85 F. 559 | U.S. Circuit Court for the District of Western Tennessee | 1898
(after stating the facts). This case is very peculiar, and I have been perplexed to know what to do with it. The defendant is a Missouri corporation, entitled, under the principles laid down in Pennoyer v. Neff, 95 U. S. 714, and other cases of like authority, to exemption from suits in other states which shall, without due process of law, bind it to personal judgment, except so far as it may have submitted'itself to these outside jurisdictions; but, by the same principles and authority, whatever property it has situated in another state is undoubtedly subject to appropriation in that state, by attachment or other proceedings for that purpose, to the payment of any debts which it may owe to citizens of that state. It is a primary principle in all jurisprudence that whenever a nonresident comes within the jurisdiction of a state, and sues its citizens, as in this case the defendant company did when it sued the plaintiffs here, it submits itself to that jurisdiction for all the purposes of that suit, and whatever remedy the defendant has against the nonresident plaintiff by way of set-off or cross action in that suit may be enforced against the nonresident, as it may against any other plaintiff, and for that purpose every court in which a suit is pending has a right to compel the nonresident plaintiff to submit to answer and defend against the cross action; and under this principle it is obvious that, if the chancery court in which the defendant company brought its suit at law could have maintained a cross action for unliquidated damages, there would have been no difficulty in having the very litigation we have in hand carried on in that suit. But, inasmuch as our Tennessee statute conferring upon the chancery court jurisdiction of actions at law by express terms excludes it from entertaining suits for unliquidated damages, the plaintiffs here were compelled to go into a court of law to bring their suit. Mill. & V. Code, § 5043. And, being so compelled, we have the anomaly, as a result of this Tennessee legislation, that parties having cross actions against each other, of purely legal cognizance, which could be well and entirely settled between them in a court of law in one suit, are separated from each other, unnaturally, so to speak, and one is in a court of chancery with his action at law, and the other is in a court of law with his cross action at law, both arising out of precisely the same
It remains, however,- to give the reasons for ruling that this garnishment has not accomplished the purpose of bringing the defendant company into court to answer this suit. On principle, it will readily occur to almost any one that to allow a plaintiff in attachment to garnish himself as a debtor to his creditor, whom he made a defendant for that purpose, is a distortion of the process of garnishment from its ordinary uses, and in itself suggests that some ulterior or sinister purpose is to be accomplished. If two parties owe each other, the two debts, so far as they go, set themselves off; and from time immemorial the courts of law have afforded them an ample opportunity to set them off against each other whenever either brings an action at law. And whatever defects formerly existed in courts of law have long since been supplemented by remedies in equity, so that it is never necessary that either should attach the other by garnishment for the sim
“When property, choses in action, or effects of a debtor, are in the hands of third persons, or third persons are indebted to such debtor, the attachment may be made by garnishment.” Mill. & V. Code, § 4219.
An ingenious argument is made in behalf of the plaintiffs, upon the authority of the cases of Boyd v. Bayless, 4 Humph. 386, and Arledge v. White, 1 Head, 239, in both of which cases, by attachments in chancery, debts due from the defendants to the plaintiffs were set off against debts due from the plaintiffs to the defendants. It does not at all appear by either of these cases that the process used was garnishment, and in the first case it is stated that the purpose was accomplished by injunction and attachment. These two cases arose under Act of 1835-36, p. 143, c. 43, which is entitled “An act more effectually to subject property in this state belonging to nonresident debtors, to the payment of their debts due citizens of this and other states.” That act and another passed at the same session are 1he main roots of our peculiar Tennessee jurisprudence, so enormously enlarging the jurisdiction of the chancery court that it has at last absorbed quite all the common-law jurisdiction, except suits for personal injuries, and jurisdiction over crimes. It has now almost complete concurrent jurisdiction with courts of law in all matters of contract, unless the suit involves unliquidated damages, and it is by reason of this very peculiarity that the controversy we have in hand arises. This act of 1836 was professedly in aid of the ordinary jurisdiction theretofore existing in a court of equity, as well as an enlargement of equitable remedies. The first section gave a remedy by hill in equity to subject the property of the nonresident, without having first recovered a judgment at law, so that it was not necessary to go to his home state, or catch him in this state, to sue at law; and it so extended that remedy as to subject to it legal as well as equitable assets, comprehending therein all classes of property, real, personal, ciroses in action, and debts. But it was confined by its very terms to the chancery court; its main object being to extend the ordinary remedies for the subjection of equitable assets to satisfy a judgment at law to the subjection of mere legal assets as well, without any previously obtained judgment at law, and nulla bona return, and to bring nonresident as well as resident debtors within the scope of this enlarged jurisdiction in equity. There is no mention made in it of garnishment, except in the sixth section. The ordinary process of garnishment, as then known to the laws of the state under execution, was intended to satisfy an execution authorized to issue, from any deficit that remained after the application of the assets which had been attached under the bill filed to enforce the new
Now, this act of 1835-36 amplified the powers and remedies of a-chancery court in the exercise of that jurisdiction which it had before, of subjecting debts due to the defendant to the process of set-off, and to the satisfaction of creditors residing in Tennessee, where their debtors .were nonresident, by allowing these remedies to be executed when there was no judgment at law, and solely upon the ground of the nonresidence of the debtor. But I repeat again, there is not a syllable in any of this legislation that enlarged in any way the process of garnishment in an original attachment at law, as known to-the act of 1794. Mill. & V. Code, § 4219 et .seq., 1 Thomp. & S-
“Attachments may be levied upon any real or personal property either of a real or equitable nature, debts or choses in action, whether due or not duo, in which the defendant has an interest.” Mill. & V. Code, § 4241 (Thomp. & S. Code, § 3500).
It is conceded by counsel for the plaintiffs that this section of the Code does not in express terms state that the resident debtor may attach a debt due by himself, but it is insisted that because that could be done, under the act of 1836, in the chancery court, it can now be done, under 1he last above quoted section of the Code, in a court of law, for the reason that section 4997, Mill. & V. Code (Thomp. & S. Code, § 4225), confers upon the circuit courts all general jurisdiction, where it is not conferred upon any other tribunal. This assumes that the jurisdiction of the act of 1836 conferred upon the chancery court no longer belongs to that court, which is a mistake, for it will be found that in the codified sed ion 5022 et seq., Mill. & V. Code (section 4279, Thomp. & S. Code), that jurisdiction is conferred upon the chancery courts in the fullest manner possible, as well as all that other jurisdiction created by chapter 4, of the acts of 1835, passed at the same session of the legislature to establish the chancery courts, and to regulate their jurisdiction, and, besides this, all that, growth of jurisdiction which had come to that court by subsequent and amendatory legislation, up to and including the Code of 1858, from which we are quoting. I do not know but what it is an assumption upon the part of counsel for the plaintiffs that Mill. & V. Code, § 4241 (Thomp. & S. Code, § 3500), above quoted, is a substantial re-enaciment
Upon an examination of all these sections of the Code, I am of the opinion that there is ample and abundant jurisdiction in the chancery court to enforce the right of set-off belonging to a creditor in Tennessee against a nonresident debtor, but that such right of set-off cannot be enforced, directly or indirectly, through the process of original attachment and garnishment at Iqw. The home creditor must resort to a court of equity to accomplish what the plaintiffs seek to accomplish here. By such a bill, and by the equitable attachment
It is for these reasons I have determined to take the course indicated, of refusing to dismiss this suit, and allowing the plaintiffs to retain it, and keep it alive hv alias writs of process until they have, by a resort to a court of equity, compelled the defendants to enter (heir appearance here, if they do not voluntarily appear. While the motion of the defendants to quash or abate the writ of garnishment and its service, as being ineffectual to accomplish its purpose, must be granted for the reasons above stated, yet the suit, will not he dismissed, and this court will lend every aid that is possible to the state court of equity first acquiring jurisdiction of the defendant’s claim against the plaintiffs to compel it to submit to a trial at law of the