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Missouri State Ins. Co. v. Jones

U.S.
Dec 4, 1933
290 U.S. 199 (1933)

Summary

holding attorneys' fees authorized by statute may be included in the amount in controversy to satisfy jurisdictional requirement

Summary of this case from UnitedHealthcare Ins. Co. v. Core Energy, Inc.

Opinion

CERTIORARI TO THE SUPREME COURT OF ARKANSAS.

No. 16.

Argued November 8, 1933. Decided December 4, 1933.

1. The amount of an attorney's fee for services in the case, demanded pursuant to a state statute, is not "costs" within the meaning of the federal removal act (Jud. Code, § 24), but should be added to the principal sum sued for in determining the amount in controversy. P. 202. 2. Provision of the state statute that the attorney's fee shall be taxed and collected as costs, does not make it costs within the meaning of the federal act. Id. 186 Ark. 519; 54 S.W.2d 407, reversed.

CERTIORARI, 289 U.S. 719, to review the affirmance of a judgment for the sum of two life insurance policies and an attorney's fee. The state court had denied the right to remove to a federal court.

Mr. Allen May, with whom Messrs. Paul B. Cromelin, Bolitha J. Laws, and A.F. House were on the brief, for petitioners.

Mr. Tom Poe, with whom Mr. Sam T. Poe was on the brief, for respondent.


In a removal proceeding based upon diversity of citizenship, is it proper to treat attorneys' fees imposed by the Arkansas statute and claimed by the plaintiff, as part of the sum necessary for jurisdiction in the federal court?

Section 41, 28 U.S.C. (Jud. Code, § 24) confers original jurisdiction upon District Courts of the United States of suits of a civil nature between citizens of different States "where the matter in controversy exceeds, exclusive of interest and costs, the sum or value of $3,000." And § 71, 28 U.S.C. (Jud. Code, § 28) provides for removing suits of which District Courts are given original jurisdiction.

Section 6155, Crawford Moses' Digest. Statutes of Arkansas —

"In all cases where loss occurs, and the fire, life, health, or accident insurance company liable therefor shall fail to pay the same within the time specified in the policy, after demand made therefor, such company shall be liable to pay the holder of such policy, in addition to the amount of such loss, twelve per cent, damages upon the amount of such loss, together with all reasonable attorneys' fees for the prosecution and collection of said loss; said attorneys' fee to be taxed by the court where the same is heard on original action, by appeal or otherwise and to be taxed up as a part of the costs therein and collected as other costs are or may be by law collected. Act March 29, 1905, p. 307."

Seeking to recover upon two insurance policies, respondent Johnson, a citizen of Arkansas, sued the petitioner, a Missouri corporation, in the Hot Springs Circuit Court. He asked judgment for $3,000, total of the policies, "together with a reasonable attorney's fee for his attorneys herein and for all of his costs herein expended."

By proper proceeding the defendant company asked removal of the cause to the United States District Court. It alleged a reasonable attorney's fee would amount to $250.00 and that the matter in controversy exceeded $3,000, exclusive of interest and costs. Removal was denied. Judgment went in favor of Johnson for $3,000; also the court further found and adjudged "that the plaintiff is entitled to an attorney's fee of $550, and the same is hereby assessed and taxed as a part of the costs in this case." Upon appeal the Supreme Court affirmed the judgment. Among other things, it said [pp. 522, 523]:

"Appellant contends for a reversal of the judgment upon the ground that the trial court erred in denying its petition for removal of the cause to the Federal Court. It is argued that to include an attorney's fee in the amount sued for exceeds $3,000, interest and costs, and in amount makes the cause a removable one under the Federal Removal Statute ( 28 U.S. C.A. 41, 71). This court has ruled otherwise in the case of Mutual Life Ins. Co. v. Marsh, 185 Ark. 333, 47 S.W.2d 585. In the case referred to, it was ruled that an attorney's fee in cases of this nature must be taxed as costs in compliance with the express terms of § 6135 of Crawford Moses' Digest."

In Marsh's Case, judgment was sought upon an insurance policy for $3,000, together with 12% penalty and attorneys' fees. The trial court denied a petition for removal. The Supreme Court disapproved, and said: "He sues for $3,000 and 12 per cent. damages and attorney's fees. Section 6155, supra, provides that the attorney's fees shall be taxed as costs, but it does not provide that the 12 per cent. penalty shall be taxed as costs. Therefore the amount in controversy was $3,360." Evidently, the court concluded because the state statute directed that attorneys' fees should be treated as costs, they were costs within the removal statute. Also, that the prescribed damages were not costs since not so declared.

But this view was rejected here in Sioux County v. National Surety Co., 276 U.S. 238, 241. We there held that a statute which allowed attorneys' fees to be taxed as part of the costs created a liability enforceable by proper judgment in a federal court; that the mere declaration of the state statute could not alter the true nature of the obligation.

In the state court the present respondent sought to enforce the liability imposed by statute for his benefit — to collect something to which the law gave him a right. The amount so demanded became part of the matter put in controversy by the complaint, and not mere "costs" excluded from the reckoning by the jurisdictional and removal statutes.

The challenged judgment must be

Reversed.


Summaries of

Missouri State Ins. Co. v. Jones

U.S.
Dec 4, 1933
290 U.S. 199 (1933)

holding attorneys' fees authorized by statute may be included in the amount in controversy to satisfy jurisdictional requirement

Summary of this case from UnitedHealthcare Ins. Co. v. Core Energy, Inc.

holding removal proper where amount in controversy included attorneys' fees plaintiff alleged he "would" receive if he prevailed

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holding that attorney's fees can be considered as a part of the amount in controversy if a state statute mandates or allows the award of attorney's fees

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holding that attorney's fees shall be included as part of the amount in controversy calculation

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stating that attorneys' fees may be used in calculating jurisdictional amount if statute allows such recovery

Summary of this case from Woodmen of the World Life Ins. v. Manganaro

reasoning that attorneys' fees are not "mere costs excluded from the reckoning" when the attorneys' fees at issue were authorized by Missouri statute that treated attorneys' fees as costs

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In Jones, a lower court found that "because the state statute directed that attorneys' fees should be treated as costs, they were costs within the removal statute."

Summary of this case from Gunther v. Travelers Indem. Co.

stating that the "mere declaration of the state statute could not alter the true nature of the obligation"

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authorizing the jurisdictional amount calculation to include a reasonable estimate of attorney fees where fee-shifting statute allows plaintiff to recover attorney fees

Summary of this case from Williams v. United Parcel Service, Inc.

In Missouri State Life Ins. Co. v. Jones, 290 U.S. 199, 54 S.Ct. 133, 78 L.Ed. 267 (1933), the United States Supreme Court held that attorney's fees, under an Arkansas statute almost identical to § 66-3238, should be added to the amount sued for, in order for the jurisdictional amount to be determined. I can see no reason why an "Uninsured Automobile Endorsement" should be viewed in a different light.

Summary of this case from Wortman v. Safeco Insurance Company of America

In Missouri State Life Ins. Co. v. Jones, 200 U.S. 199, 78 L.Ed., 267, 54 Sup. Ct., 133, the court passing upon a statute of the State of Arkansas, similar to the one here involved, which allowed an attorney's fee to be taxed as part of the costs, said: "In the state court the present respondent sought to enforce the liability imposed by statute for his benefit — to collect something to which the law gave him a right.

Summary of this case from Johnson v. Universal L. A. Ins. Co.

In Missouri State Life Insurance Co. v. Jones, 290 U.S. 199, 202, 54 S.Ct. 133, 78 L.Ed. 267 (1933), the Supreme Court concluded the demand for attorney fees “became part of the matter put in controversy by the complaint” for purposes of federal jurisdiction.

Summary of this case from Lewis v. Vill. of Hobart

In Missouri State Life Ins. v. Jones, 290 U.S. 199, 54 S.Ct. 133, 78 L.Ed. 267 (1933), the United States Supreme Court reversed the Arkansas Supreme Court's decision in Missouri State Life Ins. v. Johnson, 186 Ark. 519, 54 S.W.2d 407 (1932), in which it held that statutory attorney's fees should be taxed as a cost and not included in the amount in controversy for purposes of determining whether a cause can be removed to federal court.

Summary of this case from Piper v. Potlatch Federal Credit Union
Case details for

Missouri State Ins. Co. v. Jones

Case Details

Full title:MISSOURI STATE LIFE INSURANCE CO. ET AL. v. JONES, ADMINISTRATOR

Court:U.S.

Date published: Dec 4, 1933

Citations

290 U.S. 199 (1933)
54 S. Ct. 133

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