Kaneshiro v. North Am. Co. For Life & Health, Civ. No. 79-0480.
| Decision Date | 11 July 1980 |
| Docket Number | Civ. No. 79-0480. |
| Citation | 496 F. Supp. 452 |
| Parties | Melvyn M. KANESHIRO, Plaintiff, v. NORTH AMERICAN COMPANY FOR LIFE AND HEALTH INSURANCE, Defendant. |
| Court | U.S. District Court — District of Hawaii |
Wallace S. Fujiyama, James E. Duffy, Jr., James J. Stone, Honolulu, Hawaii, for plaintiff.
Terence J. O'Toole, Dan T. Kochi, Honolulu, Hawaii, for defendant.
DECISION ON ORDER OF REMAND TO STATE COURT
Plaintiff Melvyn M. Kaneshiro filed this suit against Defendant North American Company for Life and Health Insurance ("North American") in Hawaii state court, alleging breach of a written contract of disability insurance. Defendant North American removed the case to this Court.
Plaintiff then filed a Motion for Remand or for Dismissal for Lack of Jurisdiction over the Subject Matter and for Costs. After considering the briefs and arguments of counsel and the record in the case, this Court on December 27, 1979, granted Plaintiff's motion for remand and for costs, and ordered this case remanded to the Circuit Court of the First Circuit of the State of Hawaii, whence it had been removed. The reasoning of the Court in support of its decision to grant the motion for remand is set forth hereinafter.
Plaintiff Kaneshiro on October 6, 1979, filed a complaint in the Circuit Court of the First Circuit of the State of Hawaii against Defendant North American, alleging that North American had breached its written contract of insurance with him by failing to make disability income payments for the period of time he claims he was entitled to them.1 The state court complaint alleged Plaintiff Kaneshiro to be "a resident of the City and County of Honolulu, State of Hawaii" and Defendant North American to be "an Illinois company doing business in the State of Hawaii."2 On August 14, 1979, the complaint was served upon the Director of Regulatory Agencies of the State of Hawaii, who forwarded it to North American.
Defendant received from Plaintiff an extension of time in which to answer the complaint up to and including October 4, 1979, on which date Defendant filed in the state court a Motion for More Definite Statement in Complaint, requesting that court "to order Plaintiff to provide a more definite statement in his Complaint as to his state citizenship and the citizenship of Defendant, on the ground that the pleading is so vague and ambiguous that Defendant . . . cannot frame a responsive pleading."3 Plaintiff, by letter to Defendant of October 5, 1979, stated that he was "a life-long citizen of Hawaii." The state court denied Defendant's motion on October 27, 1979.
On October 31, 1979, Defendant North American filed a Petition for Removal of the case to this Court pursuant to 28 U.S.C. § 1446(a). The petition relies on the parties' diversity of citizenship as ground for removal and contains an allegation of Kaneshiro's citizenship based on the October 5, 1979, letter.4 North American also filed, on the same day, a Request for Admission pursuant to Federal Rule of Civil Procedure 36 regarding Kaneshiro's citizenship.
On November 26, 1979, Plaintiff filed a Motion for Remand or for Dismissal for Lack of Jurisdiction over the Subject Matter and for Costs. This Court heard argument on December 27, 1979, and ruled from the bench that the motion for remand, and for costs in the amount of $180.00, be granted, and that the action be remanded to the Circuit Court of the First Circuit, State of Hawaii. On January 4, 1980, an Order Granting Motion for Remand and for Costs, reflecting that ruling, was entered. In light of the scant and conflicting case law on the issue presented, the Court takes this opportunity to set forth in this decision the reasoning behind its order.
Plaintiff Kaneshiro argues that Defendant's Petition for Removal is untimely, because it was not "filed within thirty days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based . . .," as required by the first paragraph of 28 U.S.C. § 1446(b).5 Plaintiff's position is that the case, although removable on the ground of diversity based upon the initial pleading, was not removed within the 30-day time limit, and that Plaintiff therefore is entitled to have the case remanded under 28 U.S.C. § 1447(c) and to his costs under § 1446(d).
Defendant, however, argues that it is the second paragraph of § 1446(b) that determines when the 30 days for removal begins to run in the instant case:
If the case stated by the initial pleading is not removable, a petition for removal may be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable.
Defendant's petition for removal is based on diversity. Defendant argues that the case was not removable on the initial pleading because Plaintiff did not allege his citizenship in the state court complaint, and that the case only became removable when Plaintiff stated his citizenship as diverse from Defendant's in Plaintiff's letter to Defendant of October 5, 1979, or alternatively, when Plaintiff failed to respond to Defendant's October 31, 1979, request to admit Plaintiff's Hawaii citizenship.6
The question presented is, given that Plaintiff's complaint alleges only that he is a "resident" of Hawaii, whether the case is "not removable" on the initial pleading on the ground of diversity, and therefore whether Defendant's time period for removal is determined by the second paragraph of § 1446(b), which covers situations in which "the case stated by the initial pleading is not removable . . ." and entitles the defendant to removal at such later time as "it may first be ascertained that the case is one which is or has become removable."7
The right to remove a case from state to federal court is a statutory right and is outlined in 28 U.S.C. § 1441, which gives this Court jurisdiction over those cases removed from state court over which this Court would have had original jurisdiction.8 This Court has removal jurisdiction based on diversity over cases over which it would have had original jurisdiction based on diversity, subject, however, to two limitations. None of the defendants may be a citizen of the state in which the district court is located. 28 U.S.C. § 1441(b); Martin v. Snyder, 148 U.S. 663, 13 S.Ct. 706, 37 L.Ed. 602 (1893). In addition, diversity must exist at the time the original action was filed as well as at the time the petition for removal is filed. 14 C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure § 3723, at 592 (1976).
The facts of the instant case appear sufficient to support removal jurisdiction based on diversity. Plaintiff Kaneshiro is a lifelong citizen of Hawaii, and Defendant North American is, and was at the time of the complaint, an Illinois corporation with its principal place of business in Illinois. Thus, the parties are diverse both at the time the action was brought and at the time the petition for removal was filed, and the defendant is not a citizen of Hawaii. In addition, the plaintiff has alleged the requisite amount in controversy.9 It follows that this Court would have had original jurisdiction over this case had Plaintiff filed the case in this Court with a proper allegation of jurisdiction. However, Plaintiff did not choose to file his case in this Court but rather chose as his forum the state court.
Whereas this Court is a court of limited jurisdiction, the state court is a court of general jurisdiction and does not similarly require in the plaintiff's complaint an allegation of citizenship to support jurisdiction.10 As a matter of general practice, state court plaintiffs do not routinely allege the citizenship of the parties in their complaints.11 Plaintiff did allege his Hawaii residency. However, residency, although relevant, is clearly not sufficient to show citizenship.12
The procedure for removal is set out in 28 U.S.C. § 1446, subsection (a) of which requires the defendant seeking removal to file "a verified petition containing a short and plain statement of the facts which entitle him . . . to removal . . .." Subsection (b) sets out the time period in which the defendant's petition to remove a case from state court must be filed:
Plaintiff in this case cites the first paragraph of § 1446(b), arguing that the case was removable on the initial pleading and that Defendant's petition for removal was therefore untimely. Defendant cites the second paragraph of § 1446(b), arguing that the case was not removable on the basis of the state court complaint.
While it may be tempting to suppose that there are only two logical possibilities, that is, that a case is either removable or not removable, and that the first paragraph of § 1446(b) covers the former and the second paragraph the latter, it is evident that such is not the situation. Rather, there are actually three possibilities. The case on the initial...
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