Davis v. Grider ( 2000 )

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 99-30900
Summary Calendar
MICHAEL DAVIS,
Plaintiff-Appellee,
V.
JOE GRIDER; ET AL.
Defendants,
AMERICAN INTERNATIONAL INSURANCE CO.,
Defendant-Appellant.
Appeal from the United States District Court
For the Eastern District of Louisiana
Civil Action 98-2271
May 5, 2000
Before SMITH, BARKSDALE and PARKER, Circuit Judges.
PER CURIAM:1
Defendant-Appellant American International Insurance Company
(“AIIC”), appeals a judgment in favor of Plaintiff-Appellee,
Michael Davis (“Davis”), for injuries sustained as a result of an
automobile accident. Although we affirm the district court's
determination with respect to mitigation of damages, because
Davis failed to present evidence with regard to coverage and
liability, we reverse and remand.
1
Pursuant to 5TH CIR. R. 47.5, the Court has determined
that this opinion should not be published and is not precedent
except under the limited circumstances set forth in 5TH CIR. R.
47.5.4.
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FACTUAL HISTORY AND PROCEEDINGS BELOW
Davis was involved in an automobile accident on August 9,
1996, with an automobile owned by Avis Rental Car Co. Davis
alleged that he was traveling as a guest passenger when a vehicle
driven by Joe Grider (“Grider”) struck his automobile from
behind. Davis also alleged that the vehicle driven by Grider was
insured under an automobile liability policy issued by AIIC. As
a result of this incident, Davis sustained personal injuries.
Davis sued Grider2 and AIIC in Louisiana state court on August 7,
1997, for damages arising out of the accident. AIIC removed the
case to federal court based on diversity.
A pretrial order was drafted and filed with the clerk of
court on June 28, 1999. In that pre-trial order, the following
pertinent facts were listed as contested by Davis: (1) whether
Joe Grider rear-ended the vehicle in which Davis was a passenger
and (2) whether AIIC provided automobile insurance coverage on
the vehicle operated by Grider.3
Approximately ten days after the filing of this pre-trial
order, a pre-trial conference was held in which all counsel of
record held discussions regarding the necessity of producing
witnesses and exhibits at trial. Davis alleges that at this
conference counsel for AIIC indicated that liability was “not a
2
Grider was originally named as a defendant but was
subsequently dismissed without prejudice on January 20, 1999,
because Davis failed to timely effect service upon him.
3
In addition, under the heading of “Uncontested Material
Facts,” the pre-trial order stated that the parties were “unaware
of any uncontested material facts.”
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serious issue” and that it would be unnecessary for Davis to
produce witnesses to prove liability on the part of Joe Grider.4
In addition, Davis asserts that counsel for AIIC admitted that
coverage for the accident existed and, consequently, Davis need
not produce a representative of AIIC to testify nor introduce a
policy into evidence. AIIC argues that no such stipulations took
place.
AIIC argued in the alternative that Davis failed to mitigate
the damages he received as a result of the accident.
Specifically, AIIC asserts that Davis worsened his injuries
because he failed to complete his physical therapy regimen. The
district court found that Davis did not fail to mitigate his
damages.
After a bench trial on the merits, the district court
entered judgment in favor of Davis and AIIC filed this timely
appeal.
STANDARD OF REVIEW
The district court's decision to modify a pre-trial order
will not be disturbed on appeal absent an abuse of discretion.
See Southwestern Engineering Co v. Cajun Elec. Power Coop., Inc.,
915 F.2d 972, 979 (5th Cir. 1990). Whether the district court in
this case modified its pre-trial order depends upon whether the
alleged stipulations regarding insurance coverage and liability
took place. The district court's factual determination as to
4
Those witnesses include the owners of the vehicle in
which plaintiff was a passenger and the investigating officer at
the scene of the accident.
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whether the stipulations occurred, thereby modifying the pretrial
order, is reviewed for clear error. See Accura Systems, Inc. v.
Watkins Motor Lines, Inc., 98 F.3d 874, 876 (5th Cir. 1996). The
district court's factual determination whether Davis failed to
mitigate his damages is reviewed for clear error. See id.DISCUSSION
I. Subject-Matter Jurisdiction.
Davis avers for the first time in his response brief that
the district court lacked diversity jurisdiction solely because
the amount in controversy did not exceed $75,000.5 See 28 U.S.C.
§ 1332(a) (1994). He argues that AIIC merely alleged conclusory
statements in its removal papers regarding the amount in
controversy. AIIC argues that it is “facially apparent” from
Davis's petition that the claims are above the requisite amount
in controversy.
This circuit utilizes a clear analytical structure to
evaluate subject matter jurisdiction for cases filed in Louisiana
state courts that assert no damage amount and are removed to
federal court based on diversity. See Simon, 193 F.3d at 850-52;
Luckett v. Delta Airlines, Inc., 171 F.3d 295, 298 (5th Cir.
5
Notwithstanding the fact that Davis brought up this
challenge to the district court's subject matter jurisdiction for
the first time on appeal, “a party may neither consent to nor
waive federal subject matter jurisdiction. Federal courts may
examine the basis for jurisdiction sua sponte, even on appeal.”
Simon v. Wal-Mart Stores, Inc., 193 F.3d 848, 850 (5th Cir. 1999)
(citations omitted); see also id. at 851 (“The [plaintiff's]
failure to object to removal or jurisdiction . . . does not
relieve [the defendant] of its burden to support federal
jurisdiction at the time of removal.”).
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1999).
In such a situation, the removing defendant must prove
by a preponderance of the evidence that the amount in
controversy exceeds $75,000. The defendant may make
this showing in either of two ways: (1) by
demonstrating that it is “facially apparent” that the
claims are likely above $75,000, or (2) “by setting
forth facts in controversy--preferably in the removal
petition, but sometimes by affidavit--that support a
finding of the requisite amount.”
Luckett, 171 F.3d at 298 (citations omitted).
In the case sub judice, AIIC filed no affidavits with its
notice of removal nor set forth any facts in controversy in that
notice. It merely alleged in a conclusory manner that the amount
in controversy exceeded the requisite jurisdictional amount.
Thus, the district court's jurisdiction was proper if the amount
in controversy exceeded $75,000.
Reading the face of Davis's petition, we find that the
district court did not err in finding that his claims exceeded
$75,000. Based on a tort theory of recovery, Davis prayed for
the following damages: past and future medical expenses, past
andfuture lost wages, past and future pain and suffering and past
and future disability. The district court had subject matter
jurisdiction to decide the merits of Davis's claims.
II. Stipulations as to Insurance and Liability.
The resolution of the issues of coverage and liability
centers on what was discussed and agreed to at a July 8, 1999
pre-trial conference between AIIC's counsel and Davis's counsel.
Davis argues that stipulations made at this conference (occurring
after the filing of the pre-trial order) modified the pre-trial
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order which contested the facts of coverage and liability as to
Grider.
The pre-trial order was filed on June 25, 1999 and was
entered into on July 12, 1999. Davis's argument is that the
events of the July 8th pre-trial conference modified and
superceded the pre-trial order which was filed approximately ten
days prior.
A. Provision of Insurance by AIIC.
The district court made a specific finding that counsel for
AIIC stipulated to insurance coverage of the vehicle that struck
Davis. The basis of this finding--that coverage was agreed to in
the pre-trial conference--contrasts (or otherwise modifies) the
written pre-trial order which listed coverage as a contested
fact. AIIC asserts that no such stipulation was made during the
July 8, 1999, pre-trial conference. Davis did not introduce
evidence at trial in support of finding coverage. We find
nothing in the record to support this finding.
“A trial court has 'broad discretion in determining whether
or not a pretrial order should be modified or amended.'” El Paso
Refinery v. Scurlock Perman Corp., 171 F.3d 249, 255 (5th Cir.
1999) (quoting Coastal States Mktg., Inc. v. Hunt, 694 F.2d 1358,
1369 (5th Cir. 1983)); see also FED R. CIV. P. 16(e). The trial
court found that the parties agreed that coverage was admitted;
however, “nothing in the transcript or in any order or writing
whatever--including any letter to or from the court or any of the
parties or counsel or even any informal notes of the court,
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counsel, or anyone else--reflects such or any similar agreement.”
Conkling v. Turner, 138 F.3d 577, 588 (5th Cir. 1998). The
district court abused its discretion6 in modifying the written
pre-trial order and finding that coverage had been stipulated
without some support in the record that the parties so agreed.
B. Liability of Grider.
Davis asserts that, at the July 8, 1999 pre-trial
conference, in direct response to the Judge's question regarding
the necessity of producing witnesses, counsel for AIIC stated
that it would not be necessary for Davis to produce the owner and
the operator of the vehicle or the investigating officer because
liability was not “a serious issue.” Relying upon these
assurances, Davis did not produce any such witnesses nor an AIIC
insurance policy.
This argument that the district court specifically found
that liability was stipulated is based on the following passage
from the trial transcript:
Thank you. Okay. We'll start right there and say
that at the pre-trial conference that insurance
coverage was admitted and although liability was not
admitted, it was represented but it was not a serious
issue, and therefore, I will begin by finding that the
Plaintiff was a passenger in an automobile that was
rear-ended by the Defendant and, therefore, the vehicle
which was operated by Joe Grider and insured by
American International Insurance Company was the sole
cause of the accident.
Although a finding as to coverage was made by the district
6
The district court abused its discretion by relying on
its clearly erroneous factual finding that the stipulation
asserted by Davis actually occurred.
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court in this passage, we find that the district court did not
specifically make a finding regarding liability. The district
court merely found that liability was “represented [as] . . . not
a serious issue.” Because the district court did not make a
finding that liability was stipulated and Davis did not present
any proof as to liability, the judgment for the plaintiff was in
error.
III. Mitigation of Damages.
AIIC argues that the district court's factual determination
that Davis did not fail to mitigate his damages was clearly
erroneous. Under Louisiana law, AIIC has the burden of showing
that Davis failed to mitigate his damages. See Gates v. Shell
Oil, 812 F.2d 1509, 1515 (5th Cir. 1987) (citing Perrette v. City
of Slidell, 465 So.2d 63, 65 (La. Ct. App. 1985)). AIIC must
show that Davis's failure to follow his prescribed treatment more
probably than not worsened his condition. See Porter v. State,
701 So.2d 1069, 1072 (La. Ct. App. 1997).
AIIC failed to meet its burden with respect to this issue.
At most, the evidence presented at trial suggests that it was
“possible” that Davis's failure to complete his physical therapy
regimen worsened his condition. The trial court's ruling that
Davis did not mitigate his damages was not clearly erroneous.
CONCLUSION
The district court's finding that AIIC insured the vehicle
which struck appellee is REVERSED and REMANDED. Because the
district court failed to make a finding as to liability on the
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part of Joe Grider and because Davis failed to provide proof of
such liability, the district court's award of damages to Davis is
REVERSED and REMANDED. The district court's finding that Davis
did not fail to mitigate his damages is AFFIRMED.
AFFIRMED in part, REVERSED in part and REMANDED.
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