Practice Exam 3
QUESTION: Dan, an American citizen who was born and raised in Nebraska, is a cheerful young college student, much liked by almost everyone who knows him. He attended the University of Nebraska, and (until the events to be recounted below) had literally never left the state - even on vacation. One personal trait that seems to endear him to his friends is his apparent indifference to most material things. For several years his only significant personal possession was a well restored 1966 Chevrolet Corvette, with a market value of about $30,000. Although Dan is a bright and attentive student when in class, his real joy in life is taking the Corvette out on country highways in Nebraska with little traffic, where he can enjoy the thrill of exceeding the speed limit by a wide margin.
Dan is the only child of his parents, and that may explain why they indulged himby giving him the Corvette when he was only 16. ..After his mother and father died in aplane crash when Dan was a college freshman, his only living relative was a rich uncle,who also loved Dan a great deal. Thus, when the uncle died a few months after Dan'sparents, he bequeathed his entire estate, chiefly consisting of a $20,000,000 interest in land in Texas, to Dan. The only other item in the estate was a bank account worth$15,000. Dan was delighted to get the money, which he used to pay tuition and fees thatMe -owed to his college. The real estate was the sort of thing that never attracted Dan'sinterest, so he never paid any attention to it (the uncle had thoughtfully paid taxes forseveral years in advance, so Dan didn't even have to think about that issue). Eighteenmonths after his uncle's death, Dan had never visited the property nor moved in any wayto sell it. Thus, the land was unused.
Dan's pleasant life changed on one of his escapades with the Corvette. Whiledriving way too fast for the conditions on a Nebraska road, he struck another automobilein which a college basketball player from the University of Texas was a passenger. Pat,the basketball player, was domiciled in Texas (in San Antonio). Pat's girl friend, BonnySue (also domiciled in Texas), was drive g he car but was miraculously uninjured(perhaps because she had too much to drink that day, and was quite relaxed when Dan'scar drove into them). Pat was not so lucky. Apart from the total loss of his car, Pat wasleft with legs paralyzed for life, ending a basketball career in which he had been expectedto sign a professional contract for more than $10,000,000 for his first year. Dan'sCorvette, of course, was also destroyed, but Dan was uninjured.
The experience frightened Dan enough so that he left Nebraska and fled to Canada. There he thought he was stuck, unable to return. He rented a small apartment in Toronto, oft a job (Dan received a waiver on Canada's strict immigration laws because his college career made him a valuable expert in advanced computer science), and while at a Canadian post office for other reasons, picked up the blank forms resting on an open counter with which to apply for Canadian citizenship. He also obtained a Nebraska absentee ballot, with which to vote in some state elections.
Meanwhile, Pat hired a lawyer. The lawyer quickly discovered that Nebraska had a tricky long-arm statute. It provided that lawsuits against out-of-state defendants were within the personal jurisdiction of Nebraska trial courts to the full extent of due process (to this extent, much like the Rhode Island statute with which you are familiar), but with a loophole for defendants who are Nebraska domiciliaries. For any defendant who was' domiciled in Nebraska at the time a cause of action arose, the long-arm statute did not permit service out of state. Thus, under the Nebraska long-arm statute, Dan - a Nebraska domiciliary at the time of the accident -could not be served with process out of state in Toronto. The Nebraska legislature had been made aware of this anomaly, but was only beginning to address it at the time Dan had injured Pat.
Pat therefore turned to the courts of Texas. Because the Texas long-arm statute was identical to the Rhode Island statute, jurisdiction rested on a true process analysis alone. Texas has a state venue statute that provides for automatic good venue when the plaintiff is a domiciliary of Texas. Therefore, Pat's lawyer filed suit in a Texas state court in San Antonio alleging a single count of negligence.
Dan responded. He filed a petition for removal with the federal district court encompassing San Antonio and he also asked the federal court to dismiss the case. These actions and the other steps Dan took after the accident raise a number of questions. Identify them and evaluate them fully.
NOTE: YOU SHOULD ASSUME THAT BOTH PARTIES RECEIVED FULL AND PROPER NOTICE OF THE FILING OF THE LAWSUIT AND OF THE REMOVAL PETITION. THUS THERE ARE NO SERVICE OF PROCESS ISSUES.
Recommended Answer
The class as a whole did pretty well. There's room for improvement, but there were also some clear strengths. The discussion below addresses the relevant issues, but no one should assume that the order in which issues are discussed below is some sort of mandatory sequence. Many students used many different approaches and did well (or sometimes not), but their success depended on how they identified and approached the issues, and not on the order in which they addressed the issues.
Jurisdiction in the courts of Texas was obviously an important issue. Many students began with an analysis of personal jurisdiction; which surprised me because I thought the best opportunity for jurisdiction over the person of the defendant or his property might be found in quasi in rem jurisdiction. Either way, however, similar points needed to be made. Dan's only contact with Texas arose from the property (realty and the bank account) which his uncle left him. Manifestly, this property (assuming there still was a bank account - he had been using it to pay tuition and fees) was unrelated to Pat's cause of action. In one sense, of course, the value of the realty suggests that the contact was large. But students mostly did well in trying to distinguish this inheritance from some other kind of contact that might have been purposeful, or systematic and continuous. Almost everyone recognized that a substantial body of witnesses would probably be found in Nebraska, not Texas. I was surprised to see how few recognized that Bonny Sue, a Texan, would most likely be found in Texas. She would, after all, be a most useful witness, even if only to prove that she was drunk at the time of the accident. This case is not a circumstance in which Texas would have a special state interest. Not even close - and the basketball skills of Pat don't change that fact. As to an alternative place to sue, Nebraska was, after all, closed to Pat (that's why he's suing in Texas), but there might be the possibility of a suit in Toronto, Canada. Is it such a big leap-to estimate that Canadian courts might have personal jurisdiction over someone found in Canada who could be served there? As to the special features of quasi in rem jurisdiction, those students who addressed this issue (most of the class) recognized that in Texas the traditional elements of quasi in rem jurisdiction could be satisfied. Some also stated that the traditional limitation on quasi in rem - the value of the property seized -wasn't all that big a problem when the property seized was worth around $20,000,000. And everyone questioned how related the property was to Pat's lawsuit, although few tried to make a case for fairness based on the other factors, mentioned above. I also thought Pat had a hard problem with jurisdiction over persons or things, notwithstanding the generous Texas long arm statute, but however students came out on that point, I would think that of the two long shots, quasi in rem might have had a little better chance than personal jurisdiction. By the way. "Responding" with a petition for removal is not consent to jurisdiction in either state or federal court.
Diversity jurisdiction raised its head in the form of the removal petition. The amount in controversy requirement was not a serious problem, but the issue of citizenship was clouded by Dan's flight to Canada. Some students thought the standard of citizenship was measured as of the date of the cause of action, when in fact it is measured as of the date the lawsuit is filed. No one lost points for this, however, unless it led them to conclude that Dan's possible domicile in Canada was irrelevant. The truth is that if Dan had become a Canadian domiciliary at the time of the filing, that status, combined with his continuing American citizenship (applying for Canadian citizenship doesn't mean he would get it, and these facts do not say that he even applied), would mean that Dan would not be diverse for,purposes of § 1332. As a whole, the class did pretty well weighing the apparently contradictory facts about Dan's domiciliary status (Nebraska or Canada).
Venue caused a few problems. Some students knew that, in removal cases, venue is controlled by state law right away. That was good. But no one lost points for not knowing that. You could lose points for not assessing the risk that a federal court might look at § 1391(a) for venue, and discussing what the venue possibilities would be under that statute.
That brings us to Erie. And as a passing observation, it should be said that this was the only point at which Erie was relevant, if at all. Strictly speaking, as the preceding paragraph indicates, state law controls here. But students could also get points by recognizing that if state law was competing with § 1391, the Erie analysis would be controlled by Ricoh. This area in which venue and Erie intersected (even collided) provided several ways to get points, and the class as a whole did pretty well.
Forum non conveniens was the topic of much creative spelling, but I knew what you were talking about. Here the points were: deference to Pat's choice of forum; possible alternative fora (the class' resistance to Canada as a possibility really surprised me -remember that Scotland was the alternative forum in Piper Aircraft v. Reyno, and Dan had filed a motion to dismiss not to transfer); places where Dan would be subject to personal jurisdiction; and the public and private weighing factors (on which the class as a whole did well).
A few students talked about possible claims by Dan against Bonny Sue, which does not strictly harmonize with a motion to dismiss. But where the discussions of supplemental jurisdiction, were particularly good they got a few points.
Black Letter Law
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