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NEW ORLEANS V. BENJAMIN, 153 U. S. 411 (1894)
U.S. Supreme Court
New Orleans v. Benjamin, 153 U.S. 411 (1894)
New Orleans v. Benjamin
Submitted January 12, 1891
Decided May 14, 1894
153 U.S. 411
When a suit does not really and substantially involve a dispute or controversy as to the effect or construction of the Constitution of the United States upon the determination of which the result depends, then it is not a suit arising under the Constitution.
Upon the bill and answer in this case, no such dispute or controversy arose as would give original jurisdiction to the Circuit Court of the United States without regard to the diverse citizenship of the parties.
The act of the Legislature of Louisiana repealing the act creating the Board of Metropolitan Police and other acts in relation thereto, was, in itself, a mere change of an instrumentality of municipal government, and as, upon the record, it must be assumed that the assets of that board and the remedies in respect thereof of those who held evidences of indebtedness issued by the board remained unaffected by the repealing act, the act could not be attacked in this way as unconstitutional because it made no specific provision for the payment of such indebtedness, on the liquidation of the affairs of the board.
Whether this suit be regarded as seeking a decree against defendants as on a creditors' bill, or as by analogy to garnishee process, it was, under the pleadings, a suit to recover the contents of choses in action within the meaning of the Judiciary Act of 1887 and 1888, and, as the bill contained no averment that the suit could have been maintained by the assignors, the jurisdiction of the circuit court cannot be sustained on the ground of diverse citizenship.
This is a certificate from the United States Circuit Court of Appeals for the Fifth Circuit, under section six of the Judiciary Act of March 3, 1891, the statement and questions of law so certified being as follows:
"The complainant, an alien, filed his bill of complaint in the circuit court against the City of New Orleans and other municipal corporations, citizens of the State of Louisiana, alleging, among other things, as follows, viz.:"
" That by an act of the Legislature of Louisiana (No. 74) approved September 14, 1868, the Parishes of Orleans (including
the City of New Orleans), Jefferson, and St. Bernard were territorially united in one district for the purpose of police government therein, called the 'Metropolitan Police District of New Orleans, Louisiana.' That the government of said district for police purposes was vested in a board of commissioners styled the 'Board of Metropolitan Police.'"
" That said board was required to appoint all the officers and employees of the police force required in said district, and their salaries, which were prescribed by the act, were required to be paid monthly. That by said act, and acts of said legislature supplementary to and amendatory thereof, said board was required to make annually an estimate of the expenses of maintaining a police force in said district, and to apportion the same to the several cities and parishes within said district, and said cities and parishes were required by said acts to promptly pay, and to provide the means for promptly paying, the amounts thus apportioned to them,"
"and they were authorized and required to raise the amount by levying taxes for that purpose."
"That said board of Metropolitan police, in obedience to the laws creating and governing the same, organized a Metropolitan police force in said district and appointed and employed the officers and members thereof, who entered upon their duties and rendered services under contracts therewith to be paid the salaries fixed by law for such employment, such contracts being made upon the faith of its revenues applicable to their payment being unimpaired."
"That said board annually made the estimates of the expenses of maintaining such police force and apportioned the same to the several cities and parishes in the district, and that large sums are due and unpaid on account thereof by the City of New Orleans and other corporations made defendants in the bill."
"That by the provisions of an act of said legislature approved February 27, 1869, and subsequent acts, all warrants issued in payment of salaries of officers, employees, and members of the Metropolitan police, and for the expenses of said board, were made receivable for all parish and municipal
taxes and licenses within the limits of the Metropolitan police district, and for all debts due or to become due to the parishes and cities within said district not exceeding in any one year the amount of their respective apportionments for that year."
" That by an Act of said legislature (No. 35) approved March 31, 1887, said Act No. 74, of September 14, 1868, establishing said Metropolitan police district; said Act No. 44, of February 27, 1869, making all warrants issued in payment of Metropolitan police salaries and expenses receivable for all municipal and parish taxes within the district; said Act No. 94, of March 30, 1870, requiring the several cities and parishes within the district to pay, and to provide the means for the payment of, their apportionments of the expenses of the board of Metropolitan police; said Act No. 16, of March 24, 1875, entitled 'An act to enforce the payment by the City of New Orleans and the several cities and parishes of the Metropolitan police district of the apportionment made upon them by the board of Metropolitan police, and for other purposes,' as well as all other acts amendatory of said above-enumerated acts, or upon the same subject matter, were repealed, and said board of Metropolitan police was abolished, and no provision was made for the liquidation of its affairs, or the payment of its debts."
" That said repealing act was in violation of Section 10, Article I, of the Constitution of the United States in that it impaired the obligation of the contracts made by said board of Metropolitan police with its officers and employees, and others to whom it was indebted, and who had contracted with and rendered services to said board upon the faith of said provisions of law for the enforced payment and collection of the sums due to it as aforesaid from the several cities and parishes within said district, out of which funds only they could be paid, and to that extent said act was and is null and void."
"The bill further avers that complainant is the holder and owner of Metropolitan police warrants, certificates, and claims against said board of Metropolitan police, said warrants and certificates having been issued by said board for services rendered and supplies furnished, and said claims being for services
rendered and supplies furnished thereto under contracts therewith, said warrants, certificates, and claims amounting to $5,032.90, and that other due and unpaid warrants and certificates issued by said board are outstanding, and sums are due and owing by it for services rendered and supplies furnished to it exceeding $200,000."
"And it is also averred:"
" That the only assets of said board of Metropolitan police at the time it was abolished were the amounts due to it by said City of New Orleans, and by the other defendants, as herein stated. That the aggregate amount of said indebtedness to said board largely exceeds the total amount of its debts and liabilities. That law and equity require that the amount of said assets should be ascertained, and the just proportion due by each of the defendants adjusted, and that the liabilities of said board of police be fixed and determined, and paid out of said assets, and, if the same exceed the liabilities of the board, that said defendants be required to pay their pro rata shares thereof."
" That said board of Metropolitan police was a body corporate under the laws of its creation, and by the repeal of said laws ceased to be, and had and has no representative or successor, against whom suit might have been or may now be brought for the establishment of the demands of the complainant herein, and he is remediless except in this honorable court, where matters of this nature are cognizable and relievable. Wherefore, he brings this his bill in behalf of himself and all other creditors of said board, similarly situated, who may come in, and contribute to the expenses of this suit."
"The prayer of the bill, in substance, is that an account be taken"
"of all the debts, liabilities, and unpaid dues, of every kind, of said board of Metropolitan police, including the warrants, certificates, and claims of your orator, and of all others who may come in and avail themselves of the decree to be made herein, and contribute to the expense of this suit; that a like account may be taken of the amount due by each of said defendants to said board of Metropolitan police for the balances of their unpaid apportionments of police expenses, as
well as of all police taxes collected by them, and withheld from said board, and that said defendants be decreed to pay into the hands of some discreet person, to be appointed receiver by this honorable court, their several pro rata shares of the amount so found to be due to creditors of said board of Metropolitan police, including all costs of the administration thereof, and that the funds thus realized be applied to the payment of your orator's said warrants, certificates, and claims, and of such other persons as may be creditors of said board, and who shall come in and establish their claims, and also to the payment of interest thereon, and all expenses of administration, and costs."
"The defendant the City of New Orleans demurred to the bill, assigning, among other causes of demurrer, the following:"
" That the complainant's said bill of complaint -- in case the same were true, which this defendant does in no wise admit -- contains not any matter of equity whereon this Court can ground any decree, or give the complainant any relief or assistance, as against this defendant."
" That the bill complains of the repeal by the Legislature of Louisiana of the aforesaid acts organizing and relating to the Metropolitan police force and the Metropolitan police board, and by reason of said repeal, the bill alleges, the Metropolitan police board was abolished, and no provision was made, or now exists, for the liquidation of the affairs, or for the payment of the alleged debts, of said board, and the bill calls upon this court to grant relief for the payment of said alleged debts of said Metropolitan police board; but this defendant shows that the only mode of payment of said alleged debts, if any, of the late Metropolitan police board, a political body for the administration of the police of the city, is by taxes to be levied for that purpose, and, if it be true, as asserted by said bill, that no provision now exists for the payment of said debts, this Court has no power to direct the levy of taxes for said asserted debts, or any power whatever to grant any relief in respect to the matters of which the bill complains."
"The demurrer was overruled."
"Said defendant then filed an answer, and, among other
things, averred as follows:"
" Further answering, defendant admits that, by the Act of the Legislature of Louisiana, No. 35 of 1877, the various acts organizing the Metropolitan police board were repealed. But all the provision for the payment of said Metropolitan police was the levy of the Metropolitan police taxes authorized by law, and said taxes had already been levied far in excess of taxes that should have been imposed, and the repealing legislation did not interfere in any manner with the levy and application of said taxes, to the extent that they could be collected, to the payment of the legal obligations of said Metropolitan police board. And with this statement, and a reference to said repealing act, this defendant denies the allegation in the bill that, by such repealing legislation, no provision was made for the liquidation of the affairs of said board, or payment of its debts."
" This defendant again affirms that said repealing act did not interfere in any manner with the means of payment of all lawful obligations of said board, nor with the right of those who had made lawful contracts -- that is, to the extent authorized by law -- with said board, and this defendant again refers to the illegal and void apportionments of said board, and to the alleged contracts made by it, far in excess of the means applicable to the support of the Metropolitan police, and far in excess of their power, and denies to be true that said repealing act was in violation of the Constitution of the United States, or 'impaired the obligation of the contracts of said board with its officers and employees who had contracted with and rendered services to said board upon the faith of said provisions of law for the enforced payment and collection of the sums due to it from the several cities and parishes within said district,' and denies that said act was null and void in any respect, or to any extent."
"Said answer also averred that the city was liable to said board only for such police taxes as she collected, and that she had fully accounted for all such collections, and denies that she is now making any such collections, and that any such taxes are collectible."
"Issue being joined, the case was referred to a master to
take an account of the amounts due by the defendants to said board and of its outstanding liabilities. He reported as due by the City of New Orleans on account of its apportionments a balance of $241,106.54 and an indebtedness of the board incurred on account of said city, and still unpaid, amounting to $123,963.06, besides interest thereon. Small amounts were found due by the other defendants, and also by the board on their account."
"Prior to the decree, a number of creditors of the board, some of whom were citizens of Louisiana, with leave of court, intervened in the suit, made proof of their claims before the master, claimed the benefit of the decree, and prayed to be permitted to share in the distribution."
"Of the amount of claims proved before the master, and covered by the decree, the complainant, an alien, holds $5,777.78; an alien intervener holds $815.78; interveners who are citizens of Louisiana hold $81,100.51, and interveners whose citizenship does not appear hold $30,302.16. Other claims, amounting to $13,363.21, were proved before the master by persons whose citizenship does not appear, and who have not intervened."
"And it appearing that complainant and interveners were assignees of the certificates, warrants, and claims of which they made proof before the master, and that their assignors were citizens of Louisiana, and there being no averment in the bill that the assignors might have sued thereon in the circuit court if no transfer thereof had been made, the City of New Orleans moved to dismiss the suit for want of jurisdiction in said court."
"The motion was denied, and a final decree made requiring the defendants to pay their virile shares of the indebtedness of the board, as reported by the master. From such decree an appeal was taken to this court, and the case came on to be heard upon the errors assigned, whereupon, the court desiring the instruction of the honorable the Supreme Court of the United States for the proper decision of the questions arising herein touching the jurisdiction of the circuit court, it is hereby ordered that the following questions and propositions
of law be certified to said Supreme Court, in accordance with the provisions of section 6 of the act entitled"
"An act to establish circuit courts of appeals and define and regulate in certain cases the jurisdiction of the circuit court of the United States and for other purposes,"
"approved March 3, 1891, to-wit:"
"First. Does the case made by the bill, alleging that the board of police has been abolished, and left without successor or legal representative, and no provision has been made for the application of its assets to the payment of its debts and the answer herein, constitute a suit in equity arising under the Constitution of the United States, and within the jurisdiction of the Circuit Court of the United States for the Eastern District of Louisiana, without regard to the diverse citizenship of the parties?"
"Second. The warrants and the certificates held by the complainant having been issued for services rendered and supplies furnished under contract with the board of Metropolitan police, when the laws required said warrants and certificates to be received by the defendants in payment of all licenses, taxes, and other dues, and all such laws having been repealed by the Legislature of Louisiana without making other provision for the redemption of said warrants and certificates, was this an impairment of the obligation of the contract in relation to such warrants and certificates, within the meaning of Article I, Section 10, of the Constitution of the United States?"
"Third. Do the pleadings show a suit to recover the contents of choses in action within the meaning of the Judiciary Act of 1887 and 1888, so as to preclude the complainant, as assignee, from suing in the circuit court of the United States to establish a fund out of which he, in common with other creditors of the late Metropolitan police board, may be paid pro rata upon their claims?"
"Fourth. Considering all the allegations in the bill of complaint, and the provisions in the Constitution and laws of Louisiana respecting the Metropolitan police board, and the Metropolitan police warrants and certificates, and the redemption circuit court
and payment of said certificates, does the case show a liability on the part of the City of New Orleans to contribute to a fund for the payment of said warrants and certificates beyond its liability for taxes assessed and collected in pursuance of the apportionments made?"
The circuit court of appeals
"further ordered that the bill of complaint, and the demurrer and answer of the City of New Orleans thereto, be made a part of the transcript certifying the aforesaid questions, together with the following sample copies of the warrants, certificates,payrolls, and assignments forming the basis of complainant's demand, to-wit:"
"Warrant Filed with and Part of Assignment"
"Central Department, Metropolitan Police"
"New Orleans, May 18th, 1874"
"Treasurer of the Board Metropolitan Police:"
"Pay to the order of James Reilly, fifty 00/100 dollars."
"By order of the board."
"$50.00 [Signed] E. Parker, Chief Clerk"
"Certificate Filed with and Part of Assignment"
"Central Department, Metropolitan Police"
"No. 4,748 $73.97"
"New Orleans, Jan. 13, 1876"
"This is to certify that the board of Metropolitan police is indebted to P. Moran, No. 22, first precinct, in the sum of seventy-three 97/100 dollars, for salary for account of the month of December, 1875."
"[Signed] L. T. Murdock"
"Treasurer Board Metropolitan Police"
"The amount due as per this certificate will not be paid unless the certificate is delivered to the treasurer of the board."
Then followed form of payrolls, the one given being
approved January 5, 1877, for $4,976.04, and the bill, demurrer, and answer, which were set forth at length.
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