White v. Baltic Conveyor Company

• Decision Date: 15 October 1962
• Docket Number: Civ. No. 229-62.
• Parties: Robert M. WHITE, Plaintiff, v. BALTIC CONVEYOR COMPANY, Defendant and Third Party Plaintiff, v. STANDARD ACCIDENT INSURANCE COMPANY, etc., Third Party Defendant.
• Court: U.S. District Court — District of New Jersey

209 F. Supp. 716

Robert M. WHITE, Plaintiff, v. BALTIC CONVEYOR COMPANY, Defendant and Third Party Plaintiff, v. STANDARD ACCIDENT INSURANCE COMPANY, etc., Third Party Defendant.

Civ. No. 229-62.

United States District Court D. New Jersey.

October 15, 1962.

Thomas F. McGuire, Pennsauken, N. J., for plaintiff.

Kisselman, Devine, Deighan & Montano, and Peter J. Devine, Jr., Camden, N. J., for defendant and third party plaintiff.

Lamb, Langan & Blake, and H. Curtis Meanor, Jersey City, N. J., for third party defendant.

LANE, District Judge.

Plaintiff Robert M. White, a domiciliary of Camden, New Jersey, is bringing a negligence action against defendant Baltic Conveyor, Inc., a corporation chartered in New Jersey. Plaintiff alleges that while he was performing his duties as an employee for Hillside Farms on June 21, 1960, he "* * * slipped and caught his foot between a pulley and a chain of a conveyor" installed on that date in a negligent manner by defendant. "As a result of the negligent and careless construction of the conveyor, the plaintiff claims that he has suffered severe and permanent disabling injuries * * *."

Baltic Conveyor, Inc., filed answer denying negligence. In addition, defendant has brought a third-party complaint against Standard Accident Insurance Company, a corporation chartered in Michigan. It claims that Standard Accident should defend the negligence suit, owing to the provisions of a policy defendant has taken out with Standard. The third-party defendant, disclaiming responsibility, maintains that the accident occurred under circumstances which exclude it from policy coverage.

The main claims and the third-party claim were originally filed in the Superior Court of New Jersey, Law Division, Camden County. Thereafter, third-party defendant removed the entire case to the United States District Court.

Plaintiff now moves by motion to have the main complaint removed to the state court. He wants the initial action in the state courts, because the "original plaintiff's claim would not be removable if sued upon alone."

Defendant-third party plaintiff appears to be unconcerned whether we retain jurisdiction or remand the entire action to the state courts. It is his desire, however, that either the federal or the state courts entertain jurisdiction over both controversies. Baltic expresses the view: "It would seem to be more expeditious to resolve the entire controversy in one court rather than have part of the matter pending before the State court and part of the matter before the Federal court."

The gist of the third-party defendant's argument advocating removal is that "* * * the third-party action concerning insurance coverage relates to contract interpretation * * * and is a separate and independent claim or controversy from the main negligence action * * *." Whether this court should retain the entire case or just the third-party action is, the third-party defendant feels, a matter of discretion.

The issue thus before us is whether the introduction into a New Jersey state action of a third-party claim, which would have been removable if asserted in an independent action, affords the basis for removal by the third-party defendant?

We answer in the negative for the following reasons:

I FEDERAL LAW DETERMINES REMOVAL

Not state law but federal law determines when removal can occur. "* * It is a question of the construction of the federal statute on removal, and not the state statute." Chicago, R. I. & P. R. Co. v. Stude, 346 U.S. 574, 580, 74 S.Ct. 290, 98 L.Ed. 317 (1954).

II POLICY OF LIMITING FEDERAL JURISDICTION

It must be borne in mind that the acknowledged policy is non-sympatny to expanding federal jurisdiction. Cf. Trail v. Green, et al., 206 F.Supp. 896 (D.N.J., 1962).

As stated by the Supreme Court in Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 109, 61 S.Ct. 868, 85 L.Ed. 1214 (1941):

"Due regard for the rightful independence of state governments, which should actuate federal courts, requires that they scrupulously confine their own jurisdiction to the precise limits which the statute has defined."

In St. Paul Mercury Indemnity v. Red Cab Co., 303 U.S. 283, 288, 58 S.Ct. 586, 82 L.Ed. 845 (1938), Mr. Justice Roberts, delivering the opinion of the court, remarked:

"The intent of Congress drastically to restrict federal jurisdiction in controversies between citizens of different states has always been rigorously enforced by the courts."

To quote McCoy v. Siler, 205 F.2d 498, 500-501 (3d Cir. 1953):

"The state court is open to him. There is no hardship on the third-party defendant if we should decide that the third-party action may not be removed to this court * * *. He is subject to suit in state court anyway, and we take it that it is no harder to defend in one court than the other. Nor can we see any social issue involved. The only policy consideration which is apparent is that we should not be astute to widen federal diversity jurisdiction."

The aforesaid is germane in the case at bar. It would be no more difficult for the third-party defendant to defend in the state courts than here.

III REMOVAL EXISTS BY STATUTE

1 Barron and Holtzoff, Fed.Prac. and Proc., § 101, p. 455-56 (Rules Ed. 1960) indicates:

"The right to remove a case from a state to a federal court is purely statutory, being dependent on the will of Congress * * *. Such a procedure was unknown to the common law."

28 U.S.C.A. § 1441(a) proclaims:

"Actions removable generally

"(a) Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending."

Sec. 1441(a) does not utilize the words "third-party defendant," but merely uses the word "defendant." To define the word defendant to mean not only the defendant in an original complaint but in addition a third-party defendant would be an unwarranted act of judicial legislation. "The purely statutory right of removal is a limited right that is not to be expanded by judicial construction." 1A Moore's Fed.Prac. ¶ 0.167 11, p. 1053 (2d Ed. 1961).

But the thrust of Standard Accident's argument is that 28 U.S.C.A. § 1441(c) gives us the necessary power to remove the action herein from the state court to the federal court. Sec. 1441(c) states:

"Whenever a separate and independent claim or cause of action, which would be removable if sued upon alone, is joined with one or more otherwise non-removable claims or causes of action, the entire case may be removed and the district court may determine all issues therein, or, in its discretion, may remand all matters not otherwise within its original jurisdiction."

28 U.S.C.A. § 1441(c) is limited to claims joined by the plaintiff, namely:

"It applies when: two or more separate and independent claims are joined in one action; not all of the claims are of a removable character, but at least one is; and, in that event, authorizes removal of the entire case on the basis of a claim, `which would be removable if sued upon alone,' i. e., this claim would be removable on the basis of a federal question or diversity." 1A Moore's Fed.Prac. ¶ 0.163 4-5, p. 705-6 (2d Ed. 1961)¹ (Footnotes omitted).

Sec. 1441(c) was intended to and does narrow the right to remove as it had existed under the Judicial Code of 1911, 36 Stat. 1094. All that was needed, there, in addition to diversity, was not a separate and independent claim or cause of action but a separate controversy. Mayflower Industries v. Thor Corporation, 184 F.2d 537, 538 (3d Cir. 1950), cert. den. 341 U.S. 903, 71 S.Ct. 610, 95 L.Ed. 1342 (1951). "The Congress, in the revision, carried out its purpose to abridge the right of removal." American Fire & Casualty Co. v. Finn, 341 U.S. 6, 10, 71 S.Ct. 534, 538, 95 L.Ed. 702 (1951) (Footnote omitted).

Note, 51 Michigan Law Review 115, 117, states:

"It would seem that the court in reaching this result refers to President and Directors of Manhattan Co. v. Monogram Associates, 81 F.Supp. 1939 (E.D., N.Y.1949) wherein the court allowed third-party defendant to remove ignored the phrase `is joined' in Sec. 1441(c) which was interpreted to mean even before * * Sequoyah Feed & Supply Co. v. Robinson, 101 F.Supp. 680 (W.D. Ark., 1951), joined in the original complaint."

"And, although subsection (c) should be fairly applied the federal courts should construe and apply it in such a manner as will carry out the intent to restrict removal." 1A Moore's Fed.Prac. 0.163 4.-2, p. 702 (2d Ed. 1961) (Footnotes omitted). Mr. Justice Reed's comment in American Fire, supra, 341 U.S. at 17, 71 S.Ct. at 541, is appropriate:

"The jurisdiction of the federal courts is carefully guarded against expansion by judicial interpretation or by prior action or consent of the parties." (Emphasis added.)

In Sequoyah Feed & Supply Co. v. Robinson, 101 F.Supp. 680, 682 (W.D. Ark.1951) wherein the court held that third-party defendants lack the power to remove their actions to federal courts, Judge Miller said:²

"In view of the approach taken by the Supreme Court, of rejecting a liberal, or `practical' as called by some courts, construction, and insisting upon a strict construction within `the precise limits which the statute has defined', which, in its opinion, is the Congressional purpose as evidenced by the various legislation on the subject, and the intention of the revisors, accepted by the Congress, to further restrict removal by the 1948 revision, the court feels inclined to agree with the construction given by Moore. In doing so, it wishes to point out that it has no desire to deprive any defendant of its right to removal, but is simply of the opinion that the Congress has not created such a right in this instance. The Congress could have done so, but had it so

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