American Surety Co. v. Ritchie , 191 S.W.2d 137 ( 1945 )

On Appellee's Motion for Rehearing. In his motion for rehearing appellee argues that this cause did not become removable at any time while it was pending in the court below. He says the jurisdiction of the trial court must be determined solely by the amount which his petition put in controversy at the time when the suit was instituted and that such jurisdiction, having once attached, could not be affected by a delay in the trial resulting in additional damages or interest thereafter accruing on his original demand. He further contends that the suit could not have been instituted originally in the federal court because the value of the recovery then sought did not come within the federal jurisdiction and that the amount in controversy for removal purposes must be determined throughout the course of the litigation by the facts as they existed at the time when the action was commenced

Under the Texas law if the amount demanded, including interest as damages, is within the original jurisdiction of a trial court at the time when the action is brought, the fact that interest accruing thereafter increases the amount to more than the jurisdictional limit will not defeat the right of the court to enter a judgment within its jurisdictional limit. Ft. Worth D.C. Ry. Co. v. Underwood,100 Tex. 284, 99 S.W. 92, 123 Am. St. Rep. 806. However, we are not here dealing with the original or continuing potential jurisdiction of the court below within the meaning of the Constitution and laws of Texas; on the contrary, we must consider primarily the potential jurisdiction of the federal courts within the meaning of the removal statutes as enacted by the Congress of the United States.

We recognize the general rule that where the asserted right of removal is grounded upon the existence of a federal question the cause does not become removable unless it could have been brought originally in the federal court. Madisonville Traction Co. v. St. Bernard Mining Co.,196 U.S. 239, 25 S. Ct. 251, 49 L. Ed. 462; Minnesota v. Northern Securities Co., 194 U.S. 48, 24 S. Ct. 598, 48 L. Ed. 870; Tennessee v. Union and Planters Bank, 152 U.S. 454, 14 S. Ct. 654, 38 L. Ed. 511. But the asserted right of removal in this cause is not based upon any federal question involving the merits of the action.

We also recognize the established rule under the federal decisions that when the right of removal is grounded upon diversity of citizenship and the amount in controversy, as in the instant case, the cause does not become removable unless such diversity existed at the time when the suit was brought. Mattingly v. Northwestern Virginia R. Co., 158 U.S. 53, 15 S. Ct. 725, 39 L. Ed. 894; Kellam v. Keith, 144 U.S. 568, 12 S. Ct. 922, 36 L. Ed. 544; Stevens v. Nichols, 130 U.S. 230, 9 S. Ct. 518, 32 L. Ed. 914. But there is a divergence of opinion as to whether this rule also applies to the amount in controversy. The Supreme Court of the State of Wisconsin has held that the jurisdictional facts which will authorize removal under the federal statutes must exist at the time of the commencement of the action. See: Egan v. Preferred Accident Ins. Co. of N. Y., 223 Wis. 129,269 N.W. 667, 107 A.L.R. 1107, and cases there cited. On the other hand, in a subsequent opinion handed down on July 26, 1944, by one of the federal courts in the case of Sink v. Mutual Life Ins. Co. of N. Y., D.C.56 F. Supp. 306, 307, it is said: "Despite the contrary view expressed in Egan v. Preferred Accident Ins. Co. of N. Y., 223 Wis. 129,269 N.W. 667, 107 A.L.R. 1107, it would appear more reasonable to apply the test at the time removal is asked. It is then that federal court jurisdiction is invoked. Whether the requisite amount was present or lacking before that time can be of no consequence."

But, regardless of the conflicting views expressed in the cases referred to above, we see no valid reason why this cause could not have been instituted originally in the federal court. There has been no change in the nature or extent of the injuries sustained by appellee since his action was begun. The facts set forth in his petition would have warranted an unequivocal demand of $3,000.01 for benefits to accrue from 150 weeks of total incapacity equally as well as they warranted a demand of $2,999.99 for 149 weeks of total incapacity. The damages claimed were not liquidated or mathematically ascertainable until the extent and duration of his incapacity could be determined. Even though he could not determine the full extent of his disability at the time his action was brought, he nevertheless served notice in his petition that he would rely upon whatever injuries and damages the competent testimony at the trial might show he had suffered.

Appellee challenges the correctness of the statement in our original opinion to the effect that he introduced evidence upon the trial "which tended to show that he was totally and permanently incapacitated to labor." We did not undertake to set forth the evidence to which we referred and we shall not do so now, because any such attempt on our part would require a summary of all the direct testimony adduced by appellee. Although the ultimate facts found by the jury are immaterial on the question of jurisdiction, we think the competent evidence introduced by appellee was sufficient to support the findings which the jury made in this case to the effect that appellee's injuries would result in 149 weeks of total incapacity and 149 additional weeks of partial incapacity.

It is evident to us that appellee attempted by the averments and prayer in his petition to accomplish two legal results which in the course of the litigation became wholly inconsistent, viz: (1) to prevent the cause from being or becoming removable into the federal court; and (2) to preserve his right to demand all the benefits to which his evidence might show he was legally entitled under the terms of the Texas Workmen's Compensation Act. Vernon's Ann.Civ.St. art. 8306 et seq. By voluntarily continuing in the pursuit of the latter result until a proper petition and bond for removal had been timely filed, it appears to us that he has necessarily failed to fully accomplish the former intended result. Although the question is not free from difficulty, we have again concluded that the disposition which we originally made of the cause is correct, and therefore appellee's motion for rehearing is overruled.