St. Luke's Hospital v. Barclay

21 F. Cas. 212 | U.S. Circuit Court for the District of Southern New York | 1855

BETTS, District Judge.

All the equities set up by the bill are denied by the answer, and until the proofs come in, the court will not inquire in which party the legal or equitable right to the fund in question is vested. In disposing of the motion to enjoin the suit at law prosecuted by the defendants, the court will limit its decision to the point, whether the action at law for the recovery of the fund in dispute shall be stayed, and, if so, upon what terms or conditions.

In opposition to the motion, it is insisted by the defendants, that the case is not within the cognizance of this court, either in respect to parties or subject matter; and that, if otherwise, then all the equity shown by the bill, for the interposition of the court to stay the action at law, is removed by the answer.

The jurisdiction of the court is resisted upon two grounds: First, that the defendants are both of them consuls of Great Britain, acknowledged by the United States, and are, in that capacity, exempt from suit in a circuit court of the United States; second, that no remedy can be had in this court upon the facts alleged in the bill.

This proceeding is not by original bill solely, seeking relief upon the equities of the case; but, in so far. as regards the injunction asked to stay the proceedings at law, it is auxiliary to that action, and may be maintained here to that end, although the court may not have jurisdiction over the parties for other relief. The authority of a circuit court over this class of suits has been considered and settled by the supreme court in two instances. In Simms v. Guthrie, 9 Cranch [13 U. S.] 19, it was decided, that a bill to enjoin a judgment at law in a circuit court of the United States, must be brought in that court, and that the court did not, in such case, regard a defect of jurisdiction in relation' to some of the parties named. In Dunn v. Clarke, 8 Pet. [33 U. S.] 3, the court say, that an injunction bill to stay proceedings at law, is not considered as an original bill between the same parties, but that, if other parties are made in the bill, and different interests are involved, it must be considered, to that extent at least, an original bill, and the jurisdiction of the circuit court-must depend upon the citizenship of the parties.

A cestui que trust may maintain a bill for an injunction against his trustee, to prevent his collecting, appropriating, or disposing of the trust property. 1 Eden, Inj. (by Waterman) 172, note 1. In this case, the allegations in the bill are sufficient to bring the parties within the jurisdiction of this court, if the bill be considered an original one in that point of view. The plaintiffs are averred to be citizens of the state of New York, and the defendants are aliens. The latter consideration is of no consequence in this case, except in so far as the proceeding may be regarded as an original suit; for, if the interest of the plaintiffs is of such a character that, under it, they would be entitled, in ordinary eases, to stay the suit prosecuted at law by the defendants for the recovery of the money in question, they are enabled to do this because the defendants are seeking, in that suit, to get possession of funds equitably belonging to the plaintiffs. And the capacity of the defendants, as suitors in the court, prosecuting for the recovery of the fund claimed by the plaintiffs, also fixes upon them a liability to be controlled, in the management of that suit, at the discretion of the court, as a court of equity. The court thus acquires jurisdiction over the present defendants in their character of parties to the record, without regard to the fact of citizenship or alienage.

If the present plaintiffs had been parties to the action at law prosecuted in this court by the defendants against The New York Life Insurance and Trust Company, they might have had that action stayed, as in ordinary cases, by bill or even motion, even though the official character of the defendants- might exempt them from amenability to an original suit. The United States cannot be sued in any court of justice; but, if plaintiffs themselves, they stand subject to the authority of the court, in their, capacity as suitors, in the same manner as private parties. Cohens v. Virginia, 6 Wheat. [21 U. S.] 406. Without regard, then, to the circumstance that the party applying by bill i to stay proceedings at law is not a party to those proceedings, or is incapable of maintaining an original action in his own name against the one he seeks to enjoin, equity will entertain a bill in his favor for that purpose, when, on facts of which the court cannot take cognizance between the parties to the action at law, it is made to appear to be against conscience that the party prosecuting at law should proceed in his cause. 2 Story, Eq. Jur. § 873. The case of a trustee attempting'to pervert his trust, or employ it to the prejudice of his cestui que trust, by a proceeding at law in which the cestui que trust would be barred of an adequate protection, is particularly appropriate for the interference of equity to restrain the proceeding by injunction. Id. § 8S2.

The defendants being, then, suitors at law, prosecuting for the possession of the fund which the bill avers to be a charity belonging to the plaintiffs to distribute, the effect ! of which suit, if successful, will be to transfer that trust fund from a public depository to the hands of individuals, the case is one proper for the interferenceof the court, to stay such change of possession, until the question of fiduciary right can be determined. That question belongs to equity, and necessarily, in the present case, because no defence can be made at law to the action there, inasmuch as the defendants took a certificate of deposit in their individual names, and the trust company will not be permitted to question their legal title, against that certificate. The protection of the present plaintiffs must be found in the aid of a court of equity, to prevent the charitable fund from being transferred to parties who deny the trust, and design to appropriate the money in a manner to place it out of the control of the plaintiffs.

The defendants, being aliens, are amenable to the jurisdiction of the circuit court in a suit in favor of citizens, and their consular character exempts them only from the jurisdiction of state courts. The act of congress gives to the district courts of the United States jurisdiction in civil actions, in suits against consuls, exclusively only of the state courts. By the law of nations, consuls are subject to the ordinary jurisdiction of the tribunals of the country to' which they are accredited. 1 Kent, Comm. 43, 45; Wheat. Law Nat. p. 293, § 22; U. S. v. Ortega, 11 Wheat. |24 U. S.] 469, note. There seems, therefore, to be no legal impediment to the application of the eleventh section of the judiciary act of 1789 (1 Stat. 78) to actions by citizens against consuls, in the circuit courts of the United States.

On both points, in my opinion, this court has cognizance of this case, and the injunction prayed for ought to issue, and be enforced until the further order of the court.

Subsequently. Bunch pleaded to the jurisdiction of the court, that, at the commencement of the suit, he was the British consul at Charleston, S. C., and Barclay was the British consul at New York, both of them admitted by the president, and that they ought to be sued iu the supreme court of the United States, or in some district court of the United States, and not elsewhere. After argument before NELSON, Circuit Justice, and BETTS, District Judge, by Marshall S. Bidwell, for the plaintiffs, and Charles Edwards. for Bunch, the court (October 2d, 1855) overruled the plea, with costs.