96 F.2d 26 | 5th Cir. | 1938
Pan American Production Company, a Delaware corporation, was the final transferee from Gulf Refining Company of Louisiana, apparently a Louisiana corporation, of what is popularly called an oil lease on certain lands in Louisiana. Producing oil wells were secured under it by the predecessors of Pan American and are still producing. Several unsuccessful wells have since been sunk by Pan Ameiican. The landowner, United Lands Company, a corporation of Louisiana, contends that proper development of the land requires further well drilling and threatens to terminate the “lease” if it is not done, while Pan American contends that further drilling is not justified by any prospect of success. A definite controversy has thus arisen which involves the possible loss by Pan American of its rights. Pan American thereupon brought in the District Court of the United States its bill against the landowner for a declaratory judgment establishing their respective rights and obligations, and for injunction against terminating the lease and operations under it; federal jurisdiction resting on diversity of citizenship. The bill was dismissed for want thereof on the' ground that the suit was on an assigned chose in action, and there was not diversity of citizenship between the original parties to the chose. Pan American Production Company appeals.
The statute involved, 28 U.S.C.A. § 41 (1), so far as material, is: “No district court shall have cognizance of any suit * * * to recover upon any promissory note or other chose in action in favor of any assignee, or of any subsequent holder if such instrument be payable to bearer and be not made by any corporation, unless such suit might have been prosecuted in such court to recover upon said iiote or other chose in action if no assignment had been made.” We do not think this is a suit to recover upon a chose in action. The phrase “chose in action” is the antithesis of chose in possession, 11 C.J. p. 759, and refers to a right to money or other personal property which is not in hand and can be reached and enjoyed only by an action. It is sometimes applied to the paper evidencing the right, as a note, bond, stock certificate or executory contract. Webster’s International Dictionary. The plaintiff here is not seeking to recover anything, but only' to protect what he has. He is in possession. If his right is a chose, it is a chose in possession. He is trying to protect property in his possession and enjoyment, and not to recover upon a chose in action. What he has, we think, is a vested right in realty. The instrument which granted it says in part: “United Lands Company * * * grants to Gulf Refining Company of Louisiana * * * the exclusive right to explore the land herein described for mineral indications, to drill and mine thereupon for oil, gas, sulphur and other minerals, and to produce and appropriate any or all of the same therefrom * * * during the term and subject to the conditions hereinafter stated. * * * After discovery of any mineral in paying quantities on the land the Company may maintain its right in effect for so long as it pleases by proceeding with reasonable diligence to develop the land. * * * Grantor shall be enti
Judgment reversed.