at equity

In 1878 the Pennsylvania Coal Company executed a deed that conveyed the surface of property but reserved in express terms the right to remove all the coal under the same. The grantee took the premises with the risk and waived all claim for damages that might arise from mining out the coal. The plaintiffs claim under this deed. On May 27, 1921, the Pennsylvania legislature approved the Kohler Act. The statute forbids the mining of anthracite coal in such way as to cause the subsidence of any structure used as a human habitation. The statute provides exceptions for land where the surface is owned by the owner of the underlying coal and is distant more than one hundred and fifty feet from any improved property belonging to any other person. The plaintiffs brought a bill in equity to prevent the Pennsylvania Coal Company from mining under their property in such way as to remove the supports and cause a subsidence of the surface and of their house. The Court of Common Pleas found that if not restrained the defendant would cause the damage to prevent which the bill was brought. It denied an injunction, holding that the statute if applied to this case would be unconstitutional. On appeal the Supreme Court of the State agreed that the defendant had contract and property rights protected by the Constitution of the United States. It held that the statute was a legitimate exercise of the police power and directed a decree for the plaintiffs. A writ of error was granted bringing the case to this Court. As applied to this case the statute is admitted to destroy previously existing rights of property and contract. The case involves a single private house. The statute ordinarily does not apply to land when the surface is owned by the owner of the coal. The Attorney General of the State, the City of Scranton, and the representatives of other extensive interests were allowed to take part in the argument below and have submitted their contentions here. The statute purports to abolish what is recognized in Pennsylvania as an estate in land. The question presented concerns mining of coal under streets or cities in places where the right to mine such coal has been reserved.

In May 1930 the Van Sweringen Corporation issued $30,000,000 in notes under an indenture naming Guaranty Trust Co. of New York as trustee with power to enforce noteholders' rights. In October 1930 Guaranty and other banks advanced large sums to companies affiliated with the Corporation and controlled by the Van Sweringens. When the Corporation could not meet its obligations, Guaranty participated in an exchange plan under which noteholders could surrender their notes for cash equal to 50 percent of face value plus twenty shares of Van Sweringen stock per $1,000 note; the offer remained open until December 15, 1931. In 1934 respondent York received $6,000 of the notes as a gift from a donor who had not accepted the exchange offer. In April 1940 three accepting noteholders filed the Hackner suit in federal court charging Guaranty with fraud and misrepresentation in connection with the exchange. York's motion to intervene was denied, and summary judgment for Guaranty was affirmed on appeal. On January 22, 1942, after her exclusion from the Hackner litigation, York filed the present class action in the United States District Court for the Southern District of New York on behalf of non-accepting noteholders. The complaint, resting exclusively on diversity of citizenship, alleged that Guaranty had breached its trust by failing to protect noteholders' interests when it assented to the exchange offer and by failing to disclose its own self-interest. The district court granted Guaranty's motion for summary judgment on the authority of the Hackner decision. The Circuit Court of Appeals reversed, holding that a federal court sitting in equity is not required to apply the New York statute of limitations that would govern an identical suit in the New York state courts. The Supreme Court granted certiorari.

In February 1866, J.H. Mitchell obtained a judgment in an Oregon circuit court against Neff for less than $300 in an action for attorney services. At that time, Neff resided outside Oregon, received no personal service of process, and made no appearance in the case. The judgment was entered by default following constructive service by publication as authorized by the Oregon Code for non-resident defendants possessing property within the state. The Oregon Code also provided for attachment of a non-resident's property in money actions. No such attachment occurred with respect to the land at issue. Instead, after the judgment, an execution issued, leading to a levy on the land and its sale at a sheriff's auction. Pennoyer purchased the property at that sale and received a sheriff's deed. Separately, in 1866, the United States issued a patent to Neff for the same tract of land under the Donation Law of Oregon, which Neff valued at $15,000. Neff then brought suit against Pennoyer in the circuit court to recover possession of the premises based on his patent title. The lower court held the Oregon judgment invalid because of deficiencies in the affidavits used to obtain the publication order and to prove publication occurred. The Supreme Court of the United States granted review to consider the validity of the state court judgment and the resulting sheriff's sale.