Vela et al v. Household Finance Corporation III
Filing
7
MEMORANDUM OPINION and ORDER... Having considered the first amended notice of removal and the original state court petition of plaintiffs, Adam Vela and Rosalinda Vela, attached thereto, the court concludes that defendant has failed to sufficiently allege the required amount in controversy... this action is hereby remanded to the state court from which it was removed. See Order for further specifics. (Ordered by Judge John McBryde on 1/2/2013) (krg)
U.S. DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
FILED
IN THE UNITED STATES DISTRICT C
NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION
·-2 20!3
CLERK, U.S. DISTRICT COURT
. By _ _-n:=-:-----
ADAM VELA AND ROSALINDA VELA,
Plaintiffs,
Deputy
§
§
§
§
vs.
§
NO. 4:12-CV-898-A
§
HOUSEHOLD FINANCE
CORPORATION III,
§
§
Defendant.
§
§
MEMORANDUM OPINION
and
ORDER
Now before the court is the amended notice of removal filed
in the above-captioned action by defendant, Household Finance
Corporation III.
under 28 U.S.C.
Defendant has alleged diversity of citizenship
§
1332 as the sole basis for removal.
Having
considered the first amended notice of removal and the original
state court petition of plaintiffs, Adam Vela and Rosalinda Vela,
attached thereto, the court concludes that defendant has failed
to sufficiently allege the required amount in controversy, and
that the case should be remanded to the state court from which it
was removed.
I.
Background
Plaintiffs initiated this action by filing their original
petition against defendant in the District Court of Tarrant
County, Texas, 236th Judicial District, as Cause No. 236-26305812.
Defendant then removed the action to this court.
On
December 31, 2012, pursuant to this court's order, defendant
filed its first amended notice of removal.
Defendant alleges
that the court has subject matter jurisdiction because of
complete diversity of citizenship between plaintiffs and
defendant, and an amount in controversy exceeding the sum or
value of $75,000.00, exclusive of interest and costs.
U.S.C.
§
See 28
1332 (a).
In the prayer of their petition, plaintiffs do not state a
specific amount of damages.
Nor is there any other statement of
the amount of damages contained elsewhere in the petition.
However, defendant contends that in the context of foreclosure
proceedings, the proper measure of the amount in controversy is
the value of the subject property, which defendant asserts is
$97,400.00.
In support of its position, defendant cites to legal
authority standing for the proposition that "in a case where the
plaintiff sought to protect the peaceful possession of his home,
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'the proper measure of the amount in controversy is the value of
the property at issue.'" Am. Notice of Removal, at 1.
After having evaluated the pleadings, and after reviewing
applicable legal authorities, the court remains unpersuaded that
the
amo~nt
in controversy in this action meets or exceeds the
required amount.
II.
Basic Principles
The court begins with a statement of basic principles
announced by the Fifth Circuit:
Pursuant to 28 U.S.C.
§
144l(a), a defendant may remove to
federal court any state court action over which the federal
district court would have original jurisdiction.
"The removing
party bears the burden of showing that federal subject matter
jurisdiction exists and that removal was proper."
Prudential Prop. Cas. Ins. Co., 276 F.3d 720, 723
2001) .
Manguno v.
(5th Cir.
"Moreover, because the effect of removal is to deprive
the state court of an action properly before it, removal raises
significant federalism concerns, which mandate strict
construction of the removal statute."
Carpenter v. Wichita Falls
Indep. Sch. Dist., 44 F.3d 362, 365-66 (5th Cir. 1995)
omitted) .
(citation
Any doubts about whether removal jurisdiction is
proper must therefore be resolved against the exercise of federal
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jurisdiction.
Acuna v. Brown & Root Inc., 200 F.3d 335, 339 (5th
Cir. 2000).
To determine the amount in controversy for the purpose of
establishing diversity jurisdiction, the court ordinarily looks
to the plaintiff's state court petition.
723.
Manguno, 276 F.3d at
If it is not facially apparent from the petition that the
amount in controversy is greater than $75,000, the removing party
must set forth summary judgment-type evidence, either in the
notice of removal or in an affidavit, showing by a preponderance
of the evidence that the amount in controversy exceeds that
amount.
Id.; Allen v. R & H Oil & Gas Co., 63 F.3d 1326, 1335
(5th Cir. 1995).
The amount in controversy is measured from the perspective
of the plaintiff.
(5th Cir. 1958)
Vraney v. Cnty. of Pinellas, 250 F.2d 617, 618
(per curiam).
In an action for declaratory or
injunctive relief, the amount in controversy is the
object of the litigation," or
~the
~value
of the
value of the right to be
protected or the extent of the injury to be prevented."
Leininger v. Leininger, 705 F.2d 727, 729 (5th Cir. 1983).
III.
Analysis
Plaintiffs' petition does not make a demand for a specific
amount of damages, does not specify a dollar amount of recovery
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sought that is at least $75,000.00, and does not define with
specificity the value of the right it seeks to protect or the
extent of the injury it seeks to prevent.
As a result, the court
evaluates the true nature of plaintiffs' claims to determine the
amount actually in controversy between the parties.
The true nature of this action is to maintain possession of
residential property plaintiffs used as security for the making
of a loan.
As the petition alleges, plaintiffs pursue these
goals by seeking an order (1) barring any foreclosure or forcible
detainer proceedings, and (2) awarding unspecified damages and
attorney's fees.
Notice of Removal, Ex. A-2 at 13-14.
Thus,
considering plaintiffs' original petition, the court has not been
provided with any information from which it can determine that
the value to plaintiffs of such relief is greater than
$75,000.00.
Defendant contends that the fair-market value of the
property should serve as the amount in controversy because
plaintiffs request equitable relief to enjoin defendant from
foreclosing on the property.
Id. at 2-3
(citing Martinez v. BAC
Home Loans Servicing, 777 F. Supp.2d 1039 (W.D. Tex. 2010)).
Defendant relies on the oft-cited argument that when equitable
relief is sought, the amount in controversy is measured by the
value of the object of the litigation, and when a mortgagor is
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attempting to protect his property, the fair market value of the
property is the amount in controversy.
2-3.
Am. Notice of Removal at
In its amended notice of removal, defendant suggests that
the value of the property is approximately $97,400.00.
Id. at 4.
The court is not persuaded by the argument that the above
figure supplies the basis for plaintiffs' interest in the
property, especially given that plaintiffs have not pleaded how
much equity they have in the property.
Defendant does not cite
to, nor can the court discern, any such statement in the petition
to support a finding that the value of the property is the amount
in controversy.
That is, for example, defendant's attribution of
the $97,400.00 figure as damages is an act of its own doing--not
plaintiffs'.
To the extent that these statements suggest that
the property value is the proper measure of the amount in
controversy in this action, the court rejects that argument. 1
Plainly, the sole goal of plaintiffs' action is to avoid or
delay a foreclosure sale and to be able to retain possession of
the property.
Nothing is alleged that would assign a monetary
1
The court is familiar with the unpublished Fifth Circuit opinion, Nationstar Mortg. LLC v.
Knox, 351 F. App'x 844 (5th Cir. 2009). The pertinent portion ofNationstar, in tum, relies on Waller v.
Prof1lns. Corp., 296 F.2d 545, 547-48 (5th Cir. 1961). This court has previously explained its reasoning
for finding Waller inapposite to determining the amount in controversy in cases such as the instant
action. See Ballew v. America's Servicing Co., No. 4:11-CV-030-A, 2011 WL 880135 (N.D. Tex. Mar.
14, 2011).
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value to plaintiffs' accomplishment of those goals.
While
plaintiffs appear to request equitable relief based on a claim
that they are entitled to hold legal title in the property, they
do not assert that such relief is based on a claim that they have
outright ownership of the property, free from any indebtedness.
Indeed, plaintiffs make statements to suggest that his ownership
of the property is encumbered by a debt, as the petition
describes a note and deed of trust, questions whether defendant
is the rightful owner or holder of the note and deed of trust,
and states that plaintiffs were seeking loan modifications from
defendant.
Am. Notice of Removal, Ex. A-2, at 3-4.
The value to
plaintiffs of their rights in the litigation is, at most, the
value of their interest in the property, not the value of the
property itself.
Thus, defendant has not established the value
of plaintiffs' interest in the property.
Defendant has not proven by a preponderance of the evidence
that the amount actually in controversy in this action exceeds
the sum or value of $75,000.00, excluding interest and costs.
Consequently, the court is remanding the case to the state court
from which it was removed, because of the failure of defendant to
persuade the court that subject matter jurisdiction exists.
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IV.
Order
For the reasons given above,
The court ORDERS that the above-captioned action be, and is
hereby, remanded to
SIGNED January
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