now     acting secretary of state of the state of Oklahoma, by      authority invested in me under § 4 of house bill No. 131,      approved by the governor of the state of Oklahoma, C. N.      Haskell, May 26th, 1908, do hereby declare the license of the      said St. Louis & San Francisco Railroad Company to transact      business in the state of Oklahoma forfeited and revoked.

In testimony whereof, I have set my hand and caused to be     affixed the great seal of the state.

Done at the city of Guthrie this 29th day of August, A. D.,     1908.

[Seal.]

Leo Meyer,

Acting Secretary of State.

Thereupon the suit which is now before us was commenced by the railroad company against the secretary of state and his assistant, seeking to enjoin them from giving effect to the certificate, or in any way disturbing or interfering with the company in carrying on business in the state. With much amplitude of statement the source and history of the title of the various railroads forming part of the complainant's system in Oklahoma were enumerated. In addition to asserting that rights secured to the corporation by the state Constitution had been denied by the action complained of, violations of the Constitution of the United States were specifically asserted on the following grounds: First, because the state law under which the secretary of state had purported to act, and the action taken thereunder, constituted an unwarranted interference on the part of the state and its officers with the judicial power of the United States; second, because the attempt to exclude the company from the state, and prevent it from doing business therein, under the circumstances stated, was repugnant to the commerce clause of the Constitution, the due process clause of the 14th Amendment, and the contract clause, the latter being based on the assertion that the congressional and legislative acts by which the roads forming part of the system of the company had been incorporated constituted contracts giving a right to do business in Oklahoma which that state had no power to impair. The court allowed a restraining order. The bill was demurred to on the ground of want of jurisdiction and want of equity. The demurrer was overruled. The court, in an elaborate opinion, expounded its reasons for so doing, holding that it had jurisdiction because of diversity of citizenship, the complainant being a citizen of Missouri, and the defendants, citizens and residents of Oklahoma. In reaching this conclusion, the court analyzed the various transactions, foreclosure, and consolidations, etc., by which the railroad company had acquired the lines composing its system, and held that there was nothing in any of them which destroyed the Missouri citizenship of the complainant. It moreover held in any event there was ample ground for jurisdiction because of the constitutional rights asserted.

As to the alleged want of equity in the bill, the court, after stating that the obvious purpose of the legislation under which the secretary of state had acted as deduced from its text, was to prevent the removal of causes from the state to a court of the United States, declared that the defendant in argument had so conceded. It was decided that the state was without authority to legislate to that effect, and therefore the law in question and the action of the secretary of state taken under it were void because of repugnancy to the Constitution of the United States. The answer, which was then filed, admitted the incorporation of the complainant in Missouri, and the citizenship in Oklahoma of the defendants, as well as the jurisdictional amount. The allegations of the complaint as to interference with the authority of the courts of the United States as to the commerce and contract clauses of the Constitution and the due process and equal protection clauses of the 14th Amendment were sought to be traversed by copious averments concerning the subject. Finally it was asserted, 1, that the Missouri corporation was never authorized to acquire any railroad in either the Indian or Oklahoma territory, and it therefore had no standing to assert as a Missouri corporation, its ownership and control of such roads as a basis for removal; 2, that in forming the line or lines of railway which constituted its system, the complainant had consolidated parallel and competing roads, in violation of the anti-trust laws of the territory and of the state of Oklahoma, as well as the law of the United States, and therefore the corporation was not in a position to assert its Missouri citizenship; and 3, that the acquisition by the complainant of various roads forming parts of its system, which were covered by charters granted by Congress or by Oklahoma territory, was in conflict with such charters, and for this reason, moreover, the corporation could not be heard to assert its Missouri citizenship. An exception of the complainant to the relevancy of the three grounds just stated was maintained, and they were stricken from the answer. By agreement between the parties, the present appellant, the successor in office as secretary of state, was substituted as defendant. Thereupon, the case having been submitted to the court on bill and answer, a decree was entered perpetually enjoining the secretary of state from giving effect to the order of revocation, or interfering with or disturbing the complainant in the transaction of its business in the state. It was expressly decreed that the act of the legislature of Oklahoma upon which the action of the secretary of state was taken was void and unenforceable because of its repugnancy to the Constitution of the United States. This appeal was then taken.

Mr. Charles West, Attorney General of Oklahoma, for appellant.

[Argument of Counsel from pages 323-325 intentionally omitted]

Messrs. W. F. Evans and E. T. Miller for appellee.

Statement by Mr. Chief Justice White

[Argument of Counsel from pages 325-327 intentionally omitted]

Mr. Chief Justice White, after making the foregoing statement, delivered the opinion of the court: