Opinion
Civil Action No. 98-1352-CM
September 28, 2000
MEMORANDUM AND ORDER
Plaintiffs, Cheryl and Galen Swisher, instituted this action under the Little Tucker Act, 28 U.S.C. § 1346(a), seeking money damages pursuant to the Fifth Amendment to the United States Constitution for a taking of property by the defendant, the United States of America. Certain real property jointly owned by the plaintiffs has been encumbered pursuant to the National Trails System Act, 28 U.S.C. § 1241-1251. The plaintiffs allege that the railroad right of way easement upon which the encumbrance is predicated was abandoned by the railroad and returned to plaintiffs' ownership in fee simple or, alternatively, that the use to which the right of way has been put under the National Trails System Act is not within the scope of the original easement. Therefore, plaintiffs argue that they are due compensation for the alleged taking.
The Little Tucker Act vests original jurisdiction for a takings claim in the district court for "[a]ny . . . civil action or claim against the United States, not exceeding $10,000 in amount." 28 U.S.C. § 1346(a)(2). Plaintiffs each assert an individual claim for $10,000 for the taking of their jointly-owned real property. Defendants have made a motion for partial summary judgment (Doc. 103), asserting that jurisdiction is limited to an aggregate claim of no more than $10,000 because plaintiffs can assert only one, joint, claim to money damages for a taking of jointly owned real property. Summary judgment is appropriate if the moving party demonstrates that there is "no genuine issue as to any material fact" and that it is "entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). Because the court finds that the plaintiffs' "claims" are, in actuality, a single claim which has been improperly split to assert jurisdiction under the Little Tucker Act, the court grants the defendant's motion for partial summary judgment.
I. Little Tucker Act Jurisdictional Standard
The parties devote a great deal of argument to the purpose of the Little Tucker Act and the fact that jurisdiction under the act is limited to claims of $10,000 or less. The purposes of the Act to allow small claims to be settled in the home district of the claimant and to preserve uniformity in federal takings law are not at issue here. Multiple claims may be joined in a case, resulting in a large aggregate amount in controversy, but each claim joined must be $10,000 or less in order for the court to retain jurisdiction. See, e.g., Glover v. Johns-Manville Corp., 662 F.2d 225, 231 (4th Cir. 1981) United States v. Louisville Nashville R.R. Co., 221 F.2d 698, 701-02 (6th Cir. 1955); Alaska Airlines v. Austin, 801 F. Supp. 760, 762 (D.D.C. 1992) (aff'd in part, rev'd in part on other grounds sub nom., Alaska Airlines, Inc. v. Johnson, 8 F.3d 799 (Fed. Cir. 1993); Jones Motor Co. v. Teledyne, Inc., 690 F. Supp. 310, 316 (D.Del. 1988).
The parties agree on the jurisdictional standard under the Little Tucker Act. What is at issue is whether joint owners of an undivided interest in real property may assert separate claims for an alleged taking of that property. If so, jurisdiction is proper under the Act up to $10,000 for each claim. If not, this court may not assert jurisdiction unless the plaintiffs waive any claim in excess of $10,000. Neither party has cited, and the court has not found any case directly on point.
II. Aggregating or Splitting Claims A. Little Tucker Act 1. Parties' Applications of the Act
The parties arguments concerning claim splitting under the Act are not dispositive. Defendant asserts that joint owners of real property may not segregate their damages by tract, year of loss, and future or past damages in order to meet the jurisdictional requirements of the Little Tucker Act. See Eccles v. United States, 296 F. Supp. 792, 794-95 (D.N.D. 1975). However, as plaintiffs point out, the Eccles court did not consider separate claims based upon an undivided ownership interest. Defendants direct the court to other decisions in which the claims of joint real property owners were limited to $10,000 total. See Narramore v. United States, 960 F.2d 1048, 1052 (Fed. Cir. 1992); United States v. Drinkwater, 434 F. Supp. 457, 462-63 (E.D.Va. 1977). However, the parties in those cases did not argue, and the courts did not decide, whether the joint owners could assert separate claims based upon an undivided ownership interest. The cases cited by defendant do, however, stand for the proposition that a claim involving an undivided interest in real property is often treated like a single claim.
The defendant also relies upon a case in which the court determined venue was not proper in the District of Maine, pursuant to the Little Tucker Act, because the suit alleged a nation-wide class action in which only one member was a resident of the forum state. The court found that forum-shopping was a consideration and, in those circumstances, the case belonged in the Claims Court. See Favareau v. United States, 44 F. Supp.2d 68, 71-72 (D.Me. 1999). Venue is not at issue in this case, and Favareau is irrelevant here.
The plaintiffs' arguments state the controlling principles of the Little Tucker Act but go no further than the defendant's arguments in addressing the issue of whether plaintiffs may assert separate claims under the Act. Essentially, the plaintiffs argue that because they each have an interest in the real estate encumbered, the claim of each may be asserted under the Act even though their interest is undivided. The defendant argues, conversely, that because the plaintiffs possess an undivided interest, plaintiffs are "carving out" separate interests from a single claim when they assert separate claims.
2. Plaintiffs' Supplemental Authority
Plaintiffs submitted supplemental authority purportedly rejecting the "Defendant's arguments that `claim' under 28 U.S.C. § 1346 (a)(2) should mean claim per parcel, as opposed to a claim per individual." (Pls.' Submission, Doc. 114, at 1); citing Bywaters v. United States, Civil Action No. 6:99CV451, slip op. at 11-12 (E.D.Tex. Aug. 25, 2000). At least in a superficial sense, plaintiffs' argument is correct. The opinion referred to by the plaintiffs is an order in which the court decided and granted class certification pursuant to Fed.R.Civ.P. 23(a) and (b)(3). See Bywaters, slip op. at 25-26. In its discussion of the numerosity requirement for class certification, that court noted the Bywaters defendant's argument that numerosity should be based upon the number of parcels at issue in a takings case, not the number of landowners, because using the number of landowners might allow claims above the Little Tucker Act jurisdictional limit of $10,000 for a single parcel of property where there is more than one owner. See id. at 11-12.
In a single paragraph, the Bywaters court determined that "[s]o long as each separate claim of each class member does not exceed $10,000, it makes no difference that one land parcel may have more than one owner, or that one person may own more than one parcel in issue." Id. To the extent that the Bywaters court was making a general statement of the jurisdictional requirement of the Little Tucker Act, this court does not disagree. However, the Bywaters court did not explain the rationale by which it arrived at its conclusion. Furthermore, the Bywaters court did not address the issue before this court whether joint owners of an undivided interest in real property may assert separate claims for a taking of that property. It is conceivable that co-owners of real property might have particular, specified interests in that parcel of property. In that case, each owner might be able to identify a separate claim as to a portion of the parcel. That is not the case of joint owners of an undivided interest presented to this court. The Bywaters decision relates only to numerosity of claims in a class action. It does not specifically address the issue before this court, and, in any event, is not controlling over this court.
B. Class Actions Alleging Diversity Jurisdiction
Courts have relied upon principles from class action cases alleging diversity jurisdiction for guidance in determining whether plaintiffs have improperly split a claim under the Little Tucker Act. In Glover, the trial court held that third party plaintiffs had improperly split claims to assert jurisdiction under the Act, and the third party plaintiffs appealed. The Fourth Circuit noted that diversity jurisdiction in class actions is based upon the amount in controversy as to each plaintiff's claim and not upon the aggregate amount of the claims. See Glover, 662 F.2d at 231. "Aggregation is permitted, however, where `two or more plaintiffs unite to enforce a single title or right in which they have a common and undivided interest.'" Id. (citing Snyder v. Harris, 394 U.S. 332, 335 (1969) (quoting Troy Bank v. G.A. Whitehead Co., 222 U.S. 39, 40-41 (1911))). The appellate court recognized that diversity aggregation standards had been applied to class actions brought pursuant to the Little Tucker Act. See id. (citing, among others, Northern Natural Gas Co. v. Grounds, 292 F. Supp. 619, 644 (D.Kan. 1968), aff'd in part and rev'd in part on other grounds, 441 F.2d 704 (10th Cir.), cert. denied, 404 U.S. 951 (1971)).
Since 1990, only the named plaintiff in a class action alleging diversity jurisdiction must satisfy the amount in controversy requirement. See In re: Prudential Ins. Co. Sales Practices Litigation, 962 F. Supp. 450, 503-04 (D.N.J. 1997) (construing 28 U.S.C. § 1367). However, § 1367 would not preclude application of prior case law to the case of multiple named plaintiffs seeking to aggregate claims based upon a common undivided interest.
Then, although Glover was not a class action, the Fourth Circuit applied the same standard to the Little Tucker Act claims at issue in Glover. It found that (1) each third party plaintiff alleged a separate claim less than $10,000, (2) the claims were not based upon an undivided interest although they arose in similar circumstances, and (3) there was no single title or right as to all third party plaintiffs. See Glover, 662 F.2d at 231. The appellate court held that the trial court had improperly aggregated the claims of the third party plaintiffs. See id. Therefore, the Fourth Circuit held that the trial court had jurisdiction over the third party plaintiffs' claims under the Little Tucker Act. See id.
Unlike Glover, in this case the plaintiffs' claims are based upon an undivided interest in the land at issue. In a class action involving such circumstances, aggregation would be proper to determine the jurisdictional amount in controversy because the individual claims asserted are based upon an undivided interest. Therefore, based upon the rationale in Glover, it is appropriate to view the plaintiffs' claims in this case as a single claim which has been improperly split to assert jurisdiction under the Little Tucker Act.
C. Meaning of "Claim" Under 28 U.S.C. § 1500
The Supreme Court has determined whether two "claims" are the same pursuant to § 1500 of the Judicial Code. See Keene Corp. v. United States, 508 U.S. 200, 212 (1993) (construing 28 U.S.C. § 1500). Section 1500 provides that the Court of Federal Claims shall not have jurisdiction over any claim for which the plaintiff has a suit pending against the United States in any other court. See 28 U.S.C. § 1500. In order to determine jurisdiction in the Court of Federal Claims, the court must determine whether the "claim" in the pending suit is the same as the "claim" alleged in the suit before the Court of Federal Claims. See Keene Corp. 508 U.S. at 210, 211. In Keene Corp., the Court held that, where the two suits are based upon different legal theories, the determination of whether they represent the same "claim" turns on whether the suits are based on "substantially the same operative facts." Id. at 212.
In the case at bar the plaintiffs allege identical, not different, legal theories. The claims are based on facts which are identical. The plaintiffs may argue that the fact of ownership is different as to each plaintiff. However, since plaintiffs' ownership interest is joint, proof of ownership will be identical. Because the Court in Keene Corp. considered a different statute and because the Court applied its decision to cases where different legal theories were alleged, the decision in Keene Corp. is not controlling in this case. But its rationale is compelling here. Here, as in Keene Corp., the definition of "claim" has jurisdictional consequences relating to whether Congress has waived sovereign immunity and provided for suit in a particular court.
Furthermore, similar factors have been considered in other cases involving jurisdiction under the Little Tucker Act. See Louisville Nashville R.R. 221 F.2d at 701 (different claims because separate contracts require separate evidence); Alaska Airlines, 801 F. Supp. at 762 (different claims because different evidence will be required); Eccles, 396 F. Supp. at 795 (single lagoon, single nuisance, single contract, therefore single claim). The identity of operative facts relating to the two claims alleged in this case supports a determination that plaintiffs, by asserting two claims, have improperly split a single claim under the Little Tucker Act.
D. Real Estate Law
The determination that plaintiffs present only one claim is further supported by considerations of real property law. In suits involving the title to real estate, in order to establish the rights of all parties with regard to the real property in question, all interested parties must be bound by any judgment entered. Therefore, all owners of the real property must be joined in the suit. See, e.g., Madden v. Glathart, 115 Kan. 796, 224 P.2d 910, 911-12 (1924) (owner of undivided half interest in property at issue is a necessary party because, otherwise, a judgment would not bind him); Polette v. Williams, 456 S.W.2d 328, 333 (Mo. 1970) (real property is different from personal property); see also Old Colony Ventures I, Inc. v. SMWNPF Holdings, Inc., 968 F. Supp. 1422, 1430 (D.Kan. 1997) (all persons with a recorded legal interest in the property were parties, therefore, complete relief could be provided); Eureka Bldg. Loan Ass'n v. Shultz, 139 Kan. 435, 32 P.2d 477, 481 (1934) (minor children, owners of real property, are necessary parties to a foreclosure action even though not personally liable for a deficiency judgment).
Had either joint owner of the real property at issue here brought this suit alone, the court, in order to provide complete relief pursuant to Fed.R.Civ.P. 19, would have been required to join the other joint owner. In order to determine the rights of the defendant in the alleged taking in that scenario, the court would be required to determine whether a taking of the real estate has occurred, what is the scope of the taking, if any, and what is the value of the interest taken. Without both joint owners before the court it would be unclear whether the "value" of the interest taken was the value of the encumbrance on the real estate or the value of the plaintiff's undivided one-half interest allegedly encumbered. In the interests of judicial economy, certainty, and prevention of a multiplicity of suits, the court would not proceed in such a fashion but would require joinder of all joint owners. Considerations of real estate law support a determination that plaintiffs, by asserting two claims, have improperly split a single claim under the Little Tucker Act.
In consideration of all the factors presented, this court finds that joint owners of an undivided interest in real property may not assert separate claims pursuant to the Little Tucker Act for an alleged taking of that property. Therefore, this court does not have jurisdiction to hear any claim by the plaintiffs in excess of $10,000 for the taking at issue. The court grants the plaintiffs thirty days to correct jurisdictional defects or the case shall be dismissed for lack of jurisdiction. III. Orders IT IS THEREFORE ORDERED that defendant's motion for partial summary judgment (Doc. 103) is granted. Pursuant to the Little Tucker Act, 28 U.S.C. § 1346(a)(2), the plaintiffs may not assert a claim in this court, as to their undivided interest in real property, in excess of $10,000.
IT IS FURTHER ORDERED that plaintiffs shall, within thirty days of the date of this order, take action to correct the jurisdictional defect in this case. Otherwise, this action shall be dismissed for lack of jurisdiction pursuant to 28 U.S.C. § 1346(a)(2).