FIRST NAT. BANK V; PRAGER.

689

FIRST NAT. BANK OF PARKERSBURG v. PRAGER et 81. (Circuit Court of Appeals, Fourth Circuit.
No. 281.

1. REMOVAL OF CAUSEs-JURISDICTION OF FEDERAL COURT EQUITY. ATTACHMENT IN

February 7, 1899.)

A federal court of equity is without jurisdiction to entertain a suit under a state statute by a contract creditor to obtain an attachment, and to set aside as in fraud of creditors a conveyance by his debtor; and such a suit is not rem{)vable into a circuit court from a state court.1
EFFECT OF CONSENT AGREE-

2.

SAME - FAILURE TO COMPLY WITH STATUTE MENT.

a

A cause cannot be removed from a state court by the entry of a consent agreement therefor in a circuit court of the United States, without the filing in the state court of the petition and bond required by the removal act.

JURISDICTION OF FEDERAL COURT-CONSENT OF PARTIES.

Jurisdiction to hear and determine a suit of which it is without jurisdiction under the statutes, or which has not been removed from a state court in the statutory manner, cannot be conferred on a federal court by consent of the parties; and its judgment in such a suit is a nullity.

Appeal from the Circuit Court of the United States for the District of West Virginia. H. P. Camden, for appellant. . V. B. Archer, W. N. Miller, W. W. Van Winkle, and B. M. Ambler, for appellees. / nefore GOFF, Circuit Judge, and PAUL and WADDILL, District Judges. PAUL, District Judge. This is an appeal from a decree of 'the circuit court of the United States for the district of West. Virginia. The apPeHant was plaintiff, and the appellees defendants, in the court below, and they will be herein designated as the "plaintiff" and the "defendants." The material question presented for our consideration, and, in our judgment, the only one necessary to be determined, is that of the jurisdiction of the circuit tourt to. have entertained and considered the cause on its merits. The record shows that on the 29th day of December, 1896, the defendantsPrager & Son executed a deed 9f assignment to one Henry Keller, a co-defendant in this suit, for the benefit of the creditors of the said Prager & Son. On the 31st day of December, 1896, the plaintiff sued out on the chancery side of the circuit court of Wood county, W. Va., under the provisions of a statute of that state (Code W. Va. '1891, c. 74, § 1), process of attachment against the property conveyed in the deed, of .assignment by Prager & Son to Keller, trustee, and filed its bill in chancery against Prager & Son and Keller, the trustee in the deed of assignment. The plaintiff's demand was for $2,500, evidenced by four promissory notes, none of which were yet due. The bill charged that the deed had been executed for the
1 As to removal of causes, generally, see note to Robbins v. Ellenbogen, 18 C. O. A. 86. 91 F.--44

690

91 FEDERAL REPORTER.

purpose of hindering, delaying, and defrauding the creditors of Prager & Son, stating in support of the bill numerous acts on the part of said defendants which it alleged to be in fraud of their creditors. This attachment was on the 31st of December, 1896, levied on the goods conveyed in said deed of assignment. At the March term, 1897, of the circuit court of Wood county, the defendants Prager & Son and the defendant Keller, in his own right and as trustee, filed demurrers to the bill, and Prager & Son filed their answers to the same. On the 29th day of December, 1896, prior to the issuing and levying of the attachment of the plaintiff, one Julius Katzenstein instituted in the circuit court of Wood county, W. Va., an action of assumpsit against said Prager & Son, and in connection therewith issued process of attachment, which was levied on the property conveyed by the said Prager & Son to Keller, trustee. On the 12th day of February, 1897, the said Keller, trustee, made a private sale to said Julius Katzenstein of all the goods assigned to said Keller by Prager & Son. -On the 19th day of February, 1897, the plaintiff sued out a second attachment against said Prager & Son, and the same was levied on a portion of the goods sold by Keller, trustee, to Katzenstr.in. At June rules, 1897, of said chancery circuit court of Wood county, the plaintiff filed an amended and supplemental bill, making, in addition' to the parties defendant to the original bill, the said Katzenstein, and all of the creditors, known and unknown, of said Prager & Son, defendants thereto; charging that the deed of trust to Keller and the sale of the goods made to Katzenstein were fraudulent, and praying that the same be declared nuH and void. At July rules, 1897, their bill was taken for confessed. The record fails to show any further proceedings' had in the state court. It appears from a statement in the record that after the plain· tiff sued out its second attachment, which was levied on the goods sold by Keller, trustee, to Katzenstein, and before the filing of the plaintiff's amended and supplemental bilI, said Katzenstein had instituted in the circuit court of the United States for the district of West Virginia an action of trespass against the plaintiff for $25,000 damages, and anoiher action in the same court against C. A. Wade, sheriff of Wood county, and the plaintiff for $50,000 damages. The first order we find in the record, entered in the circuit court for the district of West Virginia in connection with this cause and its removal from the state court. is the following:
"At a circuit court of the United States for the district of West Virginia, continued and held at Parkersburg, in said district, on the 2d day of July 1897, the following order was made and entered of record, to wit: "Julius Katzenstein vs. C. A. Wade, First National Bank of Parkersburg, and . Others. In Case. "The defendants this day moved the court to continue this cause until the next term of this court, supported by the affidavit of H. H. Moss, which .motion was resisted by plaintiff; and it being suggested to the court, upon. consideration of said motion, that the First National Bank of Parkersburg has brought suit against Isaac Prager & Son and Henry Keller, trustee, In the circuit court ofWdod county, West Virginia, and has Impleaded the· said Julius Katzenstein and others therein, since this action was brought in this court, and it being stipulated In wrlting'between the plaintiff in this ·action and the plaintiff in said suit in the state court that the action pending therein

FIRST NAT. BANK V. PRAGER.

691

shall be ,removed into this court, and be heard herein along with this action, It is orde'red that this cause be continued generally until the next term."

The l!ltipulation referred to is as follows:
"In the Circuit Court of the United States for the District of West "The State of West Virginia, Which Sues for the Use and at the Relation of Julius Katzenstein, vs. Charles A. Wade, Sheriff. etc., and Others. In Debt. "The First National Bank of Parkersburg vs. Isaac Prager & Son and Others. In Equity. "In the Circuit Court of Wood County, West Virginia. "Julius Katzenstein, the plaintiff In the first above named action, and the First National Bank of Parkersburg, the plaintiff in the said last-named cause, hereby stipulate and agree that the said suit pending in the said state court shall be removed by the plaintiff, Julius Katzenstein, in the first-named action, Into the s·aid circuit court of the United States for the district of West Virginia, and be heard there along with the said first-named action and the action pending in said federal court brought by said Julius Katzenstein against the First National Bank of Parkersburg and others. "Witness our hands this 2nd day of July, 1897. "R. P. Camden, Att'y for Wade & Others. "Julius Katzenstein, by W. N. Miller, Att'y."

The next order entered is the following:
"At a circuit court of the United States for the district of West Virginia, held at Wheeling. in said district, on the 20th day of September, 1897, the following order was made and entered of record, to wit: "The First National Bank of Parkersburg vs. Isaac Prager & Son and Others. In Chancery. "This day came Julius Katzenstein, one of the defendants to the amended and supplemental bill in said cause, and presented to the court a certified copy of the record in said cause from the circuit court of Wood county, West Virginia; and upon his motion it is ordered that said cause be entered in this court, and on his further motion it is' further ordered that said cause be remitted to this court, sitting at Parkersburg, to be therein further proceeded with according to law."

The next order is as follows:

"At a circuit court of the United States for the district of West Virginia, held at Parkersburg, in said district, on the 10th day of January, 1898, the following order was made and entered of record, to wit: "First National Bank of Parkersburg vs. Isaac Prager & Son et at In Equity. "This day came the defendants, Isaac Prager & Son, by their attorney, and presented to the court a duly-attested transcript of the record in the aboveentitled cause, which had heretofore, to wit, on the 20th day of September, 1897, been tiled and docketed in the circuit court of the United States for the district of West Virginia, sitting at Wheeling, and which, by an order duly entered of record in said court, was remitted to this court for further proceedings to be had therein; and on their motion It is ordered that said papers be tiled and said cause docketed in this court for further proceedings to be had therein."

After the entry of the last order the defendant Hemy Keller, trus· tee, moved to remand the cause to the state court, but the court overruled thp motion. After the motion to remand was overruled, various proceedings were had prior to the entry of the decree from which this appeal was taken. Counsel haw filed elaborate briefs on the question whether the de· cree complained of is a final decree from which an appeal can be taken, and on the merits of the finding of that decree. It is wholly unnec-

692

91 FEDERAL REPORTER.

essary (Uscns!! these matters.' From the facts above stated, it is so apparent that the court below was without jlirisdiction as to preclude the discussion of any othel'slilbject presented by the record. Beginning with'the institution of the chancery Sp.it in the state' court, we find that the necessary diversity of citizenship to confer jurisdiction on a fedE!ral court does not exist. The record does not show a between citizens of'different states, in which it must be shown that every party upon oI;leside is a citizen of a different state Young v. Parker's Adm'r, 132 U. from every mt1ty upon the S. 267, 10 Sup, Ct. 75; 1 Fost.l!'ed. Prac. 18. The diversity of citizenship;illust appear affirmatively from the record. The proceedings in this, cause show that the. plaintiff and the defendants in the all citizens oftpestate of West-Virginia, and that the a number of the defendants .in the amended and supplemental biUwcre citizens of West Virginia. Even if the necessary diversity of citizenship existed between the parties tq, the original wbich allows a removal into a federal the suit prevented such removal. It was court, brought under a statute of West Virginia which permits a contract creditor, before his claim has been reduced to judgJilent, to sue out an attachmelltinilequity, and attack a conveyance as void because made creditors. Such a suit canwith intent'toh'inder, not in a t,ederalc.purt of equity," Cates v. Allen, 14,9 U. S.' 451,13 Sup. Ct. 833,,977; SCQtt v. Neely, 140 U. S. 106, 11 Sup. Ct.: 712,j.UpUinsv. Coal Qo., 150 U. S. 371, 14 Sup, Ct. 127; D. A.TompkinsCo. v.Oatowba Mills, 82 Fed. 780. In thetast case the doctrine is ..thusstiited: '. " " ' ,. :":.,;,.'1< '..' ,
ls tha,t Il;l the federal court a sllnple-contract credltof, to juqgment, cl,l,nnotcomelnto equity to ob· who tain the seizure of his debtor's property, and Its appllcatlou. to his ·cIalm."

Again, the requirements of the statute providing, for the removal of It callsefroma, state court into,a federal court were in no respect complied with."1 '·The statute of March 3, 1887, as amended by the act ,of August 13, 1888, prondes:
"Sec. 8. +Jl.llt whenever any party: entltledto remove any suit mentioned. In the precllding section, except tn such caS as are provided for in s of slild sectIon, maycleslre to remove $uch suit from a state the last cOQrt to tile ,clrClllt court or ,the Unltl'!dStates, he may:make and file a peti· tion In suclf.sult In such state 'court at the time, orllt any time before the def.e.ndaqt '!·.IS ,'r,.e. qulred by pie laws 0 ..(t11.e state or the.l'.Ule of the state court . .. . in Which suit is brougl:\t to or plead to the declaration or complaint of tlle, for the removal of Such suit into the circuit court, to be held In the district where such suIt Is pendIng, and' shall make and file therewith a bond, with good and sufficient surety, for his or their entering in such clrllult court, on. tbe. first day of: Its then next session, a copy of the record ins1.lch SUit: and for paying all, ,costs that .may be awarded by the said circuit, court If saId. court shall hold that such suit was wrongfully or improperly. vemoved thereto, and, also,' fOT their appearIng and entering speclai ball In such suit, If special bail was originally requisite ther'eln. It shall then be the duty of the state court to accept said petition and bond, and proceed no further In such
> "

:J iI, ,<'

"

. ,,; ','.'

.u

The record fails to sMw that there were any steps whatever taken in compliance with the requirements of this statute. Its positive

MORRIN V.

693

provisions were entirely ignored by the parties, and they aimeQ to accomplish by the entry of a consent agreement in the circuit court that which they could not do by with the provisions of the statnk By this unauthorized procedure they sought to invoke the jurisdiction of the federal court, in a cause in which, owing to the citizenship of the parties, the character of the suit, and th,e failure to comply with the requirements of the statute providing for the removal of causes. it could not be entertained. That the agreement entered into by the parties could not confer jurisdiction on the federal court is too well settled to admit of discussion. 2 Fost. Fed. Prac. p. 813, § 383. In Bank v. Calhoun, 102 U. S. 256, Justice Miller, speaking for the court, says:
"It needs no citation of authorities to show that the mere consent of parties cannot confer upon a court of the United States the jurisdiction to hear and decide. a case. If thiS were once conceded, the federal courts would become the common resort of persons who have no right, either under the constitution or the laws of the United States, to litigate In those courts."

The circujt court belng without jurisdiction in this cause, the decree appealed from was a nullity. Its action, will be reversed, with directions to remand the cause to the state court. As the appellant and the appellees are eq'ually responsible for removing this cause into a court without jurisdiction to entertain it, costs will be allowed to neither party. Reversed.

MORRIN v. LAWLER.

(Circuit Court.

Bmw.

D. New York. January 28, 1899.)

. .

APPEAL-EFFECT AS TRANSFER OF CAUBE-ApPLICATION TO SUBSTITUTE ApPEAl,

It is the rule. in federal courts that" wben all the steps necessary to perfect an appeal have been properly taken, the action is within the cOntrol of t.he appellate court, and a motion for substitution of the 'appeal bond must be addressed to that court.

On Motion for Leave to Substitute Appeal Bond. Briesen & Knauth, for complainant. Dickerson & Brown, for defendants. Dayton & Swift, for Oity Trust, Safe·Deposit & Surety Co. 'THOMAS, District Ju(lge. The above action is one of three cases jointly heard and determined in this court, and since December, 1898, pending in the circuit of appeals. After the interlocu· tory decree and the appeal therefrom, the complainant, by motion, objected to the bond offered by the defendant to perfect such appeal, on the gJ'ound that such bond did not provide for the payment of the decree of the trial court as well as that of the appellate court. There· upon this court held that such bond did cover the damages and costs involved in the decree of the trial court as well as those of the appellate court, and the defendant on December 10, 1898, entered an order upon the decision denying the motion. Qn the 21st day of· January, 1899, tb,e City Trust, Safe-Deposit & Surety Company oCPhila-