Opinion
Civil Action 00-0260-M.
June 7, 2000.
MEMORANDUM ORDER
This action is before the Court on Plaintiff's Motion to Remand (Doc. 8). Jurisdiction has been invoked in this Court under 28 U.S.C. § 1332. It is ORDERED that Plaintiff's Motion to Remand be GRANTED.
This action was randomly assigned to the undersigned Magistrate Judge to conduct any. and all proceedings including a trial, if necessary, and the entry of final judgment (Doc. 6). The parties subsequently completed a consent form, giving the undersigned Magistrate Judge the authority to conduct all remaining proceedings (Doc. 12)
The facts, very briefly, are as follows. Plaintiff Alabama Power Company (APCo) filed a Complaint for Condemnation of land owned by Defendant Sustainable Forests, L.L.C. (Sustainable) in the Probate Court of Escambia County on February 28, 2000 (Doc. 1, Exhibit A) Bob Bonner, Escambia County Tax Collector, was named as a Defendant in the action as a lienholder on the property sought to be condemned. Id. Sustainable removed the action, alleging that this Court has diversity jurisdiction under 28 U.S.C. § 1332 and that this action is removable pursuant to 28 U.S.C. § 1441 and 1446 (Doc. 1). APCo subsequently filed a Motion to Remand the action back to the state court (Doc. 8). Sustainable filed an opposition brief (Doc. 15) to which APCo replied (Doc. 19); Sustainable filed a response to the reply (Doc. 20, Exhibit 1)
Sustainable's Motion for Leave to File Supplemental Briefs is GRANTED (Doc. 20).
In a removal action, the party asserting jurisdiction has the burden of establishing proof of jurisdiction by a preponderance of the evidence. McNutt V. General Motors Acceptance Corp. of Indiana, Inc., 298 U.S. 178 (1936). In a removal action, that burden is upon the defendant. Wilson V. Republic Iron Steel Co., 257 U.S. 92 (1921). Removal is a statutory remedy which must be narrowly construed so as to limit federal jurisdiction. Shamrock Oil Gas Corp. v. Sheets, 313 U.S. 100 (1941)
The Court notes that any civil action over which the district court would have original jurisdiction may be removed by the defendant to the district court for the district in which the action is pending. 28 U.S.C. § 1441 (a). The district court has jurisdiction over actions between citizens of different states so long as all plaintiffs are diverse from all defendants, Strawbridge v. Curtiss, 7 U.S. 267 (1806), and the amount in controversy exceeds $75,000. 28 U.S.C. § 1332(b)
There is no apparent dispute that the amount in controversy exceeds $75,000. Sustainable asserts that the value of the property in question exceeds that amount (Doc. 1); in its Motion to Remand, APCo does not challenge the assertion (Doc. 8). What is in dispute, however, is whether complete diversity exists. The discussion focuses on Defendant Bonner and his role in this lawsuit.
Plaintiff APCo is an Alabama corporation with its principal place of business in Birmingham, Alabama (Doc. 8, p. 3). Defendant Bonner is domiciled in Alabama (Doc. ¶ ,6). Defendant Sustainable is incorporated under the laws of Delaware with its principal place of business in New York (Doc. 1, ¶ 5). These facts, by themselves, demonstrate that Plaintiff is not diverse from all of the Defendants as APCo and Bonner are both Alabama citizens. Sustainable has argued that Bonner's presence in this action is a mere formality while APCo argues that he is an indispensable party.
Plaintiff argues that Alabama statutory law requires that Bonner be named as a party to the action because he is a lienholder under Ala. Code § 18 — lA — 72(a)(2) and that he is, therefore, an indispensable party (Doc. 8, p. 5). APCo further notes that Alabama Civil Practice Form § 2-7-2 lists the County Tax Collector as an automatic defendant in a Complaint for Condemnation (Doc. 8, pp. 5-6). Alabama statutory law further states that the tax lien "is superior to all other liens." Ala. Code § 40 — 1-3.
"[T]he complaint shall . . . [n]ame as defendants all persons who to the plaintff's knowledge are owners of or who have or claim any interest in the property sought to be taken." The Commentary to this code section specifically states that this language includes persons who have "alien or other security interest."
Sustainable argues, however, that although Alabama statutory law requires that Bonner be named as a Defendant, he is a nominal party who "has no interest in the property in question that would be affected by the outcome of this proceeding" (Doc. 1, ¶ 6; see also Doc. 15, pp. 2— 5). Defendant's argument, summarily, is that Alabama law requires Bonner's presence to give APCo notice that Sustainable owes taxes on the disputed property which cannot be paid until after the tax year is completed on September 30, 2000 and that until payment of those taxes is made, APCo's interest in the property is inferior to that of Bonner as lienholder (Doc. 15).
The Court has reviewed the arguments made by Sustainable but finds that it has not satisfied its burden of proving, by a preponderance of the evidence, that this Court has jurisdiction over this action. Though Defendant argues that Bonner's presence is merely incidental to the real dispute, this Court is not convinced.
Sustainable points to a number of cases in its briefs but none of them are "on point" with the facts presented here. While the Court understands that nominal or formal parties may be ignored for purposes of determining whether diversity jurisdiction exists, the ignored party in each cited case relevant to this jurisdiction was either performing ministerial functions for the parties or was someone whose interests were already adequately represented. See Navarro Savings Association v. Lee, 446 U.S. 458, 465— 66 (1980) (managed trust's beneficial shareholders ignored because trustees held legal title to assets); Walden v. Skinner,. 101 U.S. (11 Otto) 577, 588 — 90 (1879) (trustee was performing ministerial act); Nunn v. Feltinton, 294 F.2d 450, 453-55 (5th Cir. 1961), cert. denied, 369 U.S. 817 (1962) (three stockholders ignored because receiver represented their interests); and Wolff v. Wolff, 768 F.2d 642, 645 — 46 (5th Cir. 1985) (partnership — performing ministerial functions was ignored).
The Eleventh Circuit, in the en banc decision Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th dr. 1981), adopted as precedent decisions of the former Fifth Circuit rendered prior to October 1, 1981.
The Court is aware that both parties have cited Tri-Cities Newspapers, Inc. v. Tri-Cities Printing Pressmen and Assistants' Local 349, 427 F.2d 325 (5th Cir. 1970). However, while that case cited relevant law, it did not apply the law to the facts before it; rather the appellate court remanded the action to the district court for further consideration.
Here, however, Bonner is a necessary party who is properly joined to these proceedings under Alabama law. Bonner is not performing a ministerial function for either of the other parties; also, only Bonner represents the interests of the State in this action. Bonner's presence destroys diversity; this Court does not have subject matter jurisdiction. Sustainable improperly removed the action to this Court. Therefore, Plaintiff's Motion to Remand is GRANTED (Doc. 8).
Therefore, it is ORDERED that this action be REMANDED to the Probate Court of Escarribia County for all further proceedings.
DONE this 7th day of June, 2000.
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