Pennoyer v. Neff 94 U.S. 714, 722 (1878)
Mitchell sued Neff in Oregon State Court over a bill of $253 for legal services. o Mitchell submitted an affidavit that Neff owned land in Oregon and lived in California but couldn't be found. Mitchell won (through a default judgment aka Federal Rule 55) and secured a writ of execution against Oregon real estate owned by Neff. The land was sold at auction and conveniently bought by Mitchell, who in turn sold it to Pennoyer. o Neff was never present, and most likely didn't even know what was happening. o Pennoyer put an ad in a local newspaper saying he was suing Neff (service of process). This is not a classic way to provide service of process. Normally you need to hand them the notice in person (although it varies from state to state). Service of Process is a requirement of jurisdiction. When he found out what happened, Neff sued Pennoyer in Federal Court. Neff won, holding that the judgment in Mitchell v. Neff was invalid. o Court decided that Mitchell had not done enough to find Neff. He did not provide service of process. Pennoyer appealed to the US Supreme Court. Supreme Court affirmed the decision and found: o Code of Oregon states that an action by a resident against an absent nonresident can result in seizure of property. Does this mean that Oregon has jurisdiction over nonresidents? Jurisdiction = authority/power that is recognized by other courts as being a valid exercise of power. o Also, the Code of Oregon states that no person is subject to the court "unless he appear in the court, or be
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found within the State or be a resident thereof, or have property therein, and in that last case, only to the extent of such property at the time of the jurisdiction attached." Ergo, Oregon does not have jurisdiction over California citizens living on California! However, according to the Oregon Code, they can claim a limited jurisdiction over people that own property in Oregon, if the issue is related to the property. The property sold under the judgment was not attached, not in any way brought under the jurisdiction of the court. In other words, it was not disposed or pursuant to the case, it was only used as the enforcement of a personal judgment having no relation to the property. In this case, the property was not in anyway involved in Neff's debt, therefore, the fact that Oregon has jurisdiction over property has no bearing on this case, the case is against Neff only (Suit was Mitchell v. Neff, not Mitchell v. Neff's Land). In personam = authority against the person. In rem = authority against the property. In rem cases can only be brought in cases that specifically involve the property. In rem cases can only be brought in the jurisdiction that the property is in. In personam cases 'move' and can be brought wherever the defendant is. Every state possesses exclusive jurisdiction and sovereignty over persons and property within its territory. In addition, the laws of one State have no operation outside its territory, except as is allowed by comity. 14th Amendment guarantees due process. Due process means that Neff was entitled to be notified. In addition, it is 'unfair' to force Neff to travel that far in order to defend himself. Also, by choosing to live in a particular state, you are acquiescing to the laws of that state, and (through voting) have some control over the laws of that state. Other states may have laws you have not consented to live under. th But note that the 14 Amendment didn't come into effect until 3 years after the case was decided! This ruling no way implies that that a State cannot authorize proceedings to determine the status of one of
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its citizens against a nonresident, or that it cannot require nonresidents making contracts within the State to have authorized representatives in that State. Since the case failed on issue of jurisdiction, the US Supreme Court did not bother to rule on the fact that Neff was never served. The fact that Neff was not served would also have bearing on the case, if Oregon could have successfully argued that they had jurisdiction over Neff. US Supreme Court did mention that if local publication of process (like printing in a local newspaper) sufficed as notification, there would be massive fraud and oppression, since there is no way a nonresident could be expected to see the ad. What the Pennoyer v. Neff case comes down to is: if you own property in a State, are you under the jurisdiction of that State? And if so, if is that jurisdiction in rem or in personam. The US Supreme Court found that the case was an in personam case (case was v. Neff, not v. Neff's House). They also found that States do not have jurisdiction in in personam cases based on solely the ownership of land within that state. Could Mitchell have sued in California instead of Oregon? No. Supreme Court mentioned that if Mitchell had attached the property at the original onset of the case, then this could have been an in rem case (or at least quasi in rem), and Oregon had jurisdiction. Of course, this assumes that Mitchell's legal fees were somehow related to some issue regarding the property, if not, he may have had a difficult time attaching the property. Quasi in rem (like in rem) could have been used May or may not have anything to do with the property. Case is not against "anyone in the world with an interest in the property," it is just against a specific person's interest in the property. Quasi in rem permits a change from the three basic common law rules of jurisdiction. Attachment means you post a notice on the property that you are taking legal
action against the property owner. A collateral attack is when you have two separate cases, and one case attacks the other case. This is different from an appeal to the cases, which is more direct. In Pennoyer v. Neff, Neff attacked the validity of the Mitchell v. Neff judgment (based on lack of jurisdiction). In a collateral attack, you can only attack the jurisdiction of the first case. You can't retry the case, due to Res Adjudicata. o Res Adjudicata means that the case has already been decided and closed and it's too late to reopen it.