Rollwitz v. Burlington Northern RR

• Decision Date: 28 January 1981
• Docket Number: No. CV-80-154-BLG.,CV-80-154-BLG.
• Citation: 507 F. Supp. 582
• Parties: Patrick C. ROLLWITZ and Jean C. Rollwitz, husband and wife, Plaintiffs, v. BURLINGTON NORTHERN RAILROAD, a Delaware Corporation, Defendant.
• Court: U.S. District Court — District of Montana

507 F. Supp. 582

Patrick C. ROLLWITZ and Jean C. Rollwitz, husband and wife, Plaintiffs, v. BURLINGTON NORTHERN RAILROAD, a Delaware Corporation, Defendant.

No. CV-80-154-BLG.

United States District Court, D. Montana, Billings Division.

January 28, 1981.

COPYRIGHT MATERIAL OMITTED

Blair Jones, Jones Law Firm, Billings, Mont., for plaintiffs.

Gary H. Peterson, Burlington Northern, Inc., Billings, Mont., for defendant.

OPINION AND ORDER

BATTIN, Chief Judge.

This is a tort action to recover for property damage and personal injuries sustained in a car/train collision. The action was originally brought in state court and subsequently removed to federal court by the defendant Railroad. The plaintiffs filed a motion to remand and that motion is presently before the Court.

Plaintiffs were passengers in a car being driven by their son when it collided with a Burlington Northern (BN) train. The accident occurred in Columbus, Montana, on October 29, 1978. Plaintiffs filed a four-count complaint against the defendant in the Thirteenth Judicial District of the State of Montana on September 4, 1980. The complaint did not state the amount of damages sought, but alleged gross negligence and prayed for punitive damages. On September 16, 1980, BN filed a petition for removal to Federal court along with the appropriate notice and bond. The petition alleged that the Federal court had diversity jurisdiction and that the amount in controversy exceeded $10,000. On September 26, 1980, the plaintiffs filed a motion to remand the case on the ground that the amount in controversy does not exceed the $10,000 requisite jurisdictional amount.

DISCUSSION

I. The Controlling Statutes

Removal was effected here pursuant to 28 U.S.C. § 1441 et seq.¹ No order is necessary to complete removal of a case from state to federal court. It is accomplished merely by the defendant filing a verified petition stating the facts which entitle him to removal, together with a copy of all process, pleadings and orders served on him in the action, and a bond for costs. 28 U.S.C. § 1446; 14 Wright, Miller and Cooper, Federal Practice and Procedure hereinafter Wright & Miller § 3730, p. 715. The propriety of the removal may be tested in federal court by a motion to remand, and remand is required if at any time before final judgment it appears that the case was improvidently removed. 28 U.S.C. § 1447(c).

The timeliness of a petition for removal is dictated by 28 U.S.C. § 1446(b). It provides:

The petition for removal of a civil action or proceeding shall be 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, or within thirty days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever period is shorter.

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.

This provision is designed to resolve any questions as to the timeliness of removal that may be presented under state practice requirements. 16 A.L.R.Fed. 287, 324 (1973). If "the case stated" in the original complaint is removable, then only the first paragraph of § 1446(b) applies. If "the case stated" is not removable, then the second applies and the defendant has thirty days after receipt of a document from which it can be first ascertained that the case is one which is or has become removable. Id. at 327.

II. Application

In the present case jurisdiction is based on diversity of citizenship. Accordingly, this Court is empowered to act only if "the matter in controversy exceeds the sum or value of $10,000, exclusive of interest and costs ...." 28 U.S.C. § 1332(a). If the requisite amount is not in controversy, then the case must be remanded.

As a general rule, the amount stated in the complaint will determine the amount in controversy unless it is shown that the amount is not claimed in good faith. St. Paul Mercury Indemn. Co. v. Red Cab Co., 303 U.S. 283, 288, 58 S.Ct. 586, 590, 82 L.Ed. 845 (1938); Horton v. Liberty Mutual Ins. Co., 367 U.S. 348, 353, 81 S.Ct. 1570, 1573, 6 L.Ed.2d 890 (1961). However, where the complaint contains no specification of damages, the federal courts have had to look elsewhere to determine if there is federal jurisdiction. In such cases the federal courts have either: (1) looked to the petition for removal, (2) made an independent appraisal of the monetary value of the claim or suggested the defendant was free to do so, or (3) remanded the action. 14 Wright & Miller ¶ 3725 p. 666. For the reasons explained below, we remand the action to state court.

The removability of the present action could not be ascertained from the face of the complaint: it contained no representation that the plaintiff was seeking the requisite jurisdictional amount. Nonetheless, the defendant immediately removed to federal court so as to avoid the running of the thirty-day time period imposed by the first paragraph of § 1446(b). The defendant's apparently premature removal was not initiated without some justification. In a number of cases in which the complaint contained no ad damnum clause the courts have made an independent evaluation of the amount in controversy, see Lee v. Altamil Corp., 457 F.Supp. 979, 981 (M.D.Fla. 1978) (court concluded that a "reasonable reading" of the complaint indicated that the amount in controversy exceeded $10,000); Horak v. Color Metal of Zurich, Switzerland, 285 F.Supp. 603, 606 (D.N.J.1968) (court concluded from allegations that it was "likely" that more than $10,000 could be recovered) and denied removal to defendants who failed to remove within 30 days of receiving the complaint. See also Mielke v. Allstate Ins. Co., 472 F.Supp. 851 (E.D.Mich.1979). In these cases the courts rejected the respective defendants' contentions that the thirty-day period for seeking removal did not begin on the date of receiving the complaint, but, rather, on some later date when it was "first ascertainable" that the cases were removable. They concluded that the second paragraph of § 1446(b) had no application, that the period for removal began upon service of the complaint, and accordingly remanded the cases to state court.

This approach to resolving the issue of the timeliness of removal has been attacked as unsound by Professor Moore, 1A Moore's Federal Practice ¶ 0.1683.-5, n. 32 at 483-84, since it forces the defendant to speculate as to whether the case is removable. He suggests:

Under some state practices an ad damnum clause is not required or has been eliminated, as where the damages are unliquidated. If, as a result of this practice, the defendant is unable to determine whether the jurisdictional amount is present, the defendant's time for removal should not begin to run until he is apprised of claims by the plaintiff for an amount that satisfies the jurisdictional requirement. For example, where the defendant may make a demand upon the plaintiff for a statement as to damages and he does so, defendant's time for removal should begin to run from the time of the receipt by him of the plaintiff's answer or response to defendant's demand, which shows a claim that satisfies the jurisdictional amount required for removal. Plaintiff's answer or response comes within the "other paper" mentioned in § 1446(b).

Id. at 483. The logic of this approach is persuasive since it is apparent that no purpose is served by beginning the period for removal until the defendant has an opportunity to intelligently conclude that the requisite amount is in controversy.

A number of cases are in apparent agreement with Professor Moore. For example, in Bonnell v. Seaboard Air Line Railroad Co., 202 F.Supp. 53 (N.D.Fla.1962), plaintiff brought a personal injury action in state court without stating the amount in controversy, merely alleging that the jurisdictional requisite of $500 was met. The plaintiff subsequently issued a demand letter for $50,000. Later during discovery the defendant asked the plaintiff to admit that more than $10,000 was in controversy. The plaintiff failed to respond and the request was deemed admitted. The court concluded that the case was not removable as initially filed since it was not shown that the requisite jurisdictional amount existed, that the demand letter did not qualify as "other paper" under § 1446(b), and consequently held that the period for seeking removal began on the date the request for admission was deemed admitted. Id. at 54-55. For similar analysis and results in analogous circumstances see Fleming v. Colonial Stores, Inc., 279 F.Supp. 933 (N.D.Fla.1968); Gaitor v. Peninsular & Occidental Steamship Co., 287 F.2d 252 (5th Cir. 1961). See also, Jong v. General Motors Corp., 359 F.Supp. 223, 226 (N.D.Cal.1973); Hamilton v. Hayes Freight Lines, 102 F.Supp. 594, 596 (E.D.Ky.1952); Camden Indus. Co. v. Carpenter's Local No. 1688, 246 F.Supp. 252, 255 (D.N.H.1965), aff'd on other grounds, 353 F.2d 178 (1st Cir. 1965), where the courts found that the running of the time period for seeking removal began only when it could be ascertained from "other papers" that the requisite amount was in controversy.

In all of these cases the issue before the court was the propriety of allowing the defendant additional time to remove beyond the thirty days immediately following receipt of the complaint, i. e., the applicability of the second paragraph of § 1446(b). In the present case the defendant removed in a timely fashion, but before the removability of the case was apparent. Thus, the issue here is not the timeliness of the...