Opinion
CIVIL ACTION 7:00-CV-224-R
March 8, 2001
MEMORANDUM OPINION AND ORDER
Plaintiff Harvey Kent Creel. ("Mr. Creel") asserts claims against Defendant Diana Gay Richardson, ("Ms. Richardson") for breach of contract. This court currently has diversity jurisdiction over this action pursuant to 28 U.S.C § 1332(a). Now before this Court is Plaintiff's Motion to Remand, filed on January 11, 2001, pursuant to 28 U.S.C. § 1447(c), For the reasons discussed below, Plaintiff's motion is GRANTED.
I. BACKGROUND FACTS
This case involves the sale of properly located in Young County, Texas. Mr. Creel, a resident of Texas, initially filed this breach of contract action in the 90th Judicial District Court of Young County, Texas on October 2, 2000, Specifically, Mr. Creel seeks the specific performance of a contract for sale of realty owned in part by Ms. Richardson, pursuant to a contract signed by both parties on January 3, 2000. Ms. Richardson, a resident of Nevada, removed the case to the Northern District of Texas on November 8, 2000, pursuant to 28 U.S.C. § 1332(a), prompting this motion to remand by Mr. Creel.The crux of both the factual and legal dispute between Mr. Creel and Ms. Richardson is the value of the ranch property that was to be sold, and whether the land's actual value supercedes the agreed contract price in figuring the amount-in-controversy. Mr. Creel maintains that the $60,000 sale price of the properly, as indicated in the contract (dated January 13, 2000), is the proper amount-in-controversy for this Court to consider in rendering its judgment on remand. To bolster his argument, Mr. Creel has submitted evidence that prior to the contract's formation, local realtors listed the property's value at approximately $61,600. In rebuttal, Ms. Richardson alleges that at the time she entered into the contract for purchase with Mr. Creel, she had never seen the property, nor had she had it appraised. In her affidavit submitted with her response, she claims that the true value of the properly is $180,000. To support her argument, Ms. Richardson has submitted Mr. Creel's Response to Defendant's Counterclaim, where he states that at the time the contract was signed, he knew the value of the property to be much greater than the amount specified in the contract.
II. LEGAL ANALYSIS
"Title 28 U.S.C. § 1441 (a) permits removal of `any civil action brought in a State Court of which the district courts of the United States have original jurisdiction.' Removal jurisdiction must be strictly construed, however, because it `implicated important federalism concerns.'" Ray v. State Farms Lloyds, 1999 WL 151667 (N.D. Tex 1999) (citing Frank v. Bear Stearns Co., 128 F.3d 919, 922 (5th Cir. 1997). "Any doubts concerning removal must be resolved against removal in favor of remanding the case back to state court." Cross v. Bankers Multiple Line Insurance Company, 810 F. Supp. 748, 750 (N.D. Tex. 1992). For these reasons, the burden of establishing subject matter jurisdiction in federal court rests on the party seeking removal. See Gaitor v. Peninsular Occidental Steamship Co., 287 F.2d 252, 253-54 (5th Cir. 1961.)
In this case, Defendant Richardson seek to remove this action to federal court on diversity grounds. In order for this Court to properly exercise diversity jurisdiction over an action, none of the plaintiffs may share state citizenship with any of the defendants, and the case in question must involve an amount in controversy of at least $75,000. See 28 U.S.C. § 1332(a). As Mr. Creel is a resident of Texas and Ms. Richardson is a resident of Nevada, it is clear that complete diversity of citizenship exists. In his motion to remand, Mr. Creel instead argues that 1.) the amount in controversy does not exceed $75,000; and 2.) that Ms. Richardson waived her right to removal by filing a special appearance to answer, transfer venue, and file a counterclaim, He also moves for the attorney's fees associated with filing this motion.
A. Amount-In-Controversy
It is well-established law in this Circuit that in those cases by which the Federal court sits in diversity, "the plaintiff remains the master of his complaint" and that "if a plaintiff pleads damages less than the jurisdictional amount, he generally can bar a defendant from removal."Allen v. RH Oil Gas Co. 63 F.3d 1326, 1335 (5th Cir. 1995), While Texas law Forbids a plaintiff from specifying the amount of damages sought in their complaint, see Tex. R. Civ. Pro, 47(b), this case indicates an exact "amount-in-controversy" on its face, because Mr. Creel's complaint seeks specific performance of a contract for a dollar amount that the parties previously agreed to. As such, the "legal certainly" test first articulated by the Supreme Court in St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 288 (1938) applies. In that case, the Court wrote that "unless the law gives a different rule, the sum claimed by the plaintiff controls if the claim is apparently made in good faith." Id. at 289. Here, the sum in question has not only been proffered by Mr. Creel, but also by Ms. Richardson, who signed the contract for sale. There is no evidence throughout the pleadings that Mr. Creel has manipulated the contract's numbers after the fact in bad faith, and thus, the law requires this Court to accept his claim at face value for remand purposes.
Even if this Court assumes, arguendo, that a complaint requesting specific performance of a previously existing contract does not determine the amount-in-controversy with "legal certainty," this Circuit has established a standard beyond the "legal certainty" Lest that "when the plaintiff's complaint does not allege a specific amount of damages, the removing defendant must prove by a preponderance of the evidence that the amount in controversy exceeds $50,000." De Aguilar v. Boeing Co., 11 F.3d 55, 58 (5th Cir. 1993). In doing so, a district court must first examine the complaint on its face to determine whether the jurisdictional amount is "facially apparent." St Paul Reinsurance Company v. Greenberg, 134 F.3d 1250, 1253 (5th Cir. 1998) (citing Allen v. RH Oil Gas Co., 63 F.3d 1326, 1335 (5th Cir. 1995). The standard is whether it is more likely than not that the amount of the claim will exceed $50,000.Id at 1253, n. 13. (citing Alien. 63 F.3d at 1336.)
The amount-in-controversy requirement is now $75,000. See 28 U.S.C. § 1332.
In this case, Mr. Creel seeks specific performance of a contract that both parties signed, He does not seek damages outside of that amount, and he has not requested relief other than attorneys' fees in this action. As such, even though Texas law forbids a plaintiff from specifying specific damage amounts, in this case the amount of relief sought by the plaintiff is "facially apparent" — should he succeed on the merits, he will be entitled to purchase Ms. Richardson's property for $60,000. Should he not succeed, he will walk away with nothing and Ms.
Richardson will keep the property. Since Mr. Creel has not requested anything in his complaint except for the order of this Court that the contract be entered into at the agreed-upon value of $60,000, Ms. Richardson is hard-pressed to explain how the amount-in-controversy here could be greater than $60,000. All she relics on in her pleadings on this motion is her own affidavit that she subjectively believes her property to be valued at $180,000. At the very least, this evidence does not meet the "preponderance of the evidence" standard against the bold face of the contract, signed by Ms. Richardson herself. Although attorney's fees are occasionally permitted in determining the jurisdictional amount-in-controversy, see Cupples Co. Mfrs. v. Farmers and Merchants State Bank, 390 F.2d 184 (5th Cir. 1968), the defendant would bear the burden of proof that Mr. Creel's attorneys fees will total more than $15,000 by a preponderance of the evidence. No such proof has been offered in these pleadings.
As a last resort, Ms. Richardson points to the plaintiff's own answer to her counterclaim submitted as evidence with this motion, in which the plaintiff admits that at the time he made the contract, he knew the property was worth much more than me sale price. However, as previously stated, for the purposes of evaluating a motion to remand, the district court must accept the amount of the plaintiff's claim on its face in the event of legal certainty of its value. St Paul, 303 U.S. at 288. While these facts may help her case that the plaintiff is not entitled to specific performance of the contract at issue, this Court cannot "remake" the contract at after the Fact to assert jurisdiction over this action. To do so would essentially raise the purchase price of the land and deny Mr. Creel the gravaman of his claim. This, the Court cannot do.
This court therefore GRANTS Mr. Creel's Motion to Remand. B. Waiver
As Mr. Creel has already succeeded on the merits of this motion, we need not consider whether Ms. Richardson waived her right to removal through her answer and counterclaim.
C. Attorney's Fees
In his Motion to Remand, Mr. Creel also petitions this Court for the attorney's fees associated with this motion, pursuant to 28 U.S.C. § 1447(c). In evaluating Mr. Creel's petition, this Court must follow the guidelines recently established by the Fifth Circuit inValdes v Wal-Mart Stores. Inc., 199 F.3d 290 (5th Cir. 2000). There, the Court wrote that "the application of § 1447(c) requires consideration of the propriety of the removing party's actions based on an objective view of the legal and factual elements of the case . . . the question [being] whether the defendant had objectively reasonable grounds to believe that removal was legally proper." Valdes, 199 F.3d at 293. A district court's subsequent determination that removal was legally improper is not determinative. Id. In awarding attorneys fees associated with a successful motion to remand., the district court should instead exercise its discretion based on the nature of the removal and the nature of the remand. Miranti v. Lee, 3 F.3d 925, 928 (5th Cir. 1993).
In this case, this Court finds that Ms. Richardson had objectively reasonable grounds to believe that removal was legally proper. Ms. Richardson's arguments to the Court on this motion were not frivolous, and this Court believes Ms. Richardson's affidavit that the value of the land is legitimately in dispute even if this question of fact cannot be entertained on a motion to remand an action for specific performance of a contract. In addition, this action was originally filed on October 2, 2000 in Young County, and the defendant filed her removal notice on November 8, 2000. As the liming of the removal notice was prompt and forthright, it did not cause the Plaintiff undue burden in the proceeding.
For these reasons, Mr. Creel's petition for attorneys fees is DENIED.
III. CONCLUSION
For the aforementioned reasons. Plaintiff Harvey Kent Creel's Motion to Remand is GRANTED and his Request for Attorney's Fees is DENIED, pursuant to 28 U.S.C. § 1447(c). This Court ORDERS this action remanded to the district court of Young County, Texas, 90th Judicial District.IT IS SO ORDERED.