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Gleicher v. Hartford Underwriters Insurance Co.

United States District Court, C.D. California

April 10, 2017

Alfreda Gleicher
v.
Hartford Underwriters Insurance Company, et al.

          Present: The Honorable Fernando M. Olguin, United States District Judge.

          CIVIL MINUTES - GENERAL

         Proceedings: (In Chambers) Order Remanding Action

         BACKGROUND

         On September 9, 2016, Alfreda Gleicher, as Trustee of the Williams Trust, dated November 6, 1991 (“plaintiff”) filed a Complaint in the Los Angeles County Superior Court against Hartford Underwriters Insurance Company (“Hartford”), Christian Julian Alexander (“Alexander”) and Audrey Angelica Cavencia (“Cavencia” and together with Alexander, “Individual Defendants”). (See Dkt. 1, Notice of Removal (“NOR”) at ¶ 1; Dkt. 1-1, Complaint; Dkt. 1-1, Amendment to Complaint (“Amendment”) at ECF 49). The Complaint asserts five claims for relief: (1) breach of contract; (2) breach of the implied covenant of good faith and fair dealing; (3) elder abuse; (4) negligence; and (5) negligent entrustment. (See Dkt. 1-1, Complaint at ¶¶ 55-100). The first three claims are asserted against Hartford, the fourth against Alexander, and the fifth claim against Cavencia. (See id.). Plaintiff alleges that Norma Williams (“Williams”), who was the trustor, and before her death, the trustee of the Williams Trust, dated November 6, 1991, purchased an insurance policy from Hartford that insured her property, located on Penmar Street in Los Angeles, California. (See id. at ¶ 8).

         On September 11, 2014, an automobile being driven at an unsafe speed by an intoxicated Alexander, “collided into the front of the Property in which [] Williams was residing and present, causing the destruction of a substantial portion of the Property and substantial damage to the remaining portions of the Property.” (Dkt. 1-1, Complaint at ¶ 13). The damage to the property was extensive. Among other things, the “house shifted on the foundation, became unlevel and unsafe and the heat was disconnected because the impact of the vehicle striking the house was so significant that it substantially disturbed the gas feed to the heater.” (Id. at ¶ 16). Asbestos was released into the air because the “original ducting was disturbed” and cracks appeared in walls and ceilings. (See id.). The damage rendered the home “unsafe to reside in.” (Id. at ¶ 18).

         Williams passed away on November 4, 2014, due to complications caused by “COPD which, on information and belief, were exacerbated by the manner in which Hartford mishandled the claim.” (Dkt. 1-1, Complaint at ¶ 22). Following Williams's death, Gleicher became successor trustee and pursued the claim with Hartford, which continued “its unreasonable claims handling practices.” (Id. at ¶ 23). According to plaintiff, although Williams timely reported the accident to Hartford, (see id. at ¶ 17), Hartford failed to address the extensive damage, and instead “took the position that it would pay only to repair localized damage.” (Id. at ¶¶ 19-20). Hartford also “acted unreasonably with respect to obvious damage.” (Id. at ¶ 21). For instance, as of the death of Williams, Hartford had made no effort to remove the debris that had been piled in front of the house; did not put up a proper vapor barrier and instead “caused a sheet of plywood to be installed over the front of the house that allowed light and air into the house, [even though] Hartford knew the house was inhabited by an elder who had no heat and who was suffering from dementia and other ailments.” (Id.). Plaintiff alleges that “Hartford's adjuster mocked and made fun of [] Williams' mental condition when she described the conditions she was living in and questioned Hartford's adjustment of claims.” (Id.).

         On January 31, 2107, Hartford removed that action on diversity jurisdiction grounds pursuant to 28 U.S.C. §§ 1332 and 1441. (See Dkt. 1, NOR at ¶ 3). Plaintiff filed a Motion to Remand (Dkt. 11, “Motion”), which Hartford opposed by referring to its briefing on its pending motion to sever. (See Dkt. 17, Defendant Hartford Underwriters Insurance Company's Memorandum of Points and Authorities in Opposition to Plaintiff's Motion to Remand). Having reviewed the pleadings, the court hereby remands this action to state court for lack of subject matter jurisdiction. See 28 U.S.C. § 1447(c).

         LEGAL STANDARD

         “Federal courts are courts of limited jurisdiction. They possess only that power authorized by Constitution and statute[.]” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377, 114 S.Ct. 1673, 1675 (1994). The courts are presumed to lack jurisdiction unless the contrary appears affirmatively from the record. See DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 342 n. 3, 126 S.Ct. 1854, 1861 (2006). Federal courts have a duty to examine jurisdiction sua sponte before proceeding to the merits of a case, see Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583, 119 S.Ct. 1563, 1569 (1999), “even in the absence of a challenge from any party.” Arbaugh v. Y&H Corp., 546 U.S. 500, 501, 126 S.Ct. 1235, 1237 (2006).

         In general, “any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court[.]” 28 U.S.C. § 1441(a). A removing defendant bears the burden of establishing that removal is proper. See Gaus v. Miles, Inc., 980 F.2d 564, 566-67 (9th Cir. 1992) (“The strong presumption against removal jurisdiction means that the defendant always has the burden of establishing that removal is proper.”) (internal quotation marks omitted); Abrego Abrego v. The Dow Chem. Co., 443 F.3d 676, 684 (9th Cir. 2006) (per curiam) (noting the “longstanding, near-canonical rule that the burden on removal rests with the removing defendant”). Moreover, if there is any doubt regarding the existence of subject matter jurisdiction, the court must resolve those doubts in favor of remanding the action to state court. See Gaus, 980 F.2d at 566 (“Federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance.”). Indeed, “[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c); see Kelton Arms Condo. Owners Ass'n, Inc. v. Homestead Ins. Co., 346 F.3d 1190, 1192 (9th Cir. 2003) (“Subject matter jurisdiction may not be waived, and, indeed, we have held that the district court must remand if it lacks jurisdiction.”); Washington v. United Parcel Serv., Inc., 2009 WL 1519894, *1 (C.D. Cal. 2009) (a district court may remand an action where the court finds that it lacks subject matter jurisdiction either by motion or sua sponte).

         DISCUSSION

         I. SUBJECT MATTER JURISDICTION.

         Having reviewed the NOR and the briefing on the Motion, the court is persuaded that it lacks subject matter jurisdiction over the instant matter.[1] In other words, plaintiff could not have originally brought this action in federal court, as plaintiff does not competently allege facts supplying diversity jurisdiction. Therefore, removal was improper. See 28 U.S.C. § 1441(a); Caterpillar, Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 2429 (1987) (“Only state-court actions that originally could have been filed in federal court may be removed to federal court by the defendant.”) (footnote omitted).

         When federal subject matter jurisdiction is predicated on diversity of citizenship pursuant to 28 U.S.C. 1332(a), complete diversity must exist between the opposing parties. See Caterpillar Inc. v. Lewis, 519 U.S. 61, 68, 117 S.Ct. 467, 472 (1996) (stating that the diversity jurisdiction statute “applies only to cases in which the citizenship of each plaintiff is diverse from the citizenship of each defendant”). Here, plaintiff appears to be a citizen of California. (See Dkt. 1-1, Complaint at ¶ 1). Hartford has shown that it is a citizen of Connecticut. (See Dkt. 1, NOR at ¶ 5). However, the Individual Defendants appear to be citizens of California. (See Dkt. 1-1, Complaint at ¶¶ 4-5; Dkt. 1-1, Amendment; Dkt. 1, NOR at ¶ 7) (failing to challenge allegations that Individual Defendants are residents of California). Hartford contends, however, that the ...


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