Louisiana Power & Light Company v. City of Thibodaux/Opinion of the Court

The City of Thibodaux, Louisiana, filed a petition for expropriation in one of the Louisiana District Courts, asserting a taking of the land, buildings, and equipment of petitioner Power and Light Company. Petitioner, a Florida corporation, removed the case to the United States District Court for the Eastern District of Louisiana on the basis of diversity of citizenship. After a pre-trial conference in which various aspects of the case were discussed, the district judge, on his own motion, ordered that 'Further proceedings herein, therefore, will be stayed until the Supreme Court of Louisiana has been afforded an opportunity to interpret Act 111 of 1900 (LSA-R.S. 19:101 et seq.),' the authority on which the city's expropriation order was based. 153 F.Supp. 515, 517-518. The Court of Appeals for the Fifth Circuit reversed, holding that the procedure adopted by the district judge was not available in an expropriation proceeding, and that in any event no exceptional circumstances were present to justify the procedure even if available. 255 F.2d 774. We granted certiorari, 358 U.S. 893, 79 S.Ct. 154, 3 L.Ed.2d 120, because of the importance of the question in the judicial enforcement of the power of eminent domain under diversity jurisdiction.

In connection with the first decision in which a closely divided Court considered and upheld jurisdiction over an eminent domain proceeding removed to the federal courts on the basis of diversity of citizenship, Madisonville Traction Co. v. St. Bernard Mining Co., 196 U.S. 239, 257, 25 S.Ct. 251, 258, 49 L.Ed. 462, Mr. Justice Holmes made the following observation:

'The fundamental fact is that eminent domain is a prerogative     of the state, which on the one hand, may be exercised in any      way that the state thinks fit, and, on the other, may not be      exercised except by an authority which the state confers.'

While this was said in the dissenting opinion, the distinction between expropriation proceedings and ordinary diversity cases, though found insufficient to restrict diversity jurisdiction, remains a relevant and important consideration in the appropriate judicial administration of such actions in the federal courts.

We have increasingly recognized the wisdom of staying actions in the federal courts pending determination by a state court of decisive issues of state law. Thus in Railroad Commission of Texas v. Pullman Co., 312 U.S. 496, 499, 61 S.Ct. 643, 644, 85 L.Ed. 971, it was said:

'Had we or they (the lower court judges) no choice in the     matter but to decide what is the law of the state, we should      hesitate long before rejecting their forecast of Texas law. But no matter how seasoned the judgment of the district court     may be, it cannot escape being a forecast rather than a      determination.'

On the other hand, we have held that the mere difficulty of state law does not justify a federal court's relinquishment of jurisdiction in favor of state court action. Meredith v. City of Winter City of Chicago v. Fieldcrest Dairies, 88 L.Ed. 9. But where the issue touched upon the relationship of City to State, City of Chicago v. Fieldcreat Dairies, Inc., 316 U.S. 168, 62 S.Ct. 986, 86 L.Ed. 1355, or involved the scope of a previously uninterpreted state statute which, if applicable, was of questionable constitutionality, Leiter Minerals, Inc., v. United States, 352 U.S. 220, 229, 77 S.Ct. 287, 292, 1 L.Ed.2d 267, we have required District Courts, and not merely sanctioned an exercise of their discretionary power, to stay their proceedings pending the submission of the state law question to state determination.

These prior cases have been cases in equity, but they did not apply a technical rule of equity procedure. They reflect a deeper policy derived from our federalism. We have drawn upon the judicial discretion of the chancellor to decline jurisdiction over a part or all of a case brought before him. See Railroad Commission of Texas v. Pullman Co., supra. Although an eminent domain proceeding is deemed for certain purposes of legal classification a 'suit at common law,' Kohl v. United States, 91 U.S. 367, 375-376, 23 L.Ed. 449, it is of a special and peculiar nature. Mr. Justice Holmes set forth one differentiating characteristic of eminent domain: it is intimately involved with sovereign prerogative. And when, as here, a city's power to condemn is challenged, a further aspect of sovereignty is introduced. A determination of the nature and extent of delegation of the power of eminent domain concerns the apportionment of governmental powers between City and State. The issues normally turn on legislation with much local variation interpreted n l ocal settings. The considerations that prevailed in conventional equity suits for avoiding the hazards of serious disruption by federal courts of state government or needless friction between state and federal authorities are similarly appropriate in a state eminent domain proceeding brought in, or removed to, a federal court.

The special nature of eminent domain justifies a district judge, when his familiarity with the problems of local law so counsels him, to ascertain the meaning of a disputed state statute from the only tribunal empowered to speak definitively-the courts of the State under whose statute eminent domain is sought to be exercised-rather than himself make a dubious and tentative forecast. This course does not constitute abnegation of judicial duty. On the contrary, it is a wise and productive discharge of it. There is only postponement of decision for its best fruition. Eventually the District Court will award compensation if the taking is sustained. If for some reason a declaratory judgment is not promptly sought from the state courts and obtained within a reasonable time, the District Court, having retained complete control of the litigation, will doubtless assert it to decide also the question of the meaning of the state statute. The justification for this power, to be exercised within the indicated limits, lies in regard for the respective competence of the state and federal court systems and for the maintenance of harmonious federal-state relations in a matter close to the political interests of a State.

It would imply an unworthy conception of the federal judiciary to give weight to the suggestion that acknowledgment of this power will tempt some otiose or timid judge to shuffle off responsibility. 'Such apprehension implies a lack of discipline and of disinterestedness on the part of the lower courts, hardly a worthy or wise basis for fashioning rules of procedure.' Kerotest Mfg. Co. v. C-O-Two Fire Equipment Co., 342 U.S. 180, 185, 72 S.Ct. 219, 222, 96 L.Ed. 200. Procedures for effective judicial administration presuppose a federal judiciary composed of judges well-equipped and of sturdy character in whom may safely be vested, as is already, a wide range of judicial discretion, subject to appropriate review on appeal.

In light of these considerations, the immediate situation quickly falls into place. In providing on his own motion for a stay in this case, an experienced district judge was responding in a sensible way to a quandary about the power of the City of Thibodaux into which he was placed by an opinion of the Attorney General of Louisiana in which it was concluded that in a strikingly similar case a Louisiana city did not have the power here claimed by the City. A Louisiana statute apparently seems to grant such a power. But that statute has never been interpreted, in respect to a situation like that before the judge, by the Louisiana courts and it would not be the first time that the authoritative tribunal has found in a statute less than meets the outsider's eye. Informed local courts may find meaning not discernible to the outsider. The consequence of allowing this to come to pass would be that this case would be the only case in which the Louisiana statute is construed as we would construe it, whereas the rights of all other litigants would be thereafter governed by a decision of the Supreme Court of Louisiana quite different from ours.

Caught between the language of an old but uninterpreted statute and the pronouncement of the Attorney General of Louisiana, the district judge determined to solve his conscientious perplexity by directing utilization of the legal resources of Louisiana for a prompt ascertainment of meaning through the only tribunal whose interpretation could be controlling-the Supreme Court of Louisiana. The District Court was thus exercising a fair and well-considered judicial discretion in staying proceedings pending the institution of a declaratory judgment action and subsequent dcis ion by the Supreme Court of Louisiana.

The judgment of the Court of Appeals is reversed and the stay order of the District Court reinstated. We assume that both parties will cooperate in taking prompt and effective steps to secure a declatory judgment under the Louisiana Declaratory Judgment Act, La.Rev.Stat., 1950, Tit. 13, §§ 4231-4246, L.S.A., and a review of that judgment by the Supreme Court of Louisiana. By retaining the case the District Court, of course, reserves power to take such steps as may be necessary for the just disposition of the litigation should anything prevent a prompt state court determination.

Reversed.

Judgment of Court of Appeals reversed and stay order of District Court reinstated.