Hall et al v. Hall et al

DISTRICT COURT OF THE VIRGIN ISLANDS
DIVISION OF ST. THOMAS AND ST. JOHN
ELSA HALL as PERSONAL
REPRESENTATIVE of the ESTATE OF
ETHLYN LOUIS HALL, and ELSA Hall
as TRUSTEE of the ETHLYN LOUISE
HALL FAMILY TRUST,
Plaintiff,
v.
SAMUEL H. HALL, Jr. and HALL &
GRIFFITH, P.C.,
Defendants and
Counterclaimants.
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) 	Civil No. 2011-54
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SAMUEL H. HALL, Jr. and HALL &
GRIFFITH, P.C.,
Counterclaimants,
v.
ELSA HALL,
Counterclaim
Defendant.
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SAMUEL H. HALL, Jr. and HALL &
GRIFFITH, P.C.,
Plaintiffs,
v.
PHYLLIS HALL-BRIN and OTHERS
KNOWN AND UNKNOWN,
Third Party
Defendants.
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
Page 2
ATTORNEYS:
Andrew C. Simpson, Esq.
Emily A. Shoup, Esq.
Law Offices of Andrew Simpson
St. Croix, U.S.V.I.
For Elsa Emily Hall.
Robert L. King, Esq.
Law Offices of Robert L. King
St. Thomas, U.S.V.I.
For Samuel Hall and Hall and Griffith, PC.
Phyllis Hall Brin
Pro se.
MEMORANDUM OPINION
GÓMEZ, C.J.
Before the Court is a motion to dismiss, filed by Attorney
Samuel H. Hall, Jr., and his law firm, Hall and Griffith, P.C.
I. 	FACTUAL AND PROCEDURAL BACKGROUND
At all material times, until approximately April 19, 2002,
Ethlyn Louise Hall (“Mrs. Hall”)1 was the owner of the plot of
land known as Parcel 17, Estate Peter Bay, St. John, U.S.V.I.
(“the Property”). On or about April 19, 2002, Mrs. Hall
subdivided the Property into seven separate sub-plots, Parcels
17-1 through 17-7. Mrs. Hall transferred ownership of certain of
the plots to her children and grandchildren as gifts.
1 Mrs. Hall was born on June 6, 1916. She was 94 years old as of the date that
the Complaint was filed.
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Hall v. Hall
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Specifically, she executed a Deed of Gift, granting to her son,
Attorney Samuel H. Hall, Jr. (“Attorney Hall”)2, the real
property described as:
Parcel 	No. 	17-5, 	Estate 	Peter 	Bay, 	No. 	2aa 	Maho 	Bay
Quarter, 	St. 	John, 	U.S. 	Virgin 	Islands 	consisting 	of
1.161 acre, more or less.
(“Parcel 17-5”). She also made the following gifts:
Parcel 17-2 to her daughter, Elsa Hall;
Parcel 17-4 to her daughter, Phyllis Hall Brin; and
Parcel 17-6 to her granddaughter, Yassin Hall Young.
(“the Gifts”). Attorney Hall represented his mother in the
aforementioned transactions, drawing up the legal documents to
accomplish the gifts and recording the same.
From April 19, 2002, until approximately December 15, 2010,
Mrs. Hall was the owner of the plot of land known as Parcel 17-
7, Estate Peter Bay on St. John, U.S. Virgin Islands (“Parcel
17-7”).
On January 24, 2003, Mrs. Hall, as landlord, entered into a
Ground Lease (the “2003 Ground Lease”) with Andrews St. John
Trust (“Andrews”), as tenant. The lease was drafted by Attorney
Hall. Pursuant to the 2003 Ground Lease, Mrs. Hall leased Parcel
17-7 to Andrews for a period of fifty years. The lease provided
that Andrews was to design and build two cottages at Andrews’s
expense. One cottage was to be built on Parcel 17-6 (the “17-6
2 At all relevant times, until sometime in 2010, Attorney Samuel H. Hall, Jr.,
Mrs. Hall’s son, served as Mrs. Hall’s attorney.
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
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Cottage”). It would be owned by Yassin Hall Young. The other
cottage was to be built on Parcel 17-4 (the “17-4 Cottage”). It
would be owned by Phyllis Hall Brin.
The 2003 Ground Lease provided that, if the 17-6 Cottage
was not completed within two years from the date of the lease,
Andrews was to pay rent of $5,000 per month ($2,500 to Yassin
Hall Young and $2,500 to Phyllis Hall Brin), until the date of
completion. If the 17-4 Cottage was not completed within four
years of the date of the lease, Andrews was to pay $2,500 per
month to Phyllis Hall Brin until the date of completion.
Additionally, if the two cottages were not completed in the
requisite time, Mrs. Hall, Phyllis Hall Brin, and Yassin Hall
Young retained the right to seek injunctive relief and to sue
for specific performance. The lease also provided that the three
of them would be granted a first priority lien on any
improvements constructed on Parcel 17-7 by Andrews, and on any
income derived by Andrews from the use and enjoyment of Parcel
17-7.
Also under the 2003 Ground Lease, Andrews was obligated to
reimburse Mrs. Hall for all property taxes on Parcel 17-7,
including all property taxes on any improvements thereon.
Construction of the cottages on Parcels 17-4 and 17-6 was
not completed by the time allotted in the 2003 Ground Lease. As
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
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such, Andrews became obligated to pay rent. Attorney Hall
collected the rent for his mother under the 2003 Ground Lease.
He also managed Andrews’s reimbursement of property taxes to
Mrs. Hall and Andrews’s construction of the cottages.
At some point in time during the term of the 2003 Ground
Lease, changes were made to the design of the 17-6 Cottage,
substantially increasing its size.3 Mrs. Hall was aware of the
changes, but alleges that she never agreed to pay the increased
costs that resulted therefrom.
On August 3, 2007, Attorney Hall drafted, and Mrs. Hall
allegedly signed, a document which allowed Attorney Hall to halt
or postpone construction on the 17-4 Cottage. The document
allowed Attorney Hall to redirect the rental income from the
2003 Ground Lease to be used instead for the construction of a
house on Parcel 17-5, owned by Attorney Hall. The document
states that the consideration for allowing Attorney Hall to
redirect the rental income from the 2003 Ground Lease to his own
property was that Attorney Hall could “complete his home in
order to expedite his assistance of [Mrs. Hall] in [her] future
care on St. John.” (Compl. ¶ 38.)
On the following day, August 4, 2007, Mrs. Hall allegedly
signed a Power of Attorney in favor of Attorney Hall. The Power
3 The person responsible for making such changes is not identified in the
record.
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
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of Attorney was not notarized. That same day, Attorney Hall
drafted, and Mrs. Hall allegedly signed, a document purporting
to be an Assignment of Interest. Pursuant to the document, Mrs.
Hall signed all of her interest in the 2003 Ground Lease to
Attorney Hall in consideration for his “assistance with her
future care and upkeep.” (Compl. ¶ 39.)
On August 13, 2008, Mrs. Hall allegedly signed another
Power of Attorney in favor of Attorney Hall. The document was
notarized by Attorney Hall’s law partner, Marie Thomas-Griffith.
Mrs. Hall has no recollection of executing or intending to
execute either Power of Attorney.
Sometime thereafter, but prior to August, 2010, Mrs. Hall
discharged Attorney Hall and his law firm as her counsel and she
retained new counsel. In August of 2010, Mrs. Hall sent letters
to Attorney Hall requesting that he provide her with a complete
accounting of her financial obligations with regard to Parcel
17-7. She also requested that Attorney Hall provide her with
information regarding the reimbursement of property taxes paid
on Parcel 17-7. Attorney Hall did not respond to Mrs. Hall’s
requests for information.
Thereafter, Mrs. Hall became aware that, on or about
October 28, 2009, Attorney Hall, purporting to act “individually
and as attorney-in-fact for” Mrs. Hall, entered into an “Early
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
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Termination of Lease, Mutual Release and Estoppel Certificate”
(the “Release”), with Andrews. The Release discharged Andrews of
any further obligation under the terms of the 2003 Ground Lease.
Mrs. Hall alleges that she was neither aware of, nor did she
otherwise consent to or approve of the transaction at the time
that Attorney Hall purportedly undertook it on her behalf.
Mrs. Hall also became aware that Attorney Hall, purporting
to act as her attorney-in-fact, entered into a lease agreement
dated December 2, 2008 (the “2008 Lease”), with the Talton
Family Trust (“Talton”). Under the 2008 Lease, Parcel 17-7 was
leased to Talton for a period of 75 years, with the rent payment
to be made in an $800,000 lump sum. The lump sum was payable to
Attorney Hall, as “agent and attorney in fact” for Mrs. Hall.
(Compl. ¶ 52.) The lease agreement obligated Talton to reimburse
Mrs. Hall for all property taxes on Parcel 17-7. Mrs. Hall
asserts that she was neither aware of, nor did she otherwise
consent to or approve of this transaction at the time that
Attorney Hall purportedly undertook it on her behalf.
On December 15, 2010, after discharging Attorney Hall and
his firm as counsel and retaining new counsel, Mrs. Hall created
the Ethlyn Louise Hall Family Trust (“the Trust”). Also on that
date, Mrs. Hall transferred all of her property to the Trust.
Mrs. Hall named herself the sole trustee of the Trust.
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
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Subsequently, Mrs. Hall received a letter from Attorney
Hall, dated February 1, 2011. The letter informed Mrs. Hall that
the 2008 Lease generated a capital gain in 2010 totaling
$1,070,000. The letter explained that the capital gain was
subject to a capital gains tax of 15%. In the letter, Attorney
Hall stated that Mrs. Hall must pay the capital gains tax in the
full amount. He explained that “he, Phyllis Hall Brin and Yassin
Hall Young all benefitted from these funds, through the building
of their houses on Parcels 17-5, 17-4 and 17-6, respectively.”
(Compl. ¶ 60.) He further explained that he, along with Phyllis
Hall Brin and Yassin Hall Young, would reimburse Mrs. Hall for
her capital gains tax payment.
Thereafter, on May 9, 2011, Mrs. Hall, individually and as
Trustee of the Ethlyn Louise Hall Family Trust (the “Trust”)
(collectively, “the plaintiffs”), filed a six-count complaint
against Attorney Hall and his law firm, Hall and Griffith, P.C.
(collectively, “the defendants”). Count One alleged a claim for
breach of fiduciary duty against Attorney Hall. Count Two
alleged a claim for legal malpractice against Attorney Hall and
Hall & Griffith, P.C. Count Three alleged an action for fraud
against Attorney Hall. Count Four asked the Court to order an
accounting. Count Five asked the Court to establish a
constructive trust for allegedly diverted proceeds and other
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
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monies. Count Six requested that the Court impose an equitable
lien on Parcel 17-5. The Complaint asserted that Attorney Hall,
and Hall & Griffith, P.C., are citizens of the Virgin Islands.
(Compl. ¶ 6.) It asserted that Mrs. Hall is a citizen of
Florida. (Compl. ¶ 3.) The complaint did not assert the
citizenship of the Trust.
In order to determine whether there was diversity of
citizenship, on March 2, 2012, the Court ordered Mrs. Hall to
file a list of all of the trustees and beneficiaries of the
Trust and to identify their citizenship. The Court then ordered
Mrs. Hall to file the Trust’s establishing documents (the
“Declaration of Trust”) with the Court. Mrs. Hall filed the
Declaration of Trust with the Court for in camera review on
March 16, 2012.
Thereafter, on March 29, 2012, the Court issued an order in
which it found the requisite diversity of citizenship lacking.
The Court thus dismissed this matter for lack of subject matter
jurisdiction.
On the following day, Mrs. Hall filed a timely motion for
reconsideration of the Court’s March 29, 2012, order dismissing
this matter. Attorney Hall and the defendant law firm opposed.
In a December 20, 2012, Memorandum Opinion and Order, the
Court granted the motion for reconsideration. The Court
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
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determined that Mrs. Hall, in her individual capacity, is the
real party in interest. As such, the Court looked only to Mrs.
Hall’s citizenship to determine whether the requisite diversity
of citizenship existed. Because Mrs. Hall was a Florida citizen
at the time the action commenced, and Attorney Hall and the
defendant law firm were citizens of the Virgin Islands, the
Court determined that it had subject matter jurisdiction on the
basis of diversity of citizenship.
On January 8, 2013, the defendants filed the instant
renewed motion to dismiss. In their motion, the defendants
explain that Mrs. Hall died on May 5, 2012. Because of Mrs.
Hall’s death, the defendants assert that all of the claims in
the complaint are extinguished. The defendants assert that none
of the claims are assignable to the Trust. Further, to the
extent the Court allows any claims asserted by the Trust to
proceed, the defendants contend that such claims should be
dismissed for lack of diversity jurisdiction. Finally, the
defendants aver that the Trust lacks standing.
On January 21, 2013, the plaintiffs filed a motion to amend
the complaint. In their motion to amend, the plaintiffs
explained that the attached proposed amended complaint
“substitutes Elsa Hall as the Personal Representative of the
Estate of Ethlyn L. Hall for Ethlyn Louise Hall in her
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Hall v. Hall
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Memorandum Opinion
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individual capacity; this amendment reflects the death of Ethlyn
Louise Hall on May 5, 2012.” (ECF No. 33.) The plaintiffs
further indicated that the amendment “substitutes Elsa Hall as
the successor trustee of the Ethlyn Louise Hall Family Trust;
this reflects the fact that upon Ethlyn Louis Hall’s death, Elsa
Hall automatically became the sole successor trustee of the
Trust.” (Id.)
The plaintiffs filed an opposition to the defendants’
motion to dismiss on January 28, 2013.
The Magistrate Judge granted the plaintiffs’ motion to
amend on February 15, 2013. As such, the plaintiffs in this
action are now Elsa Hall as the Personal Representative of the
Estate of Ethlyn L. Hall and Elsa Hall as Trustee of the Ethlyn
Louise Hall Family Trust (the “Plaintiffs”).
The amended complaint contains ten counts. Counts One and
Two allege breach of fiduciary duty against both defendants.
Count Three alleges legal malpractice against both defendants.
Counts Four and Five allege conversion against both defendants.
Count Six alleges fraud against both defendants. Count Seven
alleges unjust enrichment against both defendants. Count Eight
seeks an accounting. Count Nine seeks a constructive trust.
Count Ten seeks an equitable lien.
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
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Subsequently, the defendants filed a nine-count
counterclaim against Elsa Hall and third-party complaint against
Phyllis Hall Brin. Count One alleges breach of fiduciary duty
against Elsa Hall. Count Two alleges intentional infliction of
emotional distress against Elsa Hall and Phyllis Hall Brin.
Count Three alleges fraud against Elsa Hall. Count Four alleges
civil conspiracy and tortious interference against Elsa Hall,
Phyllis Hall Brin, and others (unnamed). Count Five alleges a
claim for conversion against Elsa Hall. Count Six seeks a
mandatory injunction against Elsa Hall. Count Seven requests an
accounting from Elsa Hall and the Trust. Count Eight asserts a
constructive trust. Count Nine asserts a claim for tortious
interference against Elsa Hall.
II. DISCUSSION
It is axiomatic that “federal courts are without power to
adjudicate the substantive claims in a lawsuit, absent a firm
bedrock of jurisdiction. When the foundation of federal
authority is, in a particular instance, open to question, it is
incumbent upon the courts to resolve such doubts, one way or the
other, before proceeding to a disposition of the merits.”
Carlsberg Resources Corp. v. Cambria Sav. and Loan Ass'n, 554
F.2d 1254, 1256 (3d Cir. 1977). A federal court may address a
question of subject-matter jurisdiction sua sponte. See
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
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Employers Ins. of Wausau v. Crown Cork & Seal Co., Inc., 905
F.2d 42, 45 (3d Cir. 1990).
“To invoke . . . diversity jurisdiction, a controversy must
be between citizens of different states, and the amount in
controversy must exceed $75,000. 	See 28 U.S.C. § 1332(a)(1).
Whether diversity jurisdiction exists is determined by examining
‘the facts as they existed when the complaint is filed.’” 	Dolin
v. Asian Am. Accessories, Inc., 449 Fed. App’x 216 (3d Cir.
2011)(quoting Newman-Green, Inc. v. Alfonzo-Larrain, 490 U.S.
826, 830 (1989)).
III. ANALYSIS
A. Survival of Claims
The defendants’ primary argument for dismissal is that the
claims asserted in the amended complaint were extinguished by
the death of Elsa Hall. When a party to a lawsuit dies, the
threshold consideration is whether the claims asserted by or
against that party are extinguished. Giles v. Campbell, 698 F.3d
153, 155-56 (3d Cir. 2012). The claims alleged here are local in
nature. As such, the Court must look to local law for guidance
as to the survival of such claims. Giles, 698 F.3d at 156.
The Virgin Islands legislature has not enacted a statute
that speaks generally about the survival of tort actions. As
such, the Court must look to the common law, as expressed in the
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Hall v. Hall
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Memorandum Opinion
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principles of the Restatement, to provide the rules of decision.
V.I. Code Ann. tit. 1, § 4. With respect to the survival of tort
actions, the Restatement (Second) of Torts, in pertinent part,
provides
(1) A cause of action for a tort may be discharged by
(a) 	the 	death 	of 	either 	party, 	in 	the 	absence 	of 	a
statute 	providing 	for 	survival 	of 	the 	cause 	of
action;
(b) 	satisfaction, 	or 	a 	release 	or 	contract 	not 	to
sue; or
(c) the discharge in bankruptcy of the tortfeasor.
Restatement (Second) of Torts § 900(1). Consistent with that
section, and to avoid termination of personal injury torts, the
Virgin Islands legislature carved out the exception found in
Virgin Islands Code Ann. tit. 5, § 77 (“Section 77”).4 While it
may seem as though Section 77 is the exclusive list of actions
that survive upon the death of a party, such a conclusion would
overstate the reach of Section 77. Rather, it seems more
appropriate to regard section 77 as a statute creating an
4 “A thing in action arising out of a wrong which results in physical injury
to the person or out of a statute imposing liability for such injury shall
not abate by reason of the death of the wrongdoer or any other person liable
for damages for such injury, nor by reason of the death of the person injured
or of any other person who owns any such thing in action. When the person
entitled to maintain such an action dies before judgment, the damages
recoverable for such injury may include loss of earnings and expenses
sustained or incurred as a result of the injury may include damages for pain,
suffering and disfigurement, or punitive or exemplary damages, or prospective
profits or earnings after the date of death. The damages recovered shall form
part of the estate of the deceased. Nothing in this section shall be
construed as making such a thing assignable.” V.I. Code Ann. tit. 5, § 77.
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Hall v. Hall
Civil No. 2011-cv-54
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exception to the general rule that personal torts terminate at
death.
With respect to non-personal injury actions, the common law
has long recognized their survival, even in the absence of
statutes.
As 	early 	as 	1330, 	by 	statute 	an 	action 	could 	be
maintained 	after 	the 	death 	of 	the 	owner 	for 	the 	taking
of 	property 	that 	had 	diminished 	his 	estate. 	Aside 	from
statute, 	a 	person 	who 	has 	obtained 	property 	from
another 	since 	deceased 	is 	liable 	for 	its 	value, 	as
also 	is 	his 	estate 	after 	his 	death, 	if 	suit 	is 	brought
in 	a 	restitutionary 	action. 	In 	many 	states 	the 	early
survival 	statute 	was 	accepted 	as 	part 	of 	the 	common
law, 	and 	from 	the 	beginning 	the 	legislatures 	of 	the
several 	states 	began 	to 	modify 	the 	common 	law 	by
enacting 	statutes, 	so 	that 	today 	there 	are 	numerous
statutes 	providing 	for 	survivorship 	after 	the 	death
either 	of 	the 	tortfeasor 	or 	of 	the 	injured 	party 	for
many 	kinds 	of 	tort 	claims 	involving 	both 	injury 	to
things and injury to the person.
Restatement (Second) of Torts § 900 cmt a (emphasis supplied).
Indeed, this Court has explained that the “common law rule
that death terminated all causes of action for personal tort has
been statutorily altered in the Virgin Islands: a cause of
action for personal injury ‘shall not abate by reason of ... the
death of the injured person.’” Farrington v. Benjamin, Civil No.
1981-187, 100 F.R.D. 474, 475 (D.V.I. 1984) (Christian, C.J.)
(emphasis added) (citing V.I. Code Ann. tit. 5, § 77).
Significantly, the common law rule that actions for restitution
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Civil No. 2011-cv-54
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survive the death of a party, see Restatement (Second) of Torts
§ 900 cmt a, was not vitiated by the creation of Section 77.
The Restatement (Third) of Restitution and Unjust
Enrichment describes what is meant by the term “restitutionary
action,” explaining that “[a] person who is unjustly enriched at
the expense of another is subject to liability in restitution.”
Restatement (Third) of Restitution and Unjust Enrichment, § 1
(2011). “Liability in restitution derives from the receipt of a
benefit whose retention without payment would result in the
unjust enrichment of the defendant at the expense of the
claimant.” Id. at cmt. a.
Indeed, while Section 77 is the only Code section that
explicitly provides for the survival of certain types of
actions, other Code sections acknowledge survival of actions for
non-personal injury claims. Necessarily included among the
universe of such actions would be restitutionary actions. For
instance, Title 15 of the Virgin Islands Code provides that
Subject 	to 	the 	provisions 	of 	sections 	76 	and 	77 	of
Title 	5, 	causes 	of 	action 	by 	one 	person 	against
another, 	whether 	arising 	on 	contract 	or 	otherwise,
survive 	to 	the 	personal 	representatives 	of 	the
former 	and 	against 	the 	personal 	representatives 	of
the latter. . . .
V.I. Code Ann. tit. 15, § 601 (2012) (“Section 601”) (emphasis
added). Title 15 further provides that
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The 	provisions 	of 	subchapter 	I 	of 	this 	chapter,
excepting 	section 	601 	of 	this 	title, 	shall 	apply 	to
actions 	of 	an 	equitable 	nature 	by 	and 	against
executors 	and 	administrators, 	except 	as 	in 	this
subchapter 	otherwise 	or 	specially 	provided. 	All 	causes
of 	action 	of 	an 	equitable 	nature 	by 	one 	person 	against
another, 	however 	arising, 	survive 	to 	the 	personal
representatives 	of 	the 	former 	and 	against 	the 	person
[sic] 	representatives 	of 	the 	latter. 	When 	the 	cause 	of
action 	survives, 	as 	herein 	provided, 	the 	executors 	or
administrators 	may 	maintain 	an 	action 	of 	an 	equitable
nature 	thereon 	against 	the 	party 	against 	whom 	the
cause 	of 	action 	accrued, 	or 	after 	his 	death 	against
the personal representatives.
V.I. Code Ann. tit. 15, § 641 (“Section 641”)(emphasis added).
Sections 601 and 641 fall squarely in line with the
Restatement’s explanation of the types of claims that survive a
party’s death at common law – most importantly here, claims for
restitution. See Restatement (Second) of Torts § 900, cmt a; see
also V.I. Code Ann. tit. 15, § 601 (acknowledging the survival
of actions arising in “contract or otherwise); V.I. Code Ann.
tit. 15, § 641 (acknowledging the survival of equitable
actions).
Here, the plaintiffs assert such restitutionary claims as
breach of fiduciary duty, legal malpractice, conversion, fraud,
and unjust enrichment:
62. 	Plaintiff 	is 	also 	entitled 	to 	a 	judgment 	ordering
Defendants 	to 	turn 	over 	to 	her 	all 	of 	Ethlyn 	Louis
Hall’s 	property, 	including 	her 	legal 	files, 	maintained
by Defendants.
. . . .
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111. 	The 	circumstances 	of 	Defendant 	Hall’s 	actions 	–
self-dealing 	and 	acting 	in 	a 	manner 	that 	was 	in
conflict 	with 	the 	interests 	of 	his 	client 	– 	are 	such
that 	in 	equity 	and 	good 	conscience, 	Defendant 	Hall
should 	be 	required 	to 	return 	the 	funds 	he 	unjustly
obtained 	to 	either 	the 	Trust 	or 	Ethlyn 	Louise 	Hall’s
Estate.
. . . .
118. 	By 	reason 	of 	the 	fraudulent 	and 	otherwise
wrongful 	manner 	in 	which 	Defendant 	Hall 	obtained 	and
converted 	money 	belonging 	to 	Ethlyn 	Louise 	Hall 	for
his 	personal 	benefit 	he 	is 	an 	involuntary 	trustee 	of
the 	property 	belonging 	to 	the 	Ethlyn 	Louise 	Hall 	and
said 	property 	and 	all 	profits 	and 	improvements
therefrom 	are 	held 	in 	constructive 	trust 	for 	Ethlyn
Louise 	Hall, 	either 	individually 	or 	as 	trustee 	for 	the
Trust, 	and 	Defendant 	Hall 	has 	a 	duty 	to 	promptly
convey same to her.
119. 	By 	reason 	of 	the 	fraudulent 	and 	otherwise
wrongful 	manner 	in 	which 	Defendant 	Hall 	obtained 	and
converted 	money 	belonging 	to 	Ethlyn 	Louise 	Hall 	for
his 	personal 	benefit 	in 	constructing 	his 	house 	on
Parcel 	17-5, 	Estate 	Peter 	Bay, 	Ethlyn 	Louise 	Hall,
individually 	and 	as 	trustee 	for 	the 	Trust, 	is 	entitled
to 	the 	imposition 	of 	an 	equitable 	lien 	on 	Parcel 	17-5,
Estate 	Peter 	Bay, 	St. 	John, 	for 	all 	sums 	invested 	in
such property.
(Am. Compl. ¶¶ 62, 111, 118-119) (emphasis added); see also
Restatement (Third) of Restitution and Unjust Enrichment, § 1
(explaining the nature of restitutionary claims). The remedies
the plaintiffs seek include an accounting, imposition of a
constructive trust, and an equitable lien. Such remedies are
equitable in nature. See generally In re Prosser, BR 06-30009,
2011 WL 576068 (Bankr. D.V.I. Feb. 9, 2011) aff’d 2013 WL 996367
(D.V.I. Mar. 14, 2013) (“[A] plaintiff could seek restitution in
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
Page 19
equity, ordinarily in the form of a constructive trust or an
equitable lien . . .”) (internal citation omitted); Gov’t
Guarantee Fund of Republic of Finland v. Hyatt Corp., 5 F. Supp.
2d 324, 327 (D.V.I. 1998) (“an equitable accounting is a remedy
of restitution where a fiduciary defendant is forced to disgorge
gains received from the improper use of the plaintiff’s property
or entitlements.”) (internal citations omitted)). As explained
above, common law explicitly addresses and allows for the
survival of such restitutionary and equitable claims as are
asserted here. See Restatement (Second) of Torts § 900 cmt a;
Restatement (Third) of Restitution and Unjust Enrichment § 1. As
such, the defendants’ motion to dismiss will be denied insofar
as it seeks dismissal due to abatement of claims.
B. Subject Matter Jurisdiction: Diversity of Citizenship
The defendants argue that the Court lacks subject matter
jurisdiction because complete diversity of citizenship is
lacking.
It is well established that, “[f]or purposes of federal
jurisdiction, the requirement of diversity of citizenship is
ordinarily determined by the situation existing at the time an
action is commenced. Once federal jurisdiction has attached, it
is not defeated by a subsequent change in citizenship of one of
the parties, nor by a formal substitution of a personal
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
Page 20
representative of nondiverse citizenship for an original party
who dies while the cause is pending.” Brough v. Strathmann
Supply Co., 358 F.2d 374, 376 (3d Cir. 1966) (internal
quotations and citation omitted). Indeed, at all times, this
suit has been on behalf of Ethlyn Louise Hall, both when Ethlyn
Hall was suing on her own behalf and when her estate was
substituted as plaintiff. See id. (explaining that the suit had
been on behalf of the plaintiff both when he brought it himself
and when his representative was the plaintiff). Further, the
claims have substantially remained the same, arise under the
same set of facts, and accrued during Mrs. Hall’s life. See
generally Cowgill, 780 F.2d at 331-32 (explaining that the
purpose of a survival action is to allow a decedent’s
representative to assert claims, which accrued prior to the
decedent’s death, that the decedent could have himself
asserted).
The Court, in its December 20, 2012, Memorandum Opinion,
determined that it had subject matter jurisdiction based on
diversity of citizenship as of the filing of the original
complaint. The nature of this action has remained the same and
diversity has not been disturbed. See Brough, 358 F.2d at 376
(concluding that, where the nature of the action against the
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Hall v. Hall
Civil No. 2011-cv-54
Memorandum Opinion
Page 21
defendants remained the same after the plaintiff was
substituted, federal jurisdiction would remain).
The premises considered, the Court will deny the
defendants’ motion to dismiss.5 An appropriate order follows.
S\
Curtis V. Gómez
Chief Judge
5 The defendants also argue that, if the claims do not survive to Mrs. Hall’s
estate, then the complaint should be dismissed because the claims cannot be
assigned to the Trust. Because the Court finds that the claims do survive and
can be brought by Ethlyn Louise Hall’s estate on her behalf, the Court need
not reach the defendants’ remaining arguments.
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