Bianchi v. Sobrinos de Ezquiaga
Bianchi v. Sobrinos de Ezquiaga
Opinion of the Court
delivered tlie following opinion':'
By tlie bill of complaint filed in this court it appears that tlie two complainants with Juan Bianchi are owners of certain very valuable real estate in the Island of Porto Rico, and that the said Jnan Bianchi,' pretending to have authority to execute a mortgage upon said real estate, but actually without such power or authority conferred by the two complainants, did execute a notarial instrument purporting to secure the payment of a certain obligation in favor of certain of the defendants, to wit: Sobrinos de Ezquiaga, in a sum exceeding $129,000; and that the said Sobrinos de Ezquiaga had pledged this mortgage to the other defendant, the Bank of JSTova Scotia, to secure the sum of $50,000 due said bank from the original mortgagees. The bill then goes on to state that on September 28, 1922, Sobrinos de Ezquiaga filed a bill to foreclose the said mortgage in the Insular district court at Mayaguez, Porto Rico. It is claimed in this bill that while the said mortgage may be valid as against the said Juan Bianchi, it is null and void as against, the two defendants, because they never authorized its execution, and that they had no knowledge or notice of the said mortgage' until long after it had been placed upon record. All the parties are domiciled in Porto Rico.
Under the peculiar law in force in Porto Rico, which is known as the method of summary foreclosure, and which method has been adopted by the Sobrinos de Ezquiaga with respect to the proceeding just mentioned as having been' instituted on September 28, 1922, the defense which these complainants in this present suit say they have, they are not allowed to present. If the acts of Juan Bianchi were of such a
The bill then goes on to recite that under the peculiar laws aforesaid the sale of the real estate will be made long before the termination of the suit for annulment, and that possession of the said real estate will pass to the purchaser, who will remain in possession during all the time until the suit for annulment shall be finally determined; and they allege that this condition of affairs operates to deprive the complainants of their property and the enjoyment thereof without due process of law, thereby denying to these complainants the equal pro lection of the laws, all in violation of the Federal Constitution. They therefore set up a Federal question, or seek to do so, and pray this court to take jurisdiction of this case and to enjoin these defendants from further prosecution of the foreclosure suit until the termination of the annulment suit; and then there is a general prayer for relief which terminates the hill, the bill itself being verified by Francisco Fianchi, one" of the complainants.
This court had a great reluctance to grant even a temporary restraining order in this case, because of the doubt as to juris-
Regarding this mortgage law itself, I do not propose at this time to express any opinion as- to whether or not it is in conflict with the Pederal Constitution beyond stating that I have always been impressed by the force and logic of the dissenting opinion by the late Mr. Justice MeLeary of the Supreme Court of Porto Pico in the case of Gimenez v. Brenes, reported in 10 P. R. R. p. 124, decided in the year 1906, in which throe members of the court upheld a foreclosure proceeding of- this summary nature.
On October 27, 1922, counsel for the defendants filed a motion to dissolve and discharge the restraining order which the court had granted, and the principal reason why the court did grant this restraining order was that the complainants offered to give a bond in the sum of $150,000 to protect the defendants in this present suit against, possible loss, damage, or expense in the event that the said restraining order should hereafter be dissolved. This motion is based upon several grounds, but it is unnecessary to recite them all, for the reason that I have come to the conclusion that the first ground is sound, and this first ground is based upon the claim of the counsel for defendants that this court is without jurisdiction, inasmuch as no facts are alleged in the bill of complaint conferring jurisdiction upon this court under the Organic Law of Porto Pico, or under any law or statute of the United States.
Fifteen decisions of the Supreme Court of the United States have been cited by counsel for complainants. I have examined them all. Two of them are cases which originated in the United States Supremo Court. These two are in Re Sawyer, 124 U. S. page 200, 31 L. ed. 402, 8 Sup. Ct. Rep. 482, and Ex parte Young, 209 U. S. page 123, 52 L. ed. 714, 13 L.R.A. (N.S.) 932, 28 Sup. Ct. Rep. 441, 14 Ann. Cas. 764. The former was a petition for habeas corpus and the writ was granted because the lower Federal court had acted without power in holding guilty of contempt certain persons charged with violating an injunction against the mayor and council of the city of Lincoln, Pcbraska, who sought to remove a local police judge from his office. It was held of course that the Federal judge had no power to interfere in matters purely local, and the man who had been found guilty of contempt was discharged by the Supreme Court by means of a habeas corpus proceeding. I find nothing in this case having any bearing whatever on the present case.
The other was the famous case of Ex parte Ymuig, who was attorney general of Minnesota, and who filed an original application before the Supreme Court of the United States because he, in his official capacity as representing the state of Minnesota, had been enjoined by the circuit court of the United States from enforcing certain statutes of Minnesota which the*
Tbe remaining thirteen cases cited by counsel for complainants are Covington & L. Turnp. Road Co. v. Sandford, 164 U. S. 578, 41 L. ed. 560, 17 Sup. Ct. Rep. 198; Dobbins v. Los Angeles, 195 U. S. 223, 49 L. ed. 169, 25 Sup. Ct. Rep. 18; Philadelphia Co. v. Stimson, 223 U. S. 605, 56 L. ed. 570, 32 Sup. Ct. Rep. 340; Rich v. Braxton, 158 U. S. 375, 39 L. ed. 1022, 15 Sup. Ct. Rep. 1006; Dodge v. Woolsey, 18 How. 331, 15 L. ed. 401; Wehrman v. Conklin, 155 U. S. 314, 39 L. ed. 167, 15 Sup. Ct. Rep. 129; Barber v. Barber, 21 How. 582, 16 L. ed. 226; Dunphy v. Kleinsmith, 11 Wall. 610, 20 L. ed. 223; Payne v. Hook, 7 Wall. 425, 19 L. ed. 260; Ellis v. Davis, 109 U. S. 485, 27 L. ed. 1006, 3 Sup. Ct. Rep. 327; Lawrence v. Nelson, 143 U. S. 215, 36 L. ed. 130, 12 Sup. Ct. Rep. 440; Bicknell v. Comstock, 113 U. S. 149, 28 L. ed. 962, 5 Sup. Ct. Rep. 399, and Green v. Creighton (Kendall v. Creighton) 23 How. 90, 16 L. ed. 419. All of these cases arc either writs of error or appeals from final decrees or final judgments which had been entered in different inferior
The latest- utterance upon this difficult question which I have been able to find is a decision by the circuit court, of appeals for the third circuit, rendered September 28, 1922, in the case of the American Mut. Liability Ins. Co. v. Volpe, reported in 284 Fed. at page 75. The opinion- is written lrv .Mr. Circuit Judge Davis, and the court thereby affirms a decree of the defendants in a suit- which was brought in the district court of the United States for the district of Mew Jersey, which suit sought to enjoin the execution of a judgment obtained in one of the state courts of Few Jersey upon the ground that the enforcement of such judgment would deprive the complainant of its right to interpose a perfectly good defense to the claim. The successful defendant contended that the United States district court is without jurisdiction to enjoin proceedings in the state court unless they involve' rights secured by the Constitution, the laws of the United States, or aro unconscionable, and § 2G5 of the Judicial Code is cited, as follows: “The writ." of injunction shall not be granted by any court of tlie United States to stay proceedings in any court of a state, except in (>ases where snob injunction may be authorized by any law re-
Then Judge Davis goes on to say that -whore the elements of Federal and equity jurisdiction are present this provision of the Judicial Code, which has been in force for more than a century, does not prevent Federal courts from enjoining proceedings in three classes of cases: First, to enforce local statutes which are repugnant to the Constitution of the United States; second, to maintain and protect their own jurisdiction, properly acquired and still subsisting, by enjoining attempts to frustrate, defeat, or impair it through proceedings in state courts; third, to deprive a party, by means of an injunction, of the benefit of a judgment obtained in a state court under circumstances where its enforcement will be contrary to recognized principles of equity and the standards of good conscience.
Of course the present case which this court is called upon to decide does not fall within the second or the third classes of cases above mentioned. It is admitted that the litigation in the present ease did not begin in the Federal court, and it is also admitted that the defendants in the present proceeding have not yet obtained any judgment in the Insular court. The theory of the present case, as presented by the complainants, must fall within the first class of cases cited by Judge Davis, or, to state it otherwise, it is sought in the present case to prevent by an injunction the enforcement of a local statute which -it is claimed is repugnant to the Constitution of the United States. In connection with this class of cases Judge Davis cites three decisions of the Supreme Court of the United States, one of which, viz.: Ex parte Young, 209 U. S. 123, 52 L. ed. 714, 13
In denying relief to the complainants in the case now under consideration, I have also been guided largely by the views of the Honorable John 0. Rose, author of the book entitled Federal Jurisdiction & Procedure, who at the time that he wrote the book was United States district judge for the district of Maryland, and who last month was promoted to be a member of the circuit court of appeals for the fourth circuit. In the second edition of his valuable work just issued by the press he seis forth very clearly in § 422 that Federal courts may not ordinarily enjoin proceedings in state courts. And he explains that the reason why Congress enacted the statute known as § 720 of the Revised Statutes, Comp. Stat. § 1242. being the same provision of law heretofore cited as § 265 of the Judicial Code, which I have quoted as part of the opinion of Judge Davis, was that Congress kept in view the dual nature of our government and sought purposely to prevent unseemly conflicts of jurisdiction between the state courts and the Federal courts. In § 423 of the same book he expressly
In conclusion, without deciding, — because I think I have
At all events, whether this last suggestion of mine he sound or unsound, I am convinced, after a careful study of many authorities, that it is my duty to dismiss the present bill for lack of jurisdiction, and it is so ordered.
Reference
- Full Case Name
- FRANCISCO BIANCHI AND ROSARIO B. DE ESTEVE v. SOBRINOS DE EZQUIAGA AND BANK OF NOVA SCOTIA, Dfts.
- Status
- Published