National Mutual Insurance Company of District of Columbia v. Tidewater Transfer Company, Inc./Dissent Frankfurter

by Felix Frankfurter

United States Supreme Court

337 U.S. 582

National Mutual Insurance Company of District of Columbia  v.  Tidewater Transfer Company, Inc.

 Argued: Nov. 8, 1948. --- Decided: June 20, 1949

Mr. Justice FRANKFURTER, with whom Mr. Justice REED concurs, dissenting.

No provisions of the Constitution, barring only those that draw on arithmetic, as in prescribing the qualifying age for a President and members of a Congress or the length of their tenure of office, are more explicit and specific than those pertaining to courts established under Article III. 'The judicial Power' which is 'vested' in these tribunals and the safeguards under which their judges function are enumerated with particularity. Their tenure and compensation, the controversies which may be brought before them, and the distribution of original and appellate jurisdiction among these tribunals are defined and circumscribed, not left at large by vague and elastic phrasing. The precision which characterizes these portions of Article III is in striking contrast to the imprecision of so many other provisions of the Constitution dealing with other very vital aspects of government. This was not due to chance or ineptitude on the part of the Framers. The differences in subject-matter account for the drastic differences in treatment. Great concepts like 'Commerce * * * among the several States,' 'due process of law,' 'liberty,' 'property' were purposely left to gather meaning from experience. For they relate to the whole domain of social and economic fact, and the statesmen who founded this Nation knew too well that only a stagnant society remains unchanged. But when the Constitution in turn gives strict definition of power or specific limitations upon it we cannot extend the definition or remove the translation. Precisely because 'it is a constitution we are expounding,' McCulloch v. State of Maryland, 4 Wheat. 316, 407, 4 L.Ed. 579; we ought not to take liberties with it.

There was deep distrust of a federal judicial system, as against the State judiciaries, in the Constitutional Convention. This distrust was reflected in the evolution of Article III. ^[1] Moreover, when they dealt with the distribution of judicial power as between the courts of the States and the courts of the United States, the Framers were dealing with a technical subject in a professional way. More than that, since the judges of the courts for which Article III made provision not only and the last word (apart from amending the Constitution) but also enjoyed life tenure, it was an essential safeguard against control by the judiciary of its own jurisdiction, to define the jurisdiction of those courts with particularity. The Framers guarded against the self-will of the courts as well as against the will of Congress by marking with exactitude the outer limits of federal judicial power.

According to Article III only 'judicial power' can be 'vested' in the courts established under it. At least this limitation, which has been the law of the land since 1792, Hayburn's Case, 2 Dall. 409, 1 L.Ed. 436, is not yet called into question. And so the President could not today elicit this Court's views on ticklish problems of international law any more than Washington was able to do in 1793. See the exchange between Secretary of State Jefferson and Chief Justice Jay in 3 Johnston, Correspondence and Public Papers of John Jay, 486-89 (1891), and 10 Sparks, Writings of George Washington, 542-45 (1840).

But if courts established under Article III can exercise wider jurisdiction than that defined and confined by Article III, and if they are available to effectuate the various substantive powers of Congress, such as the power to legislate for the District of Columbia, what justification is there for interpreting Article III as imposing one restriction in the exercise of those other powers of the Congress-the restriction to the exercise of 'judicial power'-yet not interpreting it as imposing the retrictions that are most explicit, namely, the particularization of the 'cases' to which 'the judicial Power shall extend'?

It is conceded that the claim for which access is sought in the District Co rt for Maryland, one of the courts established under Article III, is not included among the 'cases' to which the judicial power can be made to extend. But if the precise enumeration of cases as to which Article III authorized Congress to grant jurisdiction to the United States District Courts does not preclude Congress from vesting these courts with authority which Article III disallows, by what rule of reason is Congress to be precluded from bringing to its aid the advisory opinions of this Court or of the Courts of Appeals? In the exercise of its constitutional power to regulate commerce, to establish uniform rules of naturalization, to raise and support armies, or to execute any of the other powers of Congress that are no less vital than its power to legislate for the District of Columbia, the Congress may be greatly in need of informed and disinterested legal advice. If Congress may grant to the United States District Courts authority to act in situations in which Article III denies it, why may not this Court respond to calls upon it by Congress if confronted with the conscientious belief of Congress that such a call is made under the Nedessary-and-Proper Clause in order to deal wisely and effectively with some substantive constitutional power of Congress? Again, if the United States District Courts are not limited to the jurisdiction rigidly defined by Article III, why is the jurisdiction of this Court restricted to original jurisdiction only in 'Cases affecting Ambassadors, other public Ministers and Consuls, and those in which a State shall be Party?' Why is not Congress justified in conferring original jurisdiction upon this Court in litigation involving the exercise of its power to make all laws which shall be necessary and proper 'for carrying into Execution' its power 'To declare War,' or 'To raise and support Armies'?

Courts set up under Article III to exercise the judicial power of the United States do so either because of the nature of the subject-matter or because of the special position of the parties. So far as the subject-matter is concerned it extends to cases arising under the 'Constitution, the Laws of the United States, and Treaties,' as well as 'to all Cases of admiralty and maritime Jurisdiction.' Article I, § 8, is an enumeration of the subjects in relation to which the Constitution authorizes Congress to make laws. Its eighteen divisions of legislative power are the sources of federal rights and sanctions. Laws enacted under them are 'the Laws of the United States,' to which the 'judicial power,' granted by Article III, extends. Laws affecting revenue, war, commerce, immigration, naturalization, bankruptcy, and the rest, as well as the vast range of laws authorized by the 'Necessary-and-Proper' Clause, are the generating sources of 'all Cases, in Law and Equity, arising under * * * the Laws of the United States,' and therefore cognizable by the courts established under Article III. Congress can authorize the making of contracts; it can therefore authorize suit thereon in any district court. Congress can establish post offices; it can therefore authorize suits against the United States for the negligent killing of a child by a post-office truck.

Insofar as the courts established under Article III can entertain a case not involving the Constitution, the laws of the United States or treaties, nor concerning admiralty, they do so because of the status of the parties, enumerated with particularity in Article III.

We are here concerned with the power of the fedeal courts to adjudicate merely because of the citizenship of the parties. Power to adjudicate between citizens of different states, merely because they are citizens of different states, has no relation to any substantive rights created by Congress. When the sole source of the right to be enforced is the law of a State, the right to resort to a federal court is restricted to 'citizens of different States.' The right to enforce such State-created obligations derives ts sole strength from Article III. No other provision of the Constitution lends support. But for Article III, the judicial enforcement of rights which only a State, not the United States, creates would be confined to State courts. It is Article III and nothing outside it that authorizes Congress to treat federal courts as 'only another court of the State,' Guaranty Trust Co. of New York v. York, 326 U.S. 99, 108, 65 S.Ct. 1464, 1469, 89 L.Ed. 2079, 160 A.L.R. 1231, and Article III allows it to do so only when the parties are citizens of different 'States.' If Congress, in its law-making power over the District of Columbia, created some right for the inhabitants of the District, it could choose to provide for the enforcement of that right in any court of the United States, because the case would be one arising under 'the Laws of the United States.' But here the controversy is one arising not under the laws of the United States but under the laws of Maryland. By the command of the Constitution, this Maryland-created right can be enforced in a federal court only if the controversy is between 'citizens of different States' in relation to the State in which the federal court is sitting.

The diversity jurisdiction of the federal courts was probably the most tenuously founded and most unwillingly granted of all the heads of federal jurisdiction which Congress was empowered by Article III to confer. It is a matter of common knowledge that the jurisdiction of the federal courts based merely on diversity of citizenship has been more continuously under fire than any other. ^[2] Inertia largely accounts for its retention. By withdrawing the meretricious advantages which diversity jurisdiction afforded one of the parties in some types of litigation, Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188, 114 A.L.R. 1487, has happily eliminated some practical but indefensible reasons for its retention. An Act for the elimination of diversity jurisdiction could fairly be called an Act for the relief of the federal courts. Concededly, no great public interest or libertarian principle is at stake in the desire of a corporation which happens to have been chartered in the District of Columbia, to pursue its claim against a citizen of Maryland in the federal court in Maryland on the theory that the right of this artificial citizen of the District of Columbia cannot be vindicated in the State courts of Maryland.

But in any event, the dislocation of the Constitutional scheme for the establishment of the federal judiciary and the distribution of jurisdiction among its tribunals so carefully formulated in Article III is too heavy a price to pay for whatever advantage there may be to a citizen of the District, natural or artificial, to go to a federal court in a particular State instead of to the State court in suing a citizen of that State. Nor is it merely a dislocation for the purpose of accomplishing a result of trivial importance in the practical affairs of life. The process of reasoning by which this result is reached invites a use of the federal courts which breaks with the whole history of the federal judiciary and disregards the wise policy behind that history. It was because Article III defines and confines the limits of jurisdiction of the courts which are established under Article III that the first Court of Claims Act fell, Gordon v. United States, 2 Wall. 561, 17 L.Ed. 921, 117 U.S. 697. And it was in observance of these Constitutional limits that this Court had to decline appellate powers sought to be con erred by the Congress in an exercise of its legislative power over the District. Keller v. Potomac Electric Power Co., 261 U.S. 428, 43 S.Ct. 445, 67 L.Ed. 731.

To find a source for 'the judicial Power,' therefore, which may be exercised by courts established under Article III of the Constitution outside that Article would be to disregard the distribution of powers made by the Constitution. ^[3] The other alternative-to expand 'the judicial Power' of Article III to include a controversy between a citizen of the District of Columbia and a citizen of one of the States by virtue of the provision extending 'the judicial Power' to controversies 'between citizens of different States'-would disregard an explicit limitation of Article III. For a hundred and fifty years 'States' as there used meant 'States'-the political organizations that form the Union and alone have power to amend the Constitution. The word did not cover the district which was to become 'the Seat of the Government of the United States,' nor the 'Territory' belonging to the United States, both of which the Constitution dealt with in differentiation from the States. A decent respect for unbroken history since the country's foundation, for contemporaneous interpretation by those best qualified to make it, for the capacity of the distinguished lawyers among the Framers to express themselves with precision when dealing with technical matters, unite to admonish against disregarding the explicit language of Article III extending the diversity jurisdiction of the federal courts 'to Controversies * * * between citizens of different States,' not to controversies between 'Citizens of different States, including the District and the Territory of the United States.'

The Framers, in making provision in regard to 'States,' meant the States which sent them as delegates to the Philadelphia Convention and the States which were to be admitted later. It was not contemplated that the district which was to become the seat of government could ever become a State. Marshall had no mean share in securing adoption of the Constitution and took special interest in the Judiciary Article. He merely gave expression to the common understanding-the best test of the meaning of words-when he rejected summarily the notion that the Citizens of the District are included among Citizens of 'States.' The very subject matter of §§ 1 and 2 of Article III is technical in the esteemed sense of that term. These sections do not deal with generalities expanding with experience. Provisions for the organization of courts and their jurisdiction pre uppose definiteness and precision of phrasing. These requirements were heeded and met by those who were concerned with framing the Judiciary Article; Wilson and Madison and Morris and Rutledge and Sherman, were lawyers of learning and astuteness. The scope of the judicial power with which the federal courts were to be entrusted was, as I have said, one of the most sharply debated and thoroughly canvassed subjects in Independence Hall. When the Framers finally decided to extend the judicial Power to controversies 'between citizens of different States,' they meant to be restrictive in the use of that term. They were not unaware of the fact that outside the States there was the Northwest Territory, and that there was to be a Seat of Government. Considering their responsibility, their professional habits, and their alertness regarding the details of Article III, the precise enumeration of the heads of jurisdiction made by the Framers ought to preclude the notion that they shared the latitudinarian attitude of Alice in Wonderland toward language.

It is suggested that other provisions of the Constitution relating to 'States' apply to the District. If the mere repetition of an inaccuracy begets truth then that statement is true, not otherwise. Decisions concerned with the District involving trial by jury in criminal and civil cases, full faith and credit for its proceedings, and the power to tax residents, rest on provisions in the Constitution not limited to 'States.' There may be a decision in which the source of rights or obligations affecting the District of Columbia derives from a legal right relating solely to 'States' or a duty to which only 'States' must be obedient. I know of no such case.

Of course every indulgence must be entertained in favor of constitutionality when legislation of Congress can fairly be deemed an exercise of the discretion, in the formulation of policy, given to Congress by the Constitution. But the cases to which jurisdiction may be extended under Article III to the courts established under it preclude any claim of discretionary authority to add to the cases listed by Article III or to change the distribution as between original and appellate jurisdiction made by that Article. Congress need not establish inferior courts; Congress need not grant the full scope of jurisdiction which it is empowered to vest in them; Congress need not give this Court any appellate power; it may withdraw appellate jurisdiction once conferred and it may do so even while a case is sub judice. Ex parte McCardle, 7 Wall. 506, 19 L.Ed. 264. But when the Constitution defined the ultimate limits of judicial power exercisable by courts which derive their sole authority from Article III, it is beyond the power of Congress to extend those limits. If there is one subject as to which this Court ought not to feel inhibited in passing on the validity of legislation by doubts of its own competence to judge what Congress has done, it is legislation affecting the jurisdiction of the federal courts. When Congress on a rare occasion through inadvertence or generosity exceeds those limitations, this Court should not goodnaturedly ignore such a transgression of congressional powers.

A substantial majority of the Court agrees that each of the two grounds urged in support of the attempt by Congress to extend diversity jurisdiction to cases involving citizens of the District of Columbia must be rejected-but not the same majority. And so, conflicting minorities in combination bring to pass a result paradoxical as it may appear-which differing majorities of the Court find insupportable.

Notes

1. The story of the scope of jurisdiction of the federal courts devised by Article III is easily traceable through the admirable index in Farrand, The Records of the Federal Convention (Rev. ed., 1937); the data are assembled in Prescott, Drafting the Federal Constitution, ch. 17 (1941); see also Friendly, The Historic Basis of Diversity Jurisdiction, 41 Harv.L.Rev. 483 (1928).
2. See for example, Hearings and S.Rep.No.626, on S. 3151, 70th Cong., 1st Sess. (1928); S.Rep.No.691, on S. 4357, 71st Cong., 2d Sess. (1930); S. 937, S. 939, H.R. 10594, H.R. 11508, S.Rep.No.530 and S.Rep.No.701, 72d Cong., 1st Sess. (1932); Hearings on S. 466, 79th Cong., 1st Sess. (1945). Earlier attacks on diversity jurisdiction are summarized in Frankfurter and Landis, The Business of the Supreme Court, 90 et seq., 136 et seq. (1928).
3. Reliance on Williams v. Austrian, 331 U.S. 642, 657, 67 S.Ct. 1443, 1450, 91 L.Ed. 1718, seems singularly inapposite. When a petition for bankruptcy is filed there may be outstanding claims by the bankrupt against debtors and by creditors against the bankrupt. Of course Congress has power to determine whether all such claims-those for and those against, the bankrupt estate should be enforced through the federal courts. That a particular claim dissociated from the fact of bankruptcy would have to be brought in a State court for want of any ground of federal jurisdiction is irrelevant. This is so because in the exercise of its power to pass 'uniform laws on the subject of Bankruptcies' Congress may deem it desirable that the federal courts be utilized for all the claims that pertain to the bankrupt estate whether in the federal court in which the bankruptcy proceeding is pending or in a more convenient federal court. The congeries of controversies thus brought into being by reason of bankruptcy may be lodged in the federal courts because they arise under 'the Laws of the United States,' to wit, laws concerning the 'subject of Bankruptcies.' It is a matter of congressional policy whether there must be a concourse of all claims affecting the bankrupt's estate in the federal court in which the bankruptcy proceeding is pending or whether auxiliary suits be pursued in other federal courts.