Lawley v. Whiteis

• Citation: 24 F. Supp. 698
• Decision Date: 28 September 1938
• Docket Number: No. 2701.,2701.
• Parties: LAWLEY et al. v. WHITEIS et al. (AMERICAN SURETY CO. OF NEW YORK, Garnishee).
• Court: U.S. District Court — Northern District of Oklahoma

24 F. Supp. 698

LAWLEY et al. v. WHITEIS et al. (AMERICAN SURETY CO. OF NEW YORK, Garnishee).

No. 2701.

District Court, N. D. Oklahoma.

September 28, 1938.

Bailey E. Bell, of Tulsa, Okl., and Louie Gossett and F. Lee Welch, both of Antlers, Okl., for plaintiffs.

Tomerlin, Chandler, Shelton & Fowler and James C. Cheek, all of Oklahoma City, Okl., for garnishee.

FRANKLIN E. KENNAMER, District Judge.

Maragret Lawley, the mother, and as Administratrix of the estate of W. E. Lawley, deceased, recovered a judgment in the District Court of Tulsa County, against Bert Whiteis and L. Sevy, for the wrongful death of a son, caused by an automobile accident. After the rendition of judgment for the plaintiffs, an execution was issued and was returned no property found. Thereafter, garnishment summons was issued under Sections 863 and 864, of Title 12, Okl.St.Ann., Sections 500 and 501, O.S. 1931, against the American Surety Company of New York, seeking to subject to the payment of the judgment an amount claimed to be due to the defendant under a policy of liability insurance alleged to have been issued by the garnishee to the defendant prior to the time of the fatal accident. Interrogatories were submitted along with the garnishment summons, as provided by the Oklahoma Statute. The garnishee filed its answer denying that it was indebted to the defendant, and further denying that it had ever written any insurance policy covering the defendants, and alleging that the defendant, Bert Whiteis, the owner of the truck involved in the accident was a carrier for hire under the laws of the State of Oklahoma, and required by such law to obtain a permit from the Corporation Commission of the State of Oklahoma, which he had neglected to do, and was therefore engaged in the business of hauling for hire, in violation of the law. The garnishee further alleged that it was prohibited by law from issuing casualty insurance to any person engaged in a like business, because the garnishee had never qualified under the laws of the State of Oklahoma and the rules and orders of the Corporation Commission to issue casualty insurance covering vehicles hauling for hire. The plaintiff filed notice of election to take issue with the answer of the garnishee, and the garnishee, within the time provided by law, filed its petition and bond for removal, and an order removing the cause to this court was duly entered. The matter comes on for hearing upon plaintiff's motion to remand.

Plaintiff and defendants are residents of the State of Oklahoma, and the garnishee, the American Surety Company of New York, is a non-resident of Oklahoma, being a corporation organized under the laws of the State of New York. The judgment obtained against the defendants was in the amount of $4,000, plus interest and costs. The only question presented, is whether the garnishment proceedings against the American Surety Company is a suit of a civil nature between citizens of different states and which can be fully determined as between them, within the purview of the removal statutes. If the garnishment proceedings instituted in this case are merely ancillary or supplemental proceedings to the suit in the State Court and the judgment rendered therein, then the same is not removable to this court. On the other hand, if such proceedings are independent suits, then they are probably removable.

The question presented here has had the consideration of the United States District Court for the Western District of Oklahoma, and has also been considered by this court. See Reed v. Bloom, D. C., 15 F.Supp. 7; Lahman v. Supernaw et al., D. C., 47 F.2d 610.

Honorable Edgar S. Vaught, Judge of the District Court for the Western District of Oklahoma, concluded that such proceedings were removable. The contrary result was reached in this court. The contrary ruling of Judge Vaught has compelled a careful reconsideration of the removability of such proceedings, with the result that the question has been carefully investigated as if it were a new one for this jurisdiction. While the decision in the case is not free from doubt, and is not a question easy of determination, still, in view of the construction placed upon the Statutes of Oklahoma by the highest court of this State, construing the nature of the proceedings, it must be concluded that garnishment proceedings under the particular Statutes noted above, are auxiliary and ancillary to the suit resulting in judgment, under which such proceedings are authorized.

The difficulty involved in determining the removability of such proceedings lies in determining the character of the garnishment proceedings. If, under the Statutes of Oklahoma, garnishment does not partake of the nature of an independent suit, or litigation, but is merely auxiliary to the main action, or supplemental to it, and a means of securing a satisfaction of judgment rendered therein, it is not removable. Pratt v. Albright, C. C., 9 F. 634. On the other hand, if such proceedings are independent suits, they may be removed.

The Statutes of Oklahoma provide for garnishment proceedings before as well as after judgment. The Statutes referred to above are applicable to proceedings after judgment has been obtained. The proceedings prescribed therein differ from proceedings prior to the entry of judgment, and the Statutes under which garnishment proceedings were instituted herein are authorized by the statute in aid of execution only after execution has been returned unsatisfied. They are found in and constitute a part of the chapter of the Oklahoma Statutes on "Executions and Other Proceedings To Enforce Judgments." Garnishment proceedings are also authorized by Sections 497, 484, 495 and 498, O.S.1931, being Sections 847, 848, 861 and 850, of Title 12, Okl. St.Ann. These provisions are not applicable to the instant case, because the procedure involved herein was instituted under the authority of the Sections of the Statute first referred to.

The Supreme Court of Oklahoma has determined that garnishment after judgment is practically an equitable execution brought for the purpose of reaching non-leviable assets and is a means provided for obtaining satisfaction of a judgment of a creditor out of the property of the debtor. See First National Bank of Cordell v. City Guaranty Bank of Hobart, 174 Okl. 545, 51 P.2d 573; Davidson v. Finley, 96 Okl. 291, 222 P. 678. It is thus well established that the proceedings in garnishment after judgment, is auxiliary to the main case and is only a means provided for obtaining satisfaction of a judgment. It has not been construed by the Supreme Court of Oklahoma to partake of an independent action, but is practically an equitable execution. The construction of the Statutes of Oklahoma governing garnishment proceedings after judgment, is binding upon this court. Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82...