United States District Court, N.D. Alabama, Northeastern Division
MEMORANDUM OPINION AND ORDER TO REMAND
N. JOHNSON, JR., UNITED STATES MAGISTRATE JUDGE
action for breach of an insurance contract proceeds before
the court sua sponte to assess the basis for subject matter
jurisdiction. Because the amount in controversy in this case
falls far below the threshold to warrant the exercise of
diversity subject matter jurisdiction, the court
ORDERS the Clerk of Court to
REMAND this case to state court.
Fred White commenced this action by filing a complaint in the
Morgan County Circuit Court. (Doc. 1-1 at 3-5). The complaint
alleges a single breach of contract claim, and further
declares that White “suffered the loss of his
trailer” and “lost the use of his trailer and the
income he would have made had he had a trailer.” (Doc.
1-1 at 3). Plaintiff demands “compensatory and punitive
damages, in a sum the Court and jury deem just . . . .”
(Doc. 1-1 at 4). As indicated, White did not request a
specific sum of damages in his complaint. Essentially, White
sued the Defendant, National Fire & Marine Insurance, for
refusing to pay on an insurance policy covering a conversion
trailer, which sustained severe damage while deployed on a
farm to haul wheat.
the case was pending in state court, National Fire served
requests for admissions pursuant to Alabama Rule of Civil
Procedure 36. The requests sought admissions to the following
1. That the Plaintiff seeks damages in this action in excess
of $75, 000, exclusive of costs and interest.
2. That the amount in controversy in this action exceeds $75,
000, exclusive of costs and interest.
3. That Plaintiff will request and demand damages in excess
of $75, 000 in this action.
4. That Plaintiff intends to request a fact-finder in this
case to return a verdict in excess of $75, 000, exclusive of
costs and interests.
(Doc. 1-1 at 39). White did not respond to National
Fire's requests for admission.
after White's failure to answer the requests for
admission, National Fire removed this action to federal
court. In its Notice of Removal, National Fire invokes the
diversity subject matter jurisdiction of this court pursuant
to 28 U.S.C. § 1332.The Notice asserts White domiciles in
Alabama and identifies National Fire's place of
incorporation and principal place of business as
Nebraska. National Fire contended the action
satisfied the $75, 000 amount-in-controversy requirement
because White failed to respond to the requests for admission
that his damages exceeded the jurisdictional floor, thus
deeming the requests admitted.
the parties submitted summary judgment briefs and materials -
although White only submitted an eight-page response - the
court discerned for the first time that White only paid
approximately $19, 000 for the trailer at issue in the
dispute, and he only insured it for $19, 000. Therefore, the
court issued an Order to Show Cause questioning the exercise
of diversity subject matter jurisdiction over this action.
National Fire responded with arguments centered on
White's failure to respond to the requests for admission,
while White did not respond.
foregoing background readily establishes the necessity for
remand of this case to state court: the evidence in this case
conclusively establishes that the amount in controversy in
this action constitutes no more than approximately $19, 000,
far less than the jurisdiction threshold of $75, 000. For
this reason, the court will remand this action to state
courts are courts of limited jurisdiction. They possess only
that power authorized by Constitution and
statute.'” Dudley v. Eli Lilly & Co.,
778 F.3d 909, 911 (11th Cir. 2014) (quoting
Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S.
375, 377 (1994)). As a result, federal courts possess
“an independent obligation to determine whether
subject-matter jurisdiction exists, even in the absence of a
challenge from any party.” Arbaugh v. Y & H
Corp., 546 U.S. 500, 514 (2006).
Fire invokes diversity jurisdiction as the basis for the
court's exercise of subject matter jurisdiction. As
reflected previously in describing diversity jurisdiction, 28
U.S.C. § 1332 provides that “district courts shall
have original jurisdiction of all civil actions where the
matter in controversy exceeds the sum or value of $75, 000,
exclusive of interest and costs, and is between . . .
citizens of different States . . . .” 28 U.S.C. §
1332(a)(1). Title 28 U.S.C. ...