Rogers v. Bates

• Decision Date: 14 September 1970
• Docket Number: No. 20085.,20085.
• Parties: Charles A. ROGERS, Conservator of the Estate of Frederick W. Pahlow, Appellant, and United States of America, v. Scott R. BATES, George Bates and Bernice Bates, Appellees.
• Court: U.S. Court of Appeals — Eighth Circuit

431 F.2d 16 (1970)

Charles A. ROGERS, Conservator of the Estate of Frederick W. Pahlow, Appellant, and United States of America, v. Scott R. BATES, George Bates and Bernice Bates, Appellees.

No. 20085.

United States Court of Appeals, Eighth Circuit.

August 17, 1970.

Rehearing Denied and Rehearing Denied September 14, 1970.

A. E. Radinsky, Denver, Colo., for appellant; Schrempp, Rosenthal, McLane & Bruckner, Omaha, Neb., on the brief.

Murl M. Maupin, Maupin, Dent, Kay, Satterfield & Gatz, North Platte, Neb., for appellees; C. J. Gatz, North Platte, Neb., on the brief.

Before MEHAFFY, GIBSON and BRIGHT, Circuit Judges.

Rehearing Denied and Rehearing En Banc Denied September 14, 1970.

BRIGHT, Circuit Judge.

Plaintiff Charles A. Rogers of Denver, Colorado, as conservator for Frederick W. Pahlow, sought to recover damages in the Nebraska federal district court for bodily injuries which Pahlow sustained as a pedestrian when struck by an automobile on Christmas Eve, 1966, in Alliance, Nebraska. Pahlow resided in Alliance at the time of the accident. All defendants, the minor operating the vehicle at the time of the accident and his parents, also live in Nebraska. The district court, Judge Van Pelt, dismissed the action on jurisdictional grounds for want of diversity. Rogers appeals, urging that the trial court erred in finding that Pahlow permanently resided in the same state as the defendants and in determining, further, that Conservator Rogers' Colorado citizenship did not effect diversity. Finally, Rogers contends that the substantial interest held by the United States as a subrogee for medical expenses invokes federal jurisdiction and requires reinstatement of the action. We reject these contentions and affirm.

We briefly and chronologically review the pertinent facts. Alliance police investigating the accident arrested and jailed Pahlow for intoxication. While his injuries appeared minor at first, a few days after the accident Pahlow lapsed into a coma. He was then taken to the Veteran's Administration Hospital at Hot Springs, South Dakota, for diagnosis and treatment. Approximately one month later, Pahlow was transferred to the Veteran's Administration Hospital at Denver, Colorado, where he underwent brain surgery. Following surgery, Pahlow, on March 10, 1967, engaged a Denver attorney to collect for the injuries Pahlow sustained in the accident. Pahlow signed a retainer agreement with the Denver attorney, listing his residence in Colorado. Thereafter, Pahlow was returned to the Hot Springs facility for recuperation. Medical records compiled by the Veteran's Administration at this time characterized Pahlow as "a little dull mentally", but competent.

On April 5, Pahlow brought action against the present defendants seeking damages for his automobile accident injuries in the United States District Court for the District of Nebraska. On April 14, the chief medical administrative services officer at the Hot Springs Veteran's Administration institution advised Denver counsel of a plan to discharge Pahlow and return him to Alliance, Nebraska, within about two weeks. Denver counsel, by letter, responded that such course of action would lead to a dismissal of Pahlow's federal court lawsuit. He requested that Pahlow travel to Denver "for consultation". Counsel and the Veteran's Administration personnel at Hot Springs arranged for Pahlow to fly to Denver for a three-day visit commencing May 9.

On May 10, Pahlow's attorney referred him to a Denver psychiatrist who diagnosed Pahlow as suffering from defective memory and impairment of perception due to chronic brain disease secondary to a sub-dural hemorrhage sustained in the accident. This physician recommended that Pahlow be evaluated by a "County Medical Commission" and that "a guardian be appointed for his person and property." Denver counsel immediately initiated action in the Denver County Probate Court, which culminated in its adjudication of Pahlow as a mentally ill person and its committing Pahlow to the care and custody of the Veteran's Administration Hospital at Fort Lyons, Colorado. Pahlow remained subject to this commitment until the next year, when on March 12, 1968, he was transferred to the Hot Springs veterans' facility for "domiciliary care".¹

Almost contemporaneously with proceedings leading to Pahlow's institutionalization in Colorado, Conservator Rogers, represented by Pahlow's Denver attorney, petitioned the Denver Probate Court to authorize him to act as conservator of Pahlow's estate and, as such, to continue Pahlow's federal court lawsuit. Armed with that court's authorization, Rogers filed an amended complaint. The Nebraska district court authorized this amendment as well as a second one adding the United States as a party plaintiff to determine its subrogation rights under 42 U.S.C. §§ 2651-2653. The United States then filed a claim as a pleading demanding reimbursement for medical costs incurred in providing care for Pahlow.

On March 3, 1969, the defendants moved to dismiss the complaint for want of diversity. On June 10, 1969, Judge Van Pelt dismissed the claim. The United States, as a party plaintiff, has not appealed.

We first consider whether Pahlow, through a combination of intention and action, established a domicile of choice in Colorado. This court has explained:

To acquire a domicil of choice, the law requires the physical presence of a person at the place of the domicil claimed, coupled with the intention of making it his present home. When these two facts concur, the change in domicil is instantaneous. Intention to live permanently at the claimed domicil is not required. If a person capable of making his choice honestly regards a place as his present home, the motive prompting him is immaterial. Janzen v. Goos, 302 F.2d 421, 425 (8th Cir. 1962); quoting with approval from Spurgeon v. Mission State Bank, 151 F.2d 702, 705-706 (8th Cir. 1945), cert. denied, 327 U.S. 782, 66 S.Ct. 682, 90 L.Ed. 1009 (1946).

Prior to and at the time of the accident, Pahlow permanently resided in Alliance. Five days after Pahlow filed his initial complaint, he told Veteran's Administration personnel at Hot Springs that he wanted to return home to Alliance. When the Denver Probate Court referred him to the Veteran's Hospital at Fort Lyons, Colorado, for custody and care, Pahlow listed his permanent home as Alliance. In view of these specific facts and in light of the record as a whole, the self-serving and conclusional statement contained in Pahlow's retainer agreement with his Denver attorney that "client states that he is a resident and citizen of the State of Colorado" pales into insignificance.² A determination of citizenship for purposes of diversity is a mixed question of law and fact, but mainly fact, which may not be set aside by an appellate court unless clearly erroneous. See Russell v. New Amsterdam Casualty Company, 325 F.2d 996 (8th Cir. 1964); Janzen, supra, 302 F.2d 421. The appellant fails to demonstrate that the trial court clearly erred in holding that Pahlow had acquired no citizenship in Colorado and that he remained domiciled in and a citizen of Nebraska at all times material to this litigation.

We next turn to appellant's contention that Conservator Rogers' Colorado citizenship requires reversal. The trial court expressly found that Pahlow's Denver counsel "manufactured" federal jurisdiction by initiating, controlling and directing Pahlow's trip to Denver in May, 1967; and by causing Rogers, characterized by the trial court as a "straw man", to be named as conservator subject to counsel's direction. In rejecting Rogers' citizenship as a controlling element creating diversity, the trial court relied upon the following mandate of 28 U.S.C. § 1359:

A district court shall not have jurisdiction of a civil action in which any party, by assignment or otherwise, has been improperly or collusively made or joined to invoke the jurisdiction of such court.

We examine this ruling. This court has previously held that the appointment of an administrator of a decedent's estate or statutory trustee with an eye to establishing diversity of citizenship to permit the bringing of an action for wrongful death in federal district court does not fall within the ambit of § 1359. Janzen, supra, 302 F.2d 421; County of Todd, Minnesota v. Loegering, 297 F.2d 470 (8th Cir. 1961); McCoy v. Blakely, 217 F.2d 227 (8th Cir. 1954).

In Janzen, supra, Judge Blackmun, writing for the court, said:

When an action is brought by an administrator or other fiduciary and the governing state law authorizes that fiduciary to bring suit in his own name as the real party in interest, it is the fiduciary\'s personal citizenship, not the identity of the statement from which he receives his appointment or the citizenship of the persons for whose benefit the action is brought, which is pertinent in the ascertainment of the existence of diversity. * * * This court has so held on a number of occasions. * * * No question is here raised as to the plaintiff, in her capacity as administratrix, being the real party in interest and the provisions of R.R.S. Nebraska, 1943, § 25-304, confirm this. In any event, the citizenship of all the beneficiaries coincides with that of the plaintiff. (Citations omitted.) 302 F.2d at 425.

In McCoy, supra, Judge Vogel noted that motive for the appointment of an administrator to create diversity "without more" established no violation of § 1359.

Appellant relies particularly upon the County of Todd, supra, holding that the substitution of a Montana citizen for a Minnesota trustee of decedent's heirs in order to obtain diversity jurisdiction in a wrongful death action against a Minnesota defendant was not collusive or improper. The opinion noted that the changing from a resident to a non-resident representative represents "usual expedients employed by counsel and client in matters of this kind." 297 F.2d at 474.

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