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BOND v. DOIG

June 15, 1977

Jennie BOND, Dora Richters and Walter C. Richters, Executor of the Estate of Lydia Clara Hoppe, Deceased, Plaintiffs,
v.
William DOIG and William Barrington Talbot, Defendants. William DOIG, Third-Party Plaintiff, v. RELIANCE INSURANCE COMPANY, Wettlin Agency, Inc., and Cutter Division of Cargile, Third-Party Defendants



The opinion of the court was delivered by: BIUNNO

 Reliance Insurance Company (Reliance), the third-party defendant in an action in the Superior Court of New Jersey, removed the entire action here on grounds of diversity jurisdiction and admiralty/maritime jurisdiction. Plaintiffs moved to remand. In the discussion that follows, all facts recited are as alleged, or as represented at hearing, since none have been "tried" in any sense.

 Defendant Doig evidently owned a motor vessel which he moored at a dock on the New York side of Greenwood Lake; he evidently slept on the vessel, but owned real estate and had other connections with New Jersey. [Tr. 3/28/77, p. 23, 11. 1-3; p. 4, 1.7 to p. 9, 1.6].

 The vessel was a pleasure boat, some 28 feet long, said to carry 11 or 12 people. On the eventful day, plaintiffs and the decedent were in a group of members of the American Association of Retired Persons (AARP) who had gone to Greenwood Lake for the day. They were at luncheon, when Doig appeared and announced that he had a boat outside and would take passengers around the lake for $2. Some 20 or more accepted; the boat capsized and three suits followed in Superior Court of New Jersey [Tr. 3/28/77, p. 12, 1. 23 to p. 13, 1. 12; p. 23, 11. 1 to 17], these being consolidated there on August 12, 1976.

 Doig had a "Yacht Policy" on his vessel, issued by Reliance. With his answer, timely filed, he asserted a third-party complaint against Reliance for a declaratory judgment on the policy, as the company had declined to defend or had denied coverage or both. This posture was evidently grounded on a warranty by Doig that the vessel was to be used for private pleasure purposes "solely", and "shall not be hired or chartered" unless approved by Reliance, with endorsement.

 Following removal here, plaintiffs moved to remand. On the motion, it appears that plaintiffs are citizens of New Jersey. The citizenship of Doig is not clear; it is either New Jersey or New York. The citizenship of Reliance is at Philadelphia. No data appears about the citizenship of other parties.

 The first question is whether Reliance can remove the case here at all. Two decisions in this district have reached different conclusions; one rules that a third-party defendant can remove, and the other that he cannot. There appears to be no controlling decision by the Court of Appeals for the Third Circuit, and while other circuits are divided on the point, there appears not to be any controlling precedent by the Supreme Court.

 The second question is whether there is jurisdiction here on diversity grounds, or admiralty/maritime grounds, or both. The admiralty/maritime aspect is involved because the Reliance "Yacht Policy" is claimed to be a maritime contract.

 Removal of Third-Party Claims.

 The removal statute is 28 U.S.C. § 1441. It contains three paragraphs. The first, (a), merely allows removal of a state court suit by a defendant if the action is one of which the district court has original jurisdiction.

 The second, (b), deals with civil actions of which the district court has original jurisdiction, and which are founded on a claim or right arising under the Constitution, treaties or laws of the United States; these are removable without regard to citizenship or residence, while actions not in this class are removable only if none of the defendants in interest is a citizen of the State.

 The third, (c), allows an entire case to be removed when there is a separate and independent claim or cause of action which would be removable if sued upon alone, joined with one or more otherwise non-removable claims or causes of action; for this class, the district court may retain the whole case, or remand all matters not otherwise removable. *fn1"

 It is important to observe that this statute does not purport to deal with all possible situations, depending on how it is construed. This is for the reason that, while the original jurisdiction of the district courts is entirely statutory, there are various classes of cases for which that jurisdiction is exclusive, others for which it is concurrent with some state court, and still others for which state courts have no jurisdiction at all, either over the subject-matter or over the defendant.

 Absent a "removal" statute, if suit is filed in a state court that lacks jurisdiction, it has no course but to dismiss. Removal statutes, like transfer of causes acts, are generally enacted out of concern that to dismiss for lack of jurisdiction may amount to a dismissal on the merits without trial, at least in cases where the bar of the statute of limitations runs out before a new suit can be filed in a court that does have jurisdiction. *fn2"


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