The Doris W. Ray Irrevocable Trust et al v. Ray

Filing 36

MEMORANDUM-DECISION AND ORDERS: It is hereby ORDERED that Petitioners' motion to remand (Dkt. No. 17) is GRANTED; and the Court further ORDERS that the Clerk of the Court shall remand this case to Herkimer Town Court; and the Court further ORDER S that the Clerk of the Court shall close this case upon transfer to Herkimer Town Court; and the Court further ORDERS that Respondent's motions to stay ( Dkt. Nos. 24 and 33) are DENIED; and the Court further ORDERS that Respondent's reque st for sanctions (Dkt. No. 28) is DENIED; and the Court further ORDERS that the Clerk of the Court shall serve a copy of this Memorandum-Decision and Order on all parties in accordance with the Local Rules. Signed by U.S. District Judge Mae A. D'Agostino on 2/2/18. (Copy served via regular mail)(ban)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
____________________________________________
THE DORIS W. RAY IRREVOCABLE
TRUST, and DORIS W. RAY,

Petitioners,
vs.

6:17-cv-763
(MAD/TWD)

MICHAEL RAY,
Respondent.
____________________________________________
APPEARANCES:

OF COUNSEL:

MACKENZIE HUGHES LLP
Mackenzie Hughes Tower
440 South Warren Street - Suite 400
Syracuse, New York 13202-4967
Attorney for Petitioners

JOHN J. SIEROTNIK, ESQ.

MICHAEL RAY
505 N. Kings Highway, #100
Post Office Box 100
Myrtle Beach, South Carolina 29578-0100
Respondent, pro se
Mae A. D'Agostino, U.S. District Judge:
MEMORANDUM-DECISION AND ORDER
I. INTRODUCTION
On July 11, 2017, Petitioners filed a verified petition to recover possession of real
property in Town Court in Herkimer, New York. See Dkt. No. 2 at 3. On July 13, 2017,
Respondent removed the Petition to the Northern District of New York pursuant to 28 U.S.C. §
1332. See Dkt. No. 1 at 1.
Currently before the Court are Petitioners' motion to remand, Dkt. No. 17, Respondent's
motion to stay and supplemental motion to stay, Dkt. Nos. 24 and 33, and Respondent's request

for sanctions, Dkt. No. 28. For the following reasons, Petitioners' motion is granted and
Respondent's motions and request are denied.
II. BACKGROUND
When her husband passed in 2006, Petitioner Doris W. Ray ("Doris Ray") gained title in
fee simple to the house at 200 Carney Avenue in Herkimer, New York (the "Property"). See Dkt.
No. 17-2 at ¶¶ 3-4. Shortly after, Doris Ray granted herself a life estate in the Property and
transferred the remainder to her two sons, Scott Ray and William W. Ray, as joint tenants with a
right of survivorship. See id. at ¶ 5. On January 4, 2014, Scott Ray passed away. See id. at ¶ 6.
Shortly after, on May 21, 2014, Doris Ray created The Doris W. Ray Irrevocable Trust (the
"Trust") for the purpose of managing her assets for her benefit. See Dkt. No. 17-5 at 6; Dkt. No.
17-7 at 1. She appointed William Ray and Respondent pro se Michael Ray ("Respondent") as
trustees. See Dkt. No. 17-5 at 6. The same day, Doris Ray gave up her life estate in the Property
and William Ray transferred his title in fee simple into the Trust. See Dkt. No. 17-2 at ¶ 8. The
Trust granted Respondent a license to occupy the Property along with Doris Ray. See Dkt. No.
17-2 at ¶ 11. While it is unclear from the record whether Respondent actually resides in the
Property, Respondent's possessions, which he claims are worth in the tens of thousands of dollars,
have not been removed. See id. at ¶ 16; Dkt. No. 21 at ¶ 3.
In late 2016, the relationship between Doris Ray and Respondent soured. On November
1, 2016, Respondent was removed as a trustee from the Trust. See Dkt. No. 17-7 at 1. Soon after,
on November 7, 2016, Doris Ray sought a protective order against Respondent in New York State
Family Court against Respondent. Dkt. No. 27-1 at 1-2. While the court granted her temporary
relief, Doris Ray never served the order on Respondent and it expired after she failed to appear in
court to support her request. See Dkt. No. 27 at ¶ 10. On June 5, 2017, Petitioners gave
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Respondent a ten-day notice that Respondent's license had been terminated and that Respondent
was required to vacate the premises. See Dkt. No. 17-2 at 13. Respondent did not completely
vacate the premises and on July 11, 2017, Petitioners filed a verified petition to recover
possession of real property (the "Petition") in the Herkimer Town Court in against Respondent in
order to evict him from Doris Ray's home. See Dkt. No. 2 at 3.
On July 13, 2017, Respondent removed the Petition to the Northern District of New York
pursuant to 28 U.S.C. § 1332. See Dkt. No. 1 at 1. Respondent claimed that he was domiciled in
South Carolina and submitted a South Carolina driver's license issued in 2009; a South Carolina
voter card issued in 2011; a South Carolina vehicle registration dated June 15, 2017; a South
Carolina car insurance tag that expires in May 2018; and a South Carolina wallet identification
card that expires in 2021 to support this assertion. See id. at 17. Respondent claimed that the
amount in controversy in this action was "in excess of $75,000.00[,] as it deals with the
ownership and or proportional ownership interest in a parcel of real estate currently appraised" at
approximately $80,000. Id. at 2; see id. at 20. On July 20, 2017, Respondent requested six
unnamed subpoenas on non-party witnesses by filing six blank subpoena forms. See Dkt. No. 9.
On July 25, 2017, Magistrate Judge Dancks denied the subpoenas without prejudice in a text
order on the grounds that the forms were blank. See Dkt. No. 14.
On August 7, 2017, Petitioners filed a motion to remand pursuant to 28 U.S.C. § 1447.
See Dkt. No. 17 at 1. On September 5, 2017, Respondent requested a 30-day extension to file his
response to the motion to remand. See Dkt. No. 23. The same day, Respondent filed a motion to
stay the motion to remand in order to conduct limited discovery. See Dkt. No. 24 at ¶ 2.
Respondent claimed that in order "to properly prepare his opposition to the Motion to Remand, he
[would] need to subpoena certain documents from the treating physician of Doris Ray, her estate
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planning attorney, the attorney who handled the estate of Scott K. Ray, and the Herkimer County
Department of Social Services." Id. at ¶ 4. Petitioners objected to these discovery requests
noting that the requested information was irrelevant to the jurisdictional question before the
Court. See Dkt. No. 27 at ¶¶ 4-7. Petitioners noted that in November 2016, Doris Ray obtained a
temporary order of protection against Respondent from the Herkimer County Family Court,
although it expired and was never served on Respondent. See id. at ¶ 10. Petitioners argued that
the need for this protective order was evidence that Respondent's discovery requests were being
made in bad faith. See id.
On September 11, 2017, Respondent filed a motion to sanction Petitioner's counsel for
knowingly submitting false information to the Court. See Dkt. No. 28 at ¶¶ 8, 10. Respondent
claimed that the order was vacated after Doris Ray failed to appear at a hearing to prosecute the
protective order and that it was referenced in an attempt to "puff" Petitioners' position. See id. at
¶¶ 6, 8. Petitioners denied that any statements regarding the protective order were false. See Dkt.
No. 29. Respondent replied stating that characterizing the protective order as having "expired"
was a false statement as the order never went into effect. See Dkt. No. 30 at 1. On October 6,
2017, Respondent filed a supplemental motion to stay the motion to remand. See Dkt. No. 33.
III. DISCUSSION
A.

Review of Pro Se Submissions
"[I]n a pro se case, the court must view the submissions by a more lenient standard than

that accorded to 'formal pleadings drafted by lawyers.'" Govan v. Campbell, 289 F. Supp. 2d 289,
295 (N.D.N.Y. 2007) (quoting Haines v. Kerner, 404 U.S. 519, 520, 92 S. Ct. 594, 30 L. Ed. 2d
652 (1972)) (other citations omitted). The Second Circuit has opined that the court is obligated to
"make reasonable allowances to protect pro se litigants" from inadvertently forfeiting legal rights
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merely because they lack a legal education. Govan v. Campbell, 289 F. Supp. 2d 289, 295
(N.D.N.Y. 2007) (quoting Traguth v. Zuck, 710 F.2d 90, 95 (2d Cir. 1983)).
B.

Subject Matter Jurisdiction
Federal district courts are courts of limited jurisdiction. Under 28 U.S.C. § 1332(a), a

federal court has jurisdiction over the subject matter of a civil action where the amount in
controversy exceeds the sum or value of $75,000, exclusive of interests and costs, and is between
citizens of different states. See 28 U.S.C. § 1332(a). "The 'party invoking the jurisdiction of the
federal court has the burden of proving that it appears to a reasonable probability that the claim is
in excess of the statutory jurisdictional amount.'" Pollock v. Trustmark Ins. Co., 367 F. Supp. 2d
293, 296 (E.D.N.Y. 2005) (quoting Scherer v. The Equitable Life Assurance Soc'y of the U.S., 347
F.3d 394, 398 (2d Cir. 2003)).
A respondent may remove to federal court "'any civil action brought in a State court of
which the district courts of the United States have original jurisdiction.'" Shapiro v. Logistec USA
Inc., 412 F.3d 307, 309-10 (2d Cir. 2005) (quoting 28 U.S.C. § 1441(a)). However, once a case
has been removed, it must be remanded "'[i]f at any time before final judgment it appears that the
district court lacks subject matter jurisdiction.'" Id. at 310 (quoting 28 U.S.C. § 1447(c)). Where,
as here, jurisdiction is asserted by a respondent in a removal petition, the respondent bears the
burden of establishing that removal is proper. See Cal. Pub. Employees' Ret. Sys. v. WorldCom,
Inc., 368 F.3d 86, 100 (2d Cir. 2004) (citations omitted). If there are any doubts as to
removability, they are resolved against removability "out of respect for the limited jurisdiction of
the federal courts and the rights of the states." In re Methyl Tertiary Butyl Ether ("MTBE")
Prods. Liab. Litig., 488 F.3d 112, 124 (2d Cir. 2007) (citation omitted). Although there is a
presumption that the court has jurisdiction when the matter is brought in federal court in the first
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instance, a respondent "removing a case to federal court encounters instead the general principle
that removal is disfavored and remand favored." Pollock, 367 F. Supp. 2d at 296-97 (citation
omitted).
1. Amount in Controversy
"The Court resolves whether to remand after removal by referring to the complaint at the
time the petition for removal is filed." In re 17,325 Liters of Liquor, 918 F. Supp. 51, 54
(N.D.N.Y. 1996) (citing Rosenberg v. GWV Travel, Inc., 480 F. Supp. 95, 96 (S.D.N.Y. 1979)).
"[I]f, upon the face of the complaint, it is obvious that the suit cannot involve the necessary
amount, removal will be futile and remand will follow." St. Paul Mercury Indem. Co. v. Red Cab
Co., 303 U.S. 283, 292 (1938).
In an action seeking injunctive relief, the Second Circuit has held that
"the amount in controversy is measured by the value of the object of
the litigation." Hunt v. Washington State Apple Adver. Com'n, 432
U.S. 333, 347 . . . (1977). . . . "[T]he amount in controversy is
calculated from the [petitioner's] standpoint; the value of the suit's
intended benefit or the value of the right being protected or the
injury being averted constitutes the amount in controversy when
damages are not requested." Kheel v. Port of New York Auth., 457
F.2d 46, 49 (2d Cir.1972) (internal quotations omitted).
Correspondent Serv. Corp. v. First Equities Corp. of Fl., 442 F.3d 767, 769 (2d Cir. 2006).
When the petitioner's desired injunctive relief is eviction, courts determine the amount in
controversy based on the potential change in the petitioner's economic position. See MCC Mortg.
LP v. Office Depot, Inc., 685 F. Supp. 2d 939, 943-44 (D. Minn. 2010). In assessing this value,
courts look to the length of time remaining in the lease and the difference in value between the
rent received from the current tenant and the potential rent from a future tenant. A. Levet Prop.
P'ship. v. Bank One, N.A., No. 03 Civ. 1373, 2003 WL 21715010, *3 (E.D. La. July 21, 2003).

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Any additional income that would be earned after the expiration of the lease's term does not count
towards the amount in controversy. Cf. id.
Here, Respondent has attempted to establish the amount in controversy requirement by
asserting that the state court proceeding would resolve a title contest of a property valued in
excess of $75,000. However, under New York law, town and village courts are courts of limited
jurisdiction that do not have the authority to resolve questions of title. Porter v. Newton, 253
N.Y.S. 200, 201 (N.Y. Sup. Ct. 1931). The only issue before the town court was whether
Petitioners could evict Respondent, as any attempt to quiet the title would be outside of the town
court's jurisdiction. See id. Thus, the amount-in-controversy analysis is limited solely to the
economic effects of the eviction.
Respondent asserts that he currently stores tens of thousands of dollars worth of his
possessions in the home. Given that the legal title to these possessions is not being challenged,
their value is irrelevant to determining the amount in controversy. At most, Respondent would
have to pay to store his things. However, this cost only affects Respondent and has no effect on
Petitioners' economic situation. As the amount in controversy is based on the perspective of
Petitioners, Respondent's potential storage costs are immaterial to this analysis.
The only relevant issue that needs to be considered in determining the amount in
controversy is the value of the license itself. After careful consideration, the Court concludes that
the license's value is de minimus. Respondent only held a license to occupy, as opposed to a
lease. Thus, Petitioners had the right to end the license at will, and the length of time remaining
on the license is legally non-existent. Given that licenses can be revoked at will, any money
made by Respondent from leasing the property would be immaterial to determining the amount in
controversy.
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Respondent has challenged Petitioners' position by claiming he possesses an ownership
interest in the property and assigned himself a license for life. However, other than this naked
assertion, Respondent has failed to provide any evidence that establishes his counter narrative.
As Respondent bears the burden of demonstrating that the amount in controversy exceeds the
$75,000 threshold, this naked allegation is legally insufficient to satisfy the amount in controversy
requirement.
2. Jurisdiction Over New York Eviction Actions
Even if the amount in controversy was somehow satisfied, this Court would be unable to
exercise jurisdiction over the claim. "[A]bsent express authorization by statute, federal courts
cannot entertain summary proceedings." United Mutual Houses, L.P. v. Andujar, 230 F. Supp. 2d
349, 354 (S.D.N.Y. 2002). "[T]he requirements of the Federal Rules of Civil Procedure, which
ordinarily do not allow proceedings more summary than the full court trial provided at common
law, are inconsistent with the strict requirements of a statutory summary eviction proceeding in
New York." Wells Fargo Bank, N.A. v. Thomas, No. 15 Civ. 928, 2015 WL 5319725, *2-*3
(S.D.N.Y. Sept. 11, 2015) (citing Glen 6 Assocs., Inc. v. Dedj, 770 F. Supp. 225, 227-28
(S.D.N.Y. 1991); United Mutual Houses, 230 F. Supp. 2d at 354). This procedural chasm has
consistently led federal courts sitting in New York to remand summary eviction proceedings back
to New York courts. See id. (citing cases).
Not only are the summary procedures inconsistent with the Federal Rules of Civil
Procedure, but, as one court noted, "[i]f we accept removal of these cases to federal court, we will
not only overburden the federal system but will also completely emasculate the state structure for
dealing with such disputes. Principles of comity and federalism thus dictate that we abstain and

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this matter is remanded to the state system to effectuate the abstention." Glen 6 Assocs., 770 F.
Supp. at 229.
C.

Motion to Stay
Respondent has filed a motion for the Court to stay judgment in this proceeding. He has

argued that he would be able to establish jurisdiction if he were allowed to subpoena Doris Ray's
medical and estate planning documents, Scott K. Ray's estate planning documents, and
information possessed by the Herkimer County Department of Social Services. See Dkt. No. 24
at ¶ 4.
A party asserting jurisdiction is "permitted discovery of facts demonstrating jurisdiction,
at least where the facts are peculiarly within the knowledge of the opposing party." Kamen v. Am.
Tel. & Tel. Co., 791 F.2d 1006, 1011 (2d Cir. 1986). "But a district court does not abuse its
discretion if it denies jurisdictional discovery where a plaintiff 'failed to show how the
information [she] hoped to obtain from this discovery would bear on the critical issue' for
jurisdiction." Haber v. United States, 823 F.3d 746, 753 (2d Cir. 2016) (quoting Gualandi v.
Adams, 385 F.3d 236, 245 (2d Cir. 2004)).
Here, Respondent has failed to show how the information he hopes to obtain from
discovery would be relevant to establishing subject matter jurisdiction. However, even if
Respondent had articulated how he believed the information would be relevant to jurisdiction, the
Court would still deny the motion to stay. As previously discussed, the Court cannot conceive of
any additional facts that would aid Respondent's quest to satisfy the amount-in-controversy
requirement. Regardless, even if such facts existed, Respondent would still face the intrinsic
legal fact that this Court is not jurisdictionally competent to adjudicate a New York State eviction
proceeding. Therefore, Respondent's motion to stay is denied.
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D.

Sanctions
Finally, Respondent requests that the Court sanction Petitioners' counsel for, in his

opinion, falsely describing the 2016 protective order.
"The imposition of Rule 11 sanctions is discretionary and should be done with caution, see
Knipe v. Skinner, 19 F.3d 72, 78 (2d Cir. 1994), 'and all doubts should be resolved in favor of the
signing attorney.'" Bowman Import/Export, Ltd. v. F.J. Elsner & Co. N.A. Ltd., No. 02-civ-3436,
2003 WL 21543522, *1 (S.D.N.Y. July 9, 2003) (quoting K.M.B. Warehouse Distrib., Inc. v.
Walker Mfg. Co., 61 F.3d 123, 131 (2d Cir. 1995)).
The Court finds that there is little difference between stating that the temporary protective
order expired and that it was dismissed for lack of prosecution. As the determination of sanctions
is at the Court's discretion, the Court declines to issue sanctions against Petitioners' counsel.
IV. CONCLUSION
After carefully reviewing the entire record in this matter, the parties' submissions and the
applicable law, and for the above-stated reasons, the Court hereby
ORDERS that Petitioners' motion to remand (Dkt. No. 17) is GRANTED; and the Court
further
ORDERS that the Clerk of the Court shall remand this case to Herkimer Town Court; and
the Court further
ORDERS that the Clerk of the Court shall close this case upon transfer to Herkimer
Town Court; and the Court further
ORDERS that Respondent's motions to stay ( Dkt. Nos. 24 and 33) are DENIED; and the
Court further

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ORDERS that Respondent's request for sanctions (Dkt. No. 28) is DENIED; and the
Court further
ORDERS that the Clerk of the Court shall serve a copy of this Memorandum-Decision
and Order on all parties in accordance with the Local Rules.
IT IS SO ORDERED.
Dated: February 2, 2018
Albany, New York

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