194. Motive for Bringing Suit or n§ 195. Same Subject-When Juris - diction Defeated. Obtaining Citizenship Rearrangement of Parties-Diverse Citizenship. §172. What Constitutes Controversy or Dispute Between Parties Jurisdiction of Federal Circuit CourtCitizenship. An unsatisfied, justiciable claim of some right involving the jurisdictional amount made by a citizen of one State against a citizen of another State is a controversy or dispute between the parties within the meaning of the statutes defining the jurisdiction of the Circuit Court. And such jurisdiction does not depend upon the denial by the defendant of the existence of the claim or of its amount or validity.2 In the exercise of the jurisdiction conferred upon it of controversies between citizens of different States a Circuit Court of the United States is for every practical purpose a court of the State in which it sits and will enforce the rights of parties according to the law of that State, taking care, as a State Court must, not to infringe any right secured by the Constitution and the laws of the United States. And in case of condemnation it would proceed under the sanction of and enforce the State law so far as it was not unconstitutional.3 173. When Corporation Is and Is Not a Citizen— Pleadings. Although a corporation, being an artificial body created by legislative power, is not a citizen within several provisions of the Constitution, yet where rights of action are to be enforced by or against a corporation, it will be considered as a citizen of the State where it was created, within the clause extending the judicial power of the United States to controversies be 1 Acts of March 3, 1875, chap. 137, § 1, 18 Stat. 470; March 3, 1887, chap. 373, § 1, 24 Stat. 552; August 13, 1888, chap. 866, § 1, 25 Stat. 433. Metropolitan Railway Receivership, In re, 208 U. S. 90, 52 L. ed. 403, 28 Sup. Ct. 219. Madisonville Traction Co. v. St. Bernard Mining Co., 196 U. S. 239, 25 Sup. Ct. 251, 49 L. ed. 262. tween citizens of the different States. And where a corporation is created by the laws of a State, it is, in suits brought in a Federal Court in that State, to be considered as a citizen of such State, whatever its status or citizenship may be elsewhere by the legislation of other States. It was held in 1861, by the Federal Supreme Court, that a corporation is not a citizen within the meaning of the Constitution of the United States and cannot maintain a suit in a court of the United States against the citizen of a different State from that by which it was chartered, unless the persons who compose the corporate body are all citizens of that State; that, in such case they may sue by their corporate name, averring the citizenship of all the members, and such a suit would be regarded as the joint suit of individual persons, united together in the corporate body and acting under the name conferred upon them for the more convenient transaction of business, and consequently entitled to maintain a suit in the Federal Courts against a citizen of another State. Where there is no plea to the jurisdiction in a suit in equity in a Federal Court an allegation that complainant is a corporation and citizen of a certain State, and that defendants are citizens of another State, and residents of the district where the suit was brought, stands admitted as to complainant though denied in the answer and as to the defendants by failure to deny." 4 Railway Co. v. Whitton, 13 Wall. (80 U. S.) 270, 20 L. ed. 571. 5 Ohio & Mississippi Rd. Co. v. Wheeler, 1 Black. (66 U. S.) 286, 17 L. ed. 130. 6 Crown Cork & Seal Co. v. Standard Brewery (U. S. C. C.), 174 Fed. 252, citing Roberts v. Lewis, 144 U. S. 653, 12 Sup. Ct. 781, 36 L. ed. 579; Butchers' & Drovers' Stock Yards Co. v. Louisville & Nashville R. Co., 67 Fed. 35, 14 C. C. A. 290, 31 U. S. App. 252. Pleadings as to averments of citizenship, see the following cases: Mexican Cent. Ry. Co. v. Pinkney, 149 U. S. 194, 37 L. ed. 699, 13 Sup. Ct. 859; Gordon v. Third Nat. Bank of Chattanooga, 144 U. S. 97, 36 L. ed. 360, 12 Sup. Ct. 657; Everhart v. Huntsville College, 120 U. S. 223, 30 L. ed. 623, 7 Sup. Ct. 555; Continental Ins. Co. v. Rhodes, 119 U. S. 237, 30 L. ed. 380, 7 Sup. Ct. 193; Grace v. American Central Ins. Co., 109 U. S. 278, 27 L. ed. 932, 3 Sup. Ct. 207; Covington Drawbridge Co. v. Shepherd, 20 How. (61 U. S.) 227, 15 L. ed. 896, aff'd 21 How. (62 U.S.) 112, 16 L. ed. 38; Piquignot v. Pennsylvania Railroad Co., 16 How. (57 U. S.) 104, 14 L. ed. 863. General issue admits corporate capacity of plaintiffs to sue. Society for a corporabrought in a citizen of may be else held in 1861, ion is not a f the United f the United Tom that by compose the in such case e citizenship carded as the In the corpo pon them for consequently gainst a cithe jurisdic gation that ain State. residents mitted as the de ed.13 d. 252 1. 579= a., 67 3. 1 $174. Presumption as to Citizenship of Members of Corporation-President and Stockholders. For the purpose of suing and being sued in the Circuit Court of the United States the members of a local corporation are conclusively presumed to be citizens of the State by whose law it was created and in which alone the corporate body has a legal existence. There is an indisputable legal presumption that a State corporation, when sued or suing in a Circuit Court of the United States, is composed of citizens of the State which created it, and, therefore, such corporation is itself deemed to come within that provision of the Constitution of the United States which confers jurisdiction upon the Federal Courts in "controversies between citizens of different States." This presumption accompanies a railroad corporation, which has consent to extend its railroad into another State, and does business therein, and it may sue or be sued in the Federal Courts in such other State as a citizen of the State of its original creation. That presumption of citizenship is one of law, not to be defeated by allegation or evidence to the contrary. No the Propagation of the Gospel, etc., v. Town of Pawlet, 4 Pet. (29 U. S.) Averment of residence of plaintiff in State, in suit against foreign corpo- An averment in a bill that the complainants are "all of Cognac in France, Thomas v. Board of Trustees of the Ohio State University, 195 U. S. 207, 25 Sup. Ct. 24, 49 L. ed. 160. St. Louis & San Francisco Ry. Co. v. James, 161 U. S. 545, 40 L. ed. 802, 16 Sup. Ct. 621, reviewing the authorities, and cited in Utah-Nevada Co. V. De Lamar, 113 Fed. 113, 118, 66 C. C. A. 179, distinguished in Patch v. Wabash Rd. Co., 207 U. S. 277, 28 Sup. Ct. 80, 52 L. ed. 208. See Dodd v. Louisville Bridge Co. (U. S. C. C.), 130 Fed. 186, 196. Where a corporation is created by the laws of a State, the legal presumption is, that its members are citizens of the State in which alone the corporate body has a legal existence. And a suit by or against a corporation, in presumption exists, however, that a president or stockholder of a corporation is a citizen of the same State as the corporation when an individual's citizenship is in question upon his right to sue in the Federal Courts. But a suit by or against a corporation in its corporate name must be presumed to be a suit by or against citizens of the State which created the corporate body, and no averment or evidence to the contrary is admissible for the purpose of withdrawing the suit from the jurisdiction of the United States. This rule of the Supreme Court was made to prevent the interminable litigation that might arise if every corporation, when suing or being sued in the courts, was compelled to show that each and every one of its members was a citizen of the State in which the corporation was organized. The necessity of the rule, the object in adopting it, was to fix the status of the corporations, and determine their rights in suing or being sued. For that purpose the presumption is indulged in. The constant tendency of the decisions of the Supreme Court of the United States has been towards putting corporations upon the same footing as natural persons in regard to the jurisdiction of suits by or against them." § 175. Citizenship Joint-Stock Company Not a Corporation for Jurisdictional Purposes. An allegation that a plaintiff is a joint-stock company organized under the laws of a State is not an allegation that it is its corporate name, must be presumed to be a suit by or against citizens of the State which created the corporate body; and no averment or evidence to the contrary is admissible for the purpose of withdrawing the suit from the jurisdiction of a court of the United States. Ohio & Mississippi Rd. Co. v. Wheeler, 1 Black. (66 U. S.) 286, 17 L. ed. 130. While the members of a corporation are, for purposes of suit by or against it in the courts of the United States, to be conclusively presumed to be citizens of the State creating it, the corporation itself is not a citizen within the meaning of the provision of the Constitution that the citizens of each State shall be entitled to all privileges and immunities of citizens of the several States. Blake v. McClung, 172 U. S. 239, 43 L. ed. 432, 19 Sup. Ct. 165. Utah-Nevada Co. v. De Lamar, 133 Fed. 113, 118, 66 C. C. A. 179. See Dodd v. Louisville Bridge Co. (U. S. C. C.), 130 Fed. 186, 196. |
