Felix Frankfurter

“ The trustee's right to judgment against the mortgagor, even though uncontested, is a matter of substance, for the judgment is the important-indeed indispensable-means of pursuing the mortgaged property into the hands of the City in the event that it should turn out in the suit against the City that it had not become personally liable for any part of the mortgage debt. ”

“ Plainly, therefore, Chase and Indianapolis Gas, are, colloquially speaking, partners in litigation. The property covered by the lease is now in the City's possession; Chase is simply acting to protect the bondholders' security. As to Indianapolis Gas, if the lease is upheld, it will continue to receive a six per cent return on its capital, and the burden of paying the interest on its bonded indebtedness will be not upon it but upon the City. What Chase wants Indianapolis Gas wants and the City does not want. ”

“ In each there is an adequate diversity of citizenship and each involves the requisite jurisdictional amount and each is 'actual' and 'substantial' enough to support the jurisdiction, if this means anything more than that a demand exceeding $3,000 must be involved. A United States district court is not without jurisdiction to render a judgment exceeding $3,000 on confession if there is the requisite diversity of citizenship. ”

“ In 1913 Indianapolis Gas turned the mortgaged utility system over to Citizens Gas, a competitor, under a lease for a term of ninety-nine years. Citizens Gas undertook among other things to pay the interest 'as the same shall from time to time fall due' on the bonds secured by the mortgage and also to pay certain sums, subject to some variation by reference to the price received for gas, to the stockholders of Indianapolis Gas. ”

“ For jurisdictional purposes Indianapolis Gas, the mortgage debtor, and the City, whose possession of the property under the circumstances was alleged to result in an assumption of the debt, as well as Citizens Gas, the intermediate owner (who seems of no consequence to the issues under discussion) , were all citizens of the State of Indiana, while Chase, the trustee, was a citizen of New York. ”

“ Chase is the trustee under a mortgage deed to secure a bond issue executed by Indianapolis Gas in 1902. In 1906 Citizens Gas was formed to compete with Indianapolis Gas in the distribution of light, heat, and power to the people of Indianapolis. Its franchise provided that after the expiration of twenty-five years and the performance of certain specified conditions, the company should be would up and its property conveyed to the City subject to the company's 'outstanding legal obligations'. ”

“ As is true of many problems in the law, the answer is to be found not in legal learning but in the realities of the record. Though variously expressed in the decisions, the governing principles are clear. ”

“ Litigation is the pursuit of practical ends, not a game of chess. ”

“ Chase thereupon filed a bill of complaint in the District Court, naming as defendants Indianapolis Gas, Citizens Gas, and the City. It prayed that the lease from Indianapolis Gas to Citizens Gas be declared valid and binding upon the defendants, and as such be deemed part of the security for the performance of the mortgage obligations; that the City be ordered to perform all of the lessee's obligations in the lease and to pay directly to the plaintiff all of the interest payments as they shall become due; that judgment for overdue interest be entered against the defendants 'liable therefor' ”

“ Litigation is the pursuit of practical ends, not a game of chess. Whether the necessary 'collision of interest', Dawson v. Columbia Ave. Sav. Fund, Safe Deposit, Title & Trust Co., supra, 197 U.S. at page 181, 25 S.Ct. ”

“ Insurance Co., 151 U.S. 368, 385, 14 S.Ct. 367, 373, 38 L.Ed. 195. These familiar doctrines governing the alignment of parties for purposes of determining diversity of citizenship have consistently guided the lower federal courts [1] and this Court. [2]
And so we turn to the actualities of this litigation. ”

“ To sustain diversity jurisdiction there must exist an 'actual', Helm v. Zarecor, 222 U.S. 32, 36, 32 S.Ct. 10, 11, 56 L.Ed. 77, 'substantial', Niles-Bement-Pond Co. v. Iron Moulders' Union, 254 U.S. 77, 81, 41 S.Ct. 39, 41, 65 L.Ed. 145, controversy between citizens of different states, all of whom on one side of the controversy are citizens of different states from all parties on the other side. Strawbridge v. Curtiss, 3 Cranch 267, 2 L.Ed. 435. Diversity jurisdiction cannot be conferred upon the federal courts by the parties' own determination of who are plaintiffs and who defendants. ”

“ It modified the judgment only by including two additional judgment debtors on whom it fixed primary and secondary liability, but continued the judgment against Indianapolis Gas with a tertiary liability for its satisfaction. ”

“ The agreement deals merely with the disposition of the interest falling due during the pendency of the litigation. Moreover, the lease between Indianapolis Gas and Citizens Gas contains no provisions requiring payment of the interest direct to Chase or the bondholders. Nor can diversity jurisdiction be rested upon so flimsy a basis as Chase's prayer for reimbursement of costs and attorneys' fess. ”