Jamerson v. Alliance Ins. Co. of Philadelphia

• Decision Date: 29 January 1937
• Docket Number: No. 5833.,5833.
• Parties: JAMERSON v. ALLIANCE INS. CO. OF PHILADELPHIA et al.
• Court: U.S. Court of Appeals — Seventh Circuit

87 F.2d 253 (1937)

JAMERSON v. ALLIANCE INS. CO. OF PHILADELPHIA et al.

No. 5833.

Circuit Court of Appeals, Seventh Circuit.

January 8, 1937.

Rehearing Denied January 29, 1937.

Bruce A. Campbell, R. E. Costello, and John M. Karns, all of East St. Louis, Ill., and P. H. Cullen, of St. Louis, Mo., for appellant.

George C. Willson and J. H. Cunningham, Jr., both of St. Louis, Mo., and Martin F. Oehmke, Harold G. Baker, and Ralph F. Lesemann, all of East St. Louis, Ill., for appellees.

Before EVANS and SPARKS, Circuit Judges, and BALTZELL, District Judge.

SPARKS, Circuit Judge.

Ten corporate fire insurance companies, non-residents of Illinois, instituted this action against appellant who was a citizen of Illinois. By it, appellees sought to enjoin appellant from prosecuting eleven separate pending suits in the city court of East St. Louis, Illinois, upon eleven separate policies of fire insurance issued to him by appellees upon a stock of merchandise subsequently destroyed by fire. Each appellee was a defendant in the state court in a separate suit on a separate policy, except the Star Insurance Company, which was a defendant in two suits, each upon a separate policy.

The bill inter alia alleged that each policy was a standard insurance contract and contained a provision that each insurer should not be liable for any more than its pro rata share of any total loss; that, although certain of the policies sued upon in the state court purported to constitute an individual liability of more than $3,000, yet each of the suits on those policies was brought for $2,999; that none of the appellees was liable on any of the policies because appellant fraudulently conspired with others to procure, and did procure all of the policies by false statements, and did conspire to bring about the fire which destroyed the insured property for the purpose of defrauding appellees; that appellant was convicted in the United States Court on an indictment charging him with using the mails to promote that conspiracy. The bill alleged equity jurisdiction first, because of the language of the policies which required an accounting with respect to the total liability and the prorated liability, and second, because the equity proceeding would avoid a multiplicity of suits.

Appellees' prayer was for a temporary restraining order without notice, for a preliminary injunction after notice, and for a permanent injunction upon final hearing, against the prosecution of the suits in the state court. They further demanded a cancellation of the policies and offered to pay into court the premiums received by them; or, in the alternative, they asked the court to determine the liability of each insurer under the provisions of the policies.

Appellant resisted the application for injunction and filed his motion to dismiss the bill for want of jurisdiction or equity. The court granted a temporary restraining order, and also a temporary injunction after notice, and overruled the motion to dismiss the bill. The appellant elected to stand on his exception to the court's ruling in denying his motion to dismiss, and declined to plead further. Whereupon, final decree was entered cancelling the policies upon return of the premiums paid by appellant, and a permanent injunction was issued against prosecution of the suits in the state court.

It is first contended by appellant that the District Court had no jurisdiction because the requisite jurisdictional amount was not involved. In support of this contention, he relies mainly on Di Giovanni v. Camden Fire Ins. Ass'n, 296 U.S. 64, 56 S.Ct. 1, 80 L.Ed. 47; Walter v. Northeastern Railroad Co., 147 U.S. 370, 13 S. Ct. 348, 37 L.Ed. 206, and Georgia Power Co. v. Hudson (C.C.A.) 49 F.(2d) 66, 75 A.L.R. 1439. This contention was thoroughly discussed in a well considered opinion by the District Court in this case, in Alliance Ins. Co. v. Jamerson, 12 F. Supp. 957, in which the Di Giovanni Case was correctly distinguished in point of fact from the one at bar, and from the line of cases typified by McDaniel v. Traylor, 196 U.S. 415, 25 S.Ct. 369, 49 L.Ed. 533, and Woodmen of the World v. O'Neill, 266 U.S. 292, 45 S.Ct. 49, 51, 69 L.Ed. 293. In the latter case, it was held that, "A conspiracy to prosecute, by concert of action, numerous baseless claims against the same person for the wrongful purpose of harassing and ruining him, partakes of the nature of a fraudulent conspiracy; and in a suit to enjoin them from being separately prosecuted, it must likewise be deemed to tie together such several claims as one claim for jurisdictional purposes, making their aggregate amount the value of the matter in controversy." Conversely, we conceive of no reason why separate defendants in separate actions at law may not join their several claims for jurisdictional purposes, when, as here, their claims are identical and are the result of an unlawful and fraudulent conspiracy entered into by appellant and his co-conspirator against all of appellees. The District Court thus held, and we think the ruling was right under the decisions cited in that opinion. That court did not discuss the Georgia Power Company Case or the Walter Case. This may be due to the fact that they were not called to its attention. However, in neither of those cases was there such connection or community of interest between the claims, by reason of conspiracy or otherwise, as would authorize aggregation for the purpose of conferring jurisdiction under the ruling in the McDaniel and Woodmen Cases.

Furthermore, the amount in controversy with respect to the Star Insurance Company clearly exceeded the amount necessary to give jurisdiction over that appellee's claim. Provident Mut. Life Ins. Co. v. Parsons (C.C.A.) 70 F.(2d) 863; Mutual Life Ins. Co. v. Rose (D.C.) 294 F. 122. The motion to dismiss for lack of jurisdictional amount having been directed to the entire bill, it was properly overruled with respect to that basis for the motion. Grosjean v. American Press...