United States District Court, D. South Carolina, Rock Hill Division
Clear Choice Construction, LLC and Piedmont Disaster Services L.L.C., Plaintiffs,
The Travelers Home and Marine Insurance Company, and XYZ Corporations 1 through 20, which are unknown entities affiliated with the Travelers band of insurers, Defendants.
OPINION AND ORDER
MARGARET B. SEYMOUR SENIOR UNITED STATES DISTRICT JUDGE.
Clear Choice Construction, LLC (hereinafter “Clear
Choice Construction”) and Piedmont Disaster Services,
L.L.C. (hereinafter collectively referred to as
“Plaintiffs”) filed a lawsuit against Defendants
The Travelers Home and Marine Insurance Company (hereinafter
“Travelers”) and XYZ Corporations 1 through 20,
which are unknown entities affiliated with the Travelers
brand of insurers (hereinafter collectively referred to as
“Defendants”), in the York County Court of Common
Pleas, South Carolina. Plaintiffs allege that Travelers
failed to pay a claim for covered losses arising out of
damage to a home in Rock Hill, South Carolina. Plaintiffs
assert causes of actions for a violation of S.C. Code. Ann.
§ 38-59-40, which provides for attorney's fees where
an insurer has refused to pay a claim; bad faith
administration of a claim; declaratory judgment entitlement
as to overhead, profits, ordinance, and law; and for tortious
interference of contractual relationships. ECF No. 1. On July
17, 2017, Defendant Travelers filed a notice of removal
pursuant to 28 U.S.C. § 1332 on the basis of diversity
of jurisdiction. Id. at 2-3. On August 18, 2017,
Plaintiffs filed a motion to remand, ECF No. 14, to which
Defendant Travelers filed an opposition on September 1, 2017.
ECF No. 17.
RELEVANT FACTS AND PROCEDURAL HISTORY
Travelers issued a policy of insurance, policy no.
0B1409983263628633 (hereinafter the “Policy”) to
Sean Seymour and Jamie Miller a/k/a Jamie Seymour
(hereinafter the “Insureds”) for property damage
and repair to their residence in Rock Hill, South Carolina
(hereinafter, the “Property”). ECF No 1-1 at 3.
On or about May 24, 2014, the Insureds suffered property
damage to the roof and gutters caused by a substantial wind
and hail storm. Id. The Insureds hired Plaintiff
Piedmont Disaster Services, L.L.C. to make the necessary
repairs on the property. ECF No. 1-1 at 4. Thereafter, the
Insureds assigned their rights to Ronald Pierce and/or
Piedmont Disaster Services, LLC. Id. Ronald Pierce
then assigned all of his rights to Plaintiff Clear Choice
the assignments, Plaintiffs filed a property damage claim
against Travelers for the repairs on the property.
Id. Plaintiffs contend an estimate in the amount of
$17, 101.82 was submitted to Travelers on numerous occasions.
ECF No. 1-1 at 4. To date, Plaintiffs indicate that $5,
917.73 has been paid by Travelers. Id. Plaintiffs
allege that repeated communications with Travelers have
failed along with multiple requests for arbitration. ECF No.
1-1 at 5.
16, 2017, Plaintiffs served the Summons and Complaint on
Travelers through the South Carolina Department of Insurance
pursuant to the provisions of S.C. Code Ann. §
38-5-70.ECF No. 1. The record does not reflect that
Defendants XYZ Corporations 1 through 20 have been served
with Plaintiffs' Summons and Complaint. On July 17, 2017,
Travelers filed an Answer that admitted to the roof and
gutter damage on the property. ECF No. 4 at 4. However,
Travelers denies that the “estimate accurately reflects
the appropriate quantities of materials necessary or the
repairs agreed to or required for the roof and
gutters.” ECF No. 4 at 4. On the same day, Travelers
also filed a notice of removal that indicated the parties are
completely diverse pursuant to 28 U.S.C. § 1332 and the
amount in controversy exceeds $75, 000. ECF No. 1 at 2-3.
August 18, 2017, Plaintiffs' filed a motion to remand.
ECF No. 14. Plaintiffs argue that Rule 11(a) of the South
Carolina Rules of Civil Procedure requires that Defendants
confer in good faith with Plaintiffs' counsel prior to
the filing of a “motion” such as a notice of
removal. Id. at 2. Plaintiffs further contend that
consultation with Plaintiffs' counsel would have been
beneficial to both parties and would have resolved the issue
regarding the amount in controversy, which was intended to be
capped at $74, 999.99. Id. at 3. As a result,
Plaintiffs allege that the failure to consult with
Plaintiffs' counsel has resulted in this matter being
unnecessarily removed to federal court. Id.
September 1, 2017, Travelers filed a response in opposition
to Plaintiffs' motion to remand. ECF No. 17. Travelers
argues that Plaintiffs' motion to remand should be denied
because: (1) it is untimely; (2) the South Carolina Rules of
Civil Procedure do not govern this Court; (3) even if the
South Carolina Rules of Civil Procedure applied, a notice of
removal is not a “motion, ” and (4) Plaintiffs
have not capped damages at $75, 000 or less. ECF No. 17 at 1.
Plaintiffs did not file a reply to Travelers' opposition.
matter is now before the court on the issue as to first,
whether diversity jurisdiction exists, and second, whether
Plaintiffs' motion to remand was timely filed.
Diversity of Jurisdiction
courts are courts of limited jurisdiction. Kokkonen v.
Guardian Life Ins. Co. of America, 511 U.S. 375, 377
(1994). A defendant is permitted to remove a case to federal
court if the court would have had original jurisdiction over
the matter. 28 U.S.C. § 1441(a). A federal court has
“original jurisdiction of all civil actions where the
matter in controversy exceeds the sum or the value of $75,
000 and is between citizens of different states.” 28
U.S.C. § 1332(a). In cases in which the district
court's jurisdiction is based on diversity of
citizenship, the burden of establishing federal jurisdiction
rests upon the party seeking removal. Strawn v. AT&T
Mobility LLC, 530 F.3d 293, 298 (4th Cir. 2008) (holding
that in removing cases based on diversity jurisdiction, the
party invoking federal jurisdiction must allege same in their
notice of removal and when challenged demonstrate basis for
jurisdiction); Mulcahey v. Columbia Organic Chem. Co.
Inc., 29 F.3d 148, 151 (4th Cir. 1994) (holding that the
burden is on the removing defendant to establish subject
matter jurisdiction). “Because courts are forums of
limited jurisdiction, any doubt as to whether a case belongs
in federal or state court should be resolved in favor of
state court.” Messex v. Quicken Loans, Inc.,
C/A No. 2:15-cv-04773-JMC, 2016 WL 3597597, at *2 (D.S.C.
July 5, 2016); See also Mulcahey, 29 F.3d at 151
(holding that “if federal jurisdiction is doubtful, a
remand is necessary”).
Fourth Circuit has not set forth a rule concerning the burden
of proof on the removing party in regard to establishing the
amount in controversy. Brailsford v. Fresenius Med. Ctr.
CNA Kidney Ctr. LLC, C/A No. 2:15-cv-04012-DCN, 2017 WL
1214337, at *1 (D.S.C. August 3, 2017) (citing Rota v.
Consol. Coal Co., C/A No. 98-1807, 1999 WL 183873 (4th
Cir. 1999) (declining to adopt any particular standard of
proof for determining amount in controversy)). However,
“courts within the District of South Carolina have
leaned towards requiring defendants in this position to show
either to a ‘legal certainty' or at least within a
‘reasonable probability' that the amount in
controversy has been satisfied.” Brailsford,
2017 WL 1214337 at *3. For example, when a Plaintiff has
alleged an indeterminable amount of damages and claims an
amount not to exceed $75, 000, the federal court must attempt
to ascertain the amount in controversy by a preponderance of
the evidence and consider Plaintiff's claims as alleged
in the complaint, the notice of removal filed with the court,
and other relevant materials in the record. Crosby v. CVS
Pharm., Inc., 409 F.Supp.2d 665, 667 (D.S.C. 2005).
“In fact, claims of punitive damages must be included
in the calculation of the amount in controversy.”
American Health and Life Ins. Co. v. Heyward, 272
F.Supp.2d 578, 581 (D.S.C. 2003). This District court has
also taken the same approach regarding consequential damages
and attorney's fees and costs. See Thompson v.
Victoria Fire & Cas. Ins. Co., 32 F.Supp.2d 847
(D.S.C. 1999) (holding that the amount in controversy exceeds
$75, 000 where complaint sought punitive damages,
consequential damages, and attorney's fees and costs
beyond the $25, 000 in actual damages claimed); Barker v.
Washington Nat'l. Ins. Co., C/A No.
9:12-cv-1901-PMD, 2013 WL 1767620, at *2 (D.S.C. April 24,
2013) (“[A]lthough not specifically alleged in the
complaint, the actual amount in controversy at the time of
removal appears to be at least $40, 000. However, because
[Plaintiff] seeks actual and punitive damages, attorney's
fees, and costs against [Defendants], the total amount in
controversy exceeds $75, 000.”).