Dameron v. Deer

88 F.R.D. 577, 32 Fed. R. Serv. 2d 852, 1980 U.S. Dist. LEXIS 15556
CourtDistrict Court, N.D. Georgia
DecidedNovember 10, 1980
DocketCiv. A. No. C80-1017A
StatusPublished
Cited by3 cases

This text of 88 F.R.D. 577 (Dameron v. Deer) is published on Counsel Stack Legal Research, covering District Court, N.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dameron v. Deer, 88 F.R.D. 577, 32 Fed. R. Serv. 2d 852, 1980 U.S. Dist. LEXIS 15556 (N.D. Ga. 1980).

Opinion

ORDER

MOYE, Chief Judge.

This case involves the ownership of three condominium units located in Colony House West Condominiums in Atlanta, Georgia. On October 22, 1979, the plaintiff executed two warranty deeds conveying units 1203 and 1205 in said condominiums to the defendant and granted defendant a deed to secure debt in unit 804. On May 1, 1980, plaintiff filed suit in the Superior Court of Fulton County, Georgia, alleging that the defendant secured the plaintiff’s execution of the warranty deeds and the deed to secure debt “through acts of fraud, undue influence, and duress.” The plaintiff sought to have the deeds cancelled and declared null and void. The plaintiff filed notices of lis pendens with respect to units 1203 and 1205, at or about the same time as the filing of the lawsuit.

On May 8, 1980, defendant sold unit 1203 to Mr. Leander W. Smith, delivering Mr. Smith a warranty deed. Mr. Smith was fully aware of the pendency of this lawsuit at the time he purchased unit 1203 and has acquired a title insurance policy on the unit up to the full purchase price of the unit.

On June 13, 1980, the defendant, an Indiana resident, removed this lawsuit to this Court pursuant to 28 U.S.C. § 1441, et seq. on the basis of the diversity of the parties, and on August 14, 1980, plaintiff moved to remand to Fulton Superior Court pursuant to 28 U.S.C. § 1447(c).

The basis for plaintiff’s remand petition is that (1) complete relief cannot be afforded among plaintiff and defendant in the present case in the absence of Mr. Smith as a party defendant because Mr. Smith claims an interest relating to the subject matter of this action and is so situated that disposition of this action in his absence may impede Mr. Smith’s ability to protect that interest, and (2) if Mr. Smith is added as a defendant, complete diversity would no longer exist between the plaintiff and defendants, depriving this Court of subject matter jurisdiction.

The Court agrees with the plaintiff that if Mr. Smith is an indispensable party to this action this Court should not allow this case to continue before it since the addition of Mr. Smith, a Georgia resident, as a party defendant would destroy complete diversity due to the fact that the plaintiff is also a Georgia resident. In re Merrimack Mutual Fire Ins. Co., 587 F.2d 642, 646 (5th Cir. 1978). The issue, therefore, is whether Fed. R.Civ.P. 19 makes Mr. Smith an indispensable party.

Although the thrust of the plaintiff’s brief in support of his motion to remand is that Mr. Smith should be joined pursuant to Rule 19(a), the Court finds Rule 19(a) inapplicable to this case. Rule 19(a) provides conditions under which a person should be joined as a party if that person’s joinder “will not deprive the court of jurisdiction over the subject matter of the action.” It is clear that the joinder of Mr. Smith would deprive the Court of subject matter jurisdiction because it would defeat complete diversity. Therefore, by its own terms, Rule 19(a) is inapplicable.

Rule 19(b) is to be applied if a person as described in subdivision (a)(l)-(2) of Rule 19 cannot be made a party. The Court will assume without deciding that Mr. Smith is a person as described in Rule 19(a)(l)-(2) and proceed to determine whether Rule 19(b) requires dismissal of this action if Mr. Smith is indeed a Rule 19(a)(l)-(2) person.1

Rule 19(b) prescribes that if a Rule 19(a)(l)-(2) person cannot be made a party the Court shall determine whether in equity [579]*579and good conscience the action should proceed among the parties before it or should be dismissed. The factors to be considered by the Court include: first, to what extent a judgment rendered in the person’s absence might be prejudicial to him or those already parties; second, the extent to which, by protective provisions in the judgment, by the shaping of relief, or other relief, or other measures, the prejudice can be lessened or avoided; third, whether a judgment rendered in the person’s absence will be adequate; fourth, whether the plaintiff will have an adequate remedy if the action is dismissed for nonjoinder. The Court will consider these factors seriatim.

1. Prejudice to Mr. Smith or Present Parties

The interest of Mr. Smith in condominium unit 1203 is coincident with that of the defendant herein under applicable Georgia law. In the affidavit of Mr. Smith, filed with defendant’s response to plaintiff’s motion to remand, Mr. Smith swore to the following statement: “On May 8, 1980, I purchased the condominium unit known as 1203 Colony House West from Mr. Randolph H. Deer, the Defendant in the above-entitled action, notwithstanding the pend-ency of this lawsuit and a lis pendens filed by the Plaintiff against that property.” He continued: “Since my title to unit 1203 derives from and is dependent upon the validity of Mr. Deer’s prior title to that property, my interests with respect to the subject matter of this lawsuit are precisely coincident with the interests of Mr. Deer in this regard. For this reason, I hereby acknowledge that Mr. Deer’s defense to the allegations made by Mr. Dameron will adequately and fully represent my interests in this connection as well. The conduct of this lawsuit in my absence will not prejudice my interest therein in any way whatsoever. I hereby acknowledge that I will be bound and will abide by any final decision of this Court (after the exhaustion of any appeals) with respect to the question of the validity of Mr. Deer’s title.”

The acknowledgment by Mr. Smith that the validity of his title depends on that of his vendor, Mr. Deer, is a correct interpretation of Georgia law. In Seay v. Malone, 219 Ga. 149, 132 S.E.2d 261 (1963), it was held that where A contracts for the sale of land to B and subsequently thereto conveys the land to C who has knowledge of the prior sale, C takes subject to all the equity existing between A and B. Id. at 151, 132 S.E.2d 261. Seay cites Copelin v. Williams, 152 Ga. 692, 111 S.E. 186 (1922), wherein it was held that if the grantee sells and conveys property to a third person, who takes with notice of an outstanding equity, the purchaser, as against the original grant- or, will acquire the legal title subject to such equity. Realizing that these Georgia cases make his title to unit 1203 reliant on the validity of Mr. Deer’s, Mr. Smith has stated that he is satisfied with the defense that Mr. Deer will present to plaintiff’s allegations herein and does not feel that his interests in unit 1203 is in any way prejudiced by his absence from this lawsuit.

The Court determines that on the basis of Mr. Smith’s sworn statements recited above that he will not be prejudiced by his not being added as a party defendant in this suit. Even though a final judgment herein favorable to the plaintiff will divest Mr. Smith of an adequate chain of title to unit 1203 since he acknowledges the dependency of his title on the validity of Mr.

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Cite This Page — Counsel Stack

Bluebook (online)
88 F.R.D. 577, 32 Fed. R. Serv. 2d 852, 1980 U.S. Dist. LEXIS 15556, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dameron-v-deer-gand-1980.