The opinion of the court was delivered by: BIUNNO
It is a rule of ancient origin that an action which is local in nature, rather than transitory, can only be asserted in a court whose territorial jurisdiction includes the location of the subject of the action. When a local action is sued on in a federal district court, with jurisdiction grounded only on the diversity of citizenship of the parties, 28 U.S.C. § 1332, then the law of the State lying within the district must be examined to decide whether the suit is a local action or not. This is so because if an action is a local one under State law, such that its court of general jurisdiction cannot entertain it, then the suit cannot be filed in the U. S. District Court which includes that State when its sole jurisdiction is diversity of citizenship. If the general court of the State cannot effectively accept and decide the suit, the federal court cannot either.
The distinction between local and transitory actions is largely overlooked or forgotten, but since a court cannot deal with a local action whose site is beyond its boundaries, the question is jurisdictional and may be dealt with sua sponte by the court, under F.R.Civ.P. 12(h)(3). The point is worth reviewing.
As is well known, when the jury system began in England, the jurors were witnesses having knowledge of the facts to be decided, and the parties were disqualified from testifying at all. The jurors were from the "neighborhood" or vicinities, and if various events took place in several neighborhoods, separate juries would be gathered for each fact issue. Thus, from a pleading standpoint, it was required that the location where each factual event occurred be stated. See, Hill v. Nelson, 70 N.J.L. 376, 57 A. 411 (Sup.1904); Defiance Fruit Co. v. Fox, 76 N.J.L. 482, 70 A. 460 (E. & A. 1908); Mehrhof, etc., v. D. L. & W., 51 N.J.L. 56, 16 A. 12 (Sup.1888).
Gradually and eventually the jury system evolved into one in which the jurors were impartial judges of the facts instead of witnesses with personal knowledge of the facts. By modern views, a juror may not testify as a witness. See N.J.Ev.Rule 43; Fed.Ev.Rule 606. With this change, the need to try the fact issue where the witnesses were gradually disappeared, and the concept of the transitory action one which could be tried by any court having jurisdiction over the person of the defendant grew.
Even so, pleading rules changed slowly, and the practice developed of alleging fictitiously that the events had occurred within the court's jurisdiction even though they had not. And, if the location of the occurrence were important, the pleader would allege both the actual location and a fictitious location. See, e.g., Duyckinck v. Clinton Mutual Ins. Co., 23 N.J.L. 279 (Sup.1852); Reed v. Wilson, 41 N.J.L. 29 (S. Ct.1879); Hill v. Nelson, supra ; and also the declaration (complaint) in Hart v. Board, etc., 57 N.J.L. 90, 29 A. 490 (Sup.1894).
However, in what have to this day remained "local" actions, fictitious pleading was not permitted, and the action could only be brought within the territorial jurisdiction of a court which embraced the location involved. See, Ackerson v. Erie RR Co., 31 N.J.L. 309 (Sup.1894).
The major category of "local" actions embraces those involving real estate, Davis v. Headley, 22 N.J.Eq. 115 (Ch.1871); Lindley v. O'Reilly, 50 N.J.L. 636, 15 A. 379 (E. & A. 1888).
This class includes not only actions involving title to real estate, such as trespass on a feigned issue to try title, or ejectment, or trespass Quare clausum fregit, but all actions arising out of a local subject, or a local right or interest, even though the remedy sought is merely money damages. Ackerson, supra, at p. 312.
The traditional test, even though not entirely perfect, is whether the specific cause of action could have arisen elsewhere than where it did. If it could not, the action is local; if it could, it is transitory. Champion v. Doughty, 18 N.J.L. 3 (Sup.1840); Deacon v. Shreve, 23 N.J.L. 204 (Sup.1851); Ackerson, supra, Defiance Fruit, supra, and Mehrhof, supra.
Examples of local actions are found in Doherty v. Catskill Cement Co., 72 N.J.L. 315, 65 A. 508 (E. & A. 1905) (negligent damage to ice pond by negligent escape of cement dust); Mehrhof, supra (obstruction of a navigable stream shutting off access to markets); Karr v. N.Y. Jewell, etc., 78 N.J.L. 198, 73 A. 132 (Sup.1909) (damage to realty from adjacent excavations); Dougherty v. Stepp, 18 N.C. 371 (Sup.1835) (unlawfully entering unenclosed land to make a survey); Dolph v. Ferris, 7 Watts & Sergeant, (Pa.) 367 (Sup.1844) (damages for loss of plaintiff's horse, gored by defendant's bull); Hannabalson v. Sessions, 116 Iowa 457, 90 N.W. 93 (Sup.1902) (reaching an arm across a boundary fence); Guille v. Swan, 19 Johnson (N.Y.) 381 (Sup.1822) (balloonist who landed in plaintiff's vegetable garden held liable in trespass for damage to vegetables by a crowd pursuing the balloon).
The concept that "local actions" must be brought within the territorial boundaries of a court which includes the subject is well recognized in federal, as well as State courts. See 15 Wright, Miller & Cooper, "Federal Practice and Procedure", § 3382. The rule is very old and well settled. As was said in Casey v. Adams, 102 U.S. 66, 26 L. Ed. 52 (1880):
"The distinction between local and transitory actions is as old as actions themselves, and no one has ever supposed that laws which prescribed generally where one should be sued, included such suits as were local in their character, either by statute or the common law, unless it was expressly so decided."
When the locale is within the territory covered by a court, and suit is filed in the wrong division or county, then since the Court has jurisdiction, the issue becomes one of venue, and under appropriate statutes or rules the place of trial may be changed within the boundaries of the court. See, e.g., N.J. Court Rule R. 4:3-2, which governs when the Superior Court as such, a court of general jurisdiction, embraces the locality involved.
In the federal structure, see 28 U.S.C. § 1391(e)(3) (actions in which any real property is involved); 28 U.S.C. § 1392(a) (civil actions "not of a local nature"); 28 U.S.C. § 1392(b) (civil actions "of a local nature"); 28 U.S.C. § 1393(a) (civil actions "not of a local nature"); and 28 U.S.C. § 1655 (actions involving liens or encumbrances on, or ...