Olberding v. Illinois Central Railroad Company/Dissent Reed

by Stanley Forman Reed

United States Supreme Court

346 U.S. 338

Olberding  v.  Illinois Central Railroad Company

 Argued: Oct. 15, 1953. --- Decided: Nov 9, 1953

Mr. Justice REED, with whom Mr. Justice MINTON joins, dissenting.

The unfortunate effect of this decision on federal venue, its uniformity and availability, in so important a field as torts by out-of-state motorists, causes me to dissent from the views of the Court. Under Neirbo Co. v. Bethlehem Corp., 308 U.S. 165, 60 S.Ct. 153, 84 L.Ed. 167, a different doctrine of venue would be applied to motor torts committed by foreign corporations doing business in a state than is applied to an individual motorist driving his own car through a state. From the opinion I would assume that a corporation not doing business in a state but causing a car to be driven therein would be immune from suits for torts in the federal courts in that state. The decision bars a non-resident injured party from seeking damages, on allegation of diversity, from a nonresident motor operator or owner in the United States District Court having jurisdiction over the place of the accident in which the motor vehicle is involved.

No question is or can now be raised against the constitutionality of the Kentucky statute to secure the presence of an out-of-state motorist in the state courts to respond to damages. It is the form generally approved for protection against our-of-state wrongdoers by motor operation, and is not subject to attack for lack of due process. ^[1] The single issue decided by the Court is that such process does not waive venue under 28 U.S.C. § 1391(a), 28 U.S.C.A. § 1391(a):

'A civil action wherein jurisdiction is founded only on diversity of citizenship may, except as otherwise provided by law, be brought only in the judicial district where all plaintiffs or all defendants reside.'

The provision was substantially the same when the Neirbo case was decided. The clause then read:

'* * * but where the jurisdiction is founded only on the fact that the action is between citizens of different States, suit shall be brought only in the district of the residence of either the plaintiff or the defendant.'

In Neirbo we held that since the foreign corporation had consented to be sued in the courts of the state, the consent extended to the federal courts sitting in the state. 308 U.S. at pages 171, 175, 60 S.Ct. at pages 156, 158, 84 L.Ed. 167. The same reasoning that led to the subjection of foreign corporations to federal litigation in the Neirbo case leads me to the conclusion that the out-of-state motorist should likewise be so held. The motor car has lengthened the radius of the individual's activities. We have upheld the constitutional power of the states to compel redress of wrongs, through the use of the automobile, at the place of their happening. It is done through the consent of the party benefiting from his privilege to use the highways of the state. The District Courts have consistently ruled that the appointment of an agent for service of process by driving on state highways is a waiver of federal venue. ^[2]

I see no difference of substance between the signing of a paper under the New York statute upon which Neirbo is based and the acceptance, by action in driving a motor car, of the privilege of using state highways under the Kentucky statute. In each case there was no federal venue except by waiver and consent. Both the Neirbo Corporation and this out-of-state motorist, in my opinion, waived objection to federal venue. The Hess case determined that the difference between the 'formal and implied appointment' of an agent for service 'is not substantial' under the Due Process Clause. 274 U.S. at page 357, 47 S.Ct. at page 633, 71 L.Ed. 1091. ^[3] The Neirbo case held that consent to service on an agent for service of process waived objection to federal venue. The same rule if applied to this situation would achieve a like desirable result, trial at the logical place, the location of the incident that gives rise to the cause of action.

I would affirm the judgment.

Notes

1. Hess v. Pawloski, 274 U.S. 352, 47 S.Ct. 632, 71 L.Ed. 1091. The statute there involved so far as pertinent read:
2. Falter v. Southwest Wheel Co., D.C., 109 F.Supp. 556; Archambeau v. Emerson, D.C., 108 F.Supp. 28; Jacobson v. Schuman, D.C., 105 F.Supp. 483; Kostamo v. Brorby, D.C., 95 F.Supp. 806; Burnett v. Swenson, D.C., 95 F.Supp. 524; Thurman v. Consolidated School Dist., D.C., 94 F.Supp. 616; Urso v. Scales, D.C., 90 F.Supp. 653; Steele v. Dennis, D.C., 62 F.Supp. 73; Krueger v. Hider, D.C., 48 F.Supp. 708. Contra: Waters v. Plyborn, D.C., 93 F.Supp. 651.
3. Cf. Knott Corp. v. Furman, 4 Cir., 163 F.2d 199. In this case plaintiff, a citizen of Massachusetts, sued the corporation in the United States District Court for the Eastern District of Virginia, for injuries received during a hotel fire. The defendant, a Delaware corporation, operated the hotel on a United States military reservation. No written appointment of any state officer as agent for service of process had been filed by the corporation. Venue was challenged and the Fourth Circuit ruled that the corporation had waived the federal venue provisions under a statute which read:

'3. If any such company shall do business in this State without having appointed the Secretary of the Commonwealth its true and lawful attorney as required herein, it shall be doing such business in the State of Virginia be deemed to have thereby appointed the Secretary of the Commonwealth its true and lawful attorney for the purposes hereinafter set forth.' Va.Code Supp.1946, § 3846a.

The language of this statute is certainly analogous to that of the Kenutucky statute, n. 1, supra.