In re Louisville Underwriters/Opinion of the Court

This is a petition by a corporation of the state of Kentucky for a writ of prohibition to the judge of the district court of the United States for the eastern district of Louisiana, to prohibit him from entertaining jurisdiction of a libel in admiralty in personam, filed April 23, 1889, by the Natchez & New Orleans Packet & Transportation Company, also a corporation of Kentucky, against the petitioner, 'in a cause of contract civil and maritime,' upon a policy of insurance by which the petitioner insured against perils of the seas and rivers, and other perils, a steam-boat of the libelant employed in the navigation of the Mississippi river.

By Pub. Laws, La. Feb. 26, 1877, No. 21, no insurance company organized under the laws of any other state shall take risks or transat any business through an agent in Louisiana, without having filed in the office of the secretary of state a certified copy of a vote of its directors appointing such an agent there to transact business, and to take risks, accompanied by a warrant of appointment from the company containing an express consent that service of legal process on him shall be as valid as if served on the company. By a copy of the record of the proceedings in the district court annexed to the return to the rule to show cause why a writ of prohibition should not issue, it appears that the libelee had filed with the secretary of state of Louisiana a copy of a vote of its directors, as well as a warrant of appointment, appointing William M. Railey its attorney at New Orleans, as required by the statute of Louisiana; that the policy sued on was signed by the libelee's president and secretary at Louisville, in the state of Kentucky, was not to be binding until countersigned by its authorized agent at New Orleans, and was countersigned by Railey; that a citation to the libelee was issued by the district court, and served by the marshal upon Railey in person; that a motion to quash the libel, and an exception to it, upon the ground, among others, that neither party was an inhabitant of the eastern district of Louislana and that the libelee had no property or credits within the district, were overruled by the district court, and the libelee ordered to answer; and that the libelee thereupon answered, and took depositions under commission. Before the cause had been brought to a hearing, the petition for a writ of prohibition was presented to this court.

It is admitted that the district courts of the United States, sitting in admiralty, have jurisdiction of the matter of the libel. Insurance Co. v. Dunham, 11 Wall. 1. But it is argued, in support of the prohibition, that no libel in personam can be sustained against a corporation in a district not within the state in which it is incorporated; and this argument is rested on the latter part of the following provision in the act of March 3, 1887, c. 373, § 1: 'But no person shall be arrested in one district, for trial in another, in any civil action before a circuit or district court; and no civil suit shall be brought before either of said courts, against any person by any original process of proceeding in any other district than that whereof he is an inhabitant.' 24 St. 552. A brief reference to previous acts of congress and decisions of this court makes it clear that this provision has no application to causes of admiralty and maritime jurisdiction. By the ancient and settled practice of courts of admiralty, a libel in personam may be maintained for any cause within their jurisdiction, wherever a monition can be served upon the libelee, or an attachment made of any personal property or credits of his; and this practice has been recognized and upheld by the rules and decisions of this court. Rule 2 in Admiralty; Manro v. Almeida, 10 Wheat. 473; Atkins v. Disintegrating Co., 18 Wall. 272; Insurance Co. v. Navigation Co., Id. 307; Cushing v. Laird, 107 U.S. 69, 2 Sup. Ct. Rep. 196; In re Manufacturing Co., 108 U.S. 401, 2 Sup. Ct. Rep. 894. The judgment, delivered at October term, 1873, in Atkins v. Disintegrating Co., just cited, is really decisive of this case. The question there presented was the construction of that provision of the judiciary act of September 24, 1789, c. 20, § 11, by which, after defining the jurisdiction of the circuit courts in 'suits of a civil nature at common law or in equity,' in which the United States were plaintiffs, or an alien was a party, or the suit was between a citizen of the state where it was brought and a citizen of another state, and also defining the criminal jurisdiction of the circuit and district courts, it was provided as follows: 'But no person shall be arrested in one district for trial in another, in any civil action before a circuit or district court; and no civil suit shall b brought before either of said courts, against an inhabitant of the United States, by any original process in any other district than that whereof he is an inhabitant, or in which he shall be found at the time of serving the writ.' 1 St. 79.

Upon a consideration of the acts of congress upon the subject, and especially of other sections of the judiciary act of 1789, of which section 9 conferred upon the district courts 'exclusive original cognizance of all civil causes of admiralty and maritime jurisdiction,' and jurisdiction concurrent with the circuit courts of certain 'suits at common law' by the United States, (1 St. 77,) section 21 authorized 'final decrees in a district court, in causes of admiralty and maritime jurisdiction,' to be reviewed in the circuit court on appeal, and section 22 authorized 'final decrees and judgments in civil actions in a district court,' to be reviewed in the circuit court by writ of error, (1 St. 83, 84,) it was demonstrated that the provision of section 11, above quoted, restricting 'civil suits' to the district of which the defendant was an inhabitant, or in which he might be found, did not include causes of admiralty jurisdiction; and it was therefore adjudged that a libel in admiralty, in personam, might be maintained against a corporation by attachment of its goods in a district not within the state in which it was incorporated. The provisions of sections 9, 11, 21, 22, of the judiciary act of 1789, above quoted, were re-enacted in substantially the same words in the Revised Statutes. Rev. St. § 563, cls. 4, 8; § 629, cls. 1-3; §§ 631, 633, 739. The provision of section 11 of the act of 1789, embodied in section 739 of the Revised Statutes, was re-enacted, with no material alteration, in the act of March 3, 1875, c. 137, § 1, as follows: 'But no person shall be arrested in one district, for trial in another, in any civil action before a circuit or district court; 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, or in which he shall be found at the time of serving such process, or commencing such proceeding.' 18 St. 470. The only changes beyond the substitution of 'person' for 'inhabitant of the United States,' consisted in inserting in the middle of the sentence, after the words 'any original process,' the words 'or proceeding,' and in substituting at the end of the sentence, for the words 'serving the writ,' the words 'serving such process, or commencing such proceeding.' These changes in no way extended the meaning of the leading words, 'civil action' and 'civil suit,' but merely affected the mode of commencing such action or suit, and were probably in tended to cover actions at law commenced otherwise than by process, according to the practice, pleadings, and forms of proceeding in the courts of the states, which had been made applicable to the circuit and district courts of the United States by the act of 1872, re-enacted in the Revised Statutes. Act June 1, 1872, c. 255, § 5, (17 St. 197;) Rev. St. § 914. The provision of the act of 1887 on which the petitioner relies differs from the corresponding provision of the act of 1875 in two particulars only: (1) In the clerical mistake, 'process of proceeding' for 'process or proceeding,' which has been set right by the act of 1888, correcting the enrollment of the act of 1887. Act Aug. 13, 1888, c. 866, § 1, (25 St.433.) (2) In striking out the last clause, permitting civil suits to be brought in the district in which the defendant is found at the time of service, and thus confining them to the district of which he is an inhabitant. This change, far from weakening the reason of the decision in Atkins v. Disintegrating Co., above cited, greatly strengthens it.

Courts of admiralty are established for the settlement of disputes between persons engaged in commerce and navigation, who, on the one hand, may be absent from theirh omes for long periods of time, and, on the other hand, often have property or credits in other places. In all nations, as observed by an early writer, such courts 'have been directed to proceed at such times, and in such manner, as might best consist with the opportunities of trade, and least hinder or detain men from their employments.' Zouch, adm. 141. In the same spirit, this court has more than once said: 'Courts of admiralty have been found necessary in all commercial countries, for the safety and convenience of commerce, and the speedy decision of controversies, where delay would often be ruin.' The Genesee Chief, 12 How. 443, 454; Insurance Co. v. Dunham, 11 Wall. 1, 24. To compel suitors in admiralty, when the ship is abroad, and cannot be reached by a libel in rem, to resort to the home of the defendant, and to prevent them from suing him in any district in which he might be served with a summons or his goods or credits attached, would not only often put them to great delay, incon venience, and expense, but would in many cases amount to a denial of justice.

In the present case, the libelee had, in compliance with the law of Louisiana, appointed an agent at New Orleans, on whom legal process might be served, and the monition was there served upon him. This would have been a good service in an action at law in any court of the state or of the United States in Louisiana. Insurance Co. v. French, 18 How. 404; Ex parte Schollenberger, 96 U.S. 369; Insurance Co. v. Woodworth, 111 U.S. 138, 146, 4 Sup. Ct. Rep. 364. And no reason has been, or can be, suggested why it should not be held equally good in admiralty. The district court for the eastern district of Louisiana having jurisdiction both of the cause and of the parties, the writ of prohibition is denied.