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f the case and the establishment of jurisdiction through quasi in rem proceedings raised the issue of fairness and territoriality. The claimant was a Maryland resident who was owed a debt by Balk, a North Carolina resident. The Marylander ascertained, apparently adventitiously, that Harris, a North Carolina resident who owed Balk an amount of money, was passing through Maryland, and the Marylander attached this debt. Balk had no notice of the action and a default judgment was entered, after which Harris paid over the judgment to the Marylander. When Balk later sued Harris in North Carolina to recover on his debt, Harris argued that he had been relieved of any further obligation by satisfying the judgment in Maryland, and the Supreme Court sustained his defense, ruling that jurisdiction had been properly obtained and the Maryland judgment was thus valid. 881 Subsequently, Harris v. Balk was overruled in Shaffer v. Heitner, 882 in which the Court rejected the Delaware state court’s jurisdiction, holding that the ‘‘minimum contacts’’ test of International Shoe applied to all in rem and quasi in rem actions. The case involved a Delaware sequestration statute under which plaintiffs were authorized to bring actions against nonresident defendants by attaching their ‘‘property’’ within Delaware, the property here consisting of shares of corporate stock and options to stock in the defendant corporation. The stock was considered to be in Delaware because that was the state of incorporation, but none of the certificates representing the seized stocks were physically present in Delaware. The reason for applying the same test as is applied in in personam cases, the Court said, ‘‘is simple and straightforward. It is premised on recognition that ‘[t]he phrase ‘judicial jurisdiction’ over a thing,’ is a customary elliptical way of referring VerDate Jul<13>2004 05:44 Jul 13, 2004 Jkt 000000 PO 00000 Frm 00160 Fmt 8222 Sfmt 8222 \\GSDDPC41\YOURS-AND-MINE\CON046.SGM CON046 AMENDMENT 14—RIGHTS GUARANTEED 1831 883 433 U.S. at 207 (internal quotation from RESTATEMENT (SECOND) OF CONFLICT OF LAWS 56, Introductory Note (1971)). 884 433 U.S. at 207. The characterization of actions in rem as being not actions against a res but against persons with interests merely reflects Justice Holmes’ insight in Tyler v. Judges of the Court of Registration, 175 Mass. 71, 76–77, 55 N.E., 812, 814, appeal dismissed, 179 U.S. 405 (1900). 885 444 U.S. 320 (1980). 886 444 U.S. at 328–30. In dissent, Justices Brennan and Stevens argued that what the state courts had done was the functional equivalent of direct-action statutes. Id. at 333 (Justice Stevens); World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 299 (1980) (Justice Brennan). The Court, however, refused so to view the Minnesota garnishment action, saying that ‘‘[t]he State’s ability to exert its power over the ‘nominal defendant’ is analytically prerequisite to the insurer’s entry into the case as a garnishee.’’ Id. at 330–31. Presumably, the comment is not meant to undermine the validity of such direct-action statutes, which was upheld in Watson v. Employers Liability Assurance Corp., 348 U.S. 66 (1954), a choice-of-law case rather than a jurisdiction case. 887 See O’Conner v. Lee-Hy Paving Corp., 579 F.2d 194 (2d Cir.), cert. denied, 439 U.S. 1034 (1978). 888 Goodrich v. Ferris, 214 U.S. 71, 80 (1909); McCaughey v. Lyall, 224 U.S. 558 (1912). to jurisdiction over the interests of persons in a thing.’’’ 883 Thus, ‘‘[t]he recognition leads to the conclusion that in order to justify an exercise of jurisdiction in rem, the basis for jurisdiction must be sufficient to justify exercising ‘jurisdiction over the interests of persons in a thing.’’’ 884 A further tightening of jurisdictional standards occurred in Rush v. Savchuk. 885 The plaintiff was injured in a one-car accident in Indiana while a passenger in a car driven by defendant. Plaintiff later moved to Minnesota and sued defendant, still resident in Indiana, in state court in Minnesota. There were no contacts between the defendant and Minnesota, but defendant’s insurance company did business there and plaintiff garnished the insurance contract, signed in Indiana, under which the company was obligated to defend defendant in litigation and indemnify him to the extent of the policy limits. The Court refused to permit jurisdiction to be grounded on the contract; the contacts justifying jurisdiction must be those of the defendant engaging in purposeful activity related to the forum. 886 Rush thus resulted in the demise of the controversial Seider v. Roth doctrine, which lower courts had struggled to save after Shaffer v. Heitner. 887 Actions in Rem: Estates, Trusts, Corporations.—Generally, probate will occur where the decedent was domiciled, and as a probate judgment is considered in rem, a determination as to assets in that State will be determinative as to all interested persons. 888 Insofar as the probate affects property, land or personalty beyond the State’s boundaries, however, the judgment is in personam and VerDate Jul<13>2004 05:44 Jul 13, 2004 Jkt 000000 PO 00000 Frm 00161 Fmt 8222 Sfmt 8222 \\GSDDPC41\YOURS-AND-MINE\CON046.SGM CON046 1832 AMENDMENT 14—RIGHTS GUARANTEED 889 Baker v. Baker, Eccles & Co., 242 U.S. 394 (1917); Riley v. New York Trust Co., 315 U.S. 343 (1942). 890 315 U.S. at 353. 891 357 U.S. 235 (1957). 892 The in personam aspect of this decision is considered supra. 893 She reserved the power to appoint the remainder, after her reserved life estate, either by testamentary disposition or by inter vivos instrument. After she moved to Florida, she executed a new will and a new power of appointment under the trust, which did not satisfy the requirements for testamentary disposition under Florida law. Upon her death, dispute arose as to whether the property passed pursuant to the terms of the power of appointment or in accordance with the residuary clause of the will. 894 357 U.S. at 246. 895 357 U.S. at 247–50. The four dissenters, Justices Black, Burton, Brennan, and Douglas, believed that the transfer in Florida of $400,000 made by a domiciliary and affecting beneficiaries, almost all of whom lived in that State, gave rise to a sufficient connection with Florida to support an adjudication by its courts of the effectiveness of the transfer. 357 U.S. at 256, 262. 896 See discussion of Pennoyer, supra. can bind only parties thereto or their privies. 889 Thus, the full faith and credit clause would not prevent a out-of-state court in the state where the property is located from reconsidering the first court’s finding of domicile, which could affect the ultimate disposition of the property. 890 The difficulty of characterizing the existence of the res in a particular jurisdiction is illustrated by the in rem aspects of Hanson v. Denckla. 891 As discussed earlier, 892 the decedent created a trust with a Delaware corporation as trustee, 893 and the Florida courts had attempted to assert both in personam and in rem jurisdiction over the Delaware corporation. Asserting the old theory that a court’s in rem jurisdiction ‘‘is limited by the extent of its power and by the coordinate authority of sister States,’’ 894 i.e., whether the court has jurisdiction over the thing, the Court thought it clear that the trust assets that were the subject of the suit were located in Delaware and thus the Florida courts had no in rem jurisdiction. The Court did not expressly consider whether the International Shoe test should apply to such in rem jurisdiction, as it has now held it generally must, but it did briefly consider whether Florida’s interests arising from its authority to probate and construe the domiciliary’s will, under which the foreign assets might pass, were a sufficient basis of in rem jurisdiction and decided they were not. 895 The effect of International Shoe in this area is still to be discerned. The reasoning of the Pennoyer 896 rule, that seizure of property and publication was sufficient to give notice to nonresidents or absent defendants, has also been applied in proceedings for the forfeiture of abandoned property. If all known claimants were personally served and all claimants who were unknown or nonresident VerDate Jul<13>2004 05:44 Jul 13, 2004 Jkt 000000 PO 00000 Frm 00162 Fmt 8222 Sfmt 8222 \\GSDDPC41\YOURS-AND-MINE\CON046.SGM CON046 AMENDMENT 14—RIGHTS GUARANTEED 1833 897 Hamilton v. Brown, 161 U.S. 256 (1896); Security Savings Bank v. California, 263 U.S. 282 (1923). See also Voeller v. Neilston Co., 311 U.S. 531 (1941). 898 339 U.S. 306 (1950). 899 A related question is which state has the authority to escheat a coporate debt. See Western Union Tel. Co. v. Pennsylvania, 368 U.S. 71 (1961); Texas v. New Jersey, 379 U.S. 674 (1965). Where a state seeks to escheat intangible corporate property such as uncollected debt, the Court found that the multiplicity of States with a possible interest made a ‘‘contacts’’ test unworkable. Citing ease of administration rather than logic or jurisdiction, the Court held that the authority to take the uncollected claims against a corporation by escheat would be based on whether the last known address on the company’s books for the each creditor was in a particular State. 900 ‘‘An elementary and fundamental requirement of due process in any proceeding which is to be accorded finality is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.’’ Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950). ‘‘There . . . must be a basis for the defendant’s amenability to service of summons. Absent consent, this means there must be authorization for service of summons on the defendant.’’ Omni Capital Int’l v. Rudolph Wolff & Co., 484 U.S. 97 (1987). 901 McDonald v. Mabee, 243 U.S. 90, 92 (1971). 902 Greene v. Lindsey, 456 U.S. 444, 449 (1982) See Dusenbery v. United States, 534 U.S. 161 (2001) (upholding a notice of forfeiture which was delivered by certified mail to the mail-room of a prison where the individual to be served was incarcerated). were given constructive notice by publication, judgments in these proceedings were held binding on all. 897 But in Mullane v. Central Hanover Bank & Trust Co., 898 the Court, while declining to characterize the proceeding as in rem or in personam, held that a bank managing a common trust fund in favor of nonresident as well as resident beneficiaries could not obtain a judicial settlement of accounts if the only notice was publication in a local paper. While such notice by publication was sufficient as to beneficiaries whose interests or addresses were unknown to the bank, the Court held it was feasible to make serious efforts to notify residents and nonresidents whose whereabouts were known, such as by mailing notice to the addresses on record with the bank. 899 Notice: Service of Process.—It is not enough that a State be potentially capable of exercising control over persons and property. Before a State can legitimately exercise such power, its jurisdiction must be perfected by an appropriate service of process which is effective to notify all parties of proceedings which may affect their rights. 900 Personal service guarantees actual notice of the pendency of a legal action, and has traditionally been deemed necessary in actions styled in personam. 901 But less rigorous notice procedures have been accepted, in light of history and of the practical obstacles to providing personal service in every instance, although these procedures do not carry with them the same certainty of actual notice as does personal service. 902 But, whether the action be in rem or in personam, there is a constitutional minimum; if it be shown that VerDate Jul<13>2004 05:44 Jul 13, 2004 Jkt 000000 PO 00000 Frm 00163 Fmt 8222 Sfmt 8222 \\GSDDPC41\YOURS-AND-MINE\CON046.SGM CON046 1834 AMENDMENT 14—RIGHTS GUARANTEED 903 In Greene v. Lindsey, 456 U.S. 444 (1982), the Court held that in light of substantial evidence that notices posted on the doors of apartments in a housing project in an eviction proceeding were often torn down by children and others before tenants ever saw them, service by posting did not comport with due process. Without requiring it, the Court observed that the mails provided an efficient and inexpensive means of communication upon which prudent men could rely and that notice by mail would provide a reasonable assurance of notice. Id. at 455. See also Mennonite Bd. of Missions v. Adams, 462 U.S. 791 (1983) (personal service or notice by mail is required for mortgagee of real property subject to tax sale); Tulsa Professional Collection Servs. v. Pope, 485 U.S. 478 (1988) (notice by mail or other appropriate means to reasonably ascertainable creditors of probated estate). 904 E.g., McGee v. International Life Ins. Co., 355 U.S. 220 (1957); Travelers Health Ass’n ex rel. State Corp. Comm’n, 339 U.S. 643 (1950). 905 See, e.g., G.D. Searle & Co. v. Cohn, 455 U.S. 404, 409–12 (1982) (discussing New Jersey’s ‘‘long-arm’’ rule, under which a plaintiff must make every effort to serve process upon someone within the State and then only if ‘‘after diligent inquiry and effort personal service cannot be made’’ within the State, then ‘‘service may be made by mailing, by registered or certified mail, return receipt requested, a copy of the summons and complaint to a registered agent for service, or to its principal place of business, or to its registered office.’’). Cf. Velmohos v. Maren Engineering Corp., 83 N.J. 282, 416 A.2d 372 (1980), vacated and remanded, 455 U.S. 985 (1982). 906 Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985). 907 E.g., Watson v. Employers Liability Assurance Corp., 348 U.S. 66 (1954) (authorizing direct action against insurance carrier rather than against the insured). 908 Holmes v. Conway, 241 U.S. 624, 631 (1916); Louisville & Nashville R.R. v. Schmidt, 177 U.S. 230, 236 (1900). A State ‘‘is free to regulate procedure of its courts in accordance with it own conception of policy and fairness unless in so doing it offends some principle of justice so rooted in the traditions and conscience of our people as to be ranked as fundamental.’’ Snyder v. Massachusetts, 291 U.S. 97, 105 (1934); West v. Louisiana, 194 U.S. 258, 263 (1904); Chicago, B. & Q. R.R. v. Chicago, 166 U.S. 226 (1897); Jordan v. Massachusetts, 225 U.S. 167, 176, (1912). The the mode of notice used was not reasonably calculated to provide the necessary information, its age and history will not sustain it. 903 The use of mail to convey notice, for instance, has become quite established, 904 especially for assertion of in personam jurisdiction extraterritorially upon individuals and corporations having ‘‘minimum contacts’’ with a forum State, where various ‘‘long-arm’’ statutes authorize notice by mail. 905 Or, in a class action, due process is satisfied by mail notification of out-of-state class members, giving such members the opportunity to ‘‘opt out’’ but with no requirement that inclusion in the class be contingent upon affirmative response. 906 Other service devices and substitutions, have been pursued and show some promise of further loosening of the concept of territoriality even while complying with minimum due process standards of notice. 907 Power of the States to Regulate Procedure Generally.—As long as a party has been given sufficient notice and an opportunity to defend his interest, the due process clause of the Fourteenth Amendment does not generally mandate the particular forms of procedure to be used in state courts. 908 The VerDate Jul<13>2004 05:44 Jul 13, 2004 Jkt 000000 PO 00000 Frm 00164 Fmt 8222 Sfmt 8222 \\GSDDPC41\YOURS-AND-MINE\CON046.SGM CON046 AMENDMENT 14—RIGHTS GUARANTEED 1835 power of a State to determine the limits of the jurisdiction of its courts and the character of the controversies which shall be heard in them and to deny access to its courts is also subject to restrictions imposed by the contract, full faith and credit, and privileges and immunities clauses of the Constitution. Angel v. Bullington, 330 U.S. 183 (1947). 909 Insurance Co. v. Glidden Co., 284 U.S. 151, 158 (1931); Iowa Central Ry. v. Iowa, 160 U.S. 389, 393 (1896): Honeyman v. Hanan, 302 U.S. 375 (1937). See also Lindsey v. Normet, 405 U.S. 56 (1972). 910 Cincinnati Street Ry. v. Snell, 193 U.S. 30, 36 (1904). 911 Some recent decisions, however, have imposed some restrictions on state procedures that require substantial reorientation of process. While this is more generally true in the context of criminal cases, in which the appellate process and postconviction remedial process have been subject to considerable revision in the treatment of indigents, some requirements have also been imposed in civil cases. Boddie v. Connecticut, 401 U.S. 371 (1971); Lindsey v. Normet, 405 U.S. 56, 74–79 (1972); Santosky v. Kramer, 455 U.S. 745 (1982). Review has, however, been restrained with regard to details. See, e.g., Lindsey v. Normet, 405 U.S. at 64–69. 912 Ownbey v. Morgan, 256 U.S. 94, 112 (1921). Thus the Fourteenth Amendment does not constrain the States to accept modern doctrines of equity, or adopt a combined system of law and equity procedure, or dispense with all necessity for form and method in pleading, or give untrammelled liberty to amend pleadings. Note that the Supreme Court did once grant review to determine whether due process required the States to provide some form of post-conviction remedy to assert federal constitutional violations, a review which was mooted when the State enacted such a process. Case v. Nebraska, 381 U.S. 336 (1965). When a State, however, through its legal system exerts a monopoly over the pacific settlement of private disputes, as with the dissolution of marriage, due process may well impose affirmative obligations on that State. Boddie v. Connecticut, 401 U.S. 371, 374–77 (1971). 913 Cohen v. Beneficial Loan Corp., 337 U.S. 541 (1949). Nor was the retroactive application of this statutory requirement to actions pending at the time of its adoption violative of due process as long as no new liability for expenses incurred before enactment was imposed thereby and the only effect thereof was to stay such proceedings until the security was furnished. States may regulate the manner in which rights may be enforced and wrongs remedied, 909 and may create courts and endow them with such jurisdiction as, in the judgment of their legislatures, seems appropriate. 910 Whether legislative action in such matters is deemed to be wise or proves efficient, whether it works a particular hardship on a particular litigant, or perpetuates or supplants ancient forms of procedure, are issues which ordinarily do not implicate the Fourteenth Amendment. The function of the Fourteenth Amendment is negative rather than affirmative 911 and in no way obligates the States to adopt specific measures of reform. 912 Commencement of Actions.—A state may impose certain conditions on the right to institute litigation. Access to the courts has been denied to persons instituting stockholders’ derivative actions unless reasonable security for the costs and fees incurred by the corporation is first tendered. 913 But, foreclosure of all access to the courts, through financial barriers and perhaps through other means as well, is subject to federal constitutional scrutiny and must be justified by reference to a state interest of suitable importance. Thus, where a State has monopolized the avenues of settle- VerDate Jul<13>2004 05:44 Jul 13, 2004 Jkt 000000 PO 00000 Frm 00165 Fmt 8222 Sfmt 8222 \\GSDDPC41\YOURS-AND-MINE\CON046.SGM CON046 1836 AMENDMENT 14—RIGHTS GUARANTEED 914 Boddie v. Connecticut, 401 U.S. 371 (1971). See also Little v. Streater, 452 U.S. 1 (1981) (state-mandated paternity suit); Lassiter v. Department of Social Services, 452 U.S. 18 (1981) (parental status termination proceeding); Santosky v. Kramer, 455 U.S. 745 (1982) (permanent termination of parental custody). 915 Young Co. v. McNeal-Edwards Co., 283 U.S. 398 (1931); Adam v. Saenger, 303 U.S. 59 (1938). 916 Jones v. Union Guano Co., 264 U.S. 171 (1924). 917 Sawyer v. Piper, 189 U.S. 154 (1903). 918 Grant Timber & Mfg. Co. v. Gray, 236 U.S. 133 (1915) 919 Lindsey v. Normet, 405 U.S. 56, 64–69 (1972). See also Bianchi v. Morales, 262 U.S. 170 (1923) (upholding mortgage law providing for summary foreclosure of a mortgage without allowing any defense except payment).. 920 Bowersock v. Smith, 243 U.S. 29, 34 (1917); Chicago, R.I. & P. Ry. v. Cole, 251 U.S. 54, 55 (1919); Herron v. Southern Pacific Co., 283 U.S. 91 (1931). See ment of disputes between persons by prescribing judicial resolution, and where the dispute involves a fundamental interest, such as marriage and its dissolution, the State may not deny access to those persons unable to pay its fees. 914 In older cases, not questioned by the more recent ones, it was held that a State, as the price of opening its tribunals to a nonresident plaintiff, may exact the condition that the nonresident stand ready to answer all cross actions filed and accept any in personam judgments obtained by a resident defendant through service of process or appropriate pleading upon the plaintiff’s attorney of record. 915 For similar reasons, a requirement of the performance of a chemical analysis as a condition precedent to a suit to recover for damages resulting to crops from allegedly deficient fertilizers, while allowing other evidence, is not deemed to be arbitrary or unreasonable. 916 Amendment of pleadings is largely within the discretion of the trial court, and unless a gross abuse of discretion is shown, there is no ground for reversal. Accordingly, where the defense sought to be interposed is without merit, a claim that due process would be denied by rendition of a foreclosure decree without leave to file a supplementary answer is utterly without foundation. 917 Defenses.—Just as a State may condition the right to institute litigation, so may it establish terms for the interposition of certain defenses. It may validly provide that one sued in a possessory action cannot bring an action to try title until after judgment is rendered and after he has paid that judgment. 918 A State may limit the defense in an action to evict tenants for nonpayment of rent to the issue of payment and leave the tenants to other remedial actions at law on a claim that the landlord had failed to maintain the premises. 919 A State may also provide that the doctrines of contributory negligence, assumption of risk, and fellow servant do not bar recovery in certain employment-related accidents. No person has a vested right in such defenses. 920 Similarly, a nonresident de- VerDate Jul<13>2004 05:44 Jul 13, 2004 Jkt 000000 PO 00000 Frm 00166 Fmt 8222 Sfmt 8222 \\GSDDPC41\YOURS-AND-MINE\CON046.SGM CON046 AMENDMENT 14—RIGHTS GUARANTEED 1837 also Martinez v. California, 444 U.S. 277, 280–83 (1980) (State interest in fashioning its own tort law permits it to provide immunity defenses for its employees and thus defeat recovery). 921 Ownbey v. Morgan, 256 U.S. 94 (1921). 922 Ballard v. Hunter, 204 U.S. 241, 259 (1907). 923 Missouri, Kansas & Texas Ry. v. Cade, 233 U.S. 642, 650 (1914). 924 Walters v. National Ass’n of Radiation Survivors, 473 U.S. 305 (1985) (limitation of attorneys’ fees to $10 in veterans benefit proceedings does not violate claimants’ Fifth Amendment due process rights absent a showing of probability of error in the proceedings that presence of attorneys would sharply diminish). See also United States Dep’t of Labor v. Triplett, 494 U.S. 715 (1990) (upholding regulations under the Black Lung Benefits Act prohibiting contractual fee arrangements). 925 Lowe v. Kansas, 163 U.S. 81 (1896). Consider, however, the possible bearing of Giaccio v. Pennsylvania, 382 U.S. 399 (1966) (statute allowing jury to impose costs on acquitted defendant, but containing no standards to guide discretion, violates due process). 926 Yazoo & Miss. R.R. v. Jackson Vinegar Co., 226 U.S. 217 (1912); Chicago & Northwestern Ry. v. Nye Schneider Fowler Co., 260 U.S. 35, 43–44 (1922); Hartford Life Ins. Co. v. Blincoe, 255 U.S. 129, 139 (1921); Life & Casualty Co. v. McCray, 291 U.S. 566 (1934). fendant in a suit begun by foreign attachment, even though he has no resources or credit other than the property attached, cannot challenge the validity of a statute which requires him to give bail or security for the discharge of the seized property before permitting him an opportunity to appear and defend. 921 Costs, Damages, and Penalties.—What costs are allowed by law is for the court to determine; an erroneous judgment of what the law allows does not deprive a party of his property without due process of law. 922 Nor does a statute providing for the recovery of reasonable attorney’s fees in actions on small claims subject unsuccessful defendants to any unconstitutional deprivation. 923 Congress may, however, severely restrict attorney’s fees in an effort to keep an administrative claims proceeding informal. 924 Equally consistent with the requirements of due process is a statutory procedure whereby a prosecutor of a case is adjudged liable for costs, and committed to jail in default of payment thereof, whenever the court or jury, after according him an opportunity to present evidence of good faith, finds that he instituted the prosecution without probable cause and from malicious motives. 925 Also, as a reasonable incentive for prompt settlement without suit of just demands of a class receiving special legislative treatment, such as common carriers and insurance companies together with their patrons, a State may permit harassed litigants to recover penalties in the form of attorney’s fees or damages. 926 By virtue of its plenary power to prescribe the character of the sentence which shall be awarded against those found guilty of crime, a State may provide that a public officer embezzling public money shall, notwithstanding that he has made restitution, suffer VerDate Jul<13>2004 05:44 Jul 13, 2004 Jkt 000000 PO 00000 Frm 0016

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