Ownbey v. Morgan

Background

Creditors began a foreign attachment action in Delaware against a nonresident man who owned a large block of stock in a Delaware company. The sheriff seized the shares and plaintiffs demanded $200,000 in security before the defendant could appear and defend. The defendant said he could not get a surety because the company was in receivership, he was not indebted, and he should be allowed to appear without posting security. The Delaware courts struck his appearance and allowed an inquisition and sale of the stock to satisfy the claim.

Reasoning

The Court asked whether requiring security before a nonresident may appear is so arbitrary that it violates the Fourteenth Amendment’s guarantee of a fair process. Relying on long-standing practice going back to the Custom of London and consistent state statutes, the Court held the condition was reasonable and not a denial of due process. The majority said due process does not demand relief from every hardship and that people who leave property inside a State may expect that property to be subject to established local procedures. The Court also rejected the equal protection claim because treating individuals and corporations differently was reasonable; corporations cannot provide personal special bail.

Real world impact

The decision lets States keep rules that require nonresident individuals to post security before converting an attachment into a full personal defense, and it allows sale of attached property when security cannot be posted. The ruling leaves open legislative change (a 1917 amendment was noted but not applied here), and affected defendants may still seek discretionary relief from state courts.

Dissents or concurrances

Two justices dissented and one justice concurred in the result. The published opinion does not set out their full opposing reasoning in detail.