Opinion ID: 224251
Heading Depth: 1
Heading Rank: 2

Heading: Jurisdiction of the Cross-Claim

Text: 14 A proper cross-claim is auxiliary or ancillary to the principal claim to which it is related and the jurisdiction which supports the claim will support the cross-claim. 5 15 Prior to the adoption of the Rules of Civil Procedure for the District Courts of the United States, 28 U.S.C.A. there was a divergence in the authorities with respect to the proximate relation which the matters in the cross bill had to bear to the original matter in controversy in order to make the cross bill proper. Some of the cases held that a cross-complaint is only proper where its determination is necessary to the effective exercise of the primary or main jurisdiction or it is essentially ancillary to the original action. Illustrative is Republic National Bank and Trust Company v. Massachusetts Bond & Ins. Co., 5 Cir., 68 F.2d 445. Other cases adopting a more liberal rule held that a cross bill is a bill brought by a defendant in a suit against the plaintiff in the same suit, or against another defendant in the same suit, or against both, touching the matters in question in the original bill; and that its purpose is either to obtain discovery of facts from the complainant or codefendant in aid of the defense of the original bill or to bring before the court new matter in aid of the defense to the original bill; or to obtain full relief for all parties and a complete determination of all controversies which arise out of the matters charged in the original bill. Illustrative is Mathis v. Ligon, 10 Cir., 39 F.2d 455, and Queenan v. Mays, 10 Cir., 90 F.2d 525, 535, and cases there cited. See discussion of conflicting views in Moore's Federal Practice Under the New Federal Rules, Vol. 1, § 13.08. 16 The confusion in the cases as to the extent of the cross-claim has been clarified and the scope of the cross-claim broadened by Rule 13(g) of the Rules of Civil Procedure for the District Courts which reads: (g) Cross-Claim against Co-Party. A pleading may state as a cross-claim any claim by one party against a co-party arising out of the transaction or occurrence that is the subject matter either of the original action or of a counterclaim therein or relating to any property that is the subject matter of the original action. Such cross-claim may include a claim that the party against whom it is asserted is or may be liable to the cross-claimant for all or part of a claim asserted in the action against a cross-claimant. 17 In Moore's Federal Practice Under the New Federal Rules, Vol. 1, § 13.08, p. 726, the author says: The confusion in the early cases as to the extent of the cross-claim has been clarified, and the scope of the cross-claim broadened. The subdivision clearly applies to all claims, legal or equitable. The cross-claim need not affect the plaintiff; it is enough if it arise `out of the transaction or occurrence that is the subject matter either of the original action or of a counterclaim therein.' As pointed out above, this language parallels language in subdivision (a) and should receive similar construction. The power of the court to order separate trials of claims or issues as provided in subdivision (i) answers the objections made in the early cases that involved cross-claims, and which led the courts to restrict the use of cross-claims. 18 Here, the transaction or occurrence which was the subject matter of the original action was the accident which resulted in personal injury to Collier. 19 If, at the time of the accident, the truck loaned to the City was under the control of the City and not Harvey, and if the employees loaned by Harvey to the City were under the sole control and direction of the City, then Harvey was not liable to Collier for the negligence of such employees 6 and Harvey was not using the truck at the time of the accident and the claim of Collier was not within the coverage of the policy. 20 On the other hand, if, at the time of the accident, the truck was under the control of Harvey and the employees loaned to the City were under the control and direction of Harvey, then Harvey was liable to Collier for the negligence of such employees 7 and Harvey was using the truck at the time of the accident and the claim of Collier was within the coverage of the policy. Hence, an adjudication with respect to the facts at the time of the accident would determine whether Collier's claim was within the coverage of the policy and also determine whether Harvey was liable to Collier for the negligence of the employees. In other words, the issues of fact necessary to determine both legal questions were identical. 21 Accordingly, we conclude that the cross-claim of Harvey against Collier was one arising out of the transaction or occurrence which was the subject matter of the principal claim to which it was related and the jurisdiction which supports the claim also supports the cross-claim. 22 If Harvey is not permitted to maintain his cross-claim against Collier, he will be in the anomalous position of having an adjudication by the Federal court as between the Insurance Company as plaintiff and Harvey and Collier as defendants that at the time of the accident the truck was under the control of the City and the employees loaned to the City were under the sole control and direction of the City and, therefore, Harvey was not using the truck, and the claim of Collier was not within the coverage of the policy, and being subject to the danger of a future adjudication by the state court that at the time of the accident the truck was under the control of Harvey and the employees under the control and direction of Harvey, and that Harvey is liable to Collier for the negligence of such employees. In order to protect the right of Harvey, it was necessary to completely adjudicate the issues referred to above as between all of the parties. 8 23 But the judgment should have been limited to an adjudication of those issues. Whether Collier predicated his claim against Harvey solely on the negligence of the two employees of Harvey loaned to the City or on those grounds and also on other grounds, the record does not clearly disclose. If Collier alleged in his petition in the state court, in addition to the negligence of the employees of Harvey loaned to the City, other grounds for recovery against Harvey, the trial court should not have adjudicated that Harvey was not liable to Collier for the injuries received as a result of the accident and the judgment should be modified accordingly. Otherwise, it should be affirmed. 24 Collier filed an answer to the complaint of the Insurance Company and asked for affirmative relief. He did not request the court, in the exercise of a sound discretion, to refuse to entertain the action for a declaratory judgment. Whether the court, in the exercise of a sound discretion, should have refused to entertain the declaratory judgment action may not be raised for the first time in this court. 25 The cause is remanded with instructions to the trial court to ascertain whether Collier alleged in his petition in the state court, in addition to the negligence of the employees of Harvey loaned to the city, other grounds for recovery against Harvey. If it finds Collier did so allege, the judgment will be modified in accordance with the views above expressed. If it finds Collier did not allege additional grounds for recovery, the judgment will stand affirmed.