2. “In determining whether to entertain and issue the writ of prohibition
for cases not involving an absence of jurisdiction but only where it is claimed that the lower
tribunal exceeded its legitimate powers, this Court will examine five factors: (1) whether the
party seeking the writ has no other adequate means, such as direct appeal, to obtain the
desired relief; (2) whether the petitioner will be damaged or prejudiced in a way that is not
correctable on appeal; (3) whether the lower tribunal's order is clearly erroneous as a matter
of law; (4) whether the lower tribunal's order is an oft repeated error or manifests persistent
disregard for either procedural or substantive law; and (5) whether the lower tribunal's order
raises new and important problems or issues of law of first impression. These factors are
general guidelines that serve as a useful starting point for determining whether a
discretionary writ of prohibition should issue. Although all five factors need not be satisfied,
it is clear that the third factor, the existence of clear error as a matter of law, should be given
substantial weight.” Syllabus Point 4, State ex rel. Hoover v. Berger, 199 W.Va. 12, 483
S.E.2d 12 (1996).
3. “[C]laims and counterclaims arise out of the same 'transaction or occurrence' when there is a logical relationship between the claim and the counterclaim.” Syllabus Point 4, in part, State ex rel. Strickland v. Daniels, 173 W.Va. 576, 318 S.E.2d 627 (1984).
4. When a motion is made to have an action transferred pursuant to Rule 42(b) of the West Virginia Rules of Civil Procedure, the movant must give notice to all parties in the case(s) to be transferred. The parties in the case(s) to be transferred must be given the opportunity to object prior to the transfer and if requested, the transferring court shall hold a hearing to determine whether transfer is proper under Rule 42(b).
Maynard, Justice:
This case is before this Court upon a petition for a writ of prohibition filed by
Thomas Taylor, Melody and Daryl Johnson, and Leonard and Iris Lucas (hereinafter
“petitioners”) against the respondents, the Honorable David W. Nibert, Judge of the Circuit
Court of Roane County, Nationwide Mutual Insurance Company, George G. O'Dell, Jr., and
Stacy McKown O'Dell. The petitioners seek to prohibit the circuit court from enforcing its
order transferring their cases to Roane County and consolidating them with a pending class
action. The petitioners further seek to prohibit the circuit court from enforcing its order
granting preliminary class certification insofar as it attempts to create a mandatory, non-opt-
out punitive damages class on the basis of a “limited punishment” theory.
This Court has before it the petition for writ of prohibition, the responses
thereto, and the argument of counsel. For the reasons set forth below, the writ is granted as
moulded.
In determining whether to entertain and issue the writ of
prohibition for cases not involving an absence of jurisdiction but
only where it is claimed that the lower tribunal exceeded its
legitimate powers, this Court will examine five factors: (1)
whether the party seeking the writ has no other adequate means,
such as direct appeal, to obtain the desired relief; (2) whether the
petitioner will be damaged or prejudiced in a way that is not
correctable on appeal; (3) whether the lower tribunal's order is
clearly erroneous as a matter of law; (4) whether the lower
tribunal's order is an oft repeated error or manifests persistent
disregard for either procedural or substantive law; and (5)
whether the lower tribunal's order raises new and important
problems or issues of law of first impression. These factors are
general guidelines that serve as a useful starting point for
determining whether a discretionary writ of prohibition should
issue. Although all five factors need not be satisfied, it is clear
that the third factor, the existence of clear error as a matter of
law, should be given substantial weight.
Syllabus Point 4, State ex rel. Hoover v. Berger, 199 W.Va. 12, 483 S.E.2d 12 (1996). With
these standards in mind, we now determine whether a writ of prohibition should be issued.
When two or more actions arising out of the same transaction or
occurrence are pending before different courts or before a court
and a magistrate, the court in which the first such action was
commenced shall order all the actions transferred to it or any
other court in which any such action is pending. The court to
which the actions are transferred may order a joint hearing or
trial of any or all of the matters in issue in any of the actions; it
may order all the actions consolidated; and it may make such
other orders concerning proceedings therein as may tend to
avoid unnecessary costs or delay. Whenever one of the actions
is pending before a magistrate and a judgment is rendered by the
magistrate for $15.00 or less, such judgment of the magistrate
shall in no manner affect the other action pending in the court;
the doctrine of res judicata shall not apply to such judgment, nor
shall any such judgment of the magistrate be admissible in
evidence in the trial of the other action pending in the court.
The petitioners maintain that the transfer was not sanctioned by Rule 42(b) because their
cases do not arise from the “same transaction or occurrence” as those cases pending in Roane
County.
This Court first considered what constitutes the “same transaction or
occurrence” in State ex rel. Strickland v. Daniels, 173 W.Va. 576, 318 S.E.2d 627 (1984).
In that case, this Court had to determine whether claims for invasion of privacy and
intentional infliction of emotional distress arose out of the same transaction that resulted in
eviction proceedings such that the tort claims should have been considered as compulsory
counterclaims. After looking at federal court decisions for guidance, this Court concluded
in Syllabus Point 4, in part, of Daniels, that “claims and counterclaims arise out of the same
'transaction or occurrence' when there is a logical relationship between the claim and the
counterclaim.”
Although we have not defined what constitutes a “logical relationship,” we can
again find guidance from other courts. In that regard, several courts have adopted what has
been labeled as “the logical relationship test” as a means of determining whether claims arise
from the same transaction or occurrence. The test was set forth in Revere Copper and Brass
Inc. v. Aetna Casualty and Surety Co., 426 F.2d 709, 715 (5th Cir. 1970), as follows,
[A] claim has a logical relationship to the original claim if it arises out of the same aggregate of operative facts as the
original claim in two senses: (1) that the same aggregate of
operative facts serves as the basis of both claims; or (2) that the
aggregate core of facts upon which the original claim rests
activates additional legal rights in a party defendant that would
otherwise remain dormant.
See also In re Lazar, 237 F.3d 967, 979 (9th Cir. 2001) (“A logical relationship exists when
the counterclaim arises from the same aggregate set of operative facts as the initial claim, in
that the same operative facts serve as the basis of both claims or the aggregate core of facts
upon which the claim rests activates additional legal rights otherwise dormant in the
defendant.”).
In this case, the petitioners assert that the only operative fact common to the
transferred cases is that they all purportedly involve Nationwide's actions in offering its
policyholders uninsured and underinsured motorist coverages using substantially similar
forms. They point out that these offers were made to individual policyholders, pertained to
separate policies of insurance issued at different times under varying circumstances, and
involved different levels of coverage. The petitioners further contend that all of the cases
sought to be transferred and consolidated involved widely disparate conduct on the part of
Nationwide in denying coverage. In summary, the petitioners say that these offers
encompassed a multitude of individual transactions between Nationwide and its
policyholders, none of which share a common aggregate of operative facts so as to require
transfer under Rule 42(b).
The petitioners further argue that the transfer was improper because neither the
1993 nor the 1999 mass mailings are relevant to their cases. For example, the petitioners
note that Nationwide initially denied coverage in the Taylor case based on the 1999 mass
mailing, but later retreated from that position in the context of a summary judgment motion
by asserting that the requirements of W.Va. Code § 33-6-31(b) were satisfied by a March 20,
1998 document unrelated to the mass mailings. The petitioners conclude that if the transfer
order only applies to cases challenging the 1993 and 1999 mass mailings, then petitioner
Taylor's case should not have been transferred since the mailings are not relevant to his case.
In response, the O'Dells (See footnote 3) argue that the circuit court properly ordered transfer
and consolidation under Rule 42. The O'Dells maintain that the transferred cases arose out
of the same transaction or occurrence, i.e., Nationwide's failure to make commercially
reasonable offers of uninsured and underinsured coverages to insureds under W.Va. Code
§§ 33-6-31 and 33-6-31d by means of its 1993 and 1999 mass mailings. The O'Dells
contend that there clearly is a logical relationship between the claims in the O'Dell class
action and the petitioners' claims. The O'Dells assert that the petitioners inexcusably gloss
over the fact that the 1993 and 1999 mailings were mass mailings. In other words, the
documents that were sent to policyholders were identical in all important respects.
Furthermore, errors in the mass mailings were identical; for example, the 1999 mailings all
used the word “VALID” instead of “VOID.”
Likewise, Nationwide also asserts that the petitioners' claims arise out of the
same transaction or occurrence as all other transferred cases, specifically, its 1993 and 1999
mass mailings. Nationwide maintains that the Rule 42(b) requirements for transfer have been
met. In that regard, Nationwide contends that all of the transferred cases are based on the
allegation that its offers of uninsured and underinsured coverages did not comply with state
law. Nationwide also argues that another consideration supporting the Transfer Order is the
burden that would be placed on parties, witnesses, and available judicial resources if multiple
lawsuits are allowed to go forward.
Having thoroughly considered the parties' arguments as well as the applicable
law, we find that the petitioners' request for a writ of prohibition with respect to the Transfer
Order should be granted. As noted above, transfer is required under Rule 42(b) only when
two or more actions arise out of the “same transaction or occurrence.” Utilizing the “logical
relationship test,” we are unable to find that the cases are logically related such that it can be
said that they arose out the same transaction or occurrence. We are, of course, mindful of
the fact that all of the plaintiffs have claims for uninsured or underinsured motorist coverage
and all received either or both of the 1993 and 1999 mailings offering such coverages.
However, the fact that all of the plaintiffs received the mailings is simply not a sufficient
basis by itself for mandatory transfer.
In Mr. Taylor's case, the mailings are not relevant. First, Mr. Taylor was not
a Nationwide insured in 1993. Clearly, the 1993 mailing has no impact upon his case.
Secondly, Nationwide has asserted and the Circuit Court of Jefferson County has ruled that
the 1999 mailing is not relevant to his case. (See footnote 4) Thus, even though Mr. Taylor received an offer
for uninsured and underinsured motorist coverages by mail in 1999 like the plaintiffs in the
class action pending in Roane County, there is no basis to transfer his case to that forum
given the fact that the mailing will not be a factor in the resolution of his claims against
Nationwide.
While the mailings may be at issue in the cases of the other petitioners, Mr. and
Mrs. Johnson, and Mr. and Mrs. Lucas, we are unable to find that their claims arose out of
the same aggregate of operative facts. In that regard, the petitioners' claims for uninsured
or underinsured motorist coverage arose as a result of separate motor vehicle accidents
involving an uninsured or underinsured motorist. See Syllabus Point 4, in part, State
Automobile Mut. Ins. Co. v. Yuler, 183 W.Va. 556, 396 S.E.2d 737 (1990) (“W.Va.Code,
33-6-31(b), as amended, on uninsured and underinsured motorist coverage, contemplates
recovery, up to coverage limits, from one's own insurer, of full compensation for damages
not compensated by a negligent tortfeasor who at the time of the accident was an owner or
operator of an uninsured or underinsured motor vehicle.”). Thus, the operative facts in each
civil action are different. Simply put, the cases arose from separate transactions or
occurrences. The fact that the petitioners received offers for uninsured and underinsured
motorist coverage from Nationwide by mail in 1993 and/or 1999 is not the transaction or
occurrence which gave rise to their civil actions. While it is true that common questions of
law may arise regarding whether Nationwide made commercially reasonable offers of
uninsured and underinsured motorists coverage to insureds such as the petitioners, such
inquiries alone cannot be the basis for transfer under Rule 42(b).
Rule 42(b) only mandates transfer when cases arise out the same transaction
or occurrence. For the reasons set forth above, we are unable to conclude that the petitioners'
cases arose out of the same transaction or occurrence as those cases pending in Roane
County, and therefore, we find that the circuit court exceeded its legitimate powers by
transferring the cases from the petitioners' chosen forums. We note that the claims of the
O'Dells and the other members in the class action pending in Roane County may be
sufficiently similar to warrant class action treatment; however, that question was not before
us here. Rather, our analysis was limited to determining whether the petitioners' cases were
properly transferred to Roane County under Rule 42(b). Because we believe the transfer was
improper due to the fact that the petitioners' cases arose from different transactions or
occurrences, the request for a writ of prohibition is hereby granted.
While we have concluded that the transfer of the petitioners' cases to Roane
County was improper under Rule 42(b), we feel compelled to comment on the nature of the
rule. As noted above, the petitioners' cases were transferred to Roane County without any
prior notice and thus, the petitioners had no opportunity to object to the transfer until after
the transfer was complete. Obviously, the decision to transfer the cases pursuant to Rule
42(b) was based upon the representations of the party requesting the transfer, in this instance,
Nationwide, that the cases arose out of the “same transaction or occurrence.” We believe
the decision to transfer the cases without giving an opportunity to the petitioners to object
was unfair and contrary to the purpose of Rule 42(b).
“The reason for such Rules relating to the transfer and consolidation of actions
is to avoid unnecessary cost or delay and to avoid the necessity of two trials instead of one,
therefore avoiding the possibility of judgments in direct conflict.” State ex rel. Bank of
Ripley v. Thompson, 149 W.Va. 183, 189, 139 S.E.2d 267, 271 (1964). Transferring cases
pursuant to Rule 42(b) without giving an opportunity to the parties in the cases being
transferred to object has the opposite effect, when, as in this case, transfer is not proper.
Here, the Transfer Order was entered on January 27, 2005, and now, almost two years later,
it has been determined that the transfer was improper. As a result, the petitioners have
incurred considerable costs and delay. It is very likely that Mr. Thomas' case would have
been resolved by now had it not been transferred to Roane County.
Accordingly, we now hold that when a motion is made to have an action
transferred pursuant to Rule 42(b) of the West Virginia Rules of Civil Procedure, the movant
must give notice to all parties in the case(s) to be transferred. The parties in the case(s) to
be transferred must be given the opportunity to object prior to the transfer and if requested,
the transferring court shall hold a hearing to determine whether transfer is proper under Rule
42(b). Of course, in an appropriate case, the decision of a circuit court transferring or
refusing to transfer a case pursuant to Rule 42(b) can be reviewed by this Court on an
extraordinary writ. (See footnote 5)
Having found that the petitioners' cases should not have been transferred to
Roane County, the petitioners' arguments with respect to the Certification Order are moot.
Writ Granted as Moulded.