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Johnson v. Manhattan Railway Co.

Supreme Court of the United States · 1933 · Civil Procedure

Civil ProcedureCollateral attackReceivershipJudicial assignmentFederal court rulescollateral attackdirect attackreceivers

Facts

The Senior Circuit Judge of the Second Circuit had assigned himself under 28 U.S.C. § 22 to hold sessions of the Southern District of New York and later specially assigned himself to hear all applications and proceedings in an intended equity suit by American Brake Shoe and Foundry Company against Interborough Rapid Transit Company. In that suit he appointed temporary receivers for Interborough, later extended the receivership to Manhattan Railway Company, and eventually continued both receiverships during the pendency of the suit. Johnson and Boehm, who did not appear in the American Brake Shoe suit despite being invited to be heard, instead brought a separate receivership suit attacking the Senior Circuit Judge's authority and the validity of his orders on the grounds that his assignment, his division-of-business order, and his actions violated federal statutes and district court rules 1-a and 11-a. A district judge agreed and vacated the Senior Circuit Judge's orders, but the court of appeals reversed.

Issue

Whether Johnson and Boehm, in a separate suit, could invalidate the Senior Circuit Judge's orders appointing and continuing receivers by arguing that his self-assignment and subsequent actions were unauthorized and contrary to district court rules. More specifically, the question was whether the attack was collateral and, if so, whether the alleged defects showed a lack of power rather than mere error.

Rule

When a party attacks orders entered in another pending suit by bringing a separate and independent action, the attack is collateral, not direct, even if both suits are in the same court. A collateral attack succeeds only if it shows a want of power, not mere error in the exercise of existing power. Under 28 U.S.C. § 22, a senior circuit judge may assign himself to hold district court if he finds the public interest requires it, and the assignment may be limited to particular cases, duties, or times; district court rules cannot validly restrict such statutory authority because district court rules must not be inconsistent with laws of the United States.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In a federal equity action pending in Chicago, a judge specially assigned from the court of appeals appoints a temporary receiver for Lakefront Transit Systems. Maya Ortiz, a bondholder who received notice that interested parties could appear at the continuation hearing, skips that hearing and instead files a new suit in the same federal district court asking another judge to declare the receivership order void because the assigned judge should not have heard the matter.

How should the second judge most likely characterize Maya's challenge?

Explanation. The challenge is collateral. The governing rule is that when a party attacks orders entered in another pending suit by filing a separate and independent action, the attack is collateral even if both suits are in the same court. It would have been a direct attack had Maya appeared in the original action, objected there, and then appealed if overruled. (Derived from Johnson v. Manhattan Railway Co. (1933).)