Pennoyer v. Neff
95 U.S. 714 (1878)
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Rule of Law:
Under the Due Process Clause of the Fourteenth Amendment, a state court may not exercise in personam jurisdiction over a non-resident defendant unless the defendant is personally served with process within the state or voluntarily appears. For a state court to exercise jurisdiction over the property of a non-resident (quasi in rem), that property must be attached at the commencement of the lawsuit.
Facts:
- J.H. Mitchell, an attorney in Oregon, provided legal services to Marcus Neff.
- Neff was a non-resident of Oregon and allegedly owed Mitchell less than $300 for these services.
- While Neff was a non-resident, he owned a tract of land in Multnomah County, Oregon, which he acquired via a patent from the U.S. government in 1866.
- Mitchell obtained a default judgment against Neff in an Oregon state court.
- Neff's Oregon land was sold at a sheriff's sale to satisfy Mitchell's judgment.
- Sylvester Pennoyer purchased the land at this sheriff's sale and received a deed.
Procedural Posture:
- J.H. Mitchell sued Marcus Neff for unpaid legal fees in the Circuit Court of Multnomah County, Oregon, a state court of first instance.
- Neff, a non-resident, was served by publication; he did not appear, and a default judgment was entered against him.
- A writ of execution was issued on the judgment, and Neff's land was sold at a sheriff's sale to Sylvester Pennoyer.
- Neff filed a new lawsuit against Pennoyer in the United States Circuit Court for the District of Oregon (a federal trial court) to recover the land.
- The U.S. Circuit Court ruled in favor of Neff, holding that the Oregon state court's judgment was invalid for lack of jurisdiction.
- Pennoyer, the defendant in the federal action, appealed the Circuit Court's decision to the United States Supreme Court.
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Issue:
Does a state court have personal jurisdiction over a non-resident defendant who was not served with process within the state, did not appear in the action, and whose property was not attached at the commencement of the lawsuit, such that a subsequent default judgment and execution sale of that property are valid?
Opinions:
Majority - Mr. Justice Field
No, a state court's judgment is invalid if it is rendered against a non-resident who has not been personally served with process within the state and has not appeared in the action. The authority of every state court is restricted by the territorial limits of the state in which it sits. For a court to adjudicate the personal rights and obligations of a defendant (in personam jurisdiction), it must have authority over the defendant's person, which is typically established by service of process within the state's borders or the defendant's voluntary appearance. Substituted service, such as by publication, is insufficient for an in personam money judgment. While a state can exercise jurisdiction over property within its borders (in rem jurisdiction), this requires that the property be brought under the court's control by seizure or attachment at the outset of the proceeding. In this case, the Oregon action was a personal one against Neff, and the land was only involved after the judgment was rendered, via a writ of execution. Because the court lacked jurisdiction over Neff's person when it rendered the judgment, the judgment was void from the beginning and could not authorize the subsequent sale of his property. Enforcing such a judgment violates the Due Process Clause of the Fourteenth Amendment.
Dissenting - Mr. Justice Hunt
Yes, a state has the power to subject the in-state property of a non-resident to the payment of debts owed to its citizens, and it can authorize a valid sale of such property through a judgment obtained via substituted service. A sovereign state must have control over all property within its limits, and this power allows it to satisfy the claims of its citizens against non-residents. The distinction between seizing property at the beginning of a suit (attachment) and seizing it at the end (execution) is a procedural matter of municipal regulation, not a constitutional requirement for jurisdiction. So long as the method of substituted notice, like publication, is reasonably designed to inform the defendant, it satisfies due process. The majority's holding improperly invalidates a long-standing and widespread practice among the states and creates uncertainty in property titles.
Analysis:
Pennoyer v. Neff established the traditional, territorial-based framework for personal jurisdiction under the Fourteenth Amendment's Due Process Clause. The decision created a rigid rule that a state's jurisdictional power is confined within its physical borders, requiring either in-state service on the person or pre-judgment attachment of property. This principle of territoriality dominated American civil procedure for nearly 70 years. The case's strict adherence to physical presence was eventually superseded by the 'minimum contacts' standard established in International Shoe Co. v. Washington, which shifted the jurisdictional analysis from pure territorial power to a more flexible inquiry into fairness and substantial justice.
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