Texas Railway Company v. Saunders

Statement by Mr. Chief Justice FULLER:

This was an action brought by Henry Saunders, June 4, 1888, in the circuit court of the United States for the eastern district of Texas against John C. Brown, the receiver of the Texas & Pacific Railway Company, to recover damages for injuries sustained by Saunders through the negligence of the receiver, his agents and employes, as he alleged. On February 6, 1889, plaintiff below filed an amended petition, making the railway company a party defendant, and alleging the discharge of the receiver, and the surrender of its property to the company without sale, improved by the expenditure of some millions of dollars in betterments paid for out of, and augmented by property, both real and personal, purchased with, the earnings during the receivership; and, further, that under the order turning over the property, the company took it charged with the receiver's liabilities, which included plaintiff's claim, and that on that account, as well as because plaintiff was entitled to a lien on the betterments and property acquired by the use of the earnings, the company was liable to plaintiff; and he prayed for judgment and for general relief. The death of defendant Brown was suggested, and the cause dismissed as to him. The company filed a demurrer and answered on September 12, 1889, assigning as ground of demurrer that the petition showed no cause of action, and answering by a general denial, and the averment of contributory negligence.

On September 23, 1889, the railway company, by counsel, and not in its own person, further answered, pleading: (1) 'That at the time plaintiff was injured the Texas and Pacific Railway and all its property was in the possession and control of John C. Brown, as receiver, appointed by the United States circuit court for the eastern district of Louisiana. Defendant says that on October 31, 1888, the said John C. Brown was discharged from his trust as receiver by an order made October 26, 1888, in the United States circuit court for the eastern district of Louisiana, and he was ordered to deliver all property in his hands to the defendant, and the defendant was ordered to receive said property, and did receive it on October 31, 1888, charged with all traffic liability due by the receiver to connecting lines, charged with the performance of all contracts made by the receiver, and charged with the payment of all judgments that may be rendered in favor of claimants who may intervene in the cause of The Missouri Pacific Railway Company v. The Texas and Pacific Railway Company, in the United States circuit court for the eastern district of Louisiana, at New Orleans, prior to February 1, 1889, and free from all other demands or claims arising against the receiver, and prior to October 31, 1888. Defendant says that plaintiff did not intervene in said cause prior to February 1, 1889. Wherefore the defendants say they are not liable at suit of plaintiff in this court, and, if liable at all, they are only liable upon due intervention of plaintiff at New Orleans, as is provided by the order of _____, discharging said receiver, which order is hereby attached and made a part of this plea. Wherefore they pray that this cause be dismissed.' (2) Defendant 'demurs to plaintiff's petition, and says said petition shows no cause of action, if this court has jurisdiction; and this court has not jursdiction over the parties plaintiff and defendant, nor of the subject-matter.' (3) General denial. (4) Contributory negligence. (5) Statute of limitations.

The cause coming on for trial, it appears from the bill of exceptions that the defendant first presented the plea above numbered 1, which the court overruled, and held insufficient. The defendant then presented its plea or demurrer to the jurisdiction on the ground that Saunders 'resided in the eastern district of Texas, and the defendant Brown resided in the county and city of Dallas, Texas, which is by law placed in the northern district of Texas, and there was no fact alleged to give this court jurisdiction,' which was also overruled. Exceptions were duly saved. The trial then proceeded, and, among other things, the order of the circuit court for the castern district of Louisiana of October 26, 1888, discharging the receiver, and directing the delivery of its property to the railway company, was put in evidence; and it was also proved that plaintiff had resided in Dallas, Tex., since May 2, 1888. At the close of the testimony, defendant moved to dismiss the cause, because plaintiff must intervene at New Orleans, and, this being overruled, further because, on the pleadings, plaintiff and defendant both resided in the northern district of Texas, which was also denied.

The jury returned a verdict in favor of plaintiff for $7,500, which, at the suggestion of the court, plaintiff reduced by remittitur to $2,500, and for the recovery of the latter sum judgment was entered. The case was then brought on writ of error to this court, and the record filed August 30, 1890.

John F. Dillon and Winslow S. Pierce, for plaintiff in error.

James Turner, for defendant in error.

Mr. Chief Justice FULLER, after stating the facts in the foregoing language, delivered the opinion of the court.