Taing v. State Farm Life Insurance Company
ORDER AND REASONS REMANDING CASE TO STATE COURT. Signed by Judge Ivan L.R. Lemelle on 12/5/2016. (Attachments: # 1 Transfer Letter)(cg)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
SUCCESSION OF SALVADOR
J. CEPRIANO, III
SUCCESSION OF JENNY
c/W No. 16-14220
STATE FARM LIFE
ORDER AND REASONS
Before the court is Salvador J. Cepriano, III’s “Motion to
Remand” (Rec. Doc. 9) and State Farm Life Insurance Company’s
opposition thereto. (Rec. Doc. 14). IT IS ORDERED that the motion
Jenny Taing and her four-year old son, Salvador J. Cepriano,
III were involved in a fatal motor vehicle accident. (Rec. Doc.
9). Taing died instantly and Cepriano III died a short time after
the accident. (Rec. Doc. 9). Both died intestate, but State Farm
Life Insurance Company (“State Farm”) insured Cepriano III’s life
for $50,000. (Rec. Doc. 9). Taing was the owner and beneficiary of
the policy. (Rec. Doc. 9). The policy provided that should all
owners or beneficiaries of the policy die, proceeds would be paid
to the estate of the last owner or beneficiary to die. (Rec. Doc.
9). After the accident, Taing’s parents, Phan and Tal Plork, filed
a claim with State Farm and received payments of $25,142.32 each.
(Rec. Doc. 9). Cepriano III’s father, Salvador J. Cepriano II,
attempted to contest the payments with State Farm and eventually
opened the successions of Taing and Cepriano III in state court.
(Rec. Doc. 9). The state court determined that Cepriano II was
survived Taing in the accident and Cepriano II was the sole heir
of Cepriano III. (Rec. Doc. 9). A judgement put Cepriano II in
possession of the proceeds of the State Farm policy. (Rec. Doc.
9). The insurance proceeds were expressly part of the “Judgement
in Possession” and any distinction between in personam and in rem
jurisdiction over the claim for insurance proceeds is illusory.
Proceeds from a life insurance policy are considered movable
considered the res.
There was no appeal and the judgement became final. (Rec.
Doc. 9). These actions were consolidated and State Farm was named
as a party to the succession in a “Motion for Insurance Proceeds,
Damages, Court Costs, Attorneys Fees, and Bad Faith Damages.” (Rec.
Doc. 1-1). State Farm removed the action from the 25th Judicial
District for the Parish of Plaquemines to this court on the basis
of diversity jurisdiction. (Rec. Doc. 9).
State Farm contends that it is not in possession of the res.
(Rec. Doc. 14). Additionally, State Farm characterizes Cepriano
II’s claims as in personam and thus outside the probate exception
because they include claims for bad faith damages, interest, and
attorneys’ fees. (Rec. Doc. 14).
A district court must remand a case to state court if “at any
time before final judgement it appears that the district court
lacks subject matter jurisdiction.” 28 U.S.C. 1447(c); Preston v.
Tenet Healthsys. Mem’l Med. Ctr., Inc., 485 F.3d 804, 813 n.3 (5th
Cir. 2007). The burden of establishing that federal jurisdiction
exists in a case “rests on the party seeking the federal forum.”
Howery v. Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001).
The removal statute is to be strictly construed. Gasch v. Hartford
Accident & Indem. Co., 491 F.3d 278, 281 (5th Cir. 2007). Any
“doubts regarding whether removal jurisdiction is proper should be
resolved against federal jurisdiction.” Acuna v. Brown & Root Inc.,
200 F.3d 335, 339 (5th Cir. 2000). In order to determine whether
jurisdiction is present, a court must “consider the claims in the
state court petition as they existed at the time of removal.”
Maguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th
A federal court “has no jurisdiction to probate a will or
administer an estate.” Markham v. Allen, 326 U.S. 490, 494 (1946).
Further, federal courts are precluded “from endeavoring to dispose
of property that is in the custody of a state probate court.”
Marshall v. Marshall, 547 U.S. 293, 311 (2006). The Fifth Circuit
has fashioned a two-step inquiry to determine whether the probate
exception applies: (1) whether the property in dispute is estate
property within the custody of the probate court and (2) whether
the plaintiff’s claims would require the federal court to assume
in rem jurisdiction over that property. Curtis v. Brunsting, 704
F.3d 406, 409 (5th Cir. 2013). If the answer to both inquiries is
“yes,” then the probate exception precludes the federal district
court from exercising jurisdiction. Id. In Marshall v. Marshall¸
the Court reasoned that when claims do not seek the probate or
annulment of a will or seek to reach a res in custody of a state
exception. 547 U.S. 293 at 297. Similarly, the Fifth Circuit has
stated that courts are to consider whether the claim “implicates
the validity of the probate proceedings or whether the plaintiff
is merely seeking adjudication of a claim between parties.” Breaux
v. Dilsaver, 254 F.3d 533, 536 (5th Cir. 2001).
Here, the state court issued a “Judgement of Possession”
giving Cepriano II “proceeds of the State Farm Life Insurance
Policy.” (Rec. Doc. 9-4). Cepriano has pled against State Farm a
claim for those same proceeds in addition to claims for damages
and attorneys’ fees. (Rec. Doc. 1-1). State Farm has made no
transformed the issue of insurance proceeds from in rem to in
personam. Providing relief to Plaintiff’s claims would require
this court to exercise in rem jurisdiction over property in the
custody of the state court. Furthermore, the state probate court
is in a better position than this court to interpret and enforce
compliance with its judgement. Thus, the probate exception is
New Orleans, Louisiana, this 5th day of December, 2016.
SENIOR UNITED STATES DISTRICT JUDGE
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