Jenkins v. Commonwealth Land Title Ins. Co.

• Decision Date: 05 September 1996
• Docket Number: No. 94-16046,94-16046
• Citation: 95 F.3d 791
• Parties: , 96 Cal. Daily Op. Serv. 6645, 96 Daily Journal D.A.R. 10,865 Danny Harris JENKINS, Plaintiff-Appellant, v. COMMONWEALTH LAND TITLE INSURANCE COMPANY, a Pennsylvania corporation licensed to do business in the State of Hawai'i, Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 791

95 F.3d 791

36 Fed.R.Serv.3d 181, 96 Cal. Daily Op. Serv. 6645,

96 Daily Journal D.A.R. 10,865

Danny Harris JENKINS, Plaintiff-Appellant, v. COMMONWEALTH LAND TITLE INSURANCE COMPANY, a Pennsylvania corporation licensed to do business in the State of Hawai'i, Defendant-Appellee.

No. 94-16046.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted May 10, 1996.

Decided Sept. 5, 1996.

Danny H. Jenkins, Honolulu, HI, Pro Se, for plaintiff-appellant.

Shelby A. Floyd, Alston, Hunt, Floyd & Ing, Honolulu, HI, for defendant-appellee.

Appeal from the United States District Court for the District of Hawai'i, Harold M. Fong, District Judge, Presiding. D.C. No. CV-93-00567-HMF.

Before: FLETCHER, D.W. NELSON, and CANBY, Circuit Judges.

FLETCHER, Circuit Judge:

Danny Harris Jenkins appeals pro se the district court judgment against him in his suit against Commonwealth Land Title Insurance Company involving a dispute over a title insurance policy. The district court dismissed Jenkins' various claims, some on summary judgment, others under Federal Rule of Civil Procedure 12(b)(6). We have jurisdiction over the appeal under 28 U.S.C. § 1291 and affirm in part and reverse in part.

FACTUAL BACKGROUND AND PROCEEDINGS BELOW

In 1981, Jenkins paid $10,000 for Oahu Tax Map Key Parcel 5-3-4:29 ("Parcel 29"), a portion of a 40-foot-wide former railroad right-of-way that was conveyed to him by a quitclaim deed. A month after the purchase, Commonwealth, through its Hawai'ian agent, issued a title insurance policy covering Jenkins' fee-simple ownership of Parcel 29 and insuring Jenkins against loss or damage up to $10,000. ¹

Jenkins wrote Commonwealth in November 1985 and made a formal claim under the policy. He restated and enclosed a recent title report by Hawai'i Escrow & Title, Inc. that showed various potential claims casting doubt on the chain of title to Jenkins' seller. Jenkins claimed they rendered his title unmarketable and requested that Commonwealth take legal action to quiet title to the Jenkins next wrote Commonwealth in February 1992, demanding written notice within one week of Commonwealth's intent to file immediately a suit to quiet title; if Jenkins did not receive such notice by his deadline, he would, he wrote, file a complaint the following day. Jenkins did not state that anyone was making a claim against his title to Parcel 29. Commonwealth apparently wrote Jenkins within a week of his letter and stated that it would investigate "whether ... it had any liability" under the policy and inform Jenkins as to its decision.

parcel in his name. In response, Commonwealth's senior claims counsel wrote Jenkins to inquire whether any adverse claims were then pending as to Parcel 29. If not, the letter stated the company would "prefer to take no action" because "all an action at this time would do is give parties named a belief that they may have an interest" and it would be "best not to open a potential 'can of worms' ". The letter also stated that if there were claims pending against Parcel 29, Jenkins should inform Commonwealth immediately so that it could evaluate the claims; "[d]epending upon the nature of the claims made ... [Commonwealth would] consider paying [Jenkins] the policy limits of $10,000 as a means of settlement". Commonwealth's records do not indicate that Jenkins ever responded to this letter, and Jenkins does not claim that he did so.

In April 1993, Jenkins, acting pro se, filed a complaint in state court, alleging breach of contract, deceptive trade practices, fraud, and negligent misrepresentation and seeking punitive damages and specific performance. Commonwealth offered to pay Jenkins the $10,000 policy limit and Jenkins refused; the company then removed the case to federal court on the basis of diversity. The district court granted summary judgment to Commonwealth on Jenkins' claims for breach of contract, punitive damages, specific performance, negligent misrepresentation, and fraud and dismissed, for failure to state a claim, Jenkins' claim of deceptive trade practices. Jenkins timely appealed, appealing all but the ruling on the claim for breach of contract.

JURISDICTION

Commonwealth removed this case to federal court on the basis of diversity jurisdiction pursuant to 28 U.S.C. § 1332. The district court denied Jenkins' motion to remand and granted Commonwealth leave to amend its notice of removal, which Commonwealth did. On appeal, Jenkins challenges the district court's determination that it had diversity jurisdiction over this case. The existence of subject-matter jurisdiction is reviewed de novo. Valdez v. United States, 56 F.3d 1177, 1179 (9th Cir.1995).

Jenkins' challenges to diversity jurisdiction over this action are without merit. Whatever formal errors of pleading Commonwealth made in its notice of removal, it remedied these in its amended notice, in which it stated that Commonwealth "is a corporation incorporated under the laws of the state of Pennsylvania, whose principal place of business was and is the state of Pennsylvania". Whatever formal defect existed by virtue of Commonwealth's statement in its notice of removal that Jenkins is a "resident" of Hawai'i rather than a citizen was similarly cured by the amendment, and by Jenkins' concession that he is a citizen of Hawai'i. The amended pleadings therefore establish that Jenkins and Commonwealth are citizens of different states, so diversity jurisdiction exists over this case under 28 U.S.C. § 1332.

DISCUSSION

I. Extension of Time for Filing of Commonwealth's Answer

Before reaching the merits of the issues on appeal, we must resolve a procedural issue. Jenkins challenges the district court's grant of Commonwealth's motion to extend the time for the filing of its answer. The complaint was served on Commonwealth on June 17, 1993. Commonwealth moved in state court on July 7, prior to the expiration of the twenty-day period in which its answer was due, for a fourteen-day extension. A hearing on Commonwealth's motion was scheduled for July 21. On July 16, however, Commonwealth filed its notice of removal; on August 6 it renewed in federal court its Rule 6(b) commits to the district court's discretion the decision to enlarge the time in which a party must perform an act required or allowed by the Federal Rules of Civil Procedure, so this court reviews such decisions for an abuse of discretion. Kyle v. Campbell Soup Co., 28 F.3d 928, 930 (9th Cir.), cert. denied, 513 U.S. 867, 115 S.Ct. 185, 130 L.Ed.2d 119 (1994).

state-court motion for an extension of time, which the district court eventually granted.

Commonwealth's initial request for an extension was filed in state court before the deadline for the filing of its answer expired, Haw. R. Civ. P. 12(a), and the state court had discretion to grant the extension "for cause shown", Haw. R. Civ. P. 6(b)(1). While the request was pending, Commonwealth removed the case to federal court. The longstanding principle is that "[a]fter removal, the federal court 'takes the case up where the State court left it off' ", Granny Goose Foods, Inc. v. Brotherhood of Teamsters Local 70, 415 U.S. 423, 436, 94 S.Ct. 1113, 1122, 39 L.Ed.2d 435 (1974) (quoting Duncan v. Gegan, 101 U.S. 810, 812, 25 L.Ed. 875 (1880)). See also Butner v. Neustadter, 324 F.2d 783, 785 (9th Cir.1963); Savell v. Southern Ry. Co., 93 F.2d 377, 379 (5th Cir.1937) ("When a case is removed the federal court takes it as though everything done in the state court had in fact been done in the federal court"). Therefore Commonwealth's request for an extension in state court before the state deadline for Commonwealth's answer had passed was properly treated, upon removal, as a pending motion filed before the deadline for Commonwealth's answer in federal court. Thus, because Commonwealth's request for an extension of the period in which to file its answer to Jenkins' complaint was "made before the expiration of the period originally prescribed" for the filing, the district court had the discretion to extend the deadline "for cause shown". Fed.R.Civ.P. 6(b)(1).

The district court did not abuse its discretion in enlarging the time for the filing of Commonwealth's answer "for cause shown" under Rule 6(b)(1). Commonwealth's attorney submitted declarations indicating (1) that she had requested that Jenkins' stipulate to an extension but that he had refused, (2) that she was lead counsel for Commonwealth in a 21-party case in state court which was set for trial on August 24 and which had a strict discovery deadline of July 23 that required her to be in Kona for depositions and motions, and (3) that she therefore had not had an opportunity to discuss the complaint with Commonwealth and to review its files on the matter. On these facts, the district court's enlargement of the time for the filing of Commonwealth's answer was not an abuse of discretion.

II. Jenkins' Claims

We conclude that the district court did not err in granting summary judgment on the claim for negligent misrepresentation, nor did it err in dismissing the fraud claim on the pleadings and in denying specific performance and punitive damages. However, we disagree with the district court's basis for dismissing on the pleadings the deceptive-practices claim and conclude that claim must be remanded to the district court for further proceedings.

A. Negligent Misrepresentation

Jenkins appeals the district court's grant of summary judgment to Commonwealth (and denial of his motion for summary judgment in his favor) on his claim of negligent misrepresentation. A grant of summary judgment is reviewed de novo. Jesinger v. Nevada Federal Credit Union, 24 F.3d 1127, 1130 (9th Cir.1994).

Even if we assume that Jenkins raised a genuine issue of material fact as to whether Commonwealth represented to him that the title to Parcel 29 was marketable and free of any liens and defects other than those set forth in the insurance policy, summary judgment...