The opinion of the court was delivered by: LANE
Baltic Conveyor, Inc., filed answer denying negligence. In addition, defendant has brought a third-party complaint against Standard Accident Insurance Company, a corporation chartered in Michigan. It claims that Standard Accident should defend the negligence suit, owing to the provisions of a policy defendant has taken out with Standard. The third-party defendant, disclaiming responsibility, maintains that the accident occurred under circumstances which exclude it from policy coverage.
The main claims and the third-party claim were originally filed in the Superior Court of New Jersey, Law Division, Camden County. Thereafter, third-party defendant removed the entire case to the United States District Court.
Plaintiff now moves by motion to have the main complaint removed to the state court. He wants the initial action in the state courts, because the 'original plaintiff's claim would not be removable if sued upon alone.'
Defendant-third party plaintiff appears to be unconcerned whether we retain jurisdiction or remand the entire action to the state courts. It is his desire, however, that either the federal or the state courts entertain jurisdiction over both controversies. Baltic expresses the view: 'It would seem to be more expeditious to resolve the entire controversy in one court rather than have part of the matter pending before the State court and part of the matter before the Federal court.'
The gist of the third-party defendant's argument advocating removal is that '* * * the third-party action concerning insurance coverage (relates to contract interpretation) * * * and is a separate and independent claim or controversy from the main (negligence) action * * *.' Whether this court should retain the entire case or just the third-party action is, the third-party defendant feels, a matter of discretion.
The issue thus before us is whether the introduction into a New Jersey state action of a third-party claim, which would have been removable if asserted in an independent action, affords the basis for removal by the third-party defendant?
We answer in the negative for the following reasons:
I FEDERAL LAW DETERMINES REMOVAL
Not state law but federal law determines when removal can occur. '* * * It is a question of the construction of the federal statute on removal, and not the state statute.' Chicago, R.I. & P.R. Co. v. Stude, 346 U.S. 574, 580, 74 S. Ct. 290, 98 L. Ed. 317 (1954).
II POLICY OF LIMITING FEDERAL JURISDICTION
It must be borne in mind that the acknowledged policy is non-sympathy to expanding federal jurisdiction. Cf. Trail v. Green, et al., 206 F.Supp. 896 (D.N.J., 1962).
As stated by the Supreme Court in Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 109, 61 S. Ct. 868, 85 L. Ed. 1214 (1941):
'Due regard for the rightful independence of state governments, which should actuate federal courts, requires that they scrupulously confine their own jurisdiction to the precise limits which the statute has defined.'
'The intent of Congress drastically to restrict federal jurisdiction in controversies between citizens of different states has always been ...