Arant v. Stover, Civ. A. No. 69-665.

Decision Date09 December 1969
Docket NumberCiv. A. No. 69-665.
Citation307 F. Supp. 144
PartiesCecil ARANT and Tom Drake, Plaintiffs, v. T. M. STOVER, Defendant.
CourtU.S. District Court — District of South Carolina

COPYRIGHT MATERIAL OMITTED

Henry Hammer, Columbia, S. C., and James H. Howey, Lancaster, S. C., for plaintiffs.

Richard E. Richards, Lancaster, S. C., for defendant.

ORDER

HEMPHILL, District Judge.

Plaintiffs move to remand this case to the Court of Common Pleas for Lancaster County, South Carolina, from whence it came by removal procedure. Decision pivots on plaintiffs' claim that complete diversity1 does not exist because plaintiff Tom Drake and defendant T. M. Stover are residents of Alabama. Admittedly, neither Tom Drake, nor anyone in whom he, at the time, had an interest or kinship, was involved in the accident2 of January 12, 1965. At some later date Arant assigned an 1/100th interest to Drake, who, as an Alabama resident, defeats diversity jurisdiction if the cause of action is assignable emphasis added under South Carolina law.3

Cecil Arant and Tom Drake allege, in their complaint, that negligence of defendant was a proximate cause of permanent injuries to Hessie W. Arant, Cecil's wife. They allege Cecil will thus be deprived of the services, social relationship, and consortium4 of his wife, and will be responsible for expenses of her maintenance, including doctor and hospital bills.5

To determine whether diversity exists, this court must first decide whether the causes of action for loss of consortium and/or maintenance costs are ones that survive.6 Next comes the test of assignability which is determined by whether the cause of action would survive in the event of death. McWhirter v. Otis Elevator Co., 40 F.Supp. 11 (D.C.S.C.1941); Hair v. Savannah Steel Drum Corp., 161 F.Supp. 654 (E.D. S.C.1955); Doremus v. Atlantic Coast Line Railroad Co., 242 S.C. 123, 130 S.E. 2d 370 (1963). The general rule is spelled out in 6 C.J.S. Assignments § 32, page 1080 (6 C.J.S. page 1080):

As a general rule, survival is the test of assignability of a right of action ex delicto—if a right of action arising out of tort is of such a nature that, on the death of the party entitled to sue, it would, either by statute or in accordance with the rules relating to the survivability of actions ex delicto in general, as shown in the title Abatement and Revival § 138, survive to his personal representative, it may be assigned; but, if the right of action is such that it would not survive, it may not be made the subject of a valid assignment.

South Carolina, by statute,7 has provided for survival of causes of action as follows:

Causes of action for and in respect to any and all injuries and trespasses to and upon real estate and any and all injuries to the person or to personal property shall survive both to and against the personal or real representative, as the case may be, of a deceased person and the legal representative of an insolvent person or a defunct or insolvent corporation, any law or rule to the contrary notwithstanding.

It thus appears from a reading of the foregoing statute that causes of action for "injuries to the person" survive the deceased person, and thus, this brings the court to the crucial question of whether the consequential damages of a husband for loss of consortium and medical expenses sustained because of injuries to his wife are "injuries to the person" of the husband. The court can reason that if the husband suffered expenditures for his wife's illness, and thereafter died, his estate could make claim against the tort feasor for his loss. The South Carolina statute, supra, specifically includes (as surviving) "all injuries to the person." Injury is defined as:

Damage or hurt done to or suffered by a person or thing; detriment to, or violation of, person, character, feelings, rights, property, or interests, or the value of a thing.8

A synonym for injury is "loss".9 At law, the injury here may be classified as a civil injury, defined:

(Civil injury) "Injuries to person or property resulting from a breach of contract, delict, or criminal offense, which may be redressed by a civil action.10

It follows that when injury produces a loss, whether that loss is expressed by payment or obligation for payment, for maintenance of the wife in her injured condition, or loss of consortium as a property and a feeling, redress for such injury (loss) survives under the South Carolina statute and the cause of action is assignable.

The husband's loss of consortium, of which he is deprived by a negligent injury to his wife, is a right which entitles him to damages for such loss. He is also entitled to recover any medical expenses he has incurred for her care and treatment, as a result of personal injuries caused and occasioned by the negligence of a third party. Sossamon v. Nationwide Mutual Insurance Co. (1964), 243 S.C. 552, 135 S.E.2d 87, 92.

Defendant further maintains that this action is barred by virtue of the wife's action11, which, he contends, included claim for hospital and doctor bills. The wife could not recover for medical expenses which are the responsibility of her husband. South Carolina has ruled that an action brought by a wife to recover for her injuries is not res judicata of a subsequent action brought by the husband for expenses and loss of consortium. Priester v. Southern Railway Co. et al. (1929), 151 S.C. 433, 149 S.E. 226.

Having determined the claim(s) of the husband is assignable, the court examines the jurisdictional issue created by the assignment. Of paramount influence on this court's reasoning is the recent decision in Lester, Adm. v. McFaddon et al., 415 F.2d 1101 (4th Cir. 1969). In that case, counsel for a deceased mother and injured child recoiled from an adverse South Carolina state trial jury verdict in the child's negligence—damage pursuit; they procured the appointment of an Augusta, Georgia, attorney as Administrator of the Mother's estate for the purpose of bringing an action for wrongful death in the federal court's diversity jurisdiction (Columbia Division). The court affirmed the lower court, and refused to apply 28 U.S.C.A. Section 135912 because of the possible injustice of a retrial on the facts, but announced that the Fourth Circuit would adopt a "new rule" of strict construction despite previous rulings of a liberal nature. Specifically, the court adopted the reasons projected in McSparran v. Weist, 402 F.2d 867 (3rd Cir. 1968) cert. den. (Fritzinger v. Weist), 395 U.S. 903, 89 S.Ct. 1739, 23 L.Ed.2d 217. Artificial creation or "manufacture" of diversity is improper and jurisdiction of the federal tribunal cannot be invoked upon that kind of diversity. 28 U.S.C.A. Section 1359 clearly applies to manufactured situations created by other means than assignments. McSparran projected:

The multiplication of "manufactured" diversity cases is a reflection on the federal judicial system and brings it into disrepute.
* * * * * *
It has often been said that in judging whether diversity of citizenship exists the courts will not inquire into the motive which led to the appointment of the personal representative. While, of course, the desire to obtain diversity jurisdiction is not in itself improper, nevertheless it is not irrelevant in the determination of the question whether the fiduciary is in fact a straw fiduciary whose citizenship is to be disregarded. Moreover, it is difficult to see how motive can be entirely ignored in ascertaining the purpose for which the representative is selected in view of the language of § 1359. The statute outlaws the creation of jurisdiction where a party has been improperly or collusively made or joined to invoke the jurisdiction of the court. While the statute does not ban the appointment of nonresident fiduciaries, the artificial selection of a straw representative who has no duty or function except to offer the use of his citizenship to create diversity in contemplated litigation is a violation of its provisions. This is made clear by the knowledge that the appointing court normally would not have designated him because of his absence from the jurisdiction and the consequent limitation of its control over him, all of which can be put aside because there is at the time of appointment nothing for him to administer and he is not expected to exercise any real function.

402 F.2d 867, 873, 874 and 875.

Plaintiffs argue that the assignment, whether artificial or not, was not effected to invoke federal jurisdiction, but operates to defeat or avoid that forum. They insist that 28 U.S.C.A. § 1359 has no application as the statute does not deal with efforts to avoid the limited jurisdiction of the federal courts. This court agrees with that contention. 28 U.S.C. Section 1359 forbids the bringing into a federal court a local action normally triable in the state court, where the diversity is artificially or collusively created, but the statute does not apply to the converse.

Lester interpreted Black and White Taxicab & Transfer Co. v. Brown & Yellow Taxicab & Transfer Co., 276 U.S. 518, 48 S.Ct. 404, 72 L.Ed. 681, 57 A.L.R. 426 and Mecom v. Fitzsimmons Drilling Co., 284 U.S. 183, 52 S.Ct. 84, 76 L.Ed. 233, 77 A.L.R. 904, as having no bearing on efforts to invoke diversity jurisdiction. In Black & White the court found a transfer, for purposes of creating diversity jurisdiction was actual, not feigned or merely colorable. Mecom deals directly with the problem here.

In Mecom, an administratrix (widow) of an Oklahoma resident allegedly fatally injured by negligence of Louisiana resident defendants, brought suit in an Oklahoma court for wrongful death; she also brought suit for pain and suffering. By virtue of her appointment by an Oklahoma probate court as administratrix and the Louisiana residence of defendants, diversity was claimed, the case removed to federal court, and plaintiff(s)' motion to remand denied. Plaintiff then resigned as...

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