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SHANE v. KANSAS CITY SOUTHERN RY. CO.

May 27, 1954

SHANE
v.
KANSAS CITY SOUTHERN RY. CO. ET AL.



The opinion of the court was delivered by: John E. Miller, District Judge.

  On March 24, 1954, plaintiff filed suit against defendants in the Circuit Court of Polk County, Arkansas, alleging that the deceased, Chas. D. Shane, was fatally injured in a railroad crossing accident as a proximate result of concurring negligence on the part of the defendants. On April 10, 1954, the defendant, Kansas City Southern Railway Company, removed the case to this Court on the ground of diversity of citizenship and amount involved as between it and the plaintiff, and on the further ground that the defendant, A.B. Callahan, was joined as a party defendant for the sole purpose of defeating Federal jurisdiction, and that such joinder was fraudulent as a matter of law. After removing the case, defendant Railway Company on May 11, 1954, filed its answer, denying negligence on the part of its employees and particularly on the part of A.B. Callahan, its section foreman.

Plaintiff, on May 18, 1954, filed her motion to remand the case to the Circuit Court of Polk County, Arkansas, on the grounds that, (1) both plaintiff and the defendant, A.B. Callahan, are citizens and residents of the State of Arkansas, thus negativing diversity of citizenship; (2) plaintiff has alleged a cause of action against the defendants jointly, as she had a right to do; and (3) that the said defendant Callahan was not fraudulently joined as a defendant to defeat Federal jurisdiction of the case.

The attorneys for the respective parties have filed memorandum briefs in support of and in opposition to the motion to remand, and the motion is now before the Court for disposition.

Over a period of years the rules of law governing fraudulent joinder, particularly in this Circuit, have become well crystallized, and before considering the facts as shown by the record in the instant case, the Court feels that a restatement of these rules which must be followed in the determination of the motion is desireable.

The Court, when presented with a removal question concerning fraudulent joinder, should consider two factors. (1) Did plaintiff have a real intention to obtain a joint judgment against the defendants? (2) Did there exist colorable ground for securing such a judgment at the time the case was removed from the state court? Smith v. Southern Pac. Co., 9 Cir., 187 F.2d 397, 401, certiorari denied 342 U.S. 823, 72 S.Ct. 42, 96 L.Ed. 622; Bolstad v. Central Surety & Insurance Corp., 8 Cir., 168 F.2d 927, 930; Locke v. St. Louis-San Francisco Ry. Co., 8 Cir., 87 F.2d 418, 421; Wells v. Missouri Pac. R. Co., 8 Cir., 87 F.2d 579, 581; Morris v. E.I. Du Pont De Nemours & Co., 8 Cir., 68 F.2d 788, 791; Wade v. New York Fire Ins. Co., D.C.Wash., 111 F. Supp. 748, 751; Montrey v. Peter J. Schweitzer, Inc., D.C.N.J., 105 F. Supp. 708, 715; Robinson v. Missouri Pacific Transp. Co., D.C.Ark., 85 F. Supp. 235, 237.

In the absence of a showing of fraudulent joinder, the nature of the controversy is governed by the allegations of plaintiff's complaint. Bolstad v. Central Surety & Insurance Corp., supra, at page 930 of 168 F.2d. See also, Smith v. Southern Pac. Co., supra; Huffman v. Baldwin, 8 Cir., 82 F.2d 5, 7, certiorari denied 299 U.S. 550, 57 S. Ct. 12, 81 L.Ed. 405; House v. Kirby Lumber Corp., D.C.Tex., 113 F. Supp. 322, 324; Harrod v. Missouri Pacific R. Co., D.C.Ark., 26 F. Supp. 619, 621.

Plaintiff's complaint must state a joint cause of action against the defendants, and if it is clearly shown by the facts alleged in the complaint that no joint liability could exist on the part of the defendants, the attempted assertion of such a joint cause of action is fraudulent as a matter of law. Rhodes v. Dierks Lumber & Coal Co., 8 Cir., 108 F.2d 846, 847; Culp v. Baldwin, 8 Cir., 87 F.2d 679, 682; Morris v. E.I. Du Pont De Nemours & Co., supra, at page 792 of 68 F.2d; Adkins v. Blakey, D.C. Mo., 88 F. Supp. 473, 474; Forrest v. Southern Ry. Co., D.C.S.C., 20 F. Supp. 753.

The law of the State, in the instant case Arkansas, determines whether a cause of action has been stated against the resident defendant and whether the liability of the defendants, if any, is joint or several. Huffman v. Baldwin, supra, at page 8 of 82 F.2d; Morris v. E.I. Du Pont De Nemours & Co., supra, at page 792 of 68 F.2d; Thomas, Adm'r v. Thompson, D.C.Ark., 80 F. Supp. 225, 226; Harrod v. Missouri Pac. R. Co., supra, at page 620 of 26 F. Supp.

To show that a joinder, fair upon its face, nevertheless is only a sham or fraudulent device to prevent removal, the petition for removal must contain a statement of facts leading to that conclusion; mere statements of the pleader's deductions will not suffice. Smith v. Southern Pac. Co., supra, at page 400 of 187 F.2d; Polito v. Molasky, 8 Cir., 123 F.2d 258, 260; Huffman v. Baldwin, supra, at page 7 of 82 F.2d; Adkins v. Blakey, supra, at page 474 of 88 F. Supp.

The burden of proof is upon the removing defendant to establish the alleged fraudulent joinder. Polito v. Molasky, 8 Cir., 123 F.2d 258, 260 (by clear and convincing evidence); Wells v. Missouri Pac. R. Co., supra, at page 581 of 87 F.2d; Morris v. E.I. Du Pont De Nemours & Co., supra, at page 791 of 68 F.2d; Hoge v. Fort Smith Gas Co., D.C.Ark., 37 F. Supp. 71.

It is equally as important to protect the state court's jurisdiction of cases improperly removed as it is to protect the federal court's jurisdiction of cases properly removed. Huffman v. Baldwin, supra, at page 7 of 82 F.2d; Morris v. E.I. Du Pont De Nemours & Co., supra, at page 793 of 68 F.2d; Lee v. Ford Motor Co., D.C.Mo., 38 F. Supp. 852, 853.

Doubtful issues of law or fact should be decided in the State court and not in the removal proceedings. Smith v. Southern Pac. Co., supra, at page 402 of 187 F.2d; Bolstad v. Central Surety & Insurance Corp., supra, at page 930 of 168 F.2d; Albi v. Street & Smith Publications, Inc., 9 Cir., 140 F.2d 310, 312; Rhodes v. Dierks Lumber & Coal Co., supra, at page 848 of 108 F.2d; Montrey v. Peter J. Schweitzer, Inc., supra, at page 717 of 105 F. Supp.; Robinson v. Missouri Pacific Transp. Co., supra, at page 238 of 85 F. Supp.

The foregoing rules of law, as heretofore stated, are well settled, and the decision in the instant case depends upon a proper application of those principles of law to the facts appearing herein.

Plaintiff in her complaint alleged that defendant Railway Company maintained a track crossing a public street just north of the junction of U.S. Highway 71 and Reine Street in the City of Mena, Arkansas; that the track at the crossing is elevated about three feet above the level of the traveled roadway, thus making the approach on each side upgrade; that high weeds, pine, underbrush and trees had grown up along defendant Railway Company's right-of-way, obscuring the view of motorists approaching the crossing while traveling along Reine Street toward U.S. Highway 71, so that a view of the track could not be had until the motorist was within thirty feet of the crossing.

"That defendant, Kansas City Southern Railway Company, in order to maintain its tracks, public railroad crossing and right-of-way in a useable condition, employed various persons as section workers and placed in charge of each crew a Section Foreman, with a certain territorial responsibility, one A.B. Callahan, was, on the 28th day of November, 1953, the Section Foreman charged with the responsibility of ...


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