*92

Under the judiciary act of 1789 the question was several times presented to this court for decision, whether the exceptions in the eleventh section of the act applied to the right of removal given in the twelfth section, and was uniformly answered in the negative. The very question arose directly in Green v. Custard, 23 How. 484. Mr. Justice GRIER, delivering the opinion of the court, said:

"If Green had been a citizen of Texas, and Custard had claimed a right as indorsee of a citizen of Texas to bring his suit in the courts of the United States, because he (Custard) was a citizen of another state, the case would have occurred which is included in the proviso to the eleventh section of the act, which restrains the jurisdiction of the court. But the United States court had jurisdiction of this case by virtue of the twelfth section. It is a right plainly conferred on Green, a citizen of Massachusetts, when sued by a citizen of Texas in a state court of Texas, no matter what the cause of action may be, provided it demand over five hundred dollars. The exception of the eleventh section could have no possible application to the case."

The same conclusion was reached in Bushnell v. Kennedy, 9 Wall. 587, in which, however, the prior decision in Green v. Custard does not appear to have been mentioned by counsel or court.

This was the established law at the time of the passage of the act of March 2, 1867, (14 St. 558,) known as the Local Prejudice Removal Act, which for the first time conferred upon the plaintiff, as well as the defendant, the right to remove a suit brought by him in a state court when the controversy was between a citizen of the state where the suit was brought and a citizen of another state, upon making and filing an affidavit that he had reason to and did believe that, from prejudice or local influence, he would not be able to obtain justice in such state court. The case of the City of Lexington v. Butler, 14 Wall. 282, was removed by the plaintiff in the action, under this act, from the state court to the circuit court. The question of jurisdiction was raised on the ground that the suit, which was founded on interest coupons attached to bonds issued by the city of Lexington and payable to bearer, could not have been brought in the circuit court on account of the restriction contained in the eleventh section of the judiciary act. It was decided, however, that the case was not within that exception, the holder of such an instrument not being an assignee, within the meaning of the act. But the court went further, and speaking through Mr. Justice CLIFFORD, said:

"Suppose, however, the rule is otherwise, still the objection must be overruled, as the suit was not originally commenced in the circuit court. Suits may properly be removed from a state court into the circuit court in cases where the jurisdiction of the circuit court, if the suit had been originally commenced there, could not have been sustained, as the twelfth section of the judiciary act does not contain any such restriction as that contained in the eleventh section of the act defining the original jurisdiction of the circuit courts. Since the decision in the case of Bushnell v. Kennedy, 9 Wall. 387, all doubt upon the subject is removed, as it is there expressly determined that the restriction incorporated in the eleventh section of the judiciary act has no application to cases removed into the circuit court from a state court;' and it is quite clear that the same rule must be applied in the con

struction of the subsequent acts of congress extending that privilege to other sections not embraced in the twelfth section of the judiciary act."

By this construction of the act of 1867 it was placed within the power of a plaintiff, on filing the requisite affidavit, to transfer from

the state court to the circuit court a suit which he could not have commenced in it, the precise objection which is made to the construction now given to the second section of the act of 1875. It was in contemplation of these previous statutes, and of the judicial decisions construing them, that congress passed the act of 1875, giving to plaintiffs as well as defendants unrestrained liberty to remove the cases specified in the second section from a state court to a circuit court, and we are bound to presume in full view and upon consideration of the very inconveniences which are now relied on as the ground for limiting the right of removal by force of the restrictive clause in the first section of the act. In our opinion this is not admissible. We are bound to take the words of the law in their usual, ordinary, literal? meaning, and to construe the two provisions in the different sections in the same sense which, in previous statutes, had uniformly been given to them, and not invent a new application and relation of the two clauses without any indication whatever of any intention on the part of congress to that effect. It was, perhaps, with foresight of possible practical inconveniences to result from the extension of the right of removal effected by the act of 1875, and in order to furnish means for preventing evasions of the limits of the jurisdiction of the courts of the United States under the forms of the law, that in the fifth section of the act it was provided, that if "it shall appear to the satisfaction of said circuit court, at any time after such suit has been brought or removed thereto, that such suit does not really and substantially involve a suit or controversy properly within the jurisdiction of said circuit court, or that the parties to said suit have been improperly made or joined, either as plaintiffs or defendants, for the purpose of creating a case cognizable or removable under this act, the said circuit court shall proceed no further therein, but shall dismiss the suit or remand it to the court from which it was removed, as justice may require." However that may be, we cannot, on the mere ground of a policy of convenience, change the settled rules of construction according to which for so long a period these and similar statutes have been administered.

The question of jurisdiction having been thus answered in the affirmative, it becomes necessary to consider the errors assigned upon the rulings of the court at the trial. These appear from a bill of exceptions and a certificate of division of opinion between the judges before whom the trial was had, and which, to understand the excep tions, it is necessary to set out in full. It is as follows:

"These causes, having been duly ordered to be tried before the same jury by the court, came on for trial before the Hon. Samuel F. MILLER and the Hon. Rensselaer R. NELSON, judges of said court, presiding at said trial, at

a general term thereof begun and held at St. Paul, Minnesota, on the third Monday in June, A. D. 1880.

"The respective causes were brought by the plaintiffs on certain policies of insurance bearing date as follows: That of the Commonwealth Insurance Company of Boston bearing date of eleventh of January, 1877; that of the Western Assurance Company of Toronto, Canada, bearing date of twentyseventh of December, 1876; and that of the Franklin Insurance Company of St. Louis, bearing date of twenty-ninth of December, 1876, the two latter being for $5,000 each, and the former for $2,500, insuring one Frances E. Barritt against loss or damage by fire on her stock of dry goods or other merchandise pertaining to her business, contained in the three-storied store, metal-roofed building, situated No. 37 East Third street, St. Paul, Minnesota, for a period of three months after their respective dates, with the condition that $35,000 other insurance shall be allowed. The respective policies were assigned by Frances E. Barritt, the assured, to one William Murphy on the seventh day of February, 1877, with the consent and approval of the respective companies.

"On the twenty-fifth day of February, 1877, said stock of goods was damaged by fire to the amount of $11,804.72, as found and determined by the arbitrators appointed by the assured and the respective companies. The policy of the Western Assurance Company of Toronto, Canada, contained, among other things, the following provision: The assured shall, if required, submit to an examination or examinations under oath by any person appointed by the company, and subscribe thereto when the same is reduced to writing;' and also all fraud or attempt at fraud, by false swearing or otherwise, shall forfeit all claim on this company, and be a perpetual bar to any recovery under this policy.'

"That of the Franklin Insurance Company of St. Louis contained, among others, the following provision, viz.: And the insured shall, if required, submit to an examination under oath, by the agent or attorney of this company, and answer all questions touching his, her, or their knowledge of anything relating to such loss or damage, or to their claim thereupon, and subscribe such examination, the same being reduced to writing;' and the further provision, to-wit: All fraud or false swearing shall cause a forfeiture of all claims on the insurers, and shall be a full bar to all remedies against the insurer on the policy.' That of the defendant, the Commonwealth Insurance Company of Boston, contained, among others, the following provision, towit: All fraud or attempt at fraud, by false swearing or otherwise, shall cause a forfeiture of all claims on this company under this* policy;' and the further provision, viz., ‘The assured shall, if required, submit to an examination or examinations, under oath, by any person appointed by the company, and subscribe to such examinations when reduced to writing.'

"Upon the trial of said causes there was evidence tending to show that the respective defendants required the assured, William Murphy, to appear before their appointed agent and submit to an examination under oath, and answer all questions touching his knowledge of anything relating to such loss or damage and his claim thereupon, and to subscribe such examination, the same being reduced to writing, which the said Murphy did, as required, and that upon said examination the question of the ownership of said goods by said Murphy was made by the defendants, and said Murphy examined at length upon the same, and he answered certain questions relating to the manner in which he paid one Frances E. Barritt for said stock at the time of his alleged purchase thereof falsely, and there was evidence tending to show that he answered thus with no purpose to deceive and defraud the insurance companies, but for the purpose of showing himself, upon the examination, consistent with a statement that he bad made about it a day or two subse

quent to the purchase of said stock, to R. G. Dunn & Co.'s commercial agency at St. Paul, Minnesota, with a view of obtaining a large commercial credit in eastern cities. There was evidence tending to show that on the ninth day of February, 1877, said William Murphy went to said agency and reported that he had bought the stock of Frances E. Barritt for $35,484.20; that he had paid for the same in cash and securities, and plaintiffs claimed that if the false statements were made to the agents of the insurance company upon examination, even though made upon a material question without intent to deceive or defraud the insurance companies, it would not prevent a recovery upon the policies, and requested the court upon that point to charge as follows: If you find, from the evidence, that any incorrect statements made by William Murphy upon his examination were made for the purpose of protecting himself against the statements made by him to the commercial agency for the purpose of obtaining more credit than he was actually entitled to, and not for the purpose of deceiving and defrauding the defendants, then such statements constitute no defense to this action;' and also, No false statements made by Murphy on his examination, under oath or otherwise, constitute a defense to this action, unless the same were made upon material issues between him and the defendants, and unless you are satisfied, from the evidence, that Mr. Murphy made them knowingly and willfully, with intent thereby to deceive and defraud the defendants.'

"The court (his honor Judge MILLER addressing the jury) refused to give said instructions, but told the jury in its charge that the said questions relating to the manner in which Mr. Murphy paid said Frances E. Barritt for said stock at the time of his alleged purchase thereof were upon a material point, upon which the defendants had a right to interrogate Mr. Murphy, and were material questions, to which they had a right to true answers from Murphy in said examinations, and upon the point in controversy upon which the said instructions were asked, charged the jury as follows, to-wit: 'It is said here, and the point is urged with a good deal of force, that unless Mr. Murphy made these false statements, if they were false, and it is conceded that they were false, with the intent to deceive and defraud these corporations, and if he made them with the intent to deceive and defraud some one else, that is is immaterial to this issue. I do not think that is the law. I do not think it was necessary in order to avoid the policy that the statements made by Mr. Murphy should have been solely, or even partly, with a view to get money wrongfully out of the companies; however, that is a point I wish to draw your attention to. If these statements had been wholly immaterial, that doctrine may be right; if it was a matter that the company had no right to inquire into or interrogate him about, if he did swear falsely and intend to deceive some one else, that does not interfere with the policy; but these companies had a right to have from him the truth about every matter that was material as evidence to show whether he owned these goods or not; they had a right to have the truth from him whatever his intentions might have been, that is, as far as the truth was material; and so far as his testimony before the notary had a tendency to mislead the companies on an important matter, it was false swearing and false testimony within the meaning of the policy, and would avoid the policy. If he stated that which was intended for their action, and which would probably influence their action, and these statements were false, then he swore faisely within the meaning of the pol icy, though he did not intend to cheat them, but intended to cheat somebody else; for, without looking to his motives, the company had a right to an honest statement from him to all questions that went to show whether he was the owner of these goods or not.'

"To which refusals to charge as requested, and to said charge as given. v.3--33

plaintiff's counsel thereupon duly excepted, and, after the rendition of the verdict for the defendants, moved for a new trial on account thereof, and said motion was duly argued by John B. Sanborn, Esq., counsel for the plaintiff, and Cushman K. Davis, Esq., counsel for the defendant, and after due consideration thereof the court denied the motion, and upon the question as to whether said instructions should be given to the jury as requested, or the jury instructed as in the said charge of the court, the opinions of the said judges were opposed.

"Whereupon, on motion of the plaintiffs, H. B. Claflin & Co., by counsel, that the points on which the disagreement hath happened may, during the term, be stated under the direction of the judges, and certified under the seal of the court to the supreme court, to be finally decided.

"It is ordered that the foregoing state of the evidence and cases, and the questions on which the disagreement of opinion hath happened, which is made under the direction of the judges, be certified according to the request of the plaintiffs, by their counsel, and the law in that case made and provided."

It was set out in the answer and relied on as a defense that the policy of original insurance made to Frances E. Barritt had been fraudulently procured for her by one Johnson, upon false representations, greatly overvaluing the stock insured; that Murphy received the assignment of the stock and policy with knowledge of the fraud, and that the pretended sale to him by Mrs. Barritt was without consideration, and merely colorable and fictitious; that Murphy consequently never acquired or had any insurable interest in the stock and property insured; that after the fire Murphy, in making proof of loss, stated under oath that the actual cash value of the property insured, at the time of the fire, amounted to $35,491.61, and that the same belonged to him; that the property insured was injured to the amount of $26,827.06, and that of said amount $6,463.39 was the cost and value of goods totally destroyed, and $20,360.67 was the amount of the loss on that part of the stock damaged but not destroyed, whereas in truth and in fact the cash value of the goods insured, at the time of the fire, did not exceed $18,000, and the total amount of the loss and damage thereto by fire did not exceed $5,000, and that said goods did not belong to Murphy, as he well knew; "that thereafter the said Murphy was examined under oath, at the city of St. Paul, by an agent of the defendant, as provided in said policy, before J. D. O'Brien, Esq., and before R. B. Galusha, Esq., who were then and there respectively notaries public within and for the county of Ramsey, and in such examination the said Murphy did swear that he had purchased said stock from said Barritt, and that he was the sole owner thereof, and that no other person had any interest therein, and that he had fully paid for the same, each and every of which statements as to said purchase, ownership, interest, payment, and the manner thereof, were wholly false, as said Murphy well knew."

It is quite obvious that upon the issues, as made in the pleadings and actually tried, it was material to show what title and interest Murphy had at the time of the loss in the property insured. If he had no insurable interest, that certainly would have been a defense.