770 F.2d 545 (5th Cir. 1985), 84-4676, Dukes v. South Carolina Ins. Co.

Docket Nº:84-4676.
Citation:770 F.2d 545
Party Name:Gary DUKES and Thomas E. Barber, d/b/a D & B Dozer Service, Plaintiffs-Appellants, v. SOUTH CAROLINA INSURANCE COMPANY, Defendant-Appellee.
Case Date:September 13, 1985
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit
 
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Page 545

770 F.2d 545 (5th Cir. 1985)

Gary DUKES and Thomas E. Barber, d/b/a D & B Dozer Service,

Plaintiffs-Appellants,

v.

SOUTH CAROLINA INSURANCE COMPANY, Defendant-Appellee.

No. 84-4676.

United States Court of Appeals, Fifth Circuit

September 13, 1985

Page 546

Cothren & Pittman, Robert G. Germany, Joseph E. Roberts, Jr., Jackson, Miss., for plaintiffs-appellants.

Heidelberg, Woodliff & Franks, David W. Dogan, III, Jackson, Miss., for defendant-appellee.

Appeal from the United States District Court for the Southern District of Mississippi.

Before CLARK, Chief Judge, POLITZ and JONES, Circuit Judges.

CLARK, Chief Judge:

Gary Dukes and Thomas Barber appeal the district court's summary judgment in favor of South Carolina Insurance Company. Dukes and Barber contend that a state court judgment was res judicata on South Carolina's summary judgment motion. They also contend that a genuine issue of material fact remained, making summary judgment inappropriate. Rejecting both contentions, we affirm.

Uncontested Facts

Dukes and Barber, doing business as D & B Dozer Service, purchased indemnity insurance for a 1971 tractor from South Carolina Insurance Company. The tractor was later destroyed by fire. Dukes and Barber sought to collect the proceeds of the policy, but South Carolina denied their claim. Dukes and Barber then filed suit against South Carolina in a Mississippi state court. They sought recovery for damage to the tractor, plus punitive damages for South Carolina's bad faith handling of the claim.

South Carolina filed a removal petition and bond with the United States District Court clerk on November 5, 1982. South Carolina notified Dukes and Barber of the removal, and maintains that a copy of the removal petition was sent to the state court clerk. For some reason, however, the state court record did not reflect the receipt of a copy of the petition. South Carolina, unaware of this defect in the removal procedure, answered the complaint in the federal

Page 547

court, and both parties participated in pretrial discovery in the federal forum.

On July 6, 1983, South Carolina served a request for admissions on Dukes and Barber. On January 5, 1984, Dukes and Barber still had not responded to the request. South Carolina moved for summary judgment, regarding its requests as admitted. On January 30, Dukes and Barber filed a response to the request for admissions. South Carolina moved to strike the response as untimely. On July 20, 1984, Dukes and Barber took a default judgment in the state court without notice to counsel for South Carolina. The summary judgment record does not disclose whether in securing the default judgment counsel for Dukes and Barber advised the state court that the case had been removed to federal court and that they had been proceeding before that court for more than one year. On August 16, the federal district court, 590 F.Supp. 1166, which was not advised of the state court default, granted South Carolina's motion to strike and motion for summary judgment. Dukes and Barber then notified the federal court and counsel for South Carolina of the state court judgment, and filed a motion to reconsider in the federal court. The federal court denied the motion, and Dukes and Barber appealed.

Jurisdiction of State Court

Dukes and Barber contend that South Carolina's failure to file a copy of the removal petition with the state court clerk resulted in the state court retaining concurrent jurisdiction with the federal court. Because counsel for South Carolina did not take steps to assure that they had complied with the letter of 28 U.S.C. Sec. 1446(e), Dukes and Barber argue that the state court retained authority to issue a default judgment which the federal court is bound to recognize. We disagree.

Dukes and Barber correctly state that the procedure for removal of an action to a federal court is governed by 28 U.S.C. Sec. 1446, and that section 1446(e) requires the defendant to give prompt written notice of the removal to all adverse parties and to file a copy of the petition with the state court clerk. The summary judgment record does not establish that such a copy was ever actually filed on the docket of the state court. The failure of South Carolina to ensure that the clerk of the state court had actually received a copy of the petition for filing is partially responsible for the present jurisdictional confusion. If Dukes and Barber had objected, South Carolina could have corrected its defective removal by filing the petition with the state clerk or by explaining its failure to that court.

In Medrano v. Texas, 580 F.2d 803 (5th Cir.1978), we held that the state court retains jurisdiction until the state court receives actual or constructive notice of the removal. Constructive notice in this case was accomplished by notice to counsel for Dukes and Barber and by their subsequent participation in the state court action. In the absence of proof that they failed in their duty as officers of the court to advise the state court of the removal before seeking a default judgment in...

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