Griffin v. Accordia Life & Annuity Co.

• Decision Date: 26 March 2020
• Docket Number: CIVIL ACTON NO. 2:19-01024-JB-B
• Citation: 438 F.Supp.3d 1341
• Parties: Judson R. GRIFFIN, Plaintiff, v. ACCORDIA LIFE AND ANNUITY COMPANY, et al., Defendants.
• Court: U.S. District Court — Southern District of Alabama

438 F.Supp.3d 1341

Judson R. GRIFFIN, Plaintiff,

v.ACCORDIA LIFE AND ANNUITY COMPANY, et al., Defendants.

CIVIL ACTON NO. 2:19-01024-JB-B

United States District Court, S.D. Alabama, Northern Division.

Signed March 26, 2020

Robert H. Turner, Sr., Law Offices of Robert H. Turner, Marion, AL, for Plaintiff.

Joshua Robert Hess, James Ethan McDaniel, Maynard, Cooper & Gale, LLC, Birmingham, AL, for Defendants.

ORDER

JEFFREY U. BEAVERSTOCK, UNITED STATES DISTRICT JUDGE

This matter is before the Court on Plaintiff's motion to remand(Doc. 6) and supporting brief (Doc. 7) and the response thereto of Defendant, Accordia Life and Annuity Company("Accordia")(Doc. 9).Also before the Court is a Motion to Appoint an Administrator ad Litem(Doc. 13), a Motion to Strike a Supplement to Motion to Remand(Doc. 15), two Motions for Extension of Time(Docs. 18 and 19), a Motion to Substitute Party(Doc. 20), and a Motion to Strike Brief in Support of Motion to Remand(Doc. 26).The Court finds it has diversity jurisdiction and denies Plaintiff's Motion to Remand for the reasons stated here and stated more specifically on the record when these matters were heard on March 19, 2020.The Court addressed the remaining pending motions during the hearing and will dispose of those motions below.

I.BACKGROUND

On October 24, 2019, Plaintiff filed suit in the Circuit Court of Perry County, Alabama, against Defendants Accordia and Frank Spell ("Spell").The Complaint alleges claims of fraudulent representation (Count I) and suppression (Count II) concerning Plaintiff's purchase of an insurance policy in January, 2002.Accordia and Spell were served on October 29, 2019.Spell passed away on November 10, 2019.On November 26, 2019, Accordia removed based on diversity of citizenship, claiming that the citizenship of Spell should be disregarded to determine diversity because he was fraudulently joined to this suit solely to defeat diversity jurisdiction.

Along with Removal, Accordia Answered the Compliant, denying all claims.(Doc. 3).On January 29, 2020, Plaintiff filed an Amended Complaint, adding a breach of contract claim (Count III) against Accordia only.(Doc. 12).Plaintiff also filed a Motion to Appoint Administrator Ad Litem (Doc. 13) and a Supplement to Motion to Remand(Doc. 14).Since the issues relevant to jurisdiction were joined, Accordia filed a Motion to Strike Plaintiff's Amended Complaint(Doc. 15), a Response in Opposition to Plaintiff's Supplement to Motion to Remand(Doc. 16), and a Response in Opposition to Plaintiff's Motion to appoint an Administrator Ad Litem (Doc. 17).Finally, Plaintiff has moved for Leave to File a Motion to Amend the Complaint Out of Time (Doc. 18), a Motion to Amend the Complaint(Doc. 19), and a Motion for Substitution of Parties(Doc. 20).Plaintiff also filed a Supplemental Brief in Support of Remand (Doc. 24) which Accordia has Moved to Strike (Doc. 26).

II.DISCUSSION

Federal courts are courts of limited jurisdiction; therefore, remand statutes are construed narrowly and jurisdictional uncertainties are resolved in favor of remand.Burns v. Windsor Ins. Co. , 31 F.3d 1092, 1095(11th Cir.1994).Diversity jurisdiction, as a general rule, requires complete diversity - every plaintiff must be diverse from every defendant.Strawbridge v. Curtiss , 3 Cranch (7 U.S.) 267, 2 L. Ed. 435(1806);28 U.S.C. § 1332(a)(1).In evaluating a motion to remand, the removing party must demonstrate federal jurisdiction.Pacheco De Perez v. AT &T Co. , 139 F.3d 1368, 1373(11th Cir.1998).

A.Time for Determining the Citizenship of the Parties.

In the present action, Spell passed away shortly after being served with the Complaint but before Accordia's removal.This circumstance creates an unusual posture for the Court determining the citizenship of the parties.Plaintiff and the Defendant Accordia cite competing caselaw to instruct the Court about the time the citizenship of the parties must be measured.Plaintiff would have this Court consider the citizenship of the parties on the date he filed his lawsuit in the state court.Accordia argues citizenship should be measured on the date of removal.Although both parties advocate competing positions each sometimes correct, neither clearly articulates the rule.This is so because Plaintiff cites a case originally filed in the federal court while Accordia cites a case which was removed.Both assess citizenship based on different events and both correctly state the law for their particular situation.

For clarity, the Court suggests the proper inquiry is the citizenship of the parties on the date Federal jurisdiction is invoked.In the present case, that is the date of removal as articulated by Accordia because federal jurisdiction was invoked when the case was removed on November 26, 2019.On that date, Spell was deceased and no motion to substitute had been filed.

B.Fraudulent Joinder of Spell.

Accordia contends Spell is fraudulently joined as a defendant.Accordia's position is based on two theories of fraudulent joinder.First, Accordia maintains that at the time of removal, because Spell was deceased and his estate had not been substituted, his citizenship should not spoil complete diversity.Second, Accordia argues Plaintiff's fraudulent representation and suppression claims against Spell are barred by the statute of limitations and thus Plaintiff cannot state a claim against him.

In a removal case alleging fraudulent joinder, the removing party must prove either: (1) there is no possibility the plaintiff can establish a cause of action against the resident defendant; (2)the plaintiff has fraudulently pled jurisdictional facts to bring the resident defendant into state court; or (3) where a diverse defendant is joined with a nondiverse defendant, there is no joint, several or alternative liability and the claims against the diverse defendant has no real connection to the claim against the nondiverse defendant.Crowe v. Coleman , 113 F.3d 1536, 1538(11th Cir.1997);Triggs v. John Crump Toyota, Inc. , 154 F.3d 1284, 1287(11th Cir.1998).The removing party's burden is heavy."A defendant must assert with particularity that a joinder is fraudulent and support the claim by clear and convincing evidence."Everett v. MTD Products, Inc. , 947 F.Supp. 441, 445(N.D. Ala.1996)(citingParks v. New York Times Co. , 308 F.2d 474, 478(5th Cir.1962), cert. denied , 376 U.S. 949, 84 S.Ct. 964, 11 L.Ed.2d 969(1964) )."The federal court makes these determinations based on the plaintiff's pleadings at the time of removal; but the court may consider affidavits and deposition transcripts submitted by the parties."Crowe , 113 F.3d at 1538(citingB., Inc. v. Miller Brewing Co. , 663 F.2d 545, 549(5th Cir.1981) ).Moreover, "[w]here a plaintiff states even a colorable claim against the resident defendant, joinder is proper and the case should be remanded to state court."Pacheco De Perez , 139 F.3d at 1380.Or in other words, "if there is even a possibility that a state court would find that the complaint states a cause of action against any one of the resident defendants, the federal court must find that the joinder was proper and remand the case to the state court."Coker v. Amoco Oil Co. , 709 F.2d 1433(11th Cir.1983), superceded by statute on other grounds as stated inWilson v. General Motors Corp. , 888 F.2d 779(11th Cir.1989).

1.Effect of Spell's Death on Removal.

Citizenship for federal jurisdiction is measured when it is invoked.Accordia correctly notes that is the citizenship of the parties on November 26, 2019, the date of removal to this Court.SeeTillman v. R.J. Reynolds Tobacco , 253 F.3d 1302, 1306 n. 1(11th Cir.2001)("For purposes of considering the specific jurisdictional question before us, we consider only the original complaint, however, because the question of diversity subject matter jurisdiction is determined on the plaintiff's pleadings at the time of removal.")(citations omitted);See alsoFulford v. Mkt. St. Mortg. Corp. , No. CIV.A. 305CV336WWO, 2005 WL 3263884, at *3(M.D. Ala.Dec. 1, 2005)(holding non-diverse defendant who died prior to removal was properly not considered for determining diversity jurisdiction).

The Court finds that Spell should not be considered for diversity purposes on the date of removal.

2.Operation of Statute of Limitations for Counts I and II.¹

Plaintiff asserts that he can maintain a claim against Spell² for fraudulent representation and suppression.Specifically, Plaintiff claims that Defendant Spell misrepresented and suppressed information at the point of sale about the policy Plaintiff purchased and the manner premiums would be charged.

In its Notice of Removal (Doc. 1)(and in response to the Motion to Remand(Doc. 7)), Accordia points out these allegations are inconsistent with the express terms of the insurance policy.Accordia also demonstrates Plaintiff specifically acknowledged receipt of the insurance policy on April 10, 2002.Further, in response to Plaintiff's request for an additional copy of his insurance policy, Accordia sent an additional copy to him on December 16, 2016.Both of these events occurred over two years before Plaintiff filed this lawsuit in the Circuit Court of Perry County, Alabama.

The Court finds that both of the above claims are barred by the statute of limitations.

"If the only claims against a resident defendant are barred by the statute of limitations, then there ‘is no possibility the plaintiff can establish a cause of action against the resident defendant.’In such a situation, the resident defendant is deemed to be fraudulently joined."Whitlock v. Jackson Nat'l Life Ins. Co. , 32 F.Supp.2d 1286, 1290(M.D. Ala.1998);see alsoLevett v. Indep. Life & Acc. Ins. Co. , 814 F.Supp. 1053, 1058(M.D. Ala.1993).

Bullock v. United Benefit Ins. Co. , 165 F. Supp. 2d 1255, 1258(M.D. Ala.2001).The statute of limitations for all of Plaintiff's claims against Spell is two years....