*1 CALIFORNIA, OF CORY, CONTROLLER et al. TEXAS, OF GENERAL
WHITE, ATTORNEY et al. 14, January 1982 Decided June Argued No. 80-1556. Burger, J., Court, C. White, J., in which opinion of the delivered the Brennan, J., O’Connor, JJ., Rehnquist, Blackmun, joined. and and Powell, J., filed p. 91. concurring judgment, post, in the opinion
filed Stevens, JJ., post, joined, in which Marshall and dissenting opinion, p. 92. Falk, Jr., B. for petitioners.
Jerome the cause argued L. Glick, R. Steven were Martin him on the briefs With Myron Mayer, Osselaer, Van Paul J. Siedorf. Clayton respondents Lilienstem for
0. the cause argued A. Patricia were him the brief on et al. With Lummis Harmon, George, M. Jr., John R. Stevenson, James Harrison cause Rick Moore. argued William James respondents him the White et al. With brief were *2 Attorney pro Texas, se, White, General of Gilbert Mark Attorney General, and Bernal, Assistant David Jr., J. Deaderick. opinion of the Court. delivered White
Justice right and assert the to both Texas California case, In this Hughes. levy of Howard on the estate death taxes state impose an inheritance tax on the real and of laws each State property personal tangible located its borders, within per- upon intangible personalty, situated, wherever of a of at the time death. Under the son domiciled in the State an individual has but one domi- California, of laws Texas and Taxing any in each officials State assert that time. cile State at the time of was domiciled their Howard us is whether the Federal Inter- death. The issue before his jurisdictional provides pleader Act, §1335, 28 U. C. a by the for resolution of inconsistent death tax claims basis officialsof two States. sequel Texas, This U. S. case is the California petitioned for leave file a There, California original jurisdic-
complaint Texas under this Court’s concurring time, At that we denied the motion. tion. opinions, suggested determina- however, four Justices that a Hughes’ might district domicile in federal tion be obtained Interpleader pursuant C. Act, court to the Federal §^.1 Act, § Interpleader provides: The Federal U. S. C. “(a) any civil original jurisdiction shall have action The district courts firm, any person, or filed interpleader or in nature of custody association, society having posses- or or his or its
corporation, note, bond, cer- more, having money or or issued property $500 sion or tificate, insurance, or or amount of policy $500 other instrument of value money or more, delivery or loan of providing payment for the or or or any or value, obligation written being amount or under property of such more, the amount of if $500 unwritten to after the decision Three weeks statutory interpleader filed a ac- the estate
administrator of for the Western Dis- District Court tion in the United States Asserting the officialsof the two trict of Texas. seeking on the tax the estate basis of inconsist-
were respective of their States was Howard ent claims that each requested Hughes’ death, it the District Court to domicileat adjudicate of domicile. The District Court the issue entered restraining prohibiting temporary order pursuing domicile-based inheri- Texas officials any including forum, other their own tance tax claims courts. *3 subject-
The
then dismissed for lack of
District Court
satisfy
requirement
for failure to
the
of
matter
§
diversity
citizenship
1335that there be
of
between at least
two adverse claimants.
It found that the administrator was
Among
claimants,
not a claimant.
the
it held that
the
County
Angeles County
Treasurer for Los
awas
citizen of
diversity purposes, citing
County
California for
Moor v.
of
(1973).
Alameda, 411 U.
693
ruled, however,
S.
court
the State of
officials,
rather than its
was
opposing
the
claimant and that because a State is not a citizen
diversity purposes,
Telegraph
of itself for
Postal
Cable Co.
“(1)
claimants,
Two or more adverse
citizenship
of diverse
as defined in
title,
section 1332 of this
claiming may
or
to
claim to be entitled
such
money
property,
any
or
or
arising by
one or more of the
virtue
benefits
note, bond,
any
certificate,
of
policy
arising by
or other
or
vir-
instrument
(2)
any
tue of
obligation;
such
plaintiff
deposited
money
and if
the
has
such
property
or
or
paid
has
the amount of or the loan or other value of such
instrument or the
obligation
registry
amount due under such
the
of the
into
court,
judgment
court,
there to abide
given
payable
the
or has
bond
to the clerk of the
surety
court
such amount and with such
as the court
judge
may
proper,
upon
compliance by
plain-
deem
conditioned
tiff with
judgment
the future
respect
order
of the court with
to the sub-
ject
controversy.
matter of the
“(b)
may
Such an
although
action
be
or claims of
entertained
the titles
conflicting
identical,
claimants do
origin,
not have a common
or are
but are adverse
independent
to and
of one another.”
(1894),the
did not
two
action
involve
Alabama, 155U.
citizenship
required
diverse
of
claimants
adverse
or more
statute.
Appeals
Circuit
for the Fifth
reversed the
of
The Court
White,
F.
2d
Lummis
of dismissal.
order
County
it
Treasurer,
found
adminis-
addition
Nevada, to
a claimant for
estate, a citizen
trator of
statutory interpleader.
recognized
It
purposes
Mining Co.,
held
Treinies
Sunshine
citizenship
stakeholder could not be
of a disinterested
that a
determining interpleader jurisdiction. Rea-
considered
legal duty
soning,
here
the administrator’s
however,
preserving
from the
assets
double death tax
the estate's
liability
was
in Ne-
his assertion that
domiciled
made
tax,
state death
the administrator
vada, which has no
stakeholder,
court further held that the citi-
interested
may
zenship
interested stakeholder
be considered
of an
§
establishing diversity
requi-
purposes
under 1335. The
County
diversity
the administrator and the
site
—between
present.
Angeles
Treasurer of Los
therefore
—was
Appeals
reject
claim
went
States’
although
nominally against
was
officials,
the suit
sovereign
a suit
two
was
by
effect
States barred
*4
Recognizing
the
that
Eleventh Amendment.
Worces
County
(1937),
Riley,
ter
Trust
Co.
The California officials
and,
for certiorari
at the
seeking
same
filed a
time,
new motion
leave
file a com
original jurisdiction.
plaint against
Texas under
Court’s
troubling
involving
ju
federal-court
issues
Because
granted
disputes,
II
certiorari.
plaintiff, estate, had the administrator appellate spective held that court the Eleventh relief, his suit. bar did not Amendment by unpersuaded this view of Edelman. That case
We are against claiming state officials their a suit involved particular program a federal-state was con- administration of Among trary regulations Constitution. to federal judgment plaintiffs sought things, for a benefits other against paid them. The case was individ- not been that had allegedly violating law, and were ual who officers arguably the reach of the Eleventh fell outside therefore Young, parte Ex S. 123 under U. Amendment however, that the case was effect a suit held, Edelman payable judgment from the State itself because correctly It Ford was demanded. was noted that state funds Treasury Department Indiana, 323 U. Motor Co. authority for this result. was Amend- hold, however, Edelman did not Eleventh money payable judgment applies unless a ment never treasury sought.2 prop- is novel state It would be a from the not bar a that the Eleventh Amendment does osition indeed money judg- enjoin simply no suit to the State itself because sought. “The Ju- Amendment reads: ment The Eleventh power dicial the United States shall not be construed Eleventh dissent miseharacterizes Edelman asserting Post, “only” money damages. seeking Amendment bars suits seeking to im Edelman recognized parties private rule “that a suit treasury pose liability paid public which must be funds in as Amendment,” but never barred the Eleventh such ones so serted that suits were the barred. *6 prosecuted any equity, or or commenced
extend to suit law against Citizens of another one of the United by its Eleventh Amendment terms Thus, . . . State seeking injunction, remedy clearly applies suit avail- to a adopt suggested limiting equity. rule, To able Eleventh Amendment to a suit for a the strictures of the ignore explicit language money judgment, and con- would very words of the Amendment itself. Edelman tradict the imply, any proposition. much less such embrace, did not naming with a suit Neither did Edelman deal a state offi- alleging defendant, but not a violation of either cer opinion Thus, there was no occasion in the state law. opinion the unanimous cite discuss Worcester that the against Amendment bars suits Eleventh state officers unless they alleged acting contrary to be to federal law or against authority law. of state Edelman did not hold alleged that suits officerswho are not to be act- ing against permissible federal or state law are under the only prospective sought. Eleventh if Amendment relief is preferable Whether or not that would be the Edelman rule, adopt v. Jordan did not it. if
Furthermore, that were to law, be the Worcester must in major part unwilling, be overruled. We are however, scope overrule that decision and narrow the of the Eleventh Amendment to the extent that action would entail. We hold statutory the Eleventh Amendment bars the inter- pleader sought judgment in this case. The of the Court of Appeals
Reversed.
concurring
judgment.
in the
Justice
Brennan,
(1978),
joined
v. Texas,
Substantially in the *7 set forth the reasons for long County me so Worcester that clear to it is now Court, good Riley, law, remains Trust Co. practical not a so- court is in the district suit presented potential problem double taxation of lution to persuasively As Justice as these. Powell in cases such dissenting opinion, cases, later argues con- of his Part III struing have undermined Worcester Clause, Process the Due holding taxation on the County's unfairness of double that the conflicting to of domiciledoes not rise determinations basis of surely And is dimensions. Powell constitutional Justice multiple observing “[t]he of threat taxation correct simply incompatible solely with domicile based system recognizing principles as ‘fun- of a federal structural right travel.” Post, to damental’ constitutional overruled, not to be and inter- if But Worcester possibility provide pleader relief from the is not available appropriate duplicative I think it estate, taxation of this of juris- original supra, our Florida, under Texas v. exercise controversy. agree present Pro- with diction to decide quoted post, “[s]omewhere within Chafee, fessor system [the] we should be able to find remedies system rem- frictions which that creates.” Where such falling edy only if exists—even the narrow class of cases holding within the ployed. of should be em- Texas Florida —it original The exercise of the Court’s very just prudent, circumstances such as this and is both likely original in accordance with intent. the Framer’s Powell, with whom Justice Marshall
Justice join, dissenting. Stevens Justice today arising
The Court decides two cases from the same post, facts, Texas, set of the instant case and of officials Califor- p. involve the efforts cases 164. Both intangible property of the late How- tax nia and Texas to Hughes right tax the Hughes. its asserts Each State ard recognize Hughes’ Yet both domicile. the basis estate on at the time Hughes one domicile have had could his death. agree multiple all would be taxation that avoid
In order to Hughes invoked the estate administrator unfair, the Hughes’ litigating Interpleader as a means Act1 Federal proceeding. The administrator al in one federal domicile complaint, was not a domi leged however, that in his ciliary but rather of the State of of either California App. 10.2 Nevada. today inter- holds that this case, instant Court Amendment. The
pleader the Eleventh is barred action dispute based on domi- does *8 deny that the burden Nor does it cile is unfair. claiming ordinarily not on one of the fall, would solely But the Court heirs to an estate.
States, but on the ap- directly. Rigidly opinion issues does not address these precedent, aged denies plying the Court indefensible an and any in federal forum and heirs of an estate the administrator incompatible claims of domicile. which to resolve legal Having bar to both there is no held in this case that taxing Hughes basis estate on the and Texas California today’s surprisingly decision in concludes domicile, presently p. ex- post, that there Texas, in controversy justiciable States those two ists a “between” two actually Hughes’ these But was domicile.3 to which today arising set the same cases—both decided and both holding in- in the of facts—cannot be reconciled. Under §1335. 1 28U. S. C. as a appeared imposes has not Nevada no estate tax and therefore party. not suffer will decision, Hughes apparently As a heirs result of this will not presumably double taxation. of other estates unfair Other heirs be so fortunate. two prohibition against no federal there that case
stant domicile, the basis estate Hughes States cannot to suffice the two claims assertion mere In them. finding “between” controversy a establish must on a dou- decision, rely the Court for ripe is a case there judgments win might both States first, that contingency: ble subject a domiciliary was Hughes courts in their own in a case the second, such taxation; and estate satisfy both claims. enough be large might estate the conclusion support foundation a speculative This is too within controversy appropriately our. case that there original jurisdiction. in these cases rest on decisions Court’s view the my our created obligations the rights
misconception its statutory its constitutional both system, I dissent. Accordingly aspects. today substantially before the Court identi- issues
cal to those presented unanimously In that case the Court denied Califor- file original nia’s motion for leave to complaint.
Court’s order did not our to de- explain one-sentence decision cline to over con- exercise our exclusive original jurisdiction however, troversies “between” Stewart, States. Justice an opinion that Justice and I fully stated joined, Stevens his reasons there existed no case contro- agreeing versy between States.4 He that California’s argued cogently *9 complaint the seeds of lawsuits”: “contain[ed] two distinct
“One is a dispute between two as to the States proper division a finite sum of is a The other suit money.
the nature of the of a de- interpleader question settle 4Justice Brennan also concurring opinion tentatively filed a accepting Justice Stewart’s conclusion stating “deny that he would California’s motion, at least until such time as statutory is shown that... inter- pleader action cannot or brought.” 601, will not be at 602. 437 Id., too filed a concurring opinion. at 615. imposed purposes of the taxes to be for
cedent’s domicile upon in the of inter- But suit nature estate. his jurisdic- original pleader and exclusive within the is not dispute not a it is between because tion this Court dispute States, if indeed it between And the States. certainly yet justiciable is a case or contro- all, is versy at meaning of that term.” the constitutional within Id., at 610-611. changed premises of 1978. On the since material fact has
No controversy justiciable opinion, is no there still the Court’s Texas, v. California. See Texas and between California dissenting).5 however, is, post, There (Powell, J., dispute liability ripe the two tax about estate’s interpleader dispute which for kind States —a jurisdiction ought to be available. II supra, four Texas,
In our 1978 decision California suggested of the administrator Justices this Court might Interpleader Hughes Act to invoke Federal estate protect claims from based on inconsistent the estate conveyed by Contradicting message of domicile. the clear today interpleader case, decision in finds our the Court ground unavailable on the that a suit the state is officials Amendment. barred Eleventh ground distinguishing in 1978 Court’s main situation today situation seems to be that “it seemed to several Members statutory might to exer [in obviate the need 1978] Texas, post, original Yet this jurisdiction.” cise our argument an actual simply unresponsive is question to the whether there in controversy case or can be original properly for which our disap have voked. Court notes that other “several uncertainties” Post, peared. Until the arguments makeweights. at 169. But its courts, conflicting have there no judgments obtained in their own “dispute finite ripe proper between of [the] two States as to the division money” comprising sum of estate. (1978) (Powell, (Stewart, J., post, concurring). U. S. See at 170 J., dissenting).
96 supra, v. all in opinions concurring might estate the administrator that
proposed
Young,
parte
Ex
123
S.
(1908),
U.
“fiction” of
invoke
Jordan,
Edelman
In the Court re- rejecting interpretation County Riley, on Worcester Trust Co. lies at the last this broader view of Edelman “were U. If “Worcester must law,” be the the Court reasons, major Ante, Edelman, be overruled.” part how- light ever, it must the law has since recognized changed Worcester 1937, and that legal on which assumptions County rested no longer valid. See uniformly v. Texas, at 601 If J., concurring). (Brennan, Worcester in- cannot be defended on the basis of its *11 temal and adherence to constitutional principles, this logic not be bound it. Court should
hH H—1 I—i The Court contmues to reason from the ac- today premise, County, Worcester taxation cepted by multiple on the basis of domicile does offend the Constitution —even in a case which both of the States concede that a person have one domicile.6 In view this may my but premise I As an alternative to the wrong. approach embraced Texas, v. now would be prepared overrule County Worcester this and to hold point tax- multiple ation on the basis of domicile —at least insofar as “domicile” is indivisible, treated as so that a can be the person domiciliary of but one State —is with the structure of incompatible our federal system.
A
v. As Justice Stewart demonstrated in
Texas v.
Florida,
Court’s conclusion
U. S. 398
(1939)
there was a controversy
States,
between
identi-
—that
fiable
a suit in
by analogy to
the nature of interpleader —can
be explained
its concern for “the
only by
plight
estate,
which was indeed confronted with a ‘substantial
likelihood’ of
Worcester
must be viewed in
context of a constitutional his
tory
hardly
consistency. Only
years
that is
one of
seven
before the
settled
County,
Court decided Worcester
in Farmers Loan Trust Co. v. Minne
&
sota,
Miller,
had overruled Blackstone
(1930),
v.
U. S. 204
(1903),
mul
multiple tax claims.” U. and inconsistent justification princi- no found of concern this focus Yet jus- actually Florida, and it finds no ples in Texas stated today. If principles the Court rests on which in the tification remedy provide no direct laws the Constitution multiple taxation on the basis with estate faced decedent’s protect principled estate, reason no there is domicile, possibility the bare fact, before completely. may See 437 the estate exhaust *12 only my however, such taxation is not view, In at 611.7 Due Process Clause of the Four- to the offensive unfair but Amendent. teenth
B consistently recognized have that state tax- decisions Our rationally “‘values connected with related to ation must be Mfg. taxing Bair, v. 437 S. Moorman Co. the state.’” (1978), quoting R. v. Mis- & Western Co. 267, 273 Norfolk (1968). Comm’n, 317, 390 U. 325 As souri State Tax Penney by Frankfurter in Wisconsin v. J. C. framed Justice (1940): 444 435, 311 Co., U. S. property
“Th[e] was without due test is whether taken process paraphrase must, if we whether the law, or, power exerted the state bears fiscal relation to protection, opportunities given by state. and benefits simple controlling question but whether the state is given anything has for which it can ask return.” principles tangible generally may property Under these be only by Curry taxed the State where it is located. (1939).8 presence Physical
McCanless, 307 U. S. subject “If it is unfair to an estate taxes when all to two domicile-based agree possible that it only domicile, just to have one that unfairness is great, greater, if not pay when a decedent’s estate is the taxes to able to both States.” 437 U. speak “When we being to tax land or chattels as ex clusively in they the state physically located, where we mean no more than that protection the benefit and enabling enjoy of laws owner fruits of his ownership... narrowly are so in restricted to the state whose justify required state succession tax the trans-
also is property the death of owner. occasioned fer of real (1949); Frick v. Penn- Wisconsin, 338 U. S. Treichler sylvania, 473, 492 intangible personal property, prop-
In with real contrast any particular place, erty physically at least located is not may any simple Moreover, there than one sense.9 more significant intangible prop- connection with has a State that example, erty in which a trust’s are ad- the State assets —for which trustee is domiciled. State ministered supra. Recognizing Curry McCanless, these differ- See intangi- upheld ences, has this Court property. The done so decisions which Court has ble principle however, the fundamental have undermined not, rationally levy must be with of a tax connected that a State’s protections imposed with which the tax values on has afforded. the State case both California Texas—as most States— recognize person have one domicile. And that a can but provides appear ade- settled that domicile would *13 intangible quate property in a of decedent’s basis for taxation dependent or on the estate, not located in the otherwise State protection Curry supra, McCanless, at of its v. laws. See tax- practical limits to territory property physically is located as to set by been without ation others. Other states have said to be if, lo- tax because of their power tangibles and so without constitutional elsewhere, to the protection cation those states can afford no substantial rights . . .” 307 taxed . U. (1939): McCanless, Curry 357, S. See v. 307 U. 365-366 considerations, practical, apply to both theoretical and “Very different is, physical rights are not related to intangibles, which taxation of relationships persons, natural or cor- things. rights are between but Such attaching'to them certain sanctions en- by porate, recognizes the law which protec- government over them and the power in courts. The forceable physical through control of a exerted gives tion it them which cannot only through protec- control over and thing. They can be made effective relationships origin are the persons whose tion to those afforded rights.” Brady, Transit, Inc. v. Complete Auto S. U. cf.
365-366; limits on (1977) Commerce Clause (defining 274, 286-288 con- to and benefits of connections in terms taxation state State). State alleges Here neither by ferred on basis. any estate other tax the entitlement taxation based follows that premises From these domicile not is un- only conflicting determinations solely on by at least one of the on this basis fair, but its asserted to only justify predicate must lack Clause.10 Due Process under levy County Trust in 1937 Worcester course, true that is, It Riley, this unfairness 292, held that admitted Co. v. County's But Worcester offend the Constitution. did not undermined, only has been already on this point holding on due limits reiterating process decisions intervening & West- see intangible property, state taxation Norfolk supra, Comm’n, Tax Missouri State R. ern Co. at 323- Corp. g., income, see, e. Mobil Oil Commis- 326, and of Taxes, 445 U. S. sioner of 436-442 but also fundamental recognized right in which this Court has a cases g., Blumstein, e. Dunn See, travel. 10 Chafee, 1936, 49 Yale L. J. Interpleader Federal Since the Act of See (1940) (footnotes omitted): 377, 383-384
“¡TJhere kind, prop- types In one the same two of double taxation. ... In the erty person taxed in on theories. two states two different taxation, tax single theory applied kind of a in both states to other double governments disagree person property, but two same vital Trust case falls into issue fact. Worcester Co. only law, class. Both had is levied states the same that a death tax only decedent’s dis- domicile that man has one domicile. was, pute where was that domicile? .
“It is . surprising rather all the attacks on double taxation. almost kind, have more been directed at the first kind seems because second *14 unjust. highly governments . . . tell the tax- [I]t unfair for both state payer, pay only tax,’ pay ‘You The have to one and then make him twice. injustice clearly the brought situation is fact that the courts out regard yet acting unlawfully, each state neither state other taxpayer any gives remedy.” (1969). It is 394 U. S. v. Thompson,
(1972); Shapiro in- risks taxpayer that a to State from State moving only by determinations conflicting based taxation multiple curring cre- with charged can be State single no While of domicile. be defended. existence cannot its fact of risk, ating sim- on domicile solely based multiple threat structural principles with the is incompatible ply constitutional right as “fundamental” system recognizing travel.
C on domicile pro- taxation based holding By could Clause, lay Due Process hibited one under the such as this of disputes for resolution basis federal district courts. By interpleader estate with threatened the officials that state taxing alleging would state a colorable an administrator multiple liability, outside of state officers were acting claim that the relevant were their they acting and thus that constitutional limits Ex parte Young, under individual capacities (1908). thus would not bar Amendment Eleventh Jordan, and the Ex and Edelman suit parte Young under would be claimants competing requirement satisfied. inter- Chafee,
Professor Zechariah the father of the federal which cre- statute, system “It is our federal pleader argued: ates the within of double taxation. Somewhere possibility that federal we remedies for the system should be able to find frictions which system Interpleader creates.” Federal Since the 1936, Act of L. Yale J. view right my the Due Process Clause provides
free of domicile. multiple taxation of based on intangibles The Federal Interpleader remedy. Act provides
As the Court holds dissent. otherwise, respectfully