Robinson v. JF Cleckley & Co., Inc.

• Decision Date: 05 November 1990
• Docket Number: Civ. A. No. 2:89-2872-1,2:89-2873-1.
• Court: U.S. District Court — District of South Carolina
• Parties: Kimberly ROBINSON, a minor under the age of 18 years, by her guardian Ad Litem, John ROBINSON, Plaintiff, v. J.F. CLECKLEY & COMPANY, INC., Ford Motor Company, Inc., South Carolina Department of Highways and Public Transportation, Walter Earl Pickel, Jr., a minor under 18 years, by his Guardian Ad Litem, Walter Earl Pickel, Sr., and Walter Earl Pickel, Sr., Defendants. John ROBINSON and Aurelia Robinson as Natural Parents and Guardians of Kimberly Robinson, a minor under the age of 18 years, Plaintiffs, v. J.F. CLECKLEY & COMPANY, INC., Ford Motor Company, Inc., South Carolina Department of Highways and Public Transportation, Walter Earl Pickel, Jr., a minor under 18 years, by his Guardian Ad Litem, Walter Earl Pickel, Sr., and Walter Earl Pickel, Sr., Defendants.

751 F. Supp. 100

Kimberly ROBINSON, a minor under the age of 18 years, by her guardian Ad Litem, John ROBINSON, Plaintiff, v. J.F. CLECKLEY & COMPANY, INC., Ford Motor Company, Inc., South Carolina Department of Highways and Public Transportation, Walter Earl Pickel, Jr., a minor under 18 years, by his Guardian Ad Litem, Walter Earl Pickel, Sr., and Walter Earl Pickel, Sr., Defendants.

John ROBINSON and Aurelia Robinson as Natural Parents and Guardians of Kimberly Robinson, a minor under the age of 18 years, Plaintiffs, v. J.F. CLECKLEY & COMPANY, INC., Ford Motor Company, Inc., South Carolina Department of Highways and Public Transportation, Walter Earl Pickel, Jr., a minor under 18 years, by his Guardian Ad Litem, Walter Earl Pickel, Sr., and Walter Earl Pickel, Sr., Defendants.

Civ. A. Nos. 2:89-2872-1, 2:89-2873-1.

United States District Court, D. South Carolina, Charleston Division.

November 5, 1990.

James H. Moss and W. Thomas Vernon, Beaufort, S.C., for plaintiffs.

Keating L. Simons, III and Trent M. Kernodle, Charleston, S.C., for defendant Ford Motor Co., Inc.

HAWKINS, Chief Judge.

This case is before this court on the report and recommendation of the United States Magistrate made in accordance with Title 28, United States Code, Section 636(b)(1)(B). Objections to the Magistrate's recommendation to remand this case to state court were filed by the defendant on August 30, 1990.

FACTS

This matter arises out of an automobile accident which occurred in April of 1986. In the accident, Kimberly Robinson sustained severe brain injuries when the car in which she was a passenger left the road and hit an embankment, virtually demolishing the car. As a result of the injuries sustained in the car accident, Kimberly will be institutionalized or will continuously require professional care for the remainder of her life. In addition to their claim against the driver of the vehicle, Kimberly's parents, in an action as guardians and an action in their capacity as parents (hereinafter "Plaintiffs"), filed claims against the South Carolina Department of Highways and Public Transportation, a road contractor, J.F. Cleckley and Company, Inc., and Ford Motor Company on June 27, 1986. Due to the presence of diversity destroying defendants, the case was not removable to federal court under 28 U.S.C. § 1446.

On September 30, 1987, the cases were removed from the active court calendar pursuant to Rule 40(c)(3) of the South Carolina Rules of Civil Procedure.¹ On January 29, 1988, while the cases were removed from the active calendar, Plaintiffs settled with the driver of the vehicle. Subsequently, Plaintiff's motion to have the cases restored to the trial calendar of the Beaufort County Court of Common Pleas was granted by court order on January 19, 1989.

On November 9, 1989, Plaintiff settled with the South Carolina Department of Highways and Public Transportation as well as the contractor, J.P. Cleckley and Company, Inc., thereby creating, for the first time, diversity of citizenship between the Plaintiff and Ford Motor Company, Inc. (hereinafter the "Defendants"). Defendant filed a notice of removal pursuant to 28 U.S.C. § 1441, et seq. on December 6, 1989. On December 14, 1989, Plaintiffs filed a motion to remand and supporting memorandum. A memorandum in opposition to the Plaintiff's motion to remand was filed by Defendant and arguments on the motion were heard before Magistrate Robert S. Carr on April 4, 1990.

Plaintiffs assert that the motion to remand should be granted because the Defendant's motion to remove was untimely. The Plaintiffs maintain that the suits commenced in June of 1986 and that the restoration of the case pursuant to the Rule 40(c)(3) order did not create a new case for purposes of 28 U.S.C. § 1441(b). Thus, because the Defendant raised its motion to remove on December 6, 1989, more than one year after the commencement of the suit, the Defendant's motion was outside the limit specified under 28 U.S.C. § 1446(b).

Alternatively, the Defendant argues that the Rule 40(c)(3) order effectively dismissed the cases. As a result, the cases were "commenced" when they were restored to the calendar on January 19, 1989. Therefore, Defendant's removal on December 6, 1989 was within the one year time limit of 28 U.S.C. § 1446(b). The Magistrate recommended that the cases be remanded to state court.

ANALYSIS

The applicable standard of review dictates the scope of this inquiry. By statute, the court is charged with conducting a de novo review of any portions of the Magistrate's report to which specific objection is registered, and may accept, reject, or modify, in whole or in part, the recommendations contained in that report. 28 U.S.C. § 636(b)(1). The court is not bound by the recommendation of the Magistrate and retains responsibility for the final determination. See Brock v. Heckler, 612 F.Supp. 1348, 1350 (D.C.S.C.1985). However, if neither party objects to the factual or legal conclusions of the Magistrate, the statute does not require review of those conclusions by the district court. Thomas v. Arn, 474 U.S. 140, 149-50, 106 S.Ct. 466, 471-72, 88 L.Ed.2d 435 (1985), reh'g denied, 474 U.S. 1111, 106 S.Ct. 899, 88 L.Ed.2d 933 (1986). Accordingly, the court has reviewed, de novo, only those conclusions of the Magistrate to which objections have been made.

The Defendant objects to the report and recommendation of the Magistrate on three grounds. First, the defendant asserts that the Magistrate incorrectly interpreted the definition of "commence" for the purposes of 28 U.S.C. § 1446(b) by focusing on the definition of "commence" as stated in Rule 3 of the South Carolina Rules of Civil Procedure. Further, the defendant objects to the failure of the Magistrate's report to address the status of a case that has been stricken from the calendar under Rule 40(c)(3) and is subsequently restored. Finally, the defendant asserts that the Magistrate's report and recommendation fails to consider the congressional intent behind the one year limitation for removal under 28 U.S.C. § 1446(b). (Defendant's Objection to Magistrate's Report and Recommendation).

To date, there have been no Fourth Circuit cases which have interpreted the one year limitation in 28 U.S.C. § 1446(b).² Therefore, these cases present issues of first impression for this court not only on the interpretation of the recent amendments to 28 U.S.C. § 1446(b), but also, by necessity, the interpretation of Rule 40(c)(3) of the South Carolina Rules of Civil Procedure (hereinafter "Rule 40(c)(3)"). In deciding this case, we are governed by the precept that removal statutes are to be strictly construed against removal and in favor of remand. Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108-09, 61 S.Ct. 868, 872, 85 L.Ed. 1214 (1941). An examination of the legislative history of the 1988 amendments to 28 U.S.C. § 1446(b) provides a useful background for our analysis.

The Judicial Improvements and Access to Justice Act (Pub.L. 100-702) (hereinafter, the "Act") was signed into law on November 19, 1988. Included in the Act were amendments dealing with the removal of suits to federal court based on diversity of citizenship. Section 1016(b)(2) of the Act amended former 28 U.S.C. § 1446(b) by substituting "notice of removal" for "petition for removal" and adding a time limitation prohibiting removal of an action to federal court more than one year following the commencement of the action. 28 U.S.C. § 1446(b) now reads, in pertinent part

If the case stated by the initial pleading is not removable, a notice of 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 except that a case may not be removed on the basis of jurisdiction conferred by section 1332 of this title more than 1 year after commencement of the action.

28 U.S.C. § 1446(b) (emphasis added).

As the legislative history of the Act clearly states, the purpose of the Act was "to improve the administration of justice in this nation...." H.R.Rep. No. 889, 100th Cong., 2d Sess. 22 (1988), U.S.Code Cong. & Admin.News 1988, pp. 5982, 5983 (hereinafter House Report). One concern in particular was the increasing caseload of the federal courts. Id. at 23, U.S.Code Cong. & Admin.News 1988, p. 5983. To address these concerns, Congress made various changes to the requirements for diversity jurisdiction cases, which included increasing the amount-in-controversy from $10,000 to $50,000 (Section 201), changing the definition of citizenship of legal representatives and certain corporations (Section 202) as well as the one year limitation provided in Section 1016(b) of the Act. Congress estimated that the increase in the amount-in-controversy would decrease the federal caseload up to forty percent. 28 U.S.C. § 1332 Commentary.

The Section-by-Section Analysis included in the House Report provides further insights into the congressional interpretation of the 1988 amendments, and specifically addresses Subsection (b)(2) which added the one year limitation

Subsection (b)(2) amends 28 U.S.C. § 1446(b) to establish a one-year limit on removal based on diversity jurisdiction as a means of reducing the opportunity for removal after substantial progress has been made in the state court. The result is a modest curtailment in access to diversity jurisdiction. The amendment addresses problems that arise from a change of parties as an action progresses toward trial in state court. The elimination of parties may create for the first time a party alignment that supports diversity jurisdiction. Under section 1446(b), removal is possible whenever this event occurs, so long as the change of parties was voluntary as to the plaintiff.

Settlement with a diversity-destroying defendant on the eve of trial, for example, may

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