21 F.3d 859 (8th Cir. 1994), 93-3248, Kahn v. Kahn

Docket Nº:93-3248.
Citation:21 F.3d 859
Party Name:Linda S. KAHN, Appellant, v. Farrell KAHN, Appellee.
Case Date:April 21, 1994
Court:United States Courts of Appeals, Court of Appeals for the Eighth Circuit
 
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Page 859

21 F.3d 859 (8th Cir. 1994)

Linda S. KAHN, Appellant,

v.

Farrell KAHN, Appellee.

No. 93-3248.

United States Court of Appeals, Eighth Circuit

April 21, 1994

Submitted March 16, 1994.

Page 860

Francis G. Slay, St. Louis, MO, argued (Jim J. Shoemake, on the brief), for appellant.

Alan C. Kohn, St. Louis, MO, argued (John A. Klobasa, on the brief), for appellee.

Before BEAM, Circuit Judge, BRIGHT, Senior Circuit Judge, and MORRIS SHEPPARD ARNOLD, Circuit Judge.

BRIGHT, Senior Circuit Judge.

Linda Kahn (Linda) appeals from the district court's entry of summary judgment in favor of her ex-husband, Farrell Kahn (Farrell), holding Linda's claims for breach of fiduciary duty, conversion, constructive fraud and fraud barred by res judicata. The present action, seeking tort damages and an accounting, involves allegations of wrongful conduct that occurred in the course of the marital relationship and that are inextricably intertwined with those issues subject to the parties' previously adjudicated dissolution proceeding. Consequently, we hold that the domestic relations exception to diversity of citizenship jurisdiction applies and precludes the exercise of federal jurisdiction. 1 We dismiss the appeal and direct the district court on remand to dismiss the action for lack of subject matter jurisdiction.

I. BACKGROUND

Linda filed for divorce after almost thirty years of marriage. She alleged various improprieties as to Farrell's marital conduct, which generally included extramarital affairs, procuring loans secured by marital property and Linda's property without Linda's permission, misappropriating the net profits from the sale of Linda's separate property, converting funds and failing to render an accounting. Citing the aforesaid conduct, Linda's counsel requested that the court award Linda a "heavily disproportionate share of the marital property." Tr. on Appeal, Dissolution Proceeding (Oct. 9, 1990), Vol. I, at 27. Trial of the dissolution action took nine days. Thereafter, on April 12, 1991, the Circuit Court of St. Louis County issued a Second Amended Decree of Dissolution, distributing the property at issue as follows:

Petitioner Linda Kahn Amount Respondent Farrell Kahn Amount A. Separate Property 1,187,593 A. Separate Property 7,100 B. Marital Property 4,224,423 B. Marital Property 3,743,518 C. Debt Allocation 220,625 C. Debt Allocation 937,341 NET MARITAL PROPERTY 4,003,798 NET MARITAL PROPERTY 2,806,177 % of Net Marital Property 58.8 % of Net Marital Property 41.2

Appellant's App. at 100. The Missouri Court of Appeals affirmed the circuit court's decree. Kahn v. Kahn, 839 S.W.2d 327 (Mo.Ct.App.1992).

Linda brought the instant action against her ex-husband on January 15, 1992, in the United States District Court for the Eastern District of Missouri. Linda's four-count

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complaint alleged that Farrell committed the following torts: breach of fiduciary duty, fraud, constructive fraud and conversion. The complaint asserted essentially the same conduct as set forth in the dissolution petition. 2 Linda sought both compensatory and punitive damages and an accounting. The district court granted Farrell's motion for summary judgment, concluding that, based upon the previous dissolution action, res judicata barred litigation of the tort claims. Kahn v. Kahn, No. 4:92CV00063-JCH, slip op. at 11 (E.D.Mo., Aug. 2, 1993).

II. DISCUSSION

The domestic relations exception, first articulated in Barber v. Barber, 62 U.S. (1 How.) 582, 584, 16 L.Ed. 226 (1859), divests the federal courts of jurisdiction over any action for which the subject is a divorce, allowance of alimony, or child custody. Ankenbrandt v. Richards, --- U.S. ----, ----, 112 S.Ct. 2206, 2215, 119 L.Ed.2d 468 (1992). In addition, as observed previously, ante n. 1, when a cause of action closely relates to but does not precisely fit into the contours of an action for divorce, alimony or child custody, federal courts generally will abstain from exercising jurisdiction. In the case at bar, we determine that Linda's claims for relief, although drafted to sound in tort, are so inextricably intertwined with the prior property settlement incident to the divorce proceeding that subject matter jurisdiction does not lie in the federal court.

Missouri law establishes a statutory procedure for divorce, in which "the circuit court shall enter a decree of dissolution if " (1) certain residency requirements are met, (2) the marriage is irretrievably broken and (3) "[t]o the extent it has jurisdiction to do so, the court has considered, approved...

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