Recarte et al v. State Farm Fire and Casualty Company
Filing
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OPINION AND ORDER: The Court DENIES the Motion for Remand 17 . Signed by Judge Joseph S Van Bokkelen on 5/8/2024. (ash)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION AT LAFAYETTE
FERMIN RECARTE and DENISE RECARTE, )
Plaintiffs,
)
)
v.
)
)
STATE FARM FIRE AND CASUALTY
)
COMPANY,
)
Defendant.
)
CAUSE NO.: 4:24-CV-7-JVB-JEM
OPINION AND ORDER
This matter is before the Court on a Motion for Remand [DE 17] filed by Plaintiffs Fermin
and Denise Recarte on February 16, 2024. Defendant State Farm Fire and Casualty Company
responded on February 29 2024, and the Recartes replied on March 7, 2024. For the reasons below,
the Court denies the motion.
The Recartes initiated this lawsuit by filing a complaint in the Tippecanoe County Superior
Court on January 3, 2024. On January 19, State Farm removed the case to federal court on the
basis of the parties’ diversity of citizenship. As alleged in the complaint, the Recartes had insured
their dwelling through an insurance policy issued by State Farm and, after the dwelling sustained
damage, the Recartes invoked their policy’s appraisal clause. State Farm did not nominate an
appraiser, and the Recartes seek the appointment of an umpire through their cause of action. The
Recartes argue that removal was improper, and State Farm contends that removal was permitted.
The parties agree that the insurance policy at issue includes the following clause: “you or
we may make a written application for a judge of a court of record in the same state and county
(or city if the city is not within a county) where the residence premises is located to select an
umpire.” (Pls.’ Ex. 1 at 33, ECF No. 18-1 (emphasis removed for readability)). The dwelling at
issue is in Tippecanoe County, Indiana.
The parties focus on different words in the above-quoted clause in arguing that their
position is correct. The Recartes maintain that the Northern District of Indiana, Hammond Division
at Lafayette (with a federal courthouse in Lafayette, Indiana), is not “a court of record in”
Tippecanoe County. State Farm insists that the “may” language of the clause is permissive and not
mandatory.
Both parties use Indiana law in supporting their positions, so the Court finds that, with no
choice of law dispute raised and the parties in agreement, Indiana law applies to this dispute. The
interpretation of contracts under Indiana law begins with “the plain language of the contract,
reading it in context, and, whenever possible, construing it so as to render each word, phrase, and
term meaningful, unambiguous, and harmonious with the whole.” Med. Protective Co. of Fort
Wayne, Indiana v. Am. Int'l Specialty Lines Ins. Co., 990 F.3d 1003, 1008 (7th Cir. 2021) (quoting
Citimortgage, Inc. v. Barabas, 975 N.E.2d 805, 813 (Ind. 2012)).
The Recartes argue that the policy’s clause is a forum-selection clause that mandates
litigation in a court of record in Tippecanoe County.
A mandatory forum-selection clause is one that contains clear language showing
that jurisdiction is appropriate only in the designated forum. Clauses that do not
contain mandatory language are only permissive and not enforceable. The law is
clear: where venue is specified with mandatory or obligatory language, the clause
will be enforced; where only jurisdiction is specified, the clause will generally not
be enforced unless there is some further language indicating the parties’ intent to
make venue exclusive.
Heckler & Koch, Inc. v. German Sport Guns GmbH, 71 F. Supp. 3d 866, 900 (S.D. Ind. 2014)
(using Indiana law to interpret a contract) (citations and quotation marks omitted).
The Court assumes, for the moment, that the Recartes are correct that the Northern District
of Indiana, Hammond Division at Lafayette, is not a court of record in Tippecanoe County. Even
so, the clause provides that the parties “may” file suit in such a court for the appointment of an
umpire. The word “may,” by its plain meaning, is a word of permission. Thus, the clause in
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question permits the Recartes to file in a court of record in Tippecanoe County. It does not,
however, require it. The parties could have expressed a requirement of filing in a court of record
in Tippecanoe County by clarifying that that court was the exclusive venue in which the request
for appointment of an umpire could be lodged. They did not. The Court cannot read an exclusivity
element that is not there into the clause. The clause permitted the Recartes to file in Tippecanoe
County Superior Court, and they did so. Equally, the clause does not prohibit State Farm’s removal
of the case to federal court, so the Court will not remand this matter.
CONCLUSION
Based on the above, the Court hereby DENIES the Motion for Remand [DE 17].
SO ORDERED on May 8, 2024.
s/ Joseph S. Van Bokkelen
JOSEPH S. VAN BOKKELEN, JUDGE
UNITED STATES DISTRICT COURT
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