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SINASON TEICHER INTER AMERICAN GRAIN CORP. v. COMM

December 3, 1957

SINASON TEICHER INTER AMERICAN GRAIN CORP., Plaintiff,
v.
COMMODITY CREDIT CORPORATION, Defendant



The opinion of the court was delivered by: BRENNAN

Plaintiff, in this action, seeks to recover a money judgment for the alleged breach of a contract. Reliance rests upon the provisions of 15 U.S.C.A. 714b as the statutory authority for its maintenance.

Three grounds are urged by the defendant on this motion as the bases for the relief sought. (1) A failure to state a claim upon which relief can be granted; (2) lack of jurisdiction; (3) improper venue.

It is unnecessary to discuss the facts of the action but a brief reference to the statute involved is deemed essential.

 The pleadings, briefs and argument are all based upon the theory that the Commodity Credit Corporation is an instrumentality of the United States and thus has a sovereign's immunity from suit. United States v. Hicks, D.C., 137 F.Supp. 564; United States v. Bowden, D.C., 105 F.Supp. 264. This immunity has been waived by the Congressional enactment found in 15 U.S.C.A. 714b(c) which provides that it may sue and be sued and that the district courts of the United States have exclusive original jurisdiction of all such suits.

 The pertinent part of the statute which gives rise to the controversy here is contained in the following sentence. 'Any suit against the Corporation shall be brought in the District of Columbia, or in the district wherein the plaintiff resides or is engaged in business'.

 The defendant contends that since there is no allegation in the complaint that the plaintiff resides or transacts business in the Northern District of New York that no sufficient claim for relief is stated. The further claim is made in the alternative that there is a lack of jurisdiction of the subject matter or improper venue, since the plaintiff does not reside in or is it engaged in business in this district.

 The plaintiff contends that the quotation from the above statute is a matter of venue only and that plaintiff, having alleged that it is a domestic corporation, the venue of the action is properly in the Northern District of New York.

 As far as material to the questions involved here, the complaint after alleging plaintiff's incorporation contains no allegation as to the location of its office as same is required to be designated in its certificate of incorporation. (N.Y. Stock Corporation Law, McKinney's Consol. Laws, c. 59, Sec. 5). Neither does it show where in fact it is engaged in business. In the course of the argument however it seemed to be conceded the plaintiff's principal place for the transaction of business and where in fact it is engaged in business is at New York City in the Southern District of New York. At least it is not engaged in business or has a principal place for the transaction of business within this district.

 Although defendant's first contention as to the failure of the pleading would be valid if the problem is one of jurisdiction (Matheny v. Porter, 10 Cir., 158 F.2d 478; Berry v. Heller, D.C., 79 F.Supp. 476, at page 478), such defect could be cured by amendment and the decision here may better rest upon the determination of the other question raised. For the purpose of such decision, the above statement as to the location of its office and the place where the plaintiff is engaged in business will be deemed to be correct.

 Whether the quotation, above, taken from the statute, imposes a jurisdictional limitation (United States v. Sherwood, 312 U.S. 584, at page 586, 61 S. Ct. 767, 85 L. Ed. 1058; United States v. Shaw, 309 U.S. 495, at page 501, 60 S. Ct. 659, 84 L. Ed. 888; State of Minnesota v. U.S., 305 U.S. 382, at page 388, 59 S. Ct. 292, 83 L. Ed. 235; Wallace v. U.S., 2 Cir., 142 F.2d 240) or is a matter of venue (Industrial Addition Ass'n v. Commissioner, 323 U.S. 310, 65 S. Ct. 289, 89 L. Ed. 260; Hoiness v. U.S., 335 U.S. 297, 69 S. Ct. 70, 93 L. Ed. 16; Panhandle Eastern Pipe Line Co. v. Federal Power Commission, 324 U.S. 635, 65 S. Ct. 821, 89 L. Ed. 1241), need not be labored since the ultimate decision turns on the same facts. This is because residence or engaging in business within the Northern District of New York is essential to either the jurisdiction of the court or the venue of the action. We can now turn to a discussion of that question.

 There is no room for plaintiff's contention that the general venue statute 28 U.S.C.A. § 1391 applies. Assuming that the provision of the statute under discussion is one of venue, as claimed by the plaintiff, the special venue provision of the statute creating the right to sue would govern over the general venue statute (Gulf Res. & Dev. Co. v. Schlumberger Well Sur. Corp., D.C., 92 F.Supp. 16). Any other application of the pertinent provision of 15 U.S.C.A. 714b would leave it without meaning or effect.

 Neither can the plaintiff now invoke the general venue statute upon the theory that the Commodity Credit Corporation has no immunity from suit. United States v. Edgarton & Sons, Inc., 2 Cir., 178 F.2d 763. Plaintiff alleges that the action arises under 15 U.S.C.A. 714, etc. No other basis for the court's jurisdiction is alleged. If reliance is now placed upon some other theory of jurisdiction, such as diversity of citizenship, then the complaint is defective because it lacks the essential jurisdictional allegations.

 There is no claim made that the plaintiff is engaged in business in this district so that the question is further narrowed to a determination as to whether or not the plaintiff resides in this district as the term is used in the statute.

 Plaintiff's argument is to the effect that the general venue statute (Sec. 1391) has been construed by some courts as applying to corporate plaintiffs as well as corporate defendants. This is a matter of controversy resulting in conflicting lower court decisions. Albright & Friel, Inc., of Delaware v. U.S., D.C., 142 F.Supp. 607, at page 608, footnote 2. I fail to see how this contention is helpful to the plaintiff. Plaintiff seems to conclude that since it is a New York ...


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