Irby Construction Co. v. Universal Surety Co.
| Decision Date | 20 May 1971 |
| Docket Number | Civ. No. 03298. |
| Citation | 326 F. Supp. 1308 |
| Parties | IRBY CONSTRUCTION COMPANY, Plaintiff, v. UNIVERSAL SURETY COMPANY and Steven H. Schreiner, Defendants. |
| Court | U.S. District Court — District of Nebraska |
Malcolm Young, of the law offices of Young, Kuhn & Person, Omaha, Neb., for plaintiff.
William H. Lewis, of the law offices of Mattson, Ricketts, Gourley & Lewis, Lincoln, Neb., for defendant, Universal Surety Co.
Benjamin Wall, of the law offices of Foulks, Wall & Wintroub, Omaha, Neb., for defendant, Steven H. Schreiner.
This matter arises on motion of the Court, sua sponte, to consider the question of the Court's jurisdiction. The problem originally arose out of a motion to dismiss for lack of jurisdiction Filing 32 filed by defendant Steven H. Schreiner Schreiner. The basis of that motion was completely without merit and is hereby dismissed without further discussion. The basis of the Court's motion is, however, much more substantial and was brought to the attention of the Court by counsel for defendant Universal Surety Company Universal.
In 1968, defendant Schreiner brought suit against Irby Construction Company Irby and others for an accounting and damages in the amount of $204,000 from Irby. As a part of that action, Schreiner caused garnishment to issue against Irby and approximately $140,000 of the funds belonging to Irby were garnisheed. The Douglas County District Court sustained Irby's motion to quash and discharge the garnishment as illegal and, in order to appeal, Schreiner was required to execute a supersedeas bond in the amount of $50,000. Defendant Universal, as surety for Schreiner, also executed the bond. It is upon this bond that Irby brings the present action.
Irby claims damages as to three separate items: Damage for the use of the money wrongfully withheld by the garnishment ($7,945.24); damage from the expense of attorney fees in obtaining dissolution of the garnishment ($5,075.00); and miscellaneous costs and expenses of a minor nature ($177.61). Irby must allege the recoverability of the item of attorney fees in order to reach the jurisdictional amount requirement of 28 U.S.C.A. § 1332. If, as defendants have urged in their brief on the subject, the attorney fees are not recoverable as a matter of law, then the Court must dismiss this action.
The Court cannot tell from the pleadings or the brief submitted by Irby whether the attorney fees claimed include expenses for both the dissolution of the garnishment and resistance of the appeal which followed to the Nebraska Supreme Court. It is also not clear whether any fees expended in the defense of the main action under which the garnishment issued are included with the total sum claimed in the complaint. Assuming for the moment that all such sums were included to some degree in the $5,075 amount claimed in the complaint, the Court will consider the recoverability of each type of attorney fee under a supersedeas bond such as is the subject of this action.
The law in Nebraska seems to have been settled since the case of Higgins v. Case Threshing Machine Co., 95 Neb. 3, 144 N.W. 1037 1914, that attorney fees expenses in the resistance of an appeal from a dissolution of garnishment under a supersedeas bond are not recoverable. The terms of the Universal bond do not seem to vary, as they relate to the appeal costs, from the provisions of the bond in Higgins. This also seems to be the position of the weight of authority in the several jurisdictions. Annotation 37 A.L.R.2d 525 1954.
Again, the weight of authority holds that attorney fees expended in defending the main action under which a wrongful garnishment or attachment has issued are generally not recoverable. Annotation 65 A.L.R.2d 1426, 1433, § 6. Nebraska apparently has not spoken on the subject, but the Court is of the opinion, under the tenor of the Higgins case, supra, and subsequent Nebraska Supreme Court opinions, that the Nebraska rule would follow the course of the majority of the courts stated above.
The last item conceivably included within plaintiff's claim for attorney fees is the expense of attacking and obtaining dissolution of the original order of garnishment. If plaintiff cannot recover upon such a claim in Nebraska as a matter of law, this suit must...
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In re Wiring Device Antitrust Litigation
...by a federal court in determining whether the amount in controversy requirement had been satisfied. Irby Construction Co. v. Universal Surety Co., 326 F.Supp. 1308 (D.Neb.1971); cf. Givens v. W. T. Grant Company, 457 F.2d 612 (2d Cir. 1972). Since more than ten thousand dollars is potential......