The opinion of the court was delivered by: John E. Miller, District Judge.
The instant action is one in tort based upon an
automobile-truck collision which occurred in Ozark, Arkansas. The
plaintiff, S.C. Ingram, an Arkansas citizen, filed suit in the
Circuit Court of Franklin County, Arkansas, Ozark District,
against the defendant, Lawrence S. Sterling, a California
citizen, alleging negligence on the part of the defendant and
praying damages in the total sum of $2,650.
On May 15, 1956, plaintiff obtained service of process on the
Secretary of State under the provisions of the Arkansas
nonresident motorist service statute. The record does not
disclose when defendant received actual notice of the filing of
On June 6, 1956, the defendant removed the case to this court
on the ground of diversity of citizenship and the amount
involved. On the same date defendant filed his answer and
counterclaim, and in the counterclaim prayed damages against the
plaintiff in the sum of $15,450. The defendant relies upon the
amount involved in his counterclaim as establishing
jurisdictional amount for the purposes of removal.
No motion to remand has been filed by the plaintiff, but under
the provisions of 28 U.S.C.A. § 1447(c), it is the duty of the
court to inquire into its own jurisdiction in removed cases.
Mayner v. Utah Construction Co., D.C.W.D. Ark., 108 F. Supp. 532.
The issue before the court is whether the amount involved in
the counterclaim may be considered in determining jurisdictional
amount for purposes of removal. In Wheatley v. Martin,
D.C.W.D.Ark., 62 F. Supp. 109, this court held that where a
counterclaim is compulsory under the state law, the amount
involved in the counterclaim may be considered. Thus, at the
outset the court is faced with the rule of stare decisis. This
rule, however, has its qualifications. In United States v. State
of Minnesota, 8 Cir., 113 F.2d 770, 774, the court said:
"We are not unmindful of the doctrine of stare
decisis, but recognize that it is entitled to great
weight and should ordinarily be adhered to, unless
the reasons therefor no longer exist, are clearly
erroneous, or manifestly wrong. The strong respect
for precedent which inheres in our legal system has
its qualifications and limitations. It does not call
for a blind, arbitrary and implicit following of
precedent, but recognizes, no vested rights nor rule
of property being involved, that it is more important
as to far reaching judicial principles that the court
should be right than that it merely be in harmony
with its previous decisions. Such a respect for
precedent balks at the perpetuation of error, and the
doctrine of stare decisis is, after all, subordinate
to legal reason and is properly departed from if and
when such departure is necessary to avoid the
perpetuation of error."
Ordinarily a court is reluctant to refuse to follow the holding
of another court. A court is even more hesitant when it comes to
overruling one of its own decisions. And, it is extremely
difficult for a court to overrule one of its own decisions when
other courts, in the meantime, have followed and relied upon that
decision. Nevertheless, the court has concluded that the instant
case demands such action.
Wheatley v. Martin was decided in 1945. The case has been
followed in Rosenblum v. Trullinger, D.C.E.D.Ark. W.D.,
118 F. Supp. 394, (Judge Lemley) and Lange v. Chicago, R.I. & Pac. R.
Co., D.C.Iowa, 99 F. Supp. 1. See also, McLean Trucking Co. v.
Carolina Scenic Stages, Inc., D.C.N.C., 95 F. Supp. 437.
Other courts have refused to follow Wheatley v. Martin.
Trullinger v. Rosenblum, E.D.Ark.W.D., 129 F. Supp. 12 (Judge
Trimble); Barnes v. Parker, D.C.Mo., 126 F. Supp. 649. Compare,
Chicago, R.I. & Pac. R. Co. v. Stude, 346 U.S. 574, 580, 74 S.Ct.
290, 98 L.Ed. 317; Shamrock Oil & Gas Corp. v. Sheets,
313 U.S. 100, 104, 61 S.Ct. 868, 85 L.Ed. 1214; Lee Foods Division,
Consolidated Grocers Corp. v. Bucy, D.C.Mo., 105 F. Supp. 402;
Sequoyah Feed & Supply Co., Inc., v. Robinson, D.C. W.D.Ark.,
101 F. Supp. 680; Stuart v. Creel, D.C.N.Y., 90 F. Supp. 392; Moore's
Commentary on the U.S. Judicial Code, p. 252.
A reconsideration of the governing principles, especially in
view of the decision of the Supreme Court in Chicago, R.I. & Pac.
R. Co. v. Stude, supra, convinces the court that its decision in
Wheatley v. Martin should be overruled. In the Wheatley case,
this court held that where a counterclaim was compulsory — as
distinguished from permissive — under the state law, the amount
involved therein could be considered in determining
jurisdictional amount for purposes of removal. The effect of that
holding was to permit state law to determine the right of
removal. Such a result is contrary to the reasoning of the court
in Chicago, R.I. & Pac. R. Co. v. Stude, supra, wherein the court
at page 580 of 346 U.S., at page 294 of 74 S.Ct. said:
The weakness of the court's decision in the Wheatley case is
pointed out quite forcibly in Barnes v. Parker, D.C.Mo.,
126 F. Supp. 649, 651, and the court is taking the liberty of quoting
extensively from that opinion.
"We have thought that it was now established beyond
all debate that, in determining the amount in
controversy in actions sought to be removed, the
Court to which removal is sought determines the
question solely by looking to the amount in good
faith prayed for as damnum in the complaint, St. Paul
Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283,
58 S.Ct. 586, 82 L.Ed. 845, regardless of subsequent
events in the action; Kirby v. American Soda Fountain
Co., 194 U.S. 141, 24 S.Ct. 619, 48 L.Ed. 911, and
that, accordingly, if the amount therein claimed was
less than the jurisdictional requirement, amounts
claimed by way of counterclaim could not be
considered as increasing the amount of the required
sum. Falls Wire Mfg. Co. v. Broderick, C.C.Mo., 6 F.
654; Gates v. Union Central Life Ins. Co., D.C.,
56 F. Supp. 149; Stuart v. Creel, D.C., 90 F. Supp. 392.
"However, there are decisions by other District
Courts, Wheatley v. Martin, D.C.Ark., 62 F. Supp. 109;
Lange v. Chicago, R.I. & P.R. Co., D.C.S.D.Iowa,
99 F. Supp. 1; Rosenblum v. Trullinger, D.C.Ark.,
118 F. Supp. 394, which apparently create an exception to
the above rule when a counterclaim is asserted and
classified as `compulsory' under the local state
practice. We can agree with neither the reasoning nor
the confusion which would result if such holdings are
followed. To recognize such an exception is to make
the federal removal practice dependent on state court
procedure and will, if extended, effectively preclude
attaining that orderly procedure and uniformity of
practice which has been the goal of all the removal
acts and which was thought to be achieved by the
present statute, 28 U.S.C.A. § 1441. To do so would
make the removability of an action into the federal
court dependent upon the practice with respect to
counterclaims in use in the particular state wherein
the federal court happened to be sitting ...