Irvine Ex Rel. Lumberman's Bank at Warren v. Lowry

Mr. Justice Baldwin delivered the opinion of the Court. This suit was instituted, in the Court of Common Pleas of Warren county, Pennsylvania, whence it was removed to the Circuit Court for the western district of that state, pursuant to' the provisions of the Judiciary Act of 1789, section twelve; and comes before this Court on a certificate of division of opinion between the, judges of that Court* pn a motion to remand the cause for want of jurisdiction. Irvine, in whose name the suit is brought, is a citizen of Pennsylvania; the Lumberman’s Bank of Warren, is a corporation chartered, by a law of that state, and located at Warren; part of the stockholders are citizens of New York, of which state the defendant is also 'a citizen. The suit is brought upon a paper, of which the following is a copy: “ $53,000, Warren, Pa., 6 September, ’37. “ Three months after date, I promise to pay to the order of Guy C. Irvine, Esq., fifty-three thousand dollars, in the office notes of the Lumberman’s Bank at Warren, and payable, at their banking house in Warren, Pa.” N. A. Lowar.” Endorsed on side, “ Guv C. Irvine.” The suit was commenced by the process of foreign attachment,, agreeably to the law of Pennsylvania; the property of the défendant was attached according to its provisions: whereupon he appeared, and, by, his counsel, moved for the removal of the cause; and having complied with the requisitiohs of the Judiciary Act, the cause was ordered to be removed to the Circuit Court. *299 By thus approving and submitting to the process of attachment, the defendant waived any privilege to which he was entitled by the section of the Judiciary Act, as held by this Court in Toland vs. Sprague, 12 Peters, 330, 331: so that on his appearance and entry of bail, the attachment was dissolved, and the cause will thenceforth proceed, as if it had commenced by the ordinary process of the Court, served'on the defendant within the district. The commencement of the action in the Common Pleas, by attachment, being, expressly provided for in the twelfth section of the Judiciary Act; it must be considered, when removed into the Circuit Court, as an originhl one. This brings us to the question raised in the argument of the plaintiff’s counsel, whether that Court can exercise any jurisdiction over the case, on the ground that the defendant, and some of the stockholders of the-bank, are citizens of New York; which would be a fatal objection to the jurisdiction, if the corporation is to be considered as the plaintiff and sole party in interest. On this subject, the decisions of the Court have been uniform,' and, as declared in the present term, in the Vicksburg Bank vs. Slocomb, have settled this point decisively; nothing then remains but to ascertain from the record, as certified, whether the bank is the real plaintiff; for if they are not, then, as Irvine is admitted to be a citizen of Pennsylvania, and Lowry of New York, the jurisdiction is undoubted. The paper' on which the suit is brought, is not negotiable by the usage or custom of merchants; it is payable to order; the promise is to pay so many dollars, but not to pay any certain sum of money; it is a promise to pay the amount “ in the office notes of the Lumberman’s Bank at Warren,” which are not money, and at most a'chattel. Not being a promissory note, either by the law merchant, the statute of Anne, or the kindred act of Assembly of Pennsylvania, it is not negotiable.by endorsement; and not being under seal, it is not-assignable by the act of Assembly on that subject relating to bonds. The bank, therefore, cannot sue in their own name, in virtue of the endorsement of Irvine in blank; nor could they so sue if it was specially endorsed to - them; because the legal right of action would still remain in Irvine, though the equitable interest in the thing promised may have passed to the-bank. This case, however, is not of that description; the only evidence of any transfer of the contents of the note is the blank endorsement of Irvine, and the affidavit of the President, of the bank; in the latter of which it is stated, that the note was received by the bank from the defendant, at the time it bears date, as a' security for his previous indebtedness thereto; and that Irvine had not then or since any interest in said note, except as a guarantor for its payment, and the solvency and sufficiency of the drawer. In referring to the affidavit, we are not to be understood that whatever may be its contents, they would influence our decision; yet, assuming the^ case to be as there stated, the legal,right of action is in Irvine ; the paper is not the evidence' of an original *300 debt, contracted by a discount thereof; or its reception as payment of a pre-existing debt due the bank: it is only a collateral security, by adding the name of Irvine as endorser. Standing as such to the bank, their rights are derivative through him; and as the endorsement passes only an equity, the legal interest is in him; he is the real plaintiff in a Court of Law, in which legal rights alone can bé recognised. This consideration points to the true line of discrimination between this and the case of Brown vs. Strode, 5 Cranch, 303; which was. a suit against an executor on his administration bond, given to the justices of the peace of the county where the testator died, and who were citizens of the state of Virginia, as well as the defendant. The jurisdiction of the Circuit Court was Sustained, on the ground that though the plaintiffs and defendants were citizens of the same state, the former were mere nominal parties, without any interest or responsibility; and made by the law of Virginia,the mere instruments or conduits through whom the legal right of the real plaintiff could be asserted; as such their names must be used, for the bond must be given to them in their official capacity; but as the person to whom the debt was due. was a British subject, he was properly considered as the only party plaintiff in the action. Whatever right of action existed in virtue of the bond, passed by the operation of the law of Virginia directly to the person for whose, benefit it was given, through the conduit appointed for that purpose. -. For such; and kindred cases, the person or. officer thus selected by the law as its agent, is not a party to-the suit; and no transfer of the bond or other security to the person intrusted is necessary to invest him with' a complete legal interest or right of action but cases of this description cannot be applied to actions like the present, in which the interest and responsibility of the parties to the paper depends on their contract; and the law neither dissolves or transfers any legal right of action, on or to the party who accepts it as security for payment of a pre-existing debt. We are therefore of opinion that the Circuit Court has jurisdiction' of the case, and direct that it be so certified. This cause came On to be heard on the transcript of the record from the Circuit Court of the United States for the Westerp District of Pennsylvania, and on the point andquestion on which the judges of. tjie said Circuit Court were opposed, in opinion, and which was certified to this Court for: its opinion, agreeably to the act of Congress in such cases made and provided, and was argued by counsel, On consideration .whereof, it is .the opinion of this Ccurt that the said Circuit Court has jurisdiction of the case. Whereupon it is ordered and adjudged that it be so certified to the said Circuit Court accordingly..