The opinion of the court was delivered by: Will, District Judge.
The issue presented by this motion for a writ of certiorari
is whether the United States of America can remove the instant
litigation to this Court from the Circuit Court of Cook County
pursuant to 28 U.S.C. § 1446(b) and/or 28 U.S.C. § 1444 and
26 U.S.C. § 7424. For reasons stated below, we conclude that the
United States may so remove this action and grant its motion.
Wacholz Heating Company (Wacholz) was a subcontractor
working for H.S. Kaiser Company (Kaiser), a general
contractor. On December 30, 1963, Wacholz made an assignment
of monies due it from Kaiser for the benefit of Johnson
Service Company (Johnson). Subsequently, Kaiser became
insolvent and the Insurance Company of North America (INA) was
required under a certain performance bond to carry out the
terms of the assignment since Kaiser was no longer capable of
doing so. The United States served INA with a Notice of Levy
on or about August 8, 1969, arising from tax liens filed by
the government against the defendant Wacholz. This action
arose when Johnson filed a complaint against the defendants
Wacholz, Kaiser, and INA to obtain those funds held by INA
which allegedly were owed to Wacholz and assigned to the
plaintiff. The plaintiff believes that it has a right prior to
the government to the funds being held by INA and hopes to
have its rights adjudicated in this action.
On July 1, 1970, Johnson caused to be served on the United
States an amendment to its Amended Complaint which attempted
to join the United States as a party defendant pursuant to
28 U.S.C. § 2410.*fn1 Meanwhile, Wacholz instituted another
action in the Circuit Court of Cook County against Johnson,
INA, the Chicago Board of Education, and the District Director
of the Internal Revenue Service. On July 21, 1970, an order
was entered consolidating these two cases.
In the Circuit Court, the government contended that it was
not a proper party defendant to the lawsuit under 28 U.S.C. § 2410
and moved to be dismissed from the action. It
simultaneously moved to intervene in the same action pursuant
to 26 U.S.C. § 7424.*fn2 The Circuit Court, apparently faced
with no objections to these motions because none of the other
parties were concerned with the exact status of the United
States in this lawsuit, granted both of the government's
motions on October 15, 1970. On November 13, 1970, the United
States filed with the Clerk of this Court its petition for
removal of said action to this Court pursuant to
28 U.S.C. § 1446(b).*fn3 The plaintiff, Johnson Service Company, has
objected to this petition contending that the removal was not
commenced within the thirty day period required by 28 U.S.C. § 1446(b)
in that the United States was named as a party
defendant on July 1, 1970, and the removal petition was not
filed until November 13, 1970. The United States contends that
it was never a proper party defendant in the state suit and the
case was not therefore removable until its motion to intervene
was granted on October 15, 1970. Therefore, it claims, it has
in fact filed its removal petition within the statutory thirty
As 28 U.S.C. § 1446(b) requires removal to be accomplished
within thirty days from the date of the initial pleading or
from the point in time when the action first becomes removable
if the original suit is not removable, it becomes crucial for
us to determine when this lawsuit became removable. If the
government was a proper party defendant under 28 U.S.C. § 2410(a),
then the action was first removable on July 1,
1970.*fn4 If, however, the government was not a proper party
defendant, then the case was not removable at that time and was
not removable until the United States was granted leave to
intervene in the suit pursuant to 26 U.S.C. § 7424*fn5 on
October 15, 1970.
The statute does not define its terms and no case law exists
to indicate what types of suits fall under the statutory
subdivision dealing with interpleader suits and suits in the
nature of interpleader. In addition, neither the United States
nor Johnson refers us to any authority to enable us to
determine the precise issue presented, i.e., whether Johnson's
suit can be considered as an interpleader suit or a suit in
the nature of interpleader.
Prior to 1966, 28 U.S.C. § 2410(a) authorized suit against
the United States only in suits attempting to quiet title to or
to foreclose a mortgage or other lien upon property over which
the United States likewise asserted a claim. However, in the
Federal Tax Lien Act of 1966, Pub.L. 89-719, the Congress
broadened the government's consent to be sued to include
condemnation, partition, and interpleader suits and suits in
the nature of interpleader. In so doing, interpleader actions
were considered to be "* * * those (suits) brought by persons
holding property for the purpose of determining who is entitled
to the property held." Senate Report No. 1708, 89th Cong., 2d
Sess. (1966), U.S. Code Cong. & Ad.News, pp. 3722, 3755.
This Congressional definition of interpleader actions is in
accord with the traditional definition. The strict bill of
interpleader is an ancient and well-established equitable
remedy, which was in existence before the enactment of
interpleader statutes, and which is maintainable independently
of statute under general equity jurisdiction. See, e.g.,
Standard Surety & Cas. Co. of New York v. Baker, 105 F.2d 578
(8th Cir. 1939). It is the peculiarly applicable remedy where a
fund or property owned by, or in the possession of, the
complainant is claimed by more than one person. The purpose of
the bill is to compel the various persons who claim the fund or
property to state their several claims, so that the court may
adjudge to whom the matter or thing in controversy belongs.
Great American Insurance Co. v. Bank of Bellevue, 366 F.2d 289
(8th Cir. 1966). The complainant is a disinterested or
indifferent stakeholder who simply prays that the hostile
claimants be required to cease from troubling him and to settle
their dispute among themselves. Strasser v. Commercial Nat.
Bank, 157 Neb. 570, 60 N.W.2d 672 (1953), cf. United States v.
Sentinal Fire Insurance Co., 178 F.2d 217 (5th Cir. 1949). It
is clear, therefore, that Johnson's suit is not a strict bill
of interpleader because Johnson holds no property whose
ownership it is seeking to have determined.
As Johnson's suit is not an interpleader action, the naming
of the United States as a party defendant pursuant to Section
2410(a), then, was effective only if Johnson's suit can be
considered to be in the nature of an interpleader action.
Johnson contends that its suit is in fact in the nature of a
bill of interpleader. It claims that INA believed that Johnson
had a right superior to that of the government to the funds in
its possession and that it was faced with the traditional
dilemma of a person who brings a bill of interpleader: it did
not know to whom the money should be paid although it knew
that it must be paid to either Johnson or the United States.
Thus, it would have been appropriate for INA to solicit the
aid of a state court by way of an interpleader action.
However, Johnson alleges, rather than directly commencing the
action with the incidental expenses thus entailed, INA
requested Johnson to file a chancery suit in which plaintiff
would seek the court's ruling that it was entitled to the
funds. Johnson accordingly filed the state court suit
presently involved. Thus, Johnson argues, its suit was in the
nature of an interpleader action even though it was not
commenced by the stakeholder as a party plaintiff.
In the Congressional reports which defined interpleader,
supra, no mention or definition was made that would indicate
what types of suits Congress intended the phrase "suits in the
nature of interpleader" to cover. We, therefore, must decide
what Congress' intent was in its use of that phrase and whether
Johnson's suit falls within that definition.
In interpreting a statute, courts are not free to reject the
literal or usual meaning of a word or phrase unless such an
adoption would lead to absurd results. Helvering v. Hammel,
311 U.S. 504, 61 S.Ct. 368, 85 L.Ed. 303 (1941). In matters of
statutory construction, a court's first duty is to give effect
to the intent of Congress; and in so doing the court's first
reference is to the literal meaning of the words employed.
Flora v. United States, 357 U.S. 63, 78 S.Ct. 1079, 2 L.Ed.2d
1165 (1958). And where, as here, a statute does not define a
term having a common law meaning, the common law concept
thereof controls. Leyerly v. United States, 162 F.2d 79 (10th
Cir. 1947). We therefore must determine the general and
accepted common law meaning of suits in the nature of
interpleader, attribute that meaning to 28 U.S.C. § 2410(a)(5),
and apply such construction to the instant suit.
As discussed above, a bill of interpleader can be
characterized by the fact that the plaintiff has no interest
in the property in question and merely desires a court
resolution of conflicting claims to that property. In order
that a person may maintain a strict bill of interpleader, he
must be indifferent between the conflicting claims. Central
Montana Stockyards v. Fraser, 133 Mont. 168, 320 P.2d 981
(1957); Case v. De Woskin, 329 Ill. ...