REPORT

OF THE

COMMITTEE ON JURISPRUDENCE AND LAW REFORM.

To the American Bar Association:

Your committee has carefully considered the various subjects that have been referred to it by the Association and by the Executive Committee, and reports as follows:

1. REMOVAL OF CAUSES.

At the meeting of the Association in 1920 your committee was instructed to bring to the attention of Congress and to request the introduction and passage of a bill amending Section 28 of the Judicial Code of the United States, in reference to the district to which a cause removed from the state court should be removed for trial. Controversy had arisen as to the definition of the words "proper district" in the section referred to and it was deemed by your committee that the addition of the following clause would remove any doubt upon the subject: "In all cases of removal where the defendant is not a resident of the state, district or division of the district, in which suit is brought, the District Court of the United States for the proper district shall be the one having jurisdiction in the district or division thereof where suit is brought."

A very extended examination of the diverse decisions on the subject, which has been made by a member of the Association, Mr. Charles A. Boston, who has assisted us materially in this matter, has led us to the conclusion that it would be wise to add to this proposed amendment the words " Notwithstanding any provision of Section 51 of this Act." Some of the courts of the United States have held that notwithstanding the express provision of Section 28 on the subject of removal, the right of removal was limited by the provisions of Section 51, conferring original jurisdiction upon the federal district courts. This provides:

Where the jurisdiction is founded only on the fact that the action is between citizens of different states, suits shall be brought only in the district of the residence of either the plaintiff or the defendant.

The conflicting decisions on these points are thus summarized by Mr. Boston (88 Central Law Journal 250).

Such suit (can) 7 (cannot) 58 be so removed from a state court, though within the apparent category of removable cases, if neither party is a citizen of the state in which the suit is brought;

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Such suit (can) "7 (cannot) " be so removed, if the plaintiff is an alien; Such suit (can) 59 (cannot) ∞ be so removed by a single non-resident defendant if there is not a separable controversy against the removing defendant;

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A separable controversy, otherwise fulfilling the necessary conditions, (can) (cannot) be removed by a resident of the state in which the suit is brought;

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A non-resident of the district (can) (cannot) remove a separable controversy, if his adversary is also a non-resident citizen;

In practice it often happens that a suit may be brought in the court of a state of which neither party is a resident. More frequently it may be brought in a county in a state, of which neither party is a resident. The state courts in such cases have jurisdiction to direct a change of venue, but this right has not been granted to the federal courts.

If Section 51 is to be literally construed, therefore, it would deprive defendants in many such cases of the right of removal to the federal courts. This certainly was not the intention of Section 28, nor should it be in the power of a plaintiff by bringing a suit in a particular state jurisdiction to deprive the defendant of the right of removal, which he would otherwise have, to the federal courts.

The bill recommended by the Association was introduced in the last Congress and your committee had a hearing upon it before a sub-committee of the Judiciary Committee of the Senate.

"Louisville & N. R. Co. vs. Western U. Tel. Co., 218 Fed. 91, 104 (E. D. Ky.); Bagenas vs. So. Pacific Co., 180 Fed. 887 (N. D. Ćal.). Sagara vs. Chicago, Etc., Co., 189 Fed. 220.

5 Hunter vs. Conrad, 85 Fed. 803 (R. I. 1898) and cases cited; Munford Rubber Tire Co. vs. Consolidated Rubber Tire Co., 130 Fed. 496 (S. D. N. Y.); Boston, Etc., Co. vs. Mackay, 70 Fed. R. 801 (S. D. N. Y.) Garner vs. Bank, 66 Fed. 369.

O'Neill vs. Birdseye, 244 Fed. 254 (S. D. N. Y.). See also Hanrick vs. Hanrick, 153 U. S. 192, 197, and California vs. So. Pac. Co., 157 U. S. 260, where it was left undecided, and Chicago R. I. & Pac. Ry. Co. vs. Martin, 178 U. S. 245, where it was not necessary to decide it, and where the cases cited did not establish the proposition for which they were cited. Hughes Federal Procedure, 337; Stanbrough vs. Cook, 38 Fed. 369, 371; Natl. Bk. of Battle Creek vs. Howard, 103 N. Y. Supp. 814.

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Thurber vs. Miller, 67 Fed. 371 (8th Cir.); Wrightsville Hardware Co. vs. Hardware, Etc., Co., 180 Fed. 586 (S. D. N. Y.); Whitaker vs. Condon, 217 Fed. 139 (Md.).

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This necessarily follows from cases under note 55. Barney vs. Latham, 103 U. S. 205.

Foulk vs. Gray, 120 Fed. R. 156, and cases cited under notes 13 to 16,

That committee did not however report. The same bill has been introduced in the present Congress by Senator Nelson and is S-1011. A copy is annexed, marked A. We recommend its passage with the amendment before mentioned which we have added in italics.

We may say, in reference to this, as well as to other legislation recommended by the Association, that the common opinion, so far as your committee has been able to ascertain it, is, that general legislation on this subject will not be taken up at the extra session, but will go over to the regular session beginning in December next.

2. DECLARATORY JUDGMENTS.

The Association, at its session in 1920, approved the recommendation of this committee that it be instructed to bring to the attention of Congress and to request the introduction and passage of a bill amending the Judiciary Code, by inserting after Section 274C. a new section to be numbered 274D., as follows:

No action or proceeding shall be open to objection on the ground that a merely declaratory judgment or order is sought thereby, and the court may make binding declarations of right whether any consequential relief is or could be claimed or not.

The Supreme Court may adopt rules for the better enforcement and regulation of the provision.

Since the report was presented to the Association it has been held by the Supreme court of the State of Michigan* that the legislature had no power under the constitution of that state to authorize a court to render a decision when there was no actual controversy. This decision is based upon much the same grounds as that of the Supreme Court in the case of Muskrat vs. United States, 219 U. S. 346, which is commented on in our last report and in the very clear commentary on that decision accompanying that report by Hon. Charles E. Hughes, who took part in it.

In view of these decisions it has seemed advisable to your committee to recommend the addition of the clause" When there is an actual controversy between the parties."

Meanwhile, the same subject has been considered in the State of Kansas and an act has been passed by that state which is much more elaborate than the bill recommended by this Association. A committee appointed by the Commissioners on Uniform State Laws has also taken the subject up and given it careful consideration. Of this committee, Professor Edwin M. Borchard of the Yale University Law School is a member. He has drawn a bill which has the approval of a sub-committee of the Commissioners and of which a copy is annexed, marked B. We referred in our

* Anway vs. Grand Rapids Ry., 179 N. W. 350.

previous report to his able brief on the subject, which had been presented to Congress at a previous session. Your committee had a hearing before the Commerce Committee of this Association and found that they were also considering the subject, which has attracted general attention.

In drawing the bill which we recommended to the Association in August last we followed the language of the English act upon this subject, which has been in force for upwards of fifty years and has received judicial construction. The argument has, however, been presented to us that the jurisdiction of the federal courts is more strictly defined and limited by the Constitution and by statute than that of the English Court of Chancery and that it would be advisable in any bill which should be urged upon the attention of Congress to insert an affirmative grant of power. In the bill under consideration by the Commissioners on Uniform State Laws, this grant is given in the following words:

SECTION 1. Scope. Courts of record, within their respective jurisdictions, are hereby empowered to declare rights and other legal relations on petition for such declaration, whether or not further relief is oi could be claimed.

The language of the Kansas act on this subject is as follows:

SECTION 1. In cases of actual controversy, courts of record shall have power to make binding adjudications of right, whether or not consequential relief is, or at the time could be claimed.

In the New York Practice Act, which takes effect October 1, 1921, the form is as follows:

SEC. 473. Declaratory Judgments. The Supreme Court shall have power in any action or proceeding to declare rights and other legal relations on request for such declaration whether or not further relief is or could be claimed, and such declaration shall have the force of a final judgment. Such provisions shall be made by rules as may be necessary and proper to carry into effect the provisions of this section.

The bill recommended by the Association at its last session amended as hereinbefore stated, has been introduced in the present Congress by Senator Nelson and is S-1012. A copy is annexed, marked C. No hearing has been had upon this bill which has been referred to a sub-committee, of which Senators Ernst of Kentucky, Shortridge of California and Shields of Tennessee are members. We recommend its amendment so that it shall take the form appended hereto, marked D.

3. APPELLATE JURISDICTION SUPREME COURT.

The frequent occasions on which the Supreme Court has been called upon to decide whether or not a writ of error, an appeal or a certiorari was the proper remedy to obtain a review in that court, and the disposition to look upon this subject as determined by statute and not subject to modification by rule of court have

led your committee to the conclusion that further legislation on this subject is desirable. This might take the form of an amendment to the present statutes. After very careful consideration we recommend, if this course is adopted, an amendment in the form appended to this report, marked E. But your committee is of opinion that there is no good reason for retaining the present complex and cumbrous machinery for review in the higher federal courts of judgments and orders in the lower courts. Writs of error, assignments of error, petitions of appeal and the like have been abolished in many of the states and no bad results have followed from the simplification of practice by which a review in all cases is to be obtained by appeal. The only steps necessary to take an appeal in these states are to file a notice of appeal with the clerk of the court and serve a copy of this notice on the adverse party. We therefore recommend for the approval of the Association a bill upon this subject which is annexed to this report and marked F.*

4. PROTECTION OF ALIENS IN THEIR TREATY RIGHTS.

A bill on this subject, which has been heretofore recommended by the Association and a copy of which is annexed to our report for the year 1920, was laid by us before Senator Kellogg, who expressed his approval of its provisions. He is, at the date of this report, consulting with eminent counsel on this subject.

5. REVISION OF UNITED STATES STATUTES.

The bill to consolidate, codify, revise and reenact the general and permanent laws of the United States passed the House of Representatives in the Sixty-sixth Congress, but did not pass the Senate, and on May 16, last the bill H. R. 12, again passed the House.

This committee and several members of the Bar who were interested in the subject had a hearing before the Senate committee of the last Congress. Many defects in the revision were pointed out.

If it is to be pressed in the Senate it should certainly receive very careful examination.

Your committee is of opinion that the unofficial consolidation of the general laws of the United States made by various law book publishers has demonstrated the desirability of having a consolidation of the general laws of the United States that would be official, and that such consolidation if accurately made

*Your committee has been much aided in its deliberations on this subject by Mr. Charles C. Moore, sometime associate editor of Federal Statutes Annotated.