Wood v. Stark Tri-County Building Trades Council

• Decision Date: 08 February 1973
• Docket Number: No. 72-1565.,72-1565.
• Citation: 473 F.2d 272
• Parties: Paul A. WOOD, Plaintiff-Appellant, v. STARK TRI-COUNTY BUILDING TRADES COUNCIL et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

473 F.2d 272 (1973)

Paul A. WOOD, Plaintiff-Appellant, v. STARK TRI-COUNTY BUILDING TRADES COUNCIL et al., Defendants-Appellees.

No. 72-1565.

United States Court of Appeals, Sixth Circuit.

Argued December 8, 1972.

Decided February 8, 1973.

Roy Browne, Akron, Ohio, for plaintiff-appellant; Joseph Sheban, Youngstown, Ohio, on brief.

Jules Markowitz, Cleveland, Ohio, James O. Cross, Robert E. Shuff, Akron, Ohio, Alan S. Belkin, Mortimer R. Riemer, Lawrence Oberdank, Cleveland, Ohio, for defendants-appellees; Jeffrey A. Belkin, of Belkin & Belkin Co., L.P.A., of Riemer & Oberdank, Cleveland, Ohio, on brief.

Before PHILLIPS, Chief Judge, and WEICK and MILLER, Circuit Judges.

PHILLIPS, Chief Judge.

In this diversity action, plaintiff, a Virginia resident, sues the defendant labor council and twelve constituent labor unions, all of Ohio. He claims that, because he was employing some non-union labor, defendants, acting through their members and employees, maliciously and wilfully damaged and destroyed his property on the job site, including materials and equipment. The complaint sought compensatory damages of $1.5 million and punitive damages of $1.5 million.

In response to a question during pretrial discovery proceedings, plaintiff said that the cost of repairing property personally owned by him which allegedly had been damaged and destroyed, was $3,000. The rest of the property damage apparently was suffered by the corporation formed by plaintiff with which he was building apartments. The suit, brought in the District Court for the Northern District of Ohio, was dismissed on summary judgment for failure to satisfy the $10,000 jurisdictional amount required by 28 U.S.C. § 1332(a).

The jurisdictional amount requirement has been a part of the federal judicial system since its inception. A $500 minimum amount in controversy in diversity actions was included in the Judiciary Act of 1789. 1 Stat. 73. The amount has been successively raised to $2,000, 24 Stat. 552, $3,000, 36 Stat. 1091, and $10,000, 28 U.S.C. § 1332(a).

The determination of the amount in controversy is fairly uncomplicated when the plaintiff seeks liquidated damages, the amount in controversy being the total of the liquidated damages. In the unliquidated damages situation, as in the present case, the courts generally apply a good faith standard to the plaintiff's complaint. If the plaintiff's claim is in good faith for an amount higher than the jurisdictional amount, then jurisdiction exists in the federal court unless it appears to a legal certainty that more than the jurisdictional amount could not be recovered by the plaintiff. St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 58 S.Ct. 586, 82 L.Ed. 845 (1938); Fireman's Fund Ins. Co. v. Railway Express Agency, 253 F.2d 780, 782 (6th Cir.1958).

In the present case, although $1.5 million in actual damages were claimed by plaintiff, the District Court concluded on motion for summary judgment that only $3,000 can be proved by him. This conclusion was based upon the answer of plaintiff to a question on interrogatories during discovery proceedings. The response of plaintiff to the inquiry was directed only to the cost of repairing equipment personally owned by him. Plaintiff claims actual damages substantially in excess of $3,000. He asserts that other equipment damaged by the Union was never repaired, and that repairs to the damaged equipment did not restore the property to its original value. He further asserts that he personally had guaranteed a construction loan of $1,900,000 from the Equitable Life Assurance Society of the United States. This loan was made to the corporation whose stock was owned by plaintiff. Plaintiff personally guaranteed that the apartment building:

"Being erected by himself or a corporation controlled by him will be completed in accordance with the terms, covenants and conditions of the aforesaid building and loan agreement and in accordance with plans and specifications now on deposit with the Society and in conformity to existing zoning and restrictions of record, free and clear of any and all claims or liens for labor performed or material furnished in connection with the construction and completion of said apartment building ... arising out of

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