These cases, and others that might be referred to, show that the five hundred kegs of nails in the hands of Fowle & Sons were not subject to the attachment of the complainant for the liabilities of Brien, their debtor, as the title to the property had already passed to the defendant, Gilmor; and, also, that Fowle & Sons had no valid lien upon them as consignees for previous advances to Brien by the delivery to the master; as they were only agents to receive the goods on commission for sale, and were advised by the bill of lading and correspondence, that they were shipped for and on account of Gilmor. Though the goods were delivered by Brien to the master for consignment, they were delivered as the property of Gilmor, and, under circumstances, as we have seen, that had the effect to invest him with the title. His right, therefore, was prior in point of time to any lien that might have been acquired, either by the complainant or Fowle & Sons, in consequence of Brien's indebtedness, upon the the other was, in point of interest. a matter of indifference to him. In any view, therefore, that can be properly taken of the case, we are of opinion the decree of the court below was right, and should be affirmed. Order. This cause came on to be heard on the transcript of the record from the Circuit Court of the United States for the District of Columbia, holden in and for the County of Alexandria, and was argued by counsel; on consideration whereof, it is now here ordered, adjudged and decreed by this court, that the decree of the said Circuit Court in this cause be, and the same is hereby affirmed, with costs. strictest principles of law; and as to the equi- | *THOMAS C. SHELDON and Eleanor [*441 ties, it was but a race of diligence among the several creditors of a failing debtor to see which should get the first security for their debts. An objection was made on the argument, that there was no evidence that Gilmor had assented to the transfer of the property to him as security for his demand against Brien, until after the levy of the complainant's attachment. The original bill was amended, making him a defendant, and in his answer he sets up that the transfer was made in pursuance of a previous agreement between him and Brien, in part liquidation of his indebtedness. 440*] *We are inclined to think this part of the answer is responsive to the bill, and there is no evidence in the case contradicting it in this respect. Though the bill is brief and meagre in the statement of the case which it presents, and has not incorporated in it the amendment making Gilmor a defendant; yet, from the nature of the charge against him, and ground for making him a party, it would seem necessarily to call upon him to set forth his the dispute. Sheldon, his Wife, Appellants, V. WILLIAM E. SILL, Appellee. Assignee of bond and mortgage bringing suit in Circuit Court must show his assignor was competent to sue there. tion but such as the statute confers. Therefore, where the third article of the Constitution of the United States says that the judicial tween citizens of different States, but the act of power shall have cognizance over controversies beCongress restrains the circuit courts from taking cognizance of any suit to recover the contents of a chose in action brought by an assignee, when the original holder could not have maintained the suit, this act of Congress is not inconsistent with the Constitution. A debt secured by bond and mortgage is a chose in action. Therefore, where the mortgagor and mortgagee resided in the same State, and the mortgagee assigned the mortgage to the citizen of another State, this assignee could not file his bill for foreclosure in the Circuit Court of the United States. Belain to the property in diapu the answer to THIS was an appeal from the Circuit Court the objection on this ground. In the absence of all evidence to the contrary, in case of an absolute assignment of property by a debtor to his creditor for the purpose of securing a pre-existing debt, an assent will be presumed on account of the benefit that he is to derive from it. This principle was recognized and applied by this court in the case of Tompkins v. Wheeler, 16 Peters, 106, and had been before in Brooks v. Marbury, 11 Wheat. 96. No expression of assent, the court say, of the persun for whose benefit the assignment is made, is necessary to the vesting the title, as the creditor is rarely unwilling to receive his debt from any hand that will pay him. It was also objected, that Brien was an incompetent witness for Gilmor, on the ground of interest; but it is apparent that he had no interest in the suit, for in any event the property would be applied to the discharge of debts against him, and whether in favor of one or Michigan, sitting in equity. The appellee was the complainant in the court below. The bill was filed to procure satisfaction of a bond, executed by the appellant, Thomas C. Sheldon, and secured by a mortgage on lands, in Michigan, executed by him and Eleanor, his wife, the other appellant. The bond and mortgage were dated on the 1st of November, 1838, and were given by the appellants, then, and ever since, citizens of the State of Michigan, to Eurotas P. Hastings, President of the Bank of Michigan, in trust for the President, Directors and Company of the Bank of Michigan. NOTE.-Jurisdiction, colorable conveyances to en able suit to be brought when the mode of transfer Jurisdiction of Circuit Court depending on par ties and residence. See note to 1 L. ed. U. S. 640; 36 L. ed. U. S. 579. General answer waives objections to residence. See note to 3 L. ed. U. S. 36. The said Hastings was then and ever since | power upon the circuit courts. A considerable has been a citizen of the State of Michigan, portion of the judicial power, placed at the disand the Bank of Michigan was a body corpo- posal of Congress by the Constitution, has been rate in the same State. intentionally permitted to lie dormant, by not On the 31 day of January, A. D. 1839, Has- being called into action by law. The eleventh tings, president of said bank, under the au- section of the Judiciary Act of 1789, giving juthority and direction of the Board of Directors, risdiction to the circuit courts, has not covered "sold, assigned, and transferred, by deed duly the whole ground of the Constitution, and executed under the seal of the bank, and un- those courts cannot, for instance, issue a mander his own seal, the said bond and mortgage, damus, but in those cases in which it may be and the moneys secured thereby, and the es- necessary to the exercise of their jurisdiction; tate thereby created," to said Sill, the com-forplainant below, who was then and still is a *1st. This is the settled, practical [*143 citizen of New York. construction, which, irrespective of express adThese are all the facts which it is necessary judications on this topic, concludes the questo state, for the purpose of raising the question | tion. of jurisdiction. The Circuit Court decided in favor of the complainant below, and decreed a sale of the mortgaged premises, etc. From this decree the defendants appealed to this court. the 2d. The point itself has been repeatedly and fully discussed and directly settled, on solemn deliberation, and not "without inquiry as to the ' validity of the act." We propose to cite some authorities on these propositions, in the above order; and then to notice the authorities cited in the opinion be ar-low. The case was argued by Mr. Romeyn for appellants, and Mr. Ashmun (in a printed gument) for the appellee. Only so much of the arguments will be given as bear upon the point of jurisdiction. 442*] *Mr. Romeyn, for the appellants: The Circuit Court had no jurisdiction. The complainant below claimed as assignee from a mortgagee, who was a citizen of the same State with the defendants, the mortga gors. A bond and mortgage, under the laws of the State of Michigan, and in every court of equity, and by the adjudications of this court, on a bill filed to sell mortgaged property, foreclose the equity of redemption, and collect the debt secured by the mortgage, constitute a chose in action, within the intent and meaning of the eleventh section of the Judiciary Act of 1789. First. Cases as to practical construction and its effect. [The counsel then cited a number of cases under this head.] Second. Cases to show that this principle has been deliberately settled. The general principle for which we contend is the necessity of legislation to define and vest jurisdiction in the Circuit Court. The opposing principle is, the right and duty of the courts to exercise jurisdiction to the extent of the constitutional limit, by virtue of its provisions and without the authority of Congress. We refer to United States Bank v. Deveaux, 5 Cranch, 61; Osborne v. Bank of United States, 9 Wheaton, 738, 1 Wash. 235; 7 Cranch, 32; Ibid. 504; 3 Wheat. 336; 12 Pet. 616; also 623, 642; 14 Pet. 75; 2 Howard, 243. In Turner v. Bank of America, 4 Dall. 8, the very question arose, and was decided. Cary v. Curtis, 3 Howard, 245; 1 Kent's Commentaries, 513. Before stating the points under this, we beg leave to refer to the case of Dundas et al. v. Bowler, 3 McLean, 205. The opinion in that case was repeated by the court as its opinion in this. It asserts that the eleventh section of the Judiciary Act of 1789 "is in conflict with the [The counsel then reviewed the authorities Constitution"; that the right of a citizen of cited to support the opinion in Dundas v. one State to sue the citizen of another State in Bowler, and contended that they did not sustain the federal courts, in all cases, is given direct-it.] ly by the Constitution; that Congress may not restrict it; that the converse is "a new and most dangerous principle, and cannot be maintained." Points under this Proposition. II. The statute in question should be construed according to the ordinary and usual acceptation of the terms used in it. Because1st. It is constitutional. 2d. If unconstitutional, it should be entirely rejected. If sustained at all, it should be subjected to the ordinary rules of interpretation. III. The phrase, "other" choses in action," includes the bond and mortgage in this suit. Because 1st. The statute was not intended to be confined to negotiable instruments, as is intimated in Dundas v. Bowler, 3 McLean, 209., Fu, I. The eleventh section of the Judiciary Act of 1789, inhibiting a suit by an assignee of a chose in action, in cases where the assignor could not have sued, if no assignment had been made, is constitutional; because, the disposal of the judicial power, except in a few special cases, belongs to Congress; and the courts cannot exercise jurisdiction in every case to which the judicial power extends, without the intervention of Congress, who are not bound to enlarge the jurisdiction of the federal courts to every subject which the Constitution might warrant. So, again, it has been decided, that Second. The exception, in the Judiciary Congress have not delegated the exercise of ju- Act, of foreign bills of exchange, will leave Idicial power to the circuit courts, but in certain nothing of consequence for this language to specific cases. Both the Constitution and an cover, if it be confined to negotiable instruact of Congress must concur in conferring ments. First. If an instrument not negotiable be assigned, the assignee can sue in equity in his own name, and therefore the reason given in Dundas Dunc v. Bowler is not sound. by the English courts, by American courts generally, and by the federal courts.] 444*] *Third. This comprehensive meaning of the cause is a matter of express decision -decisions which have remained for forty Douglas, 610; 1 Powell on Mortgages, 109, years unquestioned. In Sere v. Pitot, 6 Cranch, 110; 4 Kent, 159, 160; 2 Vernon, 401; 2 Jac. & 332, Chief Justice Marshall decides that promis- Walk. 194, note; 4 Conn. 235, 424; 6 Conn. sory notes were not alone in the contemplation 158 to 164; 18 Johns. 114; 4 Kent's Com. 161, of Congress, and that the "intention was to ex-note a; 21 Wend. 483; 2 Gallison, 154; 5 Pecept from the jurisdiction those who could sue | ters, 483; 1 Paine, 534; 9 Wheat. 489: by virtue of equitable assignments, as well as those who could do so by virtue of legal assign"The term 'other chose in action,' is broad enough to include either case." ments." 2d. The object of the statute was to preserve to the State judicatures the interpretation and enforcement of contracts made between their own "citizens; and the general nature of a bond and mortgage, and the fact that they affect the realty of the State, render it particularly proper that they should not be considered out of the statute. 7th. Whatever be the doctrine at law, in equity a mortgage is styled and treated, in all its relations and for all purposes, as a chose in action. 2 Jac. & Walk. 185; 1 Hopkins, 594; Story's Equity, secs. 1013, 1015, 1016. 8th. If it be conceded that the complainant might have brought ejectment on the mortgage, it would not effect the character of the action. For, First. This action can be fully sustained by an informal transfer, or even a simple delivery of the mortgage, without writing; while an ejectment would require a formal, regular transfer, with the solemnity of other deeds of realty, in order to pass the legal estate. 3d. There is greater reason for inhibiting the collection of mortgage debts in the United | States courts, by an assignee, than of negotiable instruments, because, in case of the latter, Second. That both proceedings grow out of a transfer for the purpose of jurisdiction would defeat the action; while in the case of the former, if the assignment of a mortgage be viewed as the transfer of a title, the consideration cannot be made the subject of inquiry. Briggs v. French, 2 Sumner, 252; Smith v. Kernochen, 7 Howard, 216. 4th. The statute includes every such right as is ordinarily termed a chose in action; by which is meant, not a right which may be sued for, but one which can be realized only by suit; not a claim to property in specie, which may, if opportunity offer, be exercised by caption or entry, but a right to a debt or damages, or money which can be recovered only by action. 1 Chitty's R. 99. A deed of land is not a chose in action. A writer on the jus mariti, after informing his readers that the husband might dispose of his wife's choses in action, will hardly need to add that this did not include her "deeds for real estate." 5th. The transferee of a bond and mortgage is usually termed an assignee, and therefore is within the act. ་ the same transaction proves nothing; because there may be two remedies for one debt, in one of which the federal court has jurisdiction, and not in the other. The indorsee of a note may sue on a direct promise to him by the maker, when he could not sue as indorsee. 5 Howard, 278. The assignment of the mortgage, without an assignment of the debt, is a nullity (2 Cowen, 23), while an assignment of the debt carries with it the interest in the land. 2 Gall. 155. In this case, an assignee of the bond alone could not sue on it in this court. This proves that an assignment of the debt will not confer jurisdiction. If we grant that he could sue in ejectment at law as assignee of the mortgage, the question would still remain, how should he be viewed when suing in equity for his money, and not for the land, and on both the bond and mortgage? Finally, we ask particular attention to the effect upon the rights of the mortgagee [*116 produced by the statute of Michigan, forbidding him to bring ejectment before foreclosure We ask an application of the old and familiar and sale. How emphatically does it reduce his rule, that, when words of fixed legal import claim to a chose in action. He has no longer a are used in a statute, such me. ning will be ac- ttile, upon which he can even take possession; corded to them in its constructio. Chief Jus- but, according to the only substantial right ever tice Marshall applied it to the interpretation of intended the secured, a claim for vernd this statute in 6 Cranch, 332, when. referring/Tthe right to an appropriation or the land by the reason why the court, in 4 Cranch, held at suit to make it. And it is no answer to this, an alien administrator might sue when th in- that this law, taking away a remedy, does not testate could not, he said, "The representives bind the federal court. It is equally high eviof a deceased person are not usually desigated dence of the doctrines of our State, in relation by the term 'assignee.'" So Justice Story the to the nature of the right of a mortgagee. circuit and this court, on several occasion, in The argument of the counsel for the appel445*] *determining that the bearer of a pm-lee upon the question of jurisdiction was as issory note could sue when the payee could,ot, follows: said that the plaintiffs title did not res upon With regard to the first point, the objection what was generally and commonly kown as is based upon the act of Congress, which proan assignment, and that the words of he stat-rides that the Circuit Court shall not have ute were employed in the ordinary pular professional sense. 6th. Even at law, the mortgagis considered but as a chose in action, and fè mortgagor is the real owner. [The counsel then cited a nuber of cases to show how a mortgage, even at w, is regarded cognizance of any suit to recover the contents of any promissory note or other chose in action, in favor of an assignee. unless such suit might have been prosecuted in such court to recover said contents if no assignment had been made, except in cases of a foreign bill of exchange. The Constitution of the United States (sec. 2 of article 3) says the judicial power shall ex- | is not. It is a realty. It is real estate conveyed, tend to controversies between citizens of different States, and, in section one of the same article, it says that this judicial power shall be vested in one Supreme Court, and such inferior courts as Congress shall from time to time establish. and at law the estate is absolute, forfeited, perfect. In equity it may be redeemed; but the estate is nevertheless absolute, and redemption is a matter of favor or equity rather than a legal right. How does this partake of a chose in action? Now, what is a foreclosure bill? It Now, we would remark, first, that the case is not a suit upon a bond, but a proceeding in before the Circuit Court was a controversy be-law against property, to cut off the equitable tween citizens of different States, and to such right to redeem within a certain period, and to a controversy the judicial power of the courts procure a sale of the real estate. It is not a of the United States extends by the Constitu-personal action-seeks no decree against the tion, and by the same Constitution that power person-but simply asks that certain property is vested, except where the Supreme Court has conveyed to the plaintiff may be sold, and furoriginal jurisdiction by the Constitution, in the ther right to redeem foreclosed. An ejectment. inferior courts created by Congress. This judi- lies upon a mortgage, especially after forfeiture; cial power, therefore, to take cognizance of this the mortgagee may convey the estate and ejectcase, is, by the Constitution, vested in the Cir- ment lies in favor of his grantee. Will it be cuit Court, and the plaintiff claims the consti- said that his grantee, though living in another tutional right to have his controversy with Mr. State, could not maintain an ejectment in this. Sheldon, living in Michigan, decided by that court to recover the property? Cannot his court. Congress has said, by the provision grantee equally appeal to this court to [*448 above referred to, that there are certain con- foreclose the equity to redeem? This point troversies between citizens of different States has been directly passed upon in the Circuit which the United States courts shall not take Court for the District of Ohio, in the case of cognizance of; yet the judicial power of the Dundas et al. v. Bowler et al., reported in the court extends to them by the Constitution, and first volume of Western Law Journal, and the citizens of the different States have the right to decision of the court is sustained by the soundhave that power exercised in their controver-est reasoning. 3 McLean, 205. sies. Where does Congress get the power or authority to deprive the courts of the United States of the judicial power with which the 447*] Constitution has invested them? *Congress may create the courts, but they are clothed with their powers by the Constitution, and we submit that the provision of the act of Congress materially conflicts with the provisions of the Constitution and is void. It has been settled, that an act of Congress, enlarging the jurisdiction of the Supreme Court beyond the terms of the Constitution, is void. Marbury v. Madison, 1 Cranch, 137. Can it any more take away a constitutional power than it can confer an unconstitutional one? We submit that it cannot. The jurisdiction of this class of controversies is in the Circuit Court. The Constitution makes no such distinction as the act of Congress does, and we respectfully submit, that it is of the utmost importance to citizens of the different States that the whole judicial power granted by the Constitution to the courts of the United States should be exercised. We are aware that in some cases it has been sund that this act of Congressar lid: but we submit that there has been no decision of this court to that effect, and even if there had, being erroneous, the court would reverse it. But a mortgage is not a promissory note or chose in action, within the meaning of the provisions of the act of Congress. A mortgage is a conveyance of the fee-simple of real estate, liable to be defeated subsequently by pay ment of money, to secure the payment of which it was made. It is in no sense a chose in action, which is a thing in action, a right of action, a thing recoverable in action, a debt, a demand, a promissory note, a right to recover damages. A chose in action was originally a right of action not assignable at law. It was a cause of suit for a debt due or a wrong. The bond with the mortgage may be a chose in action; but the estate conveyed by the mortgage Mr. Justice Grier delivered the opinion of the court: The only question which it will be necessary to notice in this case is, whether the Circuit. Court had jurisdiction. Sill, the complainant below, a citizen of New York, filed his bill in the Circuit Court of the United States for Michigan, against Sheldon, claiming to recover the amount of a bond and mortgage, which had been assigned to him by Hastings, the President of the Bank of Michigan. Sheldon in his answer, among other things, pleaded that "the bond and mortgage in controversy, having been originally given by a citizen of Michigan to another citizen of the same State, and the complainant being assignee of them, the Circuit Court had no jurisdiction. The eleventh section of the Judiciary Act, which defines the jurisdiction of the circuit courts, restrains them from taking "cognizance of any suit to recover the contents of any promissory rate, or other chose in action, in favor of ar assignee, unless a suit might have be prosecuted in such court to recover the conats, if no assignment had been made, except cases of foreign bills of exchange." Thehird article of the Constitution declares that he judicial power of the United States. shall e vested in one Supreme Court, and such ferior courts as the Congress may, from time time, ordain and establish." The second stion of the same article enumerates the cases al controversies of which the judicial power sha have cognizance, and, among others, it specifics"controversies between citizens of different Stas." It has beenalleged, that this restriction of the Judiciary A, with regard to assignees of choses in action,s in conflict with this provision of the Constution, and therefore void. It must be adntted, that if the Constitution: had ordained and stablished the inferior courts, and distributed to them their respective powers, the mortgage will be assets in the hands of his they could not be restricted or devested by Con- executor, and although the technical legal esgress. But as it has made no such distribution, tate may descend to his heir, it can be used one of two consequences must result-either only for the purpose of obtaining satisfaction that each inferior court created by Congress of the debt. The heir will be but a trustee for must exercise all the judicial powers not given the executor. to the Supreme Court, or that Congress, having the power to establish the courts, must de449*] fine their respective jurisdictions. *The first of these inferences has never been asserted, and could not be defended with any show of reason, and if not, the latter would seem to follow as a necessary consequence. And it would seem to follow, also, that, having a right to prescribe, Congress may withhold from any court of its creation jurisdiction of any of the enumerated controversies. Courts created by statute can have no jurisdiction but such as the statute confers. No one of them can assert a just claim to jurisdiction exclusively conferred on another, or withheld from all. The Constitution has defined the limits of the judicial power of the United States, but has not prescribed how much of it shall be exercised by the Circuit Court; consequently, the statute which does prescribe the limits of their jurisdiction, cannot be in conflict with the Constitution, unless it confers powers not enumerated therein. Such has been the doctrine held by this court since its first establishment. To enumerate all the cases in which it has been either directly advanced or tacitly assumed would be tedious and unnecessary. In the case of Turner v. Bank of North America, 4 Dall. 10, it was contended, as in this case, that, as it was a controversy between citizens of different States, the Constitution gave the plaintiff a right to sue in the Circuit Court, notwithstanding he was an assignee within the restriction of the eleventh section of the Judiciary Act. But the court said: "The political truth is, that the disposal of the judicial power (except in a few specified instances) belongs to Congress; and Congress is not bound to enlarge the jurisdiction of the federal courts to every subject, in every form which the Constitution might warrant." This decision was made in 1799; since that time, the same doctrine has been frequently asserted by this court, as may be seen in McIntire v. Wood, 7 Cranch, 506; Kendall v. United States, 12 Peters, 616; Cary v. Curtis, 3 Howard, 245. The only remaining inquiry is, whether the In equity, the debt or bond is treated as the principal, and the mortgage as the incident. It passes by the assignment or transfer of the bond, and is discharged by its payment. It is, in fact, but a special security, or lien on the property mortgaged. The remedy obtained on it in a court of equity is not the recovery of land, but the satisfaction of the debt. It is the pursuit by action of one debt on two instruments or securities, the one general, the other special. The decree is, that the mortgaged premises be sold to pay the debt, and if insufficient for that purpose, that the complainant have further remedy, by execution, for the bal ance. The complainant in this case is the purchaser and assignee of a sum of money, a debt, a chose in action, not of a tract of land. He seeks to recover by this action a debt assigned to him. He is therefore the "assignee of a chose in action," within the letter and spirit of the act of Congress under consideration, and cannot support this action in the Circuit Court of the United States, where his assignor could not. The judgment of the Circuit Court must therefore be reversed, for want of jurisdiction. Order. This cause came on to heard on the transcript of the record from the Circuit Court of the United States for the District of Michigan, and was argued by counsel; on consideration whereof, it is now here ordered and decreed by this court, that this cause be, and the same is hereby reversed, for the want of jurisdiction in that court; and that this cause be, and the same is hereby remanded to the said Circuit Court, with directions to dismiss the bill of complaint for the want of jurisdiction. complainant in this case is the assignee of a *JACOB LE ROY, Plaintiff in Error, [*451 "chose in action," within the meaning of the statute. The term "chose in action" is one of comprehensive import. It includes the infinite variety of contracts, covenants, and promises, which confer on one party a right to recover a personal chattel or a sum of money from another, by action. It is true, a deed or title for land does not come within this description. And it, is true, also, that a mortgagee may avail himself of his legal title to recover in ejectment, in a court of law. Yet, even there, he is considered as hav450*] ing but a chattel *interest, while the mortgagor is treated as the true owner. The land will descend to the heir of the mortgagor. His widow will be entitled to dower. But on the death of the mortgagee, the debt secured by V. WILLIAM BEARD. Power to agent to sell lands-extent of authority-covenant of seisin broken without eviction-power ambiguous, construction of by agent binds principal-assumpsit in one State on undertaking in another, seal not affixed. By the laws of Wisconsin, where the contract in question was made, a scroll or any device by way But of seal has the same effect as an actual seal. in New York it is otherwise, and an action brought NOTE. Attorney, authority of. See note to S L. ed. U. S. 60. Lex loci rei sitæ governs titles to lands by deed or devise. See notes to 5 L. ed. U. §. 335, 6 L. ed U. S. 367, 5S3. |