U.S. v. Heyward-Robinson Co. case brief
1979, U.S. Ct of Appeals Second Circuit
Posture: Judgment was entered for Plaintiff, defendant appeals. Ct of Appeals affirms
Facts: Action involves two subcontracts for excavation work between D’Agostino and Heyward as prime contractor on two construction jobs in Connecticut. One of prime contracts was constructing barracks at naval base and the other was for a plant at Stelma. Agostino brought action against Heyward and its surety Maryland to recover payments alleged to be due on Navy job. Heyward denied and brought counterclaim for extra costs for Navy and Stelma. D’agostino interposed a reply counterclaim to recover movies alleged to be due on Stelma job. At trial, two subcontracts were treated together. Jury found Heyward breached subcontracts in a special trial, then another special trial for worth. Judgment against Heyward was for 40,000.
Reasoning: Heyward claims that district court had no jurisdiction over counterclaims on Stelma job, judgment must be reversed because they were presented as inseperable. Found that there is no independent basis of federal jurisdiction over Stelma and with no diversity jurisdiction too. Question is if claims are compulsory or permissive, if they are permission there is no jurisdiction unless there is an independent jurisdictional ground. If compulsory then they are ancillary to claim asserted and independent basis not required. The court decided that counterclaims were compulsory within meanings, there was such a close logical relationship between claims that Stelma arose out of same transaction or occurrence. Court also found many other reasons for it arising out of same occurrence.
Friendly Concurrence: Whether counterclaim is compulsory must be made at pleading stage and it is irrelevant that it was made at different stages. They should have taken the case as if the counterclaim did not exist. Thinks that court ignored the law. He said that permissive claims are not dismissed based on no independent jurisdictional basis.