Pennoyer v.
Neff
Facts: Attorney John H. Mitchell provided legal services to Marcus Neff in
connection with a land grant in the state of Oregon. Mitchell later sued
Neff in an Oregon state court to recover unpaid legal fees. Neff no longer
lived in Oregon and was apparently now living in California. Since Neff
lived out of state, the Oregon state court allowed Mitchell to “serve” Neff
with notice of the suit by posting an advertisement in a local newspaper.
This is called “substituted service by publication.” In accordance with a
state law allowing for service be made by publication of summons,
Mitchell published a notice in a local newspaper regarding the lawsuit.
When Neff failed to appear in court, Mitchell won a default judgment.
After Neff’s land in Oregon was seized to satisfy the judgment, Mitchell
purchased it at public auction. He subsequently assigned it to Sylvester
Pennoyer. Nine years later, Neff sued Pennoyer in federal court to recover
his land.
Issue: Whether jurisdiction over Neff was acquired by the court of Oregon.
Held: No. The several States of the Union are not, it is true, in every respect
independent, many of the right and powers which originally belonged to
them being now vested in the government created by the Constitution.
But, except as restrained and limited by that instrument, they possess and
exercise the authority of independent States, and the principles of public
law to which we have referred are applicable to them.
1) One of these principles is, that every State possesses exclusive
jurisdiction and sovereignty over persons and property within its
territory. As a consequence, every State has the power to determine for
itself the civil status and capacities of its inhabitants; to prescribe the
subjects upon which they may contract, the forms and solemnities with
which their contracts shall be executed, the rights and obligations arising
from them, and the mode in which their validity shall be determined and
their obligations enforced; and also the regulate the manner and
conditions upon which property situated within such territory, both
personal and real, may be acquired, enjoyed, and transferred.
2) The other principle of public law referred to follows from the one
mentioned; that is, that no State can exercise direct jurisdiction and
authority over persons or property without its territory. Story, Confl. Laws, c.
2; Wheat. Int. Law, pt. 2, c. 2. The several States are of equal dignity and
authority, and the independence of one implies the exclusion of power
from all others. And so it is laid down by jurists, as an elementary principle,
that the laws of one State have no operation outside of its territory, except
so far as is allowed by comity; and that no tribunal established by it can
extend its process beyond that territory so as to subject either persons or
property to its decisions. ‘Any exertion of authority of this sort beyond this
limit,’ says Story, ‘is a mere nullity, and incapable of binding such persons
or property in any other tribunals.’
Direct power of one sovereign (one State) does not extend outside of the
borders of that state. So service outside Oregon did not matter.
Since, the court did not acquire jurisdiction over Neff and his land, the
selling of his land was void. Mitchell acquired no right over the land,
following the principle of nemo dat quad non habet, Pennoyer also never
got a good title over it.