IN RE: the ESTATE OF Sari E. Silvern BROWN (2023)

MEMORANDUM OPINION AND ORDER

This cause comes before the Court on Plaintiffs’ Motion to Remand [7]. The motion is fully briefed and ripe for ruling. Having considered the parties’ submissions, the relevant legal authority, and otherwise being duly advised in the premises, for the reasons set forth below, the Court finds that remand is appropriate and the motion will be granted.

I. BACKGROUND

This action arises in connection with the administration of the Estate of Sari E. Silvern Brown (“Sari” or “Decedent”), who passed away on June 26, 2022. The Decedent's Last Will and Testament was admitted to probate in the estate proceedings initiated in the Chancery Court of Lincoln County, Mississippi, Cause No. 22-cv-00396 (the “Estate Matter”). See [6] p. 32. Plaintiff Corie Cooperstein (“Corie”) was appointed Executrix of the Estate. Id. at pp. 34, 38-39. Plaintiffs then filed within the Estate Matter their verified complaint (the “Complaint”), in which they seek both declaratory and injunctive relief from Defendant Stephanie Siper (“Siper”) Id. at pp. 46-58.

The claims asserted in the Complaint are sought both on behalf of Corie and Aaron Feldman, individually, as well as the Estate by Corie in her capacity as the legal representative of the Estate. The pleading includes claims involving undue influence over the Decedent and seeks to recover assets belonging to Plaintiffs, which, again, include the Estate itself. Id. at pp. 48-50.¹

Thereafter, as Plaintiffs concede, Siper timely removed the Estate Matter to this Court within thirty (30) days of having received the Complaint. See [1]. As her basis for federal jurisdiction, Siper invokes diversity of citizenship pursuant to 28 U.S.C.A. § 1332. Id. at pp. 2, 4. Plaintiffs do not contest that there is complete diversity or that the amount in controversy exceeds the jurisdictional limit of $75,000.00. Rather, Plaintiffs assert that there are two grounds for applying the “probate exception,” which bars federal jurisdiction: (1) the entire probate proceeding has been removed; and (2) the underlying Complaint includes claims on behalf of the Estate.

II. DISCUSSION

A. Applicable Law

1. Removal

Federal courts are courts of limited jurisdiction, having subject matter jurisdiction only over those matters specifically designated by the Constitution or statute. See Energy Mgmt. Servs., LLC v. City of Alexandria, 739 F.3d 255, 257 (5th Cir. 2014); In re FEMA Trailer Formaldehyde Prods. Liab. Litig., 668 F.3d 281, 286 (5th Cir. 2012). “Because removal raises significant federalism concerns, the removal statute is strictly construed and any doubt as to the propriety of removal should be resolved in favor of remand.” Gutierrez v. Flores, 543 F.3d 248, 251 (5th Cir. 2008). “The removing party bears the burden of showing that federal jurisdiction exists and that removal was proper.” Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002); Nowlin v. United States, 81 F. Supp. 3d 514, 524 (N.D. Miss. 2015).

2. The Probate Exception

While federal jurisdiction, such as diversity jurisdiction in this case, may appear to be present, the United States Supreme Court has “recognized a ‘probate exception’ ․ to otherwise proper federal jurisdiction.” Marshall v. Marshall, 547 U.S. 293, 309, 126 S.Ct. 1735, 164 L.Ed.2d 480 (2006). “[A] federal court has no jurisdiction to probate a will or administer an estate ․” Markham v. Allen, 326 U.S. 490, 494, 66 S.Ct. 296, 90 L.Ed. 256 (1946) (discussing antecedent history of probate exception). As with removal in general, the party invoking federal jurisdiction—here Siper—bears the burden of proving, by a preponderance of the evidence, that the probate exception does not apply to this action. See Est. of Gordon v. Leidy, 2019 WL 3347179, at *1 (N.D. Miss. July 25, 2019) (citing Leskinen v. Halsey, No. CV 12-623, 2013 WL 802915, at *7 (E.D.N.Y. Jan. 28, 2013)).

B. Analysis

The removal of civil actions brought in a state court of which the district courts have original jurisdiction is governed by statute, which states that “any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant[.]” 28 U.S.C.A. § 1441 (emphasis added). Plaintiffs first argue that the civil action removed here is the entire Estate Matter. The Complaint initiated a supplemental proceeding within the Estate Matter that could not be removed without taking the entire state-court matter with it, which appears to be the case according to the state court record filed in this case. See [6].² As a result, the whole “civil action” regarding the administration of the Estate has been removed, which has effectively divested the Chancery Court of Lincoln County from administering all matters related to the Estate. The removal of the entire probate proceeding certainly runs afoul of the probate exception. See Davis v. Chase Home Fin., LLC, No. 1:11CV470-HSO-RHW, 2012 WL 12883313, at *3 (S.D. Miss. Apr. 18, 2012); Est. of Hobgood v. Pac. Life Ins. Co., No. 1:13CV201-HSO-RHW, 2013 WL 12209907, at *3 (S.D. Miss. Oct. 31, 2013).

Siper appears to concede that removing the entire probate matter was improper and attempts to get around the probate exception by arguing that it intended to remove only the Complaint from the Estate Matter and asks the Court to sever it. However, Siper cannot simply remove only the Complaint because it appears to be a supplemental proceeding, rather than a civil action, filed by the executrix of the estate (along with certain heirs) to recover assets within a state court probate proceeding. See Fischer v. Hartford Life Ins., 486 F. Supp. 2d 735 (N.D. Ill. 2007) (finding that a petition filed by an executor against a life insurance company to recover assets of the estate was a supplemental proceeding rather than a civil action because it was merely a continuation of the estate administration pending in state court); see also Dale v. Family Guar. Life Ins. Co., 205 F. Supp. 2d 620, 622 (S.D. Miss. 2002) (remanding a contempt action for lack of subject matter jurisdiction, despite complete diversity, because the contempt proceeding was ancillary to underlying liquidation action over which there was no federal jurisdiction, such that the contempt proceeding did not qualify as a separate civil action). Because 28 U.S.C.A. § 1441 requires removal of the “civil action,” there can be no “removal of a single claim within a state court proceeding[.]” See Chase, 2012 WL 12883313, at *3.³

As for severing the Complaint from the administration of the estate, quite simply, the Court is without authority to do so because “jurisdictional facts that support removal must be judged at the time of the removal.” Gebbia v. Wal-Mart Stores, Inc., 233 F.3d 880, 883 (5th Cir. 2000). If this Court had no subject matter jurisdiction at the time of removal, the Court may not exercise any authority to subsequently sever claims.⁴

Finally, even if the Court could sever the Complaint, it would not do so because it finds that the claims in the Complaint itself are further barred by the probate exception. In their Complaint, Plaintiffs allege the following relevant facts:

The Decedent left a Last Will and Testament that bequeathed the residue of her estate to a Family Trust, but if that Trust is no longer valid or is amended, the reside goes to the Executrix to disburse as a testamentary trust to five certain individuals. [1-1] at ¶¶ 9, 10.

The Decedent also held certain retirement accounts through Merrill Lynch. Id. at ¶ 11. The beneficiary form for the retirement accounts originally named Decedent's late husband as the beneficiary and that no contingent beneficiary had ever been named. Id. at ¶ 12. With no contingent beneficiary, the Estate would then become the beneficiary of the accounts, and the assets would pass under the Will to five certain individuals. Id. at ¶ 12.

Siper coerced the Decedent through undue influence to transfer money and/or securities to Siper and have herself named as the beneficiary of the retirement accounts. [1-1] at ¶ 14. Once it is shown that Siper exerted undue influence, the funds will be shown to be an asset of the estate and/or Plaintiffs. Id. at ¶ 17.

Based on these allegations, the Court finds that if Plaintiffs are successful, any funds will become the assets of the estate, which will then be subject to distribution in accordance with the Decedent's Will. That would clearly be the “administration of an estate,” which is barred by the probate exception.

Plaintiff argues that the retirement account funds are a “non-probate” asset, which the Plaintiffs have conceded that the estate may not have an interest. [11] at pp. 3-4.⁵ However, as the Plaintiffs point out, the Complaint does not involve claims solely regarding the IRAs. The Complaint clearly refers to “other assets” and is replete with references to such things as cash, property, securities, funds, and accounts. See [1-1] at ¶¶ 14, 19, 22, 23, 27, 28. Siper argues that such references were too vague to deprive this Court of jurisdiction, but the Court need not delve into the merits of the claims. Nevertheless, in reply, the Plaintiffs have produced documents supplied by Merrill Lynch, which show the transfer of other securities to Siper. Assuming Plaintiffs establish Siper's undue influence as to such transfers, then those amounts would not be returned to Plaintiffs Corie and Aaron individually, but to the estate itself. It appears that the Complaint, in a broad sense, is an attempt by the Executrix to marshal the assets of the estate to be disbursed in accordance with Decedent's Will.

Actions that seek to dispose of property belonging to the Estate are properly matters for the probate court. See Adams v. Harris, No. CIV. A. 4:07-CV-96HTW, 2008 WL 682419, at *2 (S.D. Miss. Mar. 7, 2008). As this Court has previously stated, “The Court is persuaded that permitting this action against Defendant to move forward in this Court would result in federal interference in state administration of the Estate.” Est. of Pringle v. Pringle, No. 1:11CV152-HSO-JMR, 2011 WL 2446478, at *4 (S.D. Miss. June 15, 2011). As such, remand is required.

III. CONCLUSION

Based on the foregoing, the Court finds that based on the probate exception, this Court has no subject matter jurisdiction over this matter. Accordingly, Plaintiffs’ Motion to Remand [7] is GRANTED. This case in its entirety is hereby remanded to the Chancery Court of Lincoln County.

SO ORDERED AND ADJUDGED this 13th day of January 2023.

FOOTNOTES

1.   The claims asserted against Siper are set forth in the following counts: (I) Declaratory and Injunctive Relief and Damages; (II) Constructive Trust; and (III) Request for an Accounting. [6] at pp. 50-53.

2.   Indeed, the caption listed at the top of Siper's Notice of Removal provides: “In the Matter of the Estate of Sari E. Silvern Brown, Deceased.” [1] at p.1.

3.   The Court finds the Davis case to be directly on point.

4.   As for Siper's fear that further resources would be unnecessarily expended to litigate the timeliness of removal if she must return to state court to seek a severance, timeliness should not be an issue because an order of severance would qualify her for removal under 28 U.S.C. § 1446 (b)(c) provided the removal was filed within thirty days after the order is issued.

5.   Siper contends that federal courts have asserted jurisdiction over actions concerning undue influence. [11] at p. 6 (citing Great Am. Life Ins. Co. v. Tanner, No. 3:16-CV-70-DMB-JMV, 2020 WL 1541375, at *1 (N.D. Miss. Mar. 31, 2020)). However, the Tanner case not only does not involve removal from a probate proceeding but also never addresses the probate exception. Upon review of the docket in that case, it began as an interpleader action by an insurance company, and the undue influence claims were brought by way of a counterclaim. Here, it is not the type of claim that divests the Court of jurisdiction, but the entirety of the circumstances surrounding the removal.

KEITH STARRETT, UNITED STATES DISTRICT JUDGE