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of the United States for final hearing, it has been held that a corporation, resident of another State, may make such an affidavit and effect a removal of the cause to the Federal court.1 When, therefore, a corporation makes an application for the removal of a cause in which it is impleaded as defendant, from a State court to a Circuit Court of the United States, in the manner prescribed by the act of Congress, it is error in the State court to proceed further in the matter, and any subsequent step is coram non judice.2
§ 7463. Submission to Local Jurisdiction does not Preclude Right of Removal. Although a foreign corporation may have submitted to the jurisdiction of the domestic State, by complying with the conditions upon which alone it is permitted to do business therein, yet such a corporation, in every case, remains a "citizen" of the State of its creation, within. the rule of Federal jurisdiction already referred to;3 and consequently it retains, in all such cases, its right to remove to the Circuit Court of the United States any action brought against it in a State court, which otherwise comes within the terms of the act of Congress authorizing such a removal by a non-resident citizen. For instance, a State statute requiring
1 Mix v. Andes Ins. Co., 74 N. Y. 53; 8. c. 30 Am. Rep. 260. In Cooke v. State Nat. Bank, 52 N. Y. 96; 8. c. 11 Am. Rep. 667,-the contrary was held, on the ground that a corporation could not make the affidavit required by the statute; but this holding was expressly overruled in the case just cited. To the contrary of the text, see Mahone v. Manchester &c. R. Co., 111 Mass. 72; 8. c. 15 Am. Rep. 9; Quigley v. Central Pac. R. Co., 11 Nev. 350; 8. c. 21 Am. Rep. 757. The above text is supported throughout by Federal cases hereafter cited in this chapter. What controversy deemed a suit" within the removal acts: proceeding for condemnation of land is. Patterson v.
Mississippi &c. Broom Co., 3 Dill. (U. S.) 465.
• Herryford v. Ætna Ins. Co., 42 Mo. 148.
• Ante, § 7448.
Herryford v. Etna Ins. Co., 42 Mo. 148; Morton v. Mutual Fire Ins. Co., 105 Mass. 141; 8. c. 7 Am. Rep. 505; Myers v. Murray, 43 Fed. Rep. 695; 8. c. 11 L. R. A. 216; 32 Am. & Eng. Corp. Cas. 25; Henning v. Western Union Tel. Co., 43 Fed. Rep. 97; Baughman v. National Water Works Co., 46 Fed. Rep. 4; Taylor Co. v. Baltimore &c. R. Co., 35 Fed. Rep. 161, 170; Fisk v. Chicago &c. R. Co., 2 Abb. Pr. (N. s.) (N. Y.) 453; 8. c. 53 Barb. (N. Y.) 472; Western Union Tel. Co. v. Dickinson, 40 Ind. 444;
foreign insurance companies doing business within the State to appoint resident agents upon whom all lawful process against them may be served, with like effect as if they were domestic companies, does not so operate that a foreign insurance company, by appointing such an agent and accepting service of process as provided by the statute, precludes itself from removing the cause to the Circuit Court of the United States in a proper case.1
§ 7464. Further of This Doctrine. - Unquestionably, the settled doctrine is that where the domestic State endeavors, by its legislation, to make all foreign corporations domestic corporations, for the purposes of State jurisdiction, this does not operate to make them such for the purposes of Federal jurisdiction, and that such a statute is void in so far as it attempts to restrain the right of the domesticated corporation
s. c. 13 Am. Rep. 295; Amsden v. Norwich Union Fire Ins. Soc., 44 Fed. Rep. 515 (disapproving Scott v. Texas Land &c. Co., 41 Fed. Rep. 225).
1 Morton v. Mutual Fire Ins. Co., 105 Mass. 141; s. c. 7 Am. Rep. 505. So held in Knorr v. Home Ins. Co., 25 Wis. 143; s. c. 3 Am. Rep. 26; denying Stevens v. Phoenix Ins. Co., 24 How. Pr. (N. Y.) 517, and New York Piano Co. v. New Haven Steamboat Co., 2 Abb. Pr. (N. s.) (N. Y.) 358, and approving Dennistoun . New York &c. R. Co., 1 Hilt. (N. Y.) 62, and Fisk v. Chicago &c. R. Co., 3 Abb. Pr. (N. 8.) (N. Y.) 454; 8. c. 53 Barb. (N. Y.) 472. The doctrine of the text is also supported by Hobbs v. Manhattan Ins. Co., 56 Me. 417; 8. c. 96 Am. Dec. 472. To the same effect are Holden v. Putnam Fire Ins. Co., 46 N. Y. 1; 8. c. 7 Am. Dec. 287; Herryford v. Ætna Ins. Co., 42 Mo. 148; and Amsden v. Norwich Union Fire Ins. Soc., 44 Fed. Rep. 515. On the contrary, it has been held in Michigan that a foreign insurance company,
by doing business in Michigan under the statutes of that State, and accepting service of process in conformity with the same, waives its right of transfer to the Federal court. People v. Circuit Court, 21 Mich. 577; s. c. 4 Am. Rep. 504. But this view has been disaffirmed by the Supreme Court of the United States, whose authority on the question is final and decisive. Post, § 7466. It was held by the Court of Appeals of Virginia, that a corporation of another State, leasing and operating a railway in Virginia, is subject to be sued in Virginia as a domestic corporation, and is not entitled to remove the action from the State to the Federal court. Baltimore &c. R. Co. v. Wightman, 29 Gratt. (Va.) 431; 8. c. 26 Am. Rep. 384; denying Baltimore &c. R. Co. v. Cary, 28 Ohio St. 208, 218. But the contrary was held by the Supreme Court of the United States, and this, of course, disposes of the question. Railroad Co. v. Koontz, 104 U. S. 5.
to remove to a Federal tribunal an action brought against it in a State tribunal.' When, therefore, an action is commenced against a foreign insurance company by the service of summons upon the person appointed by such company to receive service of process within the State, in pursuance of a statute of the State, as its agent and attorney therein, upon whom all process against the non-resident company may be served, and who is also its managing agent within the State, such agent and attorney can, upon entering appearance for the defendant, file a petition for the removal of the cause, under section 639 of the Revised Statutes of the United States, signing the same by him as such attorney and verifying it by his affidavit, in which he states that he is the defendant's general managing agent; and this will be the act of the defendant and will have the effect of removing the cause and ousting the State court of further jurisdiction."
7465. This Right of Removal Extends to "Tramp Corporations."— By analogy to the doctrine elsewhere referred
1 Rece v. Newport News &c. Co., 32 W. Va. 164; s. c. 5 Ins. L. J. 515; 3 L. R. A. 572; 5 Rail. & Corp. L. J. 515; 9 S. E. Rep. 212; post, § 7466.
Shaft v. Phoenix Mut. Ins. Co., 67 N. Y. 544; 8. c. 23 Am. Rep. 138. See, further, Insurance Company v. Dunn, 19 Wall. (U. S.) 214; Farmers' Loan &c. Co. v. Maquillan, 3 Dill. (U. S.) 379; Minnett v. Milwaukee &c. R. Co., 3 Dill. (U. S.) 460. In Cooke v. State Nat. Bank, 52 N. Y. 96; 8. c. 11 Am. Rep. 667,- the action was brought by a citizen of New York, in a State court in New York, against a national bank located in Boston. It was held: 1. That the court was not ousted of jurisdiction by section 57 of the National Currency Act (13 U. S. Stat, at Large, 99), that statute being permissive, and not mandatory as to the courts in which a national bank may be sued. 2. That the defendant was a citizen of Massachu
setts, within the meaning of the acts relating to the removal of causes to the Federal courts. 3. That the joinder in the action, as defendants, of the drawers of the check, would not deprive the bank of the right alone to apply for the removal of the cause to the Federal court, the causes of action being distinct and only properly joined by virtue of a State statute. A fourth proposition was ruled by a divided court, which was, that the cause could not be removed
by the bank into the Federal court under the Act of Congress of March 2, 1867, on the ground of local prejudice, by reason that, being a corporation, it had not the power to make the affidavit prescribed by the statute. But the case has been overruled on this last point, as already stated, by Mix v. Andes Ins. Co., 74 N. Y, 53; s. c. 30 Am. Rep. 260.
to, that a corporation is conclusively presumed, for the purposes of Federal jurisdiction, to be a "citizen" of the State under whose laws it is created, no matter whether it has an actual domicile in that State or not, and no matter where its actual business domicile may be, and no matter what the citizenship of its members may be,'-- it is the doctrine that, within the meaning of the removal acts, a corporation is a citizen and resident of the State under whose laws it is created, although it may be organized for the purpose of doing business chiefly in other States. Under this theory, a corporation aggregate, composed, we will say, entirely of citizens of New York, created for the purpose of carrying on business in the State of New York, and nowhere else, under a charter procured by the aid of an attorney in West Virginia, under the laws of that State, becomes a citizen of the State of New York; so that whenever an action is brought against it by another citizen of that State, for an amount within the jurisdiction of the Circuit Court of the United States, it is entitled to remove the action into that court, thus defrauding the State court of its rightful jurisdiction over its own citizens.
§ 7466. Invalidity of Stipulations not to Remove.-It is a general principle of law that an agreement in advance in which an attempt is made to oust the ordinary jurisdiction of the courts, is illegal and void. Misapplying this principle, the courts of the United States hold that a statute of a State imposing upon a foreign insurance company, as a condition upon which the State grants to it the right to do business within its limits, that it will file an agreement that it will not
1 Ante, § 7448, et seq.; Louisville &c. R. Co. v. Letson, 2 How. (U. S.) 497; Railroad Company v. Harris, 12 Wall. (U. S.) 65; Railway Company v. Whitton, 13 Wall. (U. S.) 270; Muller v. Dows, 94 U. S. 444; Myers v. Murray, 43 Fed. Rep. 695; Williams v. Missouri &c. R. Co., 3 Dill. (U.S.) 267.
Baughman v. National Water
Works Co., 46 Fed. Rep. 4; Myers v. Murray, 43 Fed. Rep. 695.
The writer is here referring to actual, and not to imaginary, cases.
Nute v. Hamilton &c. Ins. Co., 6 Gray (Mass.), 174; Cobb v. New England Mut. Ins. Co., 6 Gray (Mass.), 192; Hobbs v. Manhattan Ins. Co., 56 Me. 417, 421; Stephenson v. Piscataqua Ins. Co., 54 Me. 55, 70; Scott v. Avery, 5 H. L. Cas. 811.
remove suits from the courts of the State into the courts of the United States, is void. The doctrine, as generally formulated, is that a State is powerless to confer upon an artificial being, of its own creation, the faculty of exercising any power in a foreign State; and, conversely, that a State may impose upon a foreign corporation any terms, conditions, and restrictions which it may see fit, upon which, alone, it will be permitted to enter the domestic jurisdiction for the purpose of engaging in business there; but that a qualification of this principle is that such terms, conditions, and restrictions shall not be repugnant to the constitution and laws of the United States. For this reason an agreement exacted of a corporation, as a condition precedent to its right to engage in business in the State, that it will not remove any suit for trial into the Federal courts, is illegal, and a statutory provision imposing such an agreement is unconstitutional, as being an attempt to oust the Federal courts of their lawful jurisdiction. But, on the other hand, the correlative propositions that the laws of one State creating and empowering a corporation can have no force, ex proprio vigore, in another State, and consequently that another State may refuse all recognition to such a corporation, and exclude it from its limits, except where it is engaged in interstate commerce, or is an agency of the United States, carry with them the conclusion that when a foreign corporation enters the domestic State under its license, it is there by sufferance, and that the State may at any time revoke the permission and expel it from its limits.
1 Insurance Company v. Morse, 20 Wall. (U. S.) 445; reversing 8. c. 30 Wis. 496; 11 Am. Rep. 580, and overruling New York Life Ins. Co. v. Best, 23 Ohio St. 105; Southern Pac. R. Co. v. Denton, 146 U. S. 202; Barron v. Burnside, 121 U. S. 186. Compare Doyle v. Continental Ins. Co., 94 U. S. 535. This holding was, of course, followed in the inferior Federal courts. Barling. Bank of British North America, 50 Fed. Rep. 260. And it was, of course, followed by the State
Therefore, the contradictory
judicatories: Texas Land &c. Co. v. Worsham, 76 Tex. 556; 8. c. 13 S. W. Rep. 384; Rece v. Newport News &c. Co., 32 W. Va. 164; s. c. 9 S. E. Rep. 212; 3 L. R. A. 572; 5 Rail. & Corp. L. J. 515.
2 Bank of Augusta v. Earle, 13 Pet. (U. S.) 519; Lafayette Ins. Co. v. French, 18 How. (U. S.) 484; Ducat v. Chicago, 10 Wall. (U. S.) 410; Paul v. Virginia, 8 Wall. (U. S.) 168.
* Insurance Company v. Morse, 20 Wall. (U. S.) 445.