Marmon/Keystone Corp. v. Rowley

77 A.L.R. Fed. 193, 100 F.R.D. 384, 1983 U.S. Dist. LEXIS 11162
CourtDistrict Court, D. Kansas
DecidedDecember 2, 1983
DocketCiv. A. No. 83-2024
StatusPublished
Cited by1 cases

This text of 77 A.L.R. Fed. 193 (Marmon/Keystone Corp. v. Rowley) is published on Counsel Stack Legal Research, covering District Court, D. Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Marmon/Keystone Corp. v. Rowley, 77 A.L.R. Fed. 193, 100 F.R.D. 384, 1983 U.S. Dist. LEXIS 11162 (D. Kan. 1983).

Opinion

MEMORANDUM AND ORDER

O’CONNOR, Chief Judge.

This matter is presently before the court on the defendánts’ motion for summary judgment. This lawsuit arises out of a highway traffic accident on January 8, 1982, involving Clarence R. Newsom, who was operating a semi-tractor trailer owned by the plaintiff, Marmon/Keystone Corporation, and defendant Omar C. Rowley, who was operating a semi-tractor trailer unit owned by defendant Margie L. Berrie. As a result of the accident, Newsom was injured, and the semi-tractor trailer unit owned by Marmon/Keystone was extensively damaged. As Newsom’s employer, plaintiff Marmon/Keystone has paid benefits to him under the Workers Compensation Act and may be required to pay additional medical expenses in the future. Because Newsom did not bring an action against the defendants within one year of the accident, pursuant to K.S.A. 44-504, plaintiff Marmon/Keystone commenced this lawsuit on February 2, 1983. Jurisdiction was based on diversity of citizenship, 28 U.S.C. § 1332, between the plaintiff (a Delaware corporation) and the individual defendants (Kansas residents) and their Maryland insurance company. On April 12, 1983, Newsom moved the court for leave to intervene as a party plaintiff. On May 16, 1983, the court granted Newsom’s motion to intervene.

On June 16, 1983, the defendants filed their motion for summary judgment, pursuant to Fed.R.Civ.P. 56(e), on the ground that the addition of Newsom, a Kansas [386]*386resident, destroyed complete diversity among the parties and thereby deprived the court of subject matter jurisdiction. In response, Newsom and the plaintiff argue that because Newsom intervened in this action rather than being joined by one of the other parties, no independent basis of jurisdiction is required (i.e. that there need not be diversity of citizenship between Newsom and the defendants).

At least prior to the 1966 amendments to the Federal Rules of Civil Procedure, it was well-established that where intervention is of right a court can exercise ancillary jurisdiction, and there need be no independent jurisdictional grounds to support the intervenor’s claim. Babcock & Wilcox Co. v. Parsons Corp., 430 F.2d 531, 540 (8th Cir.1970); 7A C. Wright and A. Miller, Federal Practice & Procedure § 1917, at 590-591 (1972); J. Moore, Moore's Federal Practice ¶ 24.18[3] (2d Ed. 1982). Rule 24 of the Federal Rules of Civil Procedure provides for two types of intervention: intervention of right and permissive intervention.

(a) Intervention of right. Upon timely application anyone shall be permitted to intervene in an action: (1) when a statute of the United States confers an unconditional right to intervene; or (2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and he is so situated that the disposition of the action may as a practical matter impair or impede his ability to protect that interest, unless the applicant’s interest is adequately represented by existing parties.
(b) Permissive intervention. Upon timely application anyone may be permitted to intervene in an action: (1) when a statute of the United States confers a conditional right to intervene; or (2) when an applicant’s claim or defense in the main action have a question of law or fact in common.... In exercising its discretion the court shall consider whether the intervention will unduly delay or prejudice adjudication of the rights of the original parties.

Fed.R.Civ.P. 24 (emphasis added).

Although the 1966 amendments to the Federal Rules of Civil Procedure liberalized and broadened the scope of intervention of right under Fed.R.Civ.P. 24(a), we believe that this amendment does not impair the court’s ability to exercise ancillary jurisdiction over a party who has intervened as of right. See Snyder v. Harris, 394 U.S. 332, 336, 89 S.Ct. 1053, 1056, 22 L.Ed.2d 319 (1969); 7A C. Wright and A. Miller, supra § 1917, at 598.

We conclude that Newsom was entitled to intervention of right, pursuant to Fed.R.Civ.P. 24(a)(2). Although the plaintiff, as Newsom’s employer, has a right to bring an action in Newsom’s absence, K.S.A. 44-504, the plaintiff’s interest in this lawsuit is limited to the extent of its subrogation interest — the extent to which it has paid and will pay benefits to Newsom under the Workers’ Compensation Act. Thus, to the extent that Newsom’s damages exceed the amounts he has received in workers’ compensation payments, his interest is not adequately represented by the plaintiff and disposition of this lawsuit in his absence would clearly impair or impede his interest. Newsom therefore falls within the letter and the spirit of Fed.R.Civ.P. 24(a)(2).

Because we find that Newsom intervened of right, we do not consider whether permissive intervention under Fed.R.Civ.P. 24(b) requires independent jurisdictional grounds. We note that although there was a case in this district in which it was suggested that a court can exercise ancillary jurisdiction over a permissive intervenor, Chalmers v. United States, 43 F.R.D. 286, 289-90 (D.Kan.1967) (Templar, J.), this position has been widely criticized by the commentators. See 7A C. Wright and A. Miller, supra § 1917, at 590-95 (1972); 3B A. Moore, supra ¶ 24.18[3]; see also 13 C. Wright, A. Miller, and E. Cooper, Federal Practice & Procedure § 3608, at 658 (1975).

Although we have concluded that Newsom was entitled to intervene of right, pursuant to Fed.R.Civ.P. 24(a)(2), our inquiry into the existence of jurisdiction in this case is not ended. There exists an exception to the ancillary jurisdiction of the [387]*387court where the intervenor of right is so related to the action that he is “indispensable” within the meaning of Fed.R.Civ.P. 19(b). 7A C. Wright and A. Miller,

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77 A.L.R. Fed. 193, 100 F.R.D. 384, 1983 U.S. Dist. LEXIS 11162, Counsel Stack Legal Research, https://law.counselstack.com/opinion/marmonkeystone-corp-v-rowley-ksd-1983.