HALL fJ. CHATTANOOGA. AGRICULTURAL WORKS.

599

when that time would be reaohed in, determination of the cause. If it should considered that the facts as presented in this case show Ii condition not contemplated by pongress as expressed by the statutes of 1887 and 1888, upon removal of causes from state to federal courts, then there was no authority for removitlg 'the same; for, although the constitution may give this right of removal, the constitution does not ,act by its own vigor in such matters. ,There should be legislative action' car(ying this provision or' the constitution, into effect, and pointing out the. mode in which can be effectuated. Without a removaf of a cause from a state to a cannot take place. Takingeifher position as correct, arid the motioti, to remand this cause ought to ,be sustained. It,is certain that congress, by virtue of the llCts we have been considering, intended to provide that,apetition for the,removal of!l cause should be made, as 'soon as all the part:es were the court, atld an issue upon the. Illeritsor the controversy presented by the complaint was made to appear.. I have not thpught itneces811ry to consider the other proposition presented. The motion to remand this cause to the court in which it originated is sustafned.

,HAiL

et al.

11. CHATTANOOGA AGRlCOLTURAL: WORKS

et al.

(Circuit Court, E.D. Ten1l688ee, B. D. December 22, 189L)
L

,Tire fact' that a petition' and bond for the removal of a cause, undel' section 3 ot the removal act, have been ii·led in the state court during vallation, will not 'Warfederal circuit court in declarlngthe cause removed before the at.atecourt has had, an opportunity to take action thereon. .

OJ' CAUSEB-PETI'l'ION AND

BY STATB COURT.

state may remove the cause, notwithstanding that bis co-(I.efendants are o1tizens ot the $tatein whicb the action is brought.· . ' . . ' . .a.S.JR,.-L()OAL PREJUDICE-AoIl)AVIT. : , . Ullder BBCtion:3 of the removal act, atIB.tJlendedby tbe,acts of 1887 and 1888. pl'Oviding 'for the removal of a 'cause "WbSll it ,hall be made to to the circuit court that; fl'om prejUdice Ol' local inlluenoo, the defendant Will not be able to obtain justice in the state court, the facts relied onto show prejudice must be set out in the petition for removal, and supportecl by tbe aftlaavit of at least one oredible penon. 4. OJ' AFFIDAVIT. A billwas brougbt by'certain persons residing in Tennessee, as creditors and stockholders of a corporation,to wind up its affairs, and to hold certain stockholderS in Ohio for the balance of their aubscljptions. The applied to the federal circuit court for a l'emoval of the cause, on the ground of local prejudice, and filed an affidavit "Uegingo that tbe corporation was formed in' Tennessee to purchase the property of a manufacturing corpOI:ation in Ohio, whJch. purcbase was made j tbat tbe petitioners, as trustees for many citizena of Ohio, owned a majority of the stock j th'at many stockholders tn Tennessee were refusing to pay their SUbscriptions, on the ground that they bad been defrauded in tbe by the Ohio people, 'Snd that much talk of this ktnd had been indulged in, tbus creati-ng a local prejudice against the Ohio stockhOlders jthat in sUits 'against the Tennessee stockholders the defen,dan" ts bad set up the alleged,fraud,a'n,',d"in, or,de, r, ,PPeal to thEll,'Ocal preju,dice, bad demanded juries to try the IBsuesj.!I>lId that is informed and ·lieves that a jury will be demanded in'this,'oouse. Hetd,that this was Bufllcient .evi-dence to wan'ant, a removal; ellpecildlf ,\,\\Ilen of the bill,itself dt.closed a disposition to appeal to'lOcal. prejudice. ' "
to, ,

'a,

'2. BAME-'DtVERSE CITIZENSHIP. Undel'the removal act of 1887, § 9, 01. 4, any defendant wbo is a citizen of, another

600
5. S.um-PETITION.

FEDERAL,.:REPORTER, .

vol. 48.

, A petition fortbe removal of a cause on tbe ground of local prejudice should state the facts relied on as showing prejudice. and should be sworn to by at least one of the petitioners, or by some agent or attorney authorized by them. When the l!-tIIdavit for removal sets out the necessary facts, a petition which Is defective in this respect may be amended to conform thereto.
OF PETITION. ·

6; .SAM:E--AilBNDMIIlNT

In Equity. Bill by W. R. Hall and others, residents of Tennessee, in a s41te court, as creditors and stockholders of the Chattanooga Agricultural Works, a Tennessee corporation, and others, to wind up the affairs of the corporation, pay its debts, and distribute the surplus, if any ,among the stockholders. Henry Todand Tad Ford, stockholders, residing in Ohio, were'rnade parties defendant, and it was sought to compel them to pay the. balance of their subscriptions to the stock; and theyi-emoved the cause. to the United States circuit court. The cause is now heard on motion to remand. Conditional order of remand. Andrews&- Barton, fot complainants. Olark. &. Brown, for defendants. :
;

KEY, J. The petition for removal in this case seeks· to bring the cause from the state court into this court upon two grounds: That is, because there is a separable· controversy between the petitioners and the other parties to the suit; and because there exists such prejudice or local influenpJl that .not be able to obtain justice in the state in any other court of the state to which this cause could be recourt, moved. It-appears that application has been made in the state court for the removal of the cause because there is a separable controversy between. the. parties. but as yet there has been no action of the state court upon the application, for want' of a 8est:>ion of the court. In cases which are soug-htto 'be removed, except those in which the application is predicated upon local influence and prejudice, the petitions must be filed in .the state <lOlli't. The acts 'of congress of March 3, 1887, and August 13, '1888, iilSedtion 3 of the actof 1815, as a,mended by thesl'l nets, provide that, except where the application for removal is based upon local influence and prejudice, the party desiring .to remove the cause may make .and file a. petition in suah suit in the state court at the time or any time before the defendant is re'quired by the laws of the state or the rule of the state corirtin which· such suit is brought to plead or answer to the declaration or complaint of the plaintifHorthe removal of such suit; and 'shall make and file therewith a bond, with good and sufficient surety, for his entering in the circuit court, and filif!g, on the first day of its then next session; a coPY of the record. It shall then be the duty of petition and bond, and proceed no further the state courtto in such suit; .and, the sa ill copy being entered as aforesaid in the circuit court of the United States, the cause shall then proceed in the same mfin:;per as if it had been originallycommencE'd in the said circuit court. It appears from the record that, since the adjournment of the last term of the state court, a petition for removal and a bond have been prepared and filedj but there has been no of court since, so that

or

HALL 'V. CHATTANOOGA AGRICULTURAL WORKS.

601

the petition and bond could be presented to the state court as contemplated by the statute. It would be premature, and a want of comity, for this court. now to say that the cause had been removed before the state court had opportunity to consider and pass upon the question the law submits to it. Moreover, the cause is not removed until the petition and bond shall be presented to the state court for acceptance. Then, and not until then, is the state court required to determine whether it. will proceed further or not. If the petition and bond conform to law, the cause is removed; if not, it is not removed. The decisions relied upon by petitioners' attorney were made in cases in which petitions and bonds had been presented to the state court complying with the requirements of the law, but in each case the state court declined to accept the petition and bond, and proceeded further, or attempted to do so, in the suit. When the state court considpl's the application for removal far as to accept orreject petition and bond, if the application be such asauthorizes a removal, the removal relates back to the date of the applicatiOlljbut it would be something remarkable for a party to go to the clerkin vacation, file· his application for removal, and take his suit into this (tourt, without presenting the matter to the state court at all, or. giving it an opportunity to accept the petition and bond as the law prescribes. 'The case mentioned by the petitioners' counsel ,1 decided here,·did not involve the point now.made. In that case the petition and bond for removal had been presented to and aQcepted by the lltate court. The authority of the state court over the cause had come to an end. The next term of this court thereafter had not met, but a copy of the record had been filed, and it was moved to take a step preliminary to the 1'repal'ation of the cause for ttial. This was resisted upon the ground that the case could not come here until the first day of the next term. It was hEM that, though the petitioners were hound to file a copy of the record py the first day of the next term, still the cause was removed to this court when the state. C01;lrt accepted the petition and bond, and, whenever a copy of the record came into this court, this court's jurisdiction of it began. The other ground of removal has its source in the act of March 8, 1887, corrected by the act of August 13, 1888. This law amends and modifies the second section of the act of March 3, 1875, among many other things, so as to make it read as follows: "And where a suit is now pending, or may hereafter be brought, in any stale court, in which there is a controversy between a citizen of the state in which the snit is brought and a citizen of another state. any defendant, being such citizen of another state, may remove such suit into the circuit court of the United States for the proper district, at any time before the trial thereof, when it shall be made to appear to said circuit court that, from prejUdice or local influence, he will not be able to obtain justice in such state court, or in any other state court to which the said defendant may, under the laws of the ,state, have the right. on account of such prejudice or local intluence,to re.move said cause. OJ ·
repol'ted.·

602

FEI):f)l,tAL llEPORTER,

vol., 48.

This provision is pecullitrllnd different in its features from the genera] character of the act in respect to removaJs. , The application is made to the circuit court of the United States, aUdit ;removes the cause, when it is made to appea.r that, from prejudice or IQcal influence, justice cannot be obtained. The act of 1875 has nothing in regard to removals for such causes. Before the act of 1887, removala for prejudice and local influencerested upon section 639,subsec. 3, Rev. St. 'rhe applicant was to file his' petition and affidavitin the state court, and he was only required to swear, that he had reason to RJ;ld did believe, he could not obtain justice therein.' The act of 188,7 does not define how the matter shall be made to appear, but:the supreme court has determined how it is to be done.. In Ex parte Penn8'!Jluania Co., 137 U. S. 457, 11 Sup. Ct. Rep. 143, it is said: "Our opinion Is that the circuit court must be legally (not merely morally) satisfled afthe truth oftha allegation that. from prejUdice or localintluence. the defendant wUlI;lot be able to obtain justlcein the state court. , Legal satisfaction requires some proof suitable to tile nature of the case; at least, an llffidavitof llcredibleperson,'and a statemerit Of factI! in such affidavit which sufficiently evince the truth .of the allegation. 'fhe amount and manner of proof required in each case must be left to the discretion of the court itself. A perfunctory showingbya formal affidavit of mere belief will not be sufficient, If the petition for removal states the facts upon which the allegation is founded. and that petition. be verified. by an affidavit of a person or persons in whom, the court 1;lils contldence, this may be regarded as prima facie proof sufficient to satisfy the conscience of the court. If more should be required by the court. 'more should be offered." In this caae the aatrmed the action of the circuit court in remanding because the a.mount in controversy did not exceed Upon the branch of the case as to which the opinion is quoted the court says: "We dispose4 to tbinkthattl)e of prejudice and local influence in qase was the circuit court was bound to regard as satisfactory. ... '" lie. We 40 not say. as a matter of law. this affidavit was not sufficient, but onlythat.the court wasD.ot b\)und to tegard it so, and might have well :regarded it as Dot'sbflleient." . ,these,expressions. \VIth one in the l.onge; paragraph amount and manner of proof reqUIred 1U each case quoted" must be to the discretion of the court itself," we may reasonably infer that, it' the circuit court had conCltided that the affidavit was sufficient, the the circuit court, in that respect, would not have been ...· . . The view'taken by the supreme strengthened and emphasized by the clause of the act of 1887 which follows the provisions. in regard to removal ibydefendants for prejudice.or local influence. This clause is: "At any :tifuel:Jefore the trial of any suit. which is now pending in any circuit court, or may here.afterbe entered therein. and which has been removed to said cQurtfrom a state court on the atndavltof any party plaintiff that he had reason to believe, and did believe. that; from prejUdice or local influence, he was unable to obtain justice in said state court, the circuit court shall. on application of the other party. examine into the truth of said affidavit. anll the

HALL tI. CllA.TTANOOGA AGBICULTUBAL WOBD.

603

groundsJ;bereof; and, unless it sballappear to the satisfaction. of said court that said party win not be.able to obtain justice in such state court, it shall cause the same to be remanded thereto."

No such form of proceeding is required of defendants as of plaintiffs. In the last case the court must examine .into the truth. of theaffidavit, and the grounds thereof. In the case of a defendant the law does not state how the matter is to be presented to the court, whether by petition or affidavit or otherwise. . It is insisted that the affidavit presented iIi this case does not give such facts in support of the allegations of prejudice and local influence as make it appear that such prej udice or influence exists. The facts stated in the affidavit are substantially that the Chattanooga Agricultural Works is a corporation organized in Tennessee to purchase. the property of the William Anson Wood Mower & Reaper Company of Youngstown, Ohio, and it did purchase it, and that petitioners, as trustees for citizens of Ohio, and in their individual right, own a majority of the stock in the agricultural works; that many stockholders at Chattanooga .are refusing to pay for the stock subscribed, beCause, as they say, the property oCsaid mower and reaper company was valued at a fraudulent and unreasonable valuation, and the Chattanooga stockholders were thus defrauded by the YoungstowD people; that much talk of this kind has been indulged in by those refusing to pay, and much local prejudice has been created thereby and exists against the Youngstown, Ohio, stockholders; that some of the resident stockholders have been sued for their subscriptions, and that they make the defense of fraud and misrepresentation and overvaluation, and, unwilling to leave the controversy to the decision of the judge, demand a jury to try the issues; that these issues are prepared by ope of the leading solicitors in the present bill, and affiant is informed and believes that it is intended to ask for a jury in this case; that a jury will be demanded in order to appeal to their prejudice against corporations generally, as well as to their prejudices against the non-residents in this controversy with the resident stockholders. No part of this affidavit is predicated on information and belief, except that in relation to the jury that is to be called for. When we look into the record, we find that the resident stockholders consist of a large number of leading and influential men in this locality, representing various professions and linell of trade, business, and manufactures. An examination of the bill filed by complainants shows from its general scope, and many of its allegations and expressions, an inclination or disposition to appeal to prejudice, as against the non-resident stockholders, and lends support to the averments of the affidavit. So far as the affidavit is concerned, it appears to be made by a credible person, and its facts make it appear that prejudice and local influence exist. But the office of the affidavit is to support the petition. If the petition for removal states the facts upon which the allegation is founded, and that petition be verified by affidavit of a person or persons in whom the court has confidence, this may be regarded as prima facie proof sufficient to satisfy the conscience of the court. "Inferentially this is the minimum of evidence to be received and

604

FEDERALBEPORTER,

vol. 48.

accepted, the court is not satisfied with this, more may be required, but it must not be satisfied with less." .Ex parte Penmylvania Co., Bupra. The petition in the case in hand does not state the facts upon which the allegation of prejudice or local influence is founded. It does not aver that either or both exist. It simply states that an affidavit (Margerum's) has been filed that it may be made to appear that, by reasonof prejudice or local influence, justice cannot be obtained. The petition is not signed by petitioners, nor is it sworn to. It is a mere perfunctory petition, signed by petitioners' attorneys, and has no higher merit than would a mere formal declaration in a civil action, and affordingno eVIdence upon a fact to be It exercises no power, f<Jrce,or influence in making it appear .to the mind or conscience of the colirt tha:tthe facts exist which would authorize the removal. The petition,as well as the affidavit, should state the facts upon which the removal is BOught, and should be sworn to by at least one of the petitioners, or by some agent or attorney authorized to act for them, other than the person who makes the supporting affidavit. There is another question presented for consideration. The petitioners are both citizens of Ohio; the complainants are all citizens of Tennessee.The defendants are the petitioners, and George J. Margerum, the Chattanooga Agricultural Works. and the Third National Bank of Chattanooga. All the defendants, except the petitioners, are citizens of Tennessee, the same state of which complainants are citizens; The of the act of 1887 is: is now peJ:!.ding, or may hereafter be brought, in any state llourt in'Yhich there is a conttoversybetween a citizen of the state in which the suit IS brought and a ¢itizen of another state, any defendant being such citizen of another state," etc. The language of the act of 1867, (Rev. St. § 639, subsec. 3,) in describing the sUit, is the same; and as to the act of 1867 it has been uniformly held that all the persons on one side must be citizens of state in which the suit is brought. and all those on the other citizens of some other state. Young v. Parker, 132 U. S. 2G7, 10 Sup. Ct. Rep. 75. Granted that the area of removability has been enlarged by the act of 1887, inasmuch as any of the defendants may remove, still the rule under the act of 1867 applies that, when the citizenship on the plaintiff's side of the suit is such as to prevent the removal under that act, it is equally effective to defeat the right under the act of 1887." Wilder v. Iron Co., 46 Fed. Rep. 682, decided by Chief Justice FULLER. But in this case no such difficulty arises, because the complainants are all citizens'of one state, and the petitioners of another and different state, and i:n this circuit it has been held uninterruptedly that where all theplain:t:iffs are citizens of one state, and a defendant is a citizen any such defendant may remove withof another and out regard to the citizenship of his co-defendants. Adelbert College v. Toledo, W. &- W. Ry. Ctk;47 Fed. Rep. 845. The language of Judge JACKSON in deciding the cause is:

HALL

v.

CHATTANOOGA

WORKS.

605

"Under the present act, [1887,] any defendant may effect the removal, provided the requisite diverse citizenship of the plaintiff or plaintiffs exists as under the act of 1867." This course of decision is sustained in Dillon on Removals, (5th Ed.)

61

"But in another respect the act of 1887 is much more liberal than its predeCessor. For whereas,the law of 1867 required that in cases where there were several defendants all must possess the requisite citizenship, (that is, none of them must be citizens of the same state with the plaintiff,) and all must join in.a petition to remove the cause on the ground of local prejudice, now tbe act of Hl87 extends the right to ·any' defendant possessing the requisite citizenship. · Nor can the right of removal thus given to "any" defendant,baving the prescribed citizenl3hip, with any respect for the ordinary sigl1ificance of language, be construed to include "all" the defendants, and so be denied to "any" unless "all" have such citizenship.' It follows, of course, from thi9',·that the non-resident defendant may remove the cause on this and it is not necessary ground, irrespective of the action of his that all should join. " According to these authorities, the petitioners, so far as the question of citizenship is concerned, may rightfully present their petition for removal. If this application for removal depends upon the proceedings, petition, bond for removal in the state court, there could be no amendment of these, or any of them, here. They are the record of So far, however, as the petition, bond, and affidavit another made to an¢! for this court, to obtain from it an order for the removal of the cause,are concerned, they belong to this court, and are it:, propspeak, and the court, in the exercise of a just and liberal erty, so . discretion, ought to allow such amendments 8S may result in a dne Of the law. Clearly, it appears, if the petition states the facts averred in the affidavit, and was sworn to, this cause ought to be moved·. This omission may be largely excused, to say the least, by the crude and uncertain condition in which the law of removal.is left o'f 1887. It will be ordered, therefore, that the motion t(). remand the cause be sustained, unless the petitioners within 10 days amenll their petition so as to conform to the opinion of the court as. herein expressed. Final action is reserved until the coming in of said amended petition, should it be filed within the time prescribed. The demurrer and motions to dissolve or modify the injunction and attachment will await final action upon the motion to remand.

606

'tllIDERAt

REPORTER;

vol. 48.

'D.

TILLO'rsdtLee uz.

(Oircuit Odtirt/B.D. Ohw, W.D. December 8t,I891.)

'Wbe'l1,the petition fcir\he removal ot a cause on the groUnll of diverse fa I10t tiled in the state !iourtbefore the answer-nay flxed'by the state laws, as reo quii-ed by the expresstel1lls 'of section 8 of the removal&Ot..oH887, (as amended by . AcllAug.18.18&S,) must be reJm'nded;"and that Ilodvantage he taken of default of answer in the state court, Aecause the suit was a 'joint one against the' 'defendant and another, who had'riot bee'Q served, is immaterial;",

OJ' OAUSI1S...,PIITI'!:ION IN SUTBCOli/;BT:-TIIIIB 01',

'

At'Law.Action by Joseph W. Davis, assistarit treasurer of Chamcpunty, Ohio, against Ephraim' Tillotson and Mary S. Tillotson to Heard on motion to remand to the state court, from which removed. Granted. " E. P. Middleton, for plaintiff. · ' Geo.M.Eit;helbergeran4 Harmon, Oolsten, GoldamUh & Hoadly, for defendants.

"as

SAGE, J. The petition in this case was filed in the court of common pleas, of Champaign county, Ohio, the 21st of May, 1890, and on the same dfiY summons was issued. Oothe 27th day of May the summons was returned, served on Ephraim Tillotson personally. The answerday the 21st of June, 1890. The defendant Ephrai,r;n Tillotson, on the 28th dllY of June, 1890, appeared moved to quash the service ofp!ocess upon hIm, and for the dismissal of the cause for want of jurisdiction. At the May terln, 1891, of sai'li court, the motion was overruled, and leave was granted to the defendaJ;lt to answer by Augustl,18Ul. On the 13th of July, 1891, said defendant filed his petition for removll1 to the United States court upon the ground that he was a residElnt and citizen of the sta.te of Illinois, as wa/J also his wife, Mary E. Tillotson, who was his co-defendant. She has not been served with process., , The action is for the recovery of back taxes amounting to $15,466.59, with interest, and the statutory penalties, upon personal property ana credits alleged to ha.ve been withheld ):>y the defendants from listing f()r a series of years, beginning with 1884 and ending with 1889. It is urged the motion to remand that the action is upon a joint, and not a joint and severai, liability, and therefore nojudgment can be taken against the defendant Ephraim Tillotson, who filed the petition for removal. The contention in support of the removal is that, as no judgment can be taken against the defendant served until his co-defendant is brought before the court, he was not in default when he filed his petition for removal. But section 3 of the removal act of 1887, as amended August 13,1888, requires that the petition for removal be filed in the state court at or before the time when the defendant is required by the laws of the state, or the rule of the state court in which the suit is pending, to ansW'er or plead to the declaration or complaint of the plaintiff. That time