Fay v. Fitzgerald

• Citation: 478 F.2d 181
• Decision Date: 08 May 1973
• Docket Number: No. 452,Docket 72-1817.,452
• Parties: Christa Ruthe FAY, Plaintiff-Appellant, v. Thomas I. FITZGERALD, as Public Administrator of the County of New York, as Administrator of the Goods, Chattels and Credits of John Patrick Fay, also known as John P. Fay, Deceased, Defendant-Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

478 F.2d 181 (1973)

Christa Ruthe FAY, Plaintiff-Appellant, v. Thomas I. FITZGERALD, as Public Administrator of the County of New York, as Administrator of the Goods, Chattels and Credits of John Patrick Fay, also known as John P. Fay, Deceased, Defendant-Appellee.

No. 452, Docket 72-1817.

United States Court of Appeals, Second Circuit.

Submitted February 13, 1973.

Decided May 8, 1973.

William G. Mulligan, New York City (Mulligan & Jacobson, New York City, of counsel), for plaintiff-appellant.

Joseph T. Arenson, New York City (Waldemar J. Dittmar, Philip Bekerman, and Elias Karban, New York City, of counsel), for defendant-appellee.

Before FRIENDLY, Chief Judge, OAKES, Circuit Judge, and DAVIS, Judge.^*

DAVIS, Judge :

John Patrick Fay, an elderly well-to-do resident of Manhattan, died abroad in 1972 ; he left no will and appellee, the Public Administrator of New York County, was designated by the Surrogate's Court as administrator of his estate. Appellant, Christa Ruthe Fay, a non-resident alien, made claim on appellee as the decedent's common-law widow, asserting that they were so married in Florida in 1960 when she was 23 and he 70. The other claimants to the estate were a resident of England who said she was the intestate's half-sister and three French residents claiming to be nieces. Invoking diversity jurisdiction, appellant began this action in 1972 against the Public Administrator for a declaratory judgment that she was Fay's wife, is his widow, and is entitled to the full estate (after expenses, debts and taxes). On the appellee's motion, the District Court dismissed the complaint in the exercise of discretion "not to entertain this claim for reasons of judicial economy and efficiency and because persons interested in these issues, but who cannot be made parties to this action, have been parties in the State Court proceeding where the same issues will be decided."

The Supreme Court has cautioned that "the propriety of declaratory relief in a particular case will depend upon a circumspect sense of its fitness informed by the teachings and experience concerning the functions and extent of federal judicial power" (Public Service Commission v. Wycoff Co., 344 U.S. 237, 243, 73 S.Ct. 236, 240, 97 L.Ed. 291 (1952)), and, more particularly, that "a federal district court should, in the exercise of discretion, decline to exercise diversity jurisdiction over a declaratory judgment action raising issues of state law when those same issues are being presented contemporaneously in state courts" (Provident Tradesmens Bank & Trust Co. v. Patterson, 390 U.S. 102, 126, 88 S.Ct. 733, 746, 19 L.Ed.2d 936 (1968), reaffirming on this point Brillhart v. Excess Ins. Co., 316 U.S. 491, 494-495, 62 S.Ct. 1173, 86 L.Ed. 1620 (1942)).

At the time the court below acted, the only proceeding in the Surrogate's Court was appellee's application to sell the decedent's cooperative apartment in New York. Appellant opposed that request on the double ground that she was the decedent's widow and also that, during his lifetime, he had given her the apartment. She asked that the application be denied "without prejudice to renewal after determination of the rights of this respondent appellant to said property as herein set forth." No determination had been made on this application when the complaint was dismissed below.

The main thrust of the appeal is that this state court proceeding should not be, and could not properly have been, the basis for a discretionary denial of declaratory relief since the issue of appellant's status as wife and widow was not necessarily involved in that proceeding —it was entirely possible that the application to sell the apartment could be wholly determined on appellant's alternative claim that she was the donee of the property, without ever reaching her claim as widow. Cf. Beach v. Rome Trust Co., 269 F.2d 367, 373-374 (C.A. 2, 1959).

However, we do not have to resolve the close issue of whether, when it acted, the District Court had adequate reason to withhold its hand in favor of the Surrogate's Court. The additional state proceedings since the dismissal below convince us that it wouldnow be a serious mistake to allow this competing action to continue. Very shortly after the District Court's decision, appellant specifically moved the Surrogate's Court to determine her status, and that of the rival claimants, as distributees of the estate. That court entertained this request but denied her demand for a jury trial (Matter of Fay, 70 Misc.2d 51, 332 N.Y.S.2d 322 (1972)). This ruling was affirmed by the Appellate Division in an order of February 22, 1973. 41 A.D.2d 703, 340 N.Y.S.2d 861. The issue of appellant's status as wife and widow is therefore about to be tried (if it has not already been) and determined in the Surrogate's Court.¹

It is appropriate for us to take account of these postjudgment happenings and to place our decision on the propriety as of the present time of entertaining this declaratory judgment action. With respect to discretion under the Declaratory Judgment Act, as distinguished from other discretionary rulings, this court has held that the appellate court should exercise its own judgment and may substitute its own judgment for that of the lower court. Broadview Chemical Corp. v. Loctite Corp., 417 F.2d 998, 1000 (C.A. 2), cert. denied, 397 U.S. 1064, 90 S.Ct. 1502, 25 L.Ed.2d 686 (1970). In addition, in another instance of review of the exercise of discretion by the district court we have stated that "since our decision has to be forward-looking, determining the cast of the proceedings from now on, we must take account of this new situation, just as we would if we were considering an injunction for the future." Korn v. Franchard Corp., 456 F.2d 1206, 1208 (C.A. 2, 1972).

With matters as they now stand, it is indisputable that the controversy over appellant's rights as a distributee "can better be settled in the proceeding pending in the state court." Brillhart v. Excess Ins. Co., supra, 316 U.S. at 495, 62 S.Ct. at 1176. The questions are not federal ; preparations to determine them have gone forward in the Surrogate's Court ; the trial is even now impending there, if it has not already been held ; the state tribunal has jurisdiction of the rival claimants, non-resident aliens who have participated in those proceedings, while the federal court does not. In this situation it would obviously be "uneconomical as well as vexatious" for the federal court to proceed in this declaratory judgment suit raising precisely the same issue which will necessarily be decided by the Surrogate's Court. Brillhart v. Excess Ins. Co., supra, 316 U.S. at 495, 62 S.Ct. 1173; Abbott Laboratories v. Gardner, 387 U.S. 136, 155, 87 S. Ct. 1507, 18 L.Ed.2d 681 (1967) ; J. Moore, Federal Practice ¶ 57.086.²

Perhaps the district court could have stayed its proceedings to await the state determination, rather than dismiss outright (cf. Stansbury v. Koss, 10 F.Supp. 477, 479-481 (S.D.N.Y. 1931)), but in the current circumstances there would be no point to such an...