United States District Court, N.D. Alabama, Southern Division
PHYLLIS H. BALLANTINE, et al., Plaintiff,
BANCORPSOUTH BANK, et al. Defendants.
OWEN BOWDRE CHIEF UNITED STATES DISTRICT JUDGE
the court is Phyllis H. Ballantine, Scott Preston Harrison,
and Renee Dupont Harrison's (“Harrison
Defendants”) “Motion to Alter, Amend, or
Vacate” (doc. 5), filed in response to the portion of
this court's Remand Order that denied an award of
attorneys' fees and costs pursuant to 28 U.S.C. §
1447(c). (Doc. 4). After careful reconsideration of the
applicable legal standard for requiring a removing party to
pay attorney's fees and expenses, the court finds that it
erred in denying the award. Therefore, the court will GRANT
the motion, VACATE its Order denying fees and costs, and
ORDER BancorpSouth to pay the just costs and actual expenses
the Harrison Defendants incurred in filing their Motion to
Remand this case to state court.
STANDARD OF REVIEW
to grant a motion to reconsider under Federal Rule of Civil
Procedure 59(e) or 60(b) is within the discretion of the
trial court. See Smith v. Casey, 741 F.3d 1236, 1241
(11th Cir. 2014). A court may relieve a party from an order
for mistake, inadvertence, or any reason that justifies
relief. See Fed. R. Civ. Pro. 60(b). A motion to
reconsider “must demonstrate why the court should
reconsider its prior decision and ‘set forth facts or
law of a strongly convincing nature to induce the court to
reverse its prior decision.'” Fidelity &
Deposit of Maryland v. Am. Consertech, Inc., 2008 WL
4080270, at *1 (S.D. Ala. Aug. 28, 2008) (quoting Cover
v. Wal-Mart Stores, Inc., 148 F.R.D. 294 (M.D. Fla.
grounds justify reconsideration of an order: (1) an
intervening change in the law, (2) the availability of new
evidence, and (3) the need to correct a clear error or
manifest injustice. See, e.g., Sussman v. Salem, Saxon
& Nielsen, P.A., 153 F.R.D. 689, 694 (M.D. Fla.
district court to grant attorneys' fees and costs
pursuant to 28 U.S.C. § 1447(c), the court must be
convinced that the removing party lacked an
“objectively reasonable basis” for the removal.
Martin v. Franklin Capital Corp., 546 U.S. 132,
140-41 (2005). But the court may depart from this general
rule when unusual circumstances exist, such as when “a
plaintiff's delay in seeking remand or failure to
disclose facts necessary to determine jurisdiction may affect
the decision to award attorney's fees.”
removed this action from probate court pursuant to 28 U.S.C.
§ 1441(a) on the basis of diversity jurisdiction. The
Harrison Defendants argued, and this court agreed, that
BancorpSouth removed the case more than a year after the
state court action began, and thus this court did not have
subject matter jurisdiction over the case. BancorpSouth based
its removal solely on the theory that the Harrison
Defendants' counterclaims and cross claims were a brand
new “lawsuit, ” separate from what it considered
to be the “administrative proceeding” in which
BancorpSouth filed its petition in the probate court.
BancorpSouth's theory would not only buy it more time to
remove the case, but also establish BancorpSouth as the
defendant in the action-therefore allowing it to remove.
Thus, the court's decision regarding the Harrison
Defendants' request for fees and costs turns on whether
Bancorpsouth's theory was objectively reasonable, and if
it was not, whether unusual circumstances justify denying the
award of fees. A. Whether BancorpSouth's Removal was
Notice of Removal, BancorpSouth stated it was removing a
matter that was a completely separate action from that which
had been ongoing in the probate court since 2007, and
separate from its own Petition for Final Settlement, filed in
March 2017. (Doc. 1 at 3). BancorpSouth asserted the Harrison
Defendants' filing entitled “Verified Counterclaims
and Crossclaims” (doc. 1-1 at 92) in the probate court
was actually the original complaint in this new
action. (Doc. 1 at 2-3, n.2). BancorpSouth also stated the
ongoing action in the probate court was an
“administrative proceeding” rather than a
judicial proceeding. However, as explained in its Remand
Order, this court rejected BancorpSouth's procedural
understanding of the case and found that BancorpSouth's
position conflicts with Alabama law.
clearly recognizes petitions for settlements of trusts as
judicial proceedings and allows parties to file counterclaims
and cross claims in response to them when appropriate.
See Regions Bank v. Reed, 60 So.3d 868 (Ala. 2010)
(holding claims against investment advisor relating to trusts
subject of final-settlement action must be brought in probate
court where the final-settlement petition was the first filed
action); Neal v. Neal, 856 So.2d 766 (Ala. 2002)
(recognizing party's counterclaim and cross claim against
petition for partial settlement of trust). Thus, the Harrison
Defendants filed their counterclaims and cross-claims in a
judicial proceeding that has been ongoing since 2007, and in
a proceeding to which BancorpSouth has been a party at least
since it filed a Petition for Final Settlement in April 2017.
only way BancorpSouth could have reasonably believed that
this case was removable in August 2017-over a year from the
time the proceeding began and some four months after
BancorpSouth filed its petition-would be if it understood
that the Harrison Defendants' filing of counterclaims in
the probate court actually constituted a brand new lawsuit.
But such a theory has no basis in the law.
survey of Alabama law clearly reveals that the Harrison
Defendants' filing did not initiate a new judicial
proceeding, but was a responsive pleading for counterclaims
and cross-claims in the same lawsuit. BancorpSouth's
statement that the Harrison Defendants' probate filing
was actually the “original complaint” in a new
lawsuit is unreasonable in light of the cases cited above.
The ongoing action in the Probate Court of Jefferson County
was not an administrative proceeding, and the Harrison
Defendants' counterclaims did not somehow transform the
non-removable action into a removable one. Given the clarity
of the relevant case law on this issue and the
well-established rules of removal, this court cannot conclude
that BancorpSouth's removal was objectively reasonable.
BancorpSouth argues it had an objectively reasonable basis
for removal because “any procedural hurdles to removal
were waivable or curable via the court's exercise of its
authority to re-align parties.” (Doc. 7 at 4). But in
its Notice of Removal, BancorpSouth never mentioned anything
about realignment. Instead, it stated “Plaintiffs
Phyllis H. Ballantine, Scott Preston Harrison, and Renee
Dupont Harrison, on July 25, 2017, commenced a civil
action against [BancorpSouth] in the Probate Court of
Jefferson County.” (Doc. 1 at 3). Then, in a footnote,
BancorpSouth provided: “Plaintiffs styled their lawsuit
as ‘Verified Counterclaims and Cross-claims.'
However, no original claim to counter nor co-party to
cross-claim exist. Plaintiffs' filing is the original
complaint in this action and the first pleading.” (Doc.
1 at 3, n.2).
clearly represented to this court that it understood the
Harrison Defendants' counterclaims to be the first
pleading in a brand new lawsuit. BancorpSouth removed the
case under the erroneous theory that the Harrison Defendants
were the true plaintiffs in the action, and “used an
administrative proceeding for which they were not a party as
a vehicle to commence a lawsuit.” BancorpSouth simply
declared the Harrison Defendants were actually the plaintiffs
in the probate court, and removed the case based on that
theory that was not founded on any case law or statutory
authority. To the contrary, Alabama law is clear that a
petition for final settlement initiates a judicial