Appendix — Bennett v. Society of Lloyd's

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APPENDIX A — ORDER OF THE UNITED STATES

DISTRICT COURT FOR THE DISTRICT OF UTAH,

CENTRAL DIVISION FILED JUNE 10, 2004

INTHE UNITED STATES DISTRICT COURT FOR

THE DISTRICT OF UTAH, CENTRAL DIVISION

Case No. 2:02C V-0204TC

THE SOCIETY OF LLOYD’S

Plaintiff,

VS.

WALLACE R. BENNETT, GRANT R. CALDWELL,

CALVIN P. GADDIS, DAVID L. GILLETTE, STEPHEN

M. HARMSEN, KELLY C. HARMSEN, JAMES R. ¥

KRUSE, EDWARD W. MUIR, and KENT B. PETERSEN,

Defendants.

ORDER

On May 13, 2004, a hearing was held on all pending

motions before the Court in this matter. In attendance were

Michael N. Zundel and Thomas R. Barton, counsel for

Plaintiff The Society of Lloyd’s (“Lloyd's”); Franklin Bennett

and David Bennett counsel for Defendant Wallace R. Bennett

(“Bennett”), who was also present; and Steven A. Wuthrich,

counsel for Defendants Stephen M. Harmsen and Kelly C.

Harmsen. Based on the papers filed by the parties, the

argument presented at the hearing, additional materials as

noted below, and good cause appearing therefor,

2a

Appendix A

THE COURT ENTERS THE FOLLOWING ORDERS

as to each of the following motions:

1. Bennett's Amended Motion Challenging Diversity of

Citizenship Jurisdiction of the Court, dated March 4, 2004

and Bennett's Motion to Determine that the Absence of

Diversity of Citizenship Jurisdiction Warrants Dismissal of

this Case, dated March 19, 2004. These motions are both

denied for the reasons set forth in Lloyd’s opposing

memoranda. Specifically, the Court finds that Lloyd's is an

English corporation. Therefore, as a matter of law, Lloyd’s

is a citizen of England. None of the defendants in this matter

are citizens of England. Therefore, diversity jurisdiction is

proper pursuant to 28 U.S.C. § 1332(a)(2). Furthermore, the

Court finds that Equitas Reinsurance, Limited (“Equitas”),

which is the assignor of Lloyd’s underlying claims against

the defendants, is also a citizen of England. Therefore, with

reference to 28 U.S.C. § 1359, the assignment from Equitas

to Lloyd’s is not collusive and does not invalidate the

diversity jurisdiction of this Court. The Court also finds that

Lloyd’s action against Bennett is not a “direct action against

[an] insurer,” and that therefore the diversity jurisdiction of

this Court is not invalidated pursuant to the exception

identified in 28 U.S.C. § 1332(c)(1).

2. Lloyd's Motion to Strike Certain Exhibits to Bennett's

Memorandum in Support of Amended Motion Challenging

Diversity Jurisdiction of the Court, dated March 19, 2004.

This motion is denied as being moot.

3. Bennett's Motion to Set Aside the Final Judgment

Under Rule 60(b), dated March 19, 2004. This motion is

3a

Appendix A

denied. The Court finds that Bennett has not met his burden

of demonstrating, by clear and convincing evidence, that

Lloyd's has committed any fraud or misrepresentation that

would warrant setting aside the Judgment Against Defendant

Bennett.

4. Bennett’s Motion for Protective Order, dated May 10,

2004. This motion is denied. The Court notes that it has

previously denied Bennett’s motion for stay pending appeal

and for relief from posting supersedeas bond, and that Bennett

has not posted a supersedeas bond. Under the circumstances,

the grounds set forth by Bennett in his motion are insufficient

to warrant an order restraining Lloyd’s current collective

efforts.

5. Lloyd's Motion to Hold Defendant Wallace R. Bennett

in Civil Contempt, dated January 26, 2004 (“Motion for Civil

Contempt”). This motion is granted in part and denied in

part for the reasons set forth below. Pursuant to 28 U.S.C.

§ 636(e)(6), Magistrate Judge Nuffer entered an Order

Certifying Facts of Contempt, dated March 23, 2004. This

order was based on Bennett’s refusal to comply with

Magistrate Judge Nuffer’s Order Granting Motion to Compel,

dated December 18, 2004, which Bennett admitted during

the hearing before Magistrate Judge Nuffer on February 24,

2004. However, based on the representations of Bennett’s

counsel at the May 13, 2004, hearing, the Court understands

that Mr. Bennett is now willing to comply with the Order

Granting Motion to Compel. Therefore, the Motion for Civil

Contempt, to the extent that it sought to incarcerate Bennett

until he complied with the Order Granting Motion to Compel,

is denied without prejudice, subject to Mr. Bennett’s full

4a

Appendix A

compliance with this Order. However, the Court finds that

Bennett’s conduct, up until the May 13, 2004 hearing, was

in violation of theOrder Granting Motion to Compel.

Therefore, to the extent that the Motion for Civil Contempt

sought a recovery of reasonable attorneys’ fees, the motion

is granted.

IT IS HEREBY ORDERED that Lloyd’s file and serve

an affidavit of expenses, including reasonable attorneys’ fees,

incurred in conjunction with the Motion for Civil Contempt,

within ten days of the entry of this Order. Bennett shall have

ten days after the service of the affidavit to submit a response

thereto.

IT IS FURTHER ORDERED THAT Bennett shall fully

and completely respond to all outstanding written discovery,

and deliver copies of responsive documents to Lloyd's

counsel’s offices, no later than Friday, June 18, 2004. No

later than May 21, 2004, Bennett shall also provide Lloyd’s

counsel, in writing, five business days on which he wiil be

available for deposition between June 28 and July 9, 2004.

Lloyd's shall select the day (or days) on which the deposition

shall occur. The aforementioned deadlines will not be affected

by motions or requests made in the interim, and will not be

altered except by order of the Court entered prior to the

applicable deadlines. If Bennett fails to adhere to any of the

aforementioned requirements, Lloyd’s is directed to contact

the Court immediately,

DATED this 9" day of June, 2004.

Sa

Appendix A

BY THE COURT:

s/ Tena Campbell

Tena Campbell

U.S. DISTRICT COURT JUDGE

APPROVED AS TO FORM:

Attorney for Wallace D. Bennett

Mr. Bennett has objected to this proposed order. His

objections are without merit and are hereby rejected.

Tena Campbell

6-9-04

6a

APPENDIX B — ORDER OF THE UNITED STATES

DISTRICT COURT FOR THE WESTERN DISTRICT

OF TEXAS, AUSTIN DIVISION FILED MAY 21, 2003

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

CIVIL NO. A-03-CA-9 JN

THE SOCIETY OF LLOYD'S

v.

CHARLES WILLIS BILA

ORDER

Before the Court are Defendant’s Motion to Deny

Recognition of Foreign Judgment (Clerk’s Doc. No. 8),

Defendant’s 12(b)(1) Motion to Dismiss Notice of Filing of

Foreign Country Judgment, and, in the Alternative, Request

for Leave to Conduct Jurisdictional Discovery (Clerk’s Doc.

No. 9), Plaintiff's Opposition to Defendant's 12(b)(1) Motion

to Dismiss Notice of Filing of Foreign Country Judgment

(Clerk’s Doc. No. 10), and Plaintiff's Motion for Recognition

of Foreign Judgment and Opposition to Defendant’s Motion

to Deny Recognition of Foreign Judgment (Cierk’s Doc. No.

11). Having considered the pleadings, case file, and

applicable law, the Court enters the following Order.

Defendant contends that the Court lacks subject-matter

jurisdiction in the instant case because Plaintiff and

Defendant are not diverse parties. The Court disagrees.

7a

Appendix B

Defendant is a Texas resident. Plaintiff is an English

corporation. Society of Lloyd’s v. Turner, 303 F.3d 325, 326-

27 (5" Cir. 2002); Society of Lloyd’s v. Ashenden, 233 F.3d

473, 475 (7" Cir. 2000). As Plaintiff is not incorporated in

Texas and does not have its principal place of business in

Texas, the parties are diverse, and, accordingly, the Court

has subject-matter jurisdiction in this case. See Howery v.

Allstate Ins. Co., 243 F.3d 912, 920 (5" Cir. 2001).

Defendant’s substantive arguments relating to theMotion

to Deny Recognition of Foreign Judgment are that the

judgment is repugnant to Texas public policy and was

obtained in violation of due process of law.' The Fifth Circuit

Court of Appeals has expressly rejected both arguments on

these identical facts. Turner, 303 F.3d at 330-33. Needless

to say, this Court will as well.’

1. Defendant also makes the related argument that the Names,

a group to which Defendant belongs, were not allowed to assert the

defense of fraud in the English proceedings, and, as such, the

judgment should not be recognized. This argument can only be

understood as a subset of the due-process argument in which

Defendant is attempting to object in the collection phase of the case

to the procedures used in the merits phase; this argument has been

squarely rejected. See Ashenden, 233 F.3d at 477-78.

2. The Court would entertain a motion from Plaintiff for

attorneys’ fees and/or sanctions under Feb. R.Civ. P. 11. At first blush,

it appears that the only way the arguments presented by Defendant

could pass muster under Rule 11 is if Defendant plans to pursue

them all the way to the United States Supreme Court (assuming a

request for an en banc hearing by the Fifth Circuit is either denied

or the en banc hearing produces the same result as Turner). Anything

(Cont'd)

8a

Appendix B

IT IS THEREFORE ORDERED, ADJUDGED, AND

DECREED that Defendant’s Motions (Clerk’s Doc. Nos. 8

& 9) are hereby DENIED.

IT IS FURTHER ORDERED, ADJUDGED, AND

DECREED that Plaintiff's Motion for Recognition of Foreign

Judgment (Clerk’s Doc. No. 11) is hereby GRANTED.

SIGNED AND ENTERED this 21“ day of May, 2003.

s/ James R. Nowlin

JAMES R. NOWLIN

CHIEF UNITED STATES DISTRICT JUDGE

(Cont'd)

less than this almost surely falls short of the strictures of Feb. R.

Civ. P. 11(b)(2). Assuming this is what Defendant has planned, it

would weigh heavily in Defendant's favor in the Court’s assessment

of the merits of any motion for fees or sanctions by Plaintiff if ©

Defendant represents this to the Court and follows through on those

representations. If not, Defendant had better produce some novel,

compelling arguments as to why he does not deserve to be sanctioned.

9a

APPENDIX C — ORDER GRANTING MOTION FOR

RECONSIDERATION OF THE UNITED STATES

DISTRICT COURT FOR THE DISTRICT OF

COLORADO FILED SEPTEMBER 9, 2004

Civil Action No. 02-RB-1959 (OES)

{Consolidated with Civil Action Nos. 02-RB-1960, 02-RB-

1961, 02-RB-1962, 02-RB-1963, 02-RB-1979]

THE SOCIETY OF LLOYD’S,

Plaintiff,

v.

JOHN MEACHEM SOMMER,

Defendant.

ORDER GRANTING MOTION FOR

RECONSIDERATION

Blackburn, J.

Pending is plaintiff's motion for reconsideration of the

court’s sua sponte dismissal of the above-captioned action

for failure to satisfy the elements of diversity jurisdiction as

pled in the case. In its distaissal order, the court found that

the “names” who comprise plaintiff Society of Lloyd’s

(Lloyd’s) “syndicates” are Colorado residents, thereby

defeating diversity of citizenship between plaintiff and

defendant, a Colorado resident. The dismissal order is

premised upon a line of cases represented by Indiana Gas

10a

Appendix C

Co. v. Home Insurance Co., 141 F.3d 314 (7" Cir. 1998),

which, similar to this court’s ruling, found an absence of

diversity between defendants and plaintiff members of

Lloyd’s syidicates of the same state. Plaintiff's motion

prompted additional research by the court, which led to the

court’s perusal of a later Seventh Circuit opinion, Society of

Lloyd’s v. Estate of McMurray, 274 F.3d 1133 (7" Cir.

2001).

In Estate of McMurray the court distinguishes a case

such as Indiana Gas Co., where Lloyd's syndicates are a

party plaintiff and are treated as partnerships for purposes of

the diversity analysis, from cases such as this one, where it

is Society of Lloyd’s itself, a corporation incorporated under

the laws of Great Britain, that is a party plaintiff. Estate of

McMurray, 274 F.3d at 1134 n.1. Where a “name,” or

member, of a plaintiff Lloyd’s syndicate shares citizenship

with a defendant party, diversity is not present.' Where,

however, Society of Lloyd’s is a plaintiff in an action against

a citizen of the United States, diversity of citizenship is

present and federal jurisdiction is appropriate. The above-

captioned matter is an Estate of McMurray type of case and

not an Indiana Gas Co. type of case.*

1. An instructive analysis of Lloyd’s unique organizational

structure in the context of a federal diversity jurisdiction

determination is found in Lowsley-Williams v. North River

Insurance Company, 884 F. Supp. 166 (D.N.J. 1995).

2. See also Society of Lloyd’s v. Turner, 303 F.3d 325 (5" Cir.

2002), and Society of Lleyd’s v. Ashenden, 233 F.3d 473 (7™ Cir.

2000), where federal courts exercised diversity jurisdiction in cases

involving Lloyd’s as a party plaintiff, although jurisdiction was not

challenged by the defendants or addressed by the courts.

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Appendix C

THEREFORE IT IS ORDERED as follows:

1. That Plaintiff’s motion for Reconsideration [#47]

filed July 24, 2003, is GRANTED;

2. Tnat my Order Dismissing Plaintiff’s Complaint

and Defendant’s Counterclaims for Lack of Jurisdiction

[#45] filed June 19, 2003, is RESCINDED; and

3. That Plaintiff’s Unopposed Motion To Permit

Withdrawl Of Motion For Reconsideration And Entry

Of Judgment filed September 8, 2004, is DENIED AS

MOOT.

Dated September 9, 2004, at Denver, Colorado.

BY THE COURT:

s/ Rober: E. Blackburn

Robert F. Blackburn

United States District Judge

ey ene

Supreme Court, U.S.

FILED :

JUL 29 2005 | .

i

GS) OFFICE OF THECLERK | '

No. 04-1731 :

IN THE

Supreme Court of the United States

WALLACE R. BENNETT,

Petitioner,

V,

THE SOCIETY OF LLOYDS,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

REPLY BRIEF

WALLACE R. BENNETT

Petitioner, Pro Se

1723 South 2100 East

Salt Lake City, Utah 84108

(801) 581-1516

195716 ce

COUNSEL PRESS

(800) 274-3321 - (800) 359-6859

TABLE OF CONTENTS

Table of Cited Authorities 22... 0... ce cee ee

I. JURISDICTIONAL REQuisiTEs NoT MET ........

II. DE&TERMINATIVE FACTS AND LAW ...........

Ill. THe DEEPER PROBLEM OF ENFORCEABILITY IN

UTAH OF THIS FOREIGN-NATION [English]

AMINE oor eS oi es ok eto aye et a

IV. THis Ltoyps Case IN OVERVIEW ..... Se eae

il

TABLE OF CITED AUTHORITIES

CASES

Carden v. Arkoma Associates,

406 US. 165 (198M 2 ee, ee

Dweck v. Japan CBM Corporation,

B71 0268 fo (9S CH 1988). se ies cai se

Erie Railroad Co. v. Tompkins,

304115 6€ (1938). See

Guaranty Trust Co. v. York,

S15 U8 99 GAS)

Hilton v. Guyot,

559:11:5. 143 (1895) <.<.24.52--:. ia.

Hummel v. Townsend,

Bes F206 307 (S" Cit 1989) os oo i ck

Indiana Gas Co., Inc. v. Home Ins. Company,

141 F.3d 314 (7 Cir. 1998) ............000.

Klaxon Co. v. Stentor Elec. Mfg. Co.,

SIS UB WNT 94 ee

Kramer v. Caribbean Mills, Inc.,

306158. O99 11969).

Mitchell v. Maurer,

BFS IS. BOE ELDON) io REE ao ee eee

Page

ili

Cited Authorities

Mitsubishi Motors Corp. v. Soler

Chrysler-Plymouth, Inc.,

MSA, GIR AEE oo es Gs i eee Oe,

Owen Equipment & Erection Co. v. Kroger,

MAT OS Os TIS Gis

Prudential Oil Corp. v. Phillips Petroleum Co.,

$466.26 409 (27 Ce 1976) on so ves se

Society of Lloyds 's v. Ashenden,

eae te Oi OF CR PO) ei oc bcs

Steel Co. v. Citizens for a Better Environment,

DEES EON eee i os si es es ea

Strawbridge v. Curtiss,

TAs Gt CUBOOL 5 ey bela bee ie es

United States v. Rutherford,

MALTS SOR TINTS) oo ae, i

Vimar Seguros Y Reaseguros, S. A. v. M/V Sky Reefer,

| he BE ks 74. eh >) Eee an pew e rate Creare a

Wainwright v. Goode,

MORSE. 78 Cisee) fo oe hes ee

Whitmore v. Arkansas,

SIS UID Ae TEI) os kee oe eres aS

iv

Cited Authorities

Page

U.S. StaTuTEs CiTED

28 U.S.C. § 1331

(Pemeral OUGsROny oi 2 eo a 5 SS 4

28 U.S.C. § 1332

(Diversity of Citizenship Jurisdiction) .... 1, 2,4, 5,8

28 U.S.C. § 1359

(Diversity Jurisdiction - Collusive Assignments) . . 3

28 U.S.C. § 1652

(The Rules of Decision Act) ...........2.6..4. 5,8

Urtan Statutes CITED

UtaH Cope ANN. § 61-1-22 (1988) .............. 6, 11

Utau Cope Ann. § 78-22b-107(3) (1990)

(Judicial Code, Asserting and defending a foreign-

UE CANIN ce we Se ee 6

UtaH Cope Ann. § 78-22b-114 (1990) |

(Judicial Code, Supplemental general

INLINE OWS 2a os 6 5 ia vo onc 0h RRR RS 6

ENGLISH STATUTES CITED

Ee WAGE OF TGC e Civica Nees ce hese 7

SE PAE OE FURS he sca ek Ca a eke ok ees 7

Cited Authorities

Page

RESTATEMENTS OF LAw CITED

1 RESTATEMENT (THIRD) OF FOREIGN RELATIONS Law

OF THE UNITED StaTEs § 482 (1986)

(“Grounds for Nonrecognition of Foreign

Judgments”) ........ Bee Sa ie a daa wo ics 5

OTHER AUTHORITIES

Christine M. Durham, Employing the Utah

Constitution in the Utah Courts, 2 UTAH BaR

JOURNAL 25 (Issue No. 9, November 1989) ..... 6

Darrell Hall, No Way Out: An Argument Against

Permitting Parties to Opt Out of U.S. Securities

Laws in International Transactions, 97 CoLum. L.

REv. 57 (Issue No. 1, January 1997) .......... 7

Courtland H. Peterson, Choice of Law and Forum

Clauses and the Recognition of Foreign Country

Judgments Revisited Through the Lloyds of London

Cases, 60 La. L. Rev. 1259 (Issue No. 4, Summer

TIPE A ee iia Co eh eer ee 7,8

ee ee. 5

Charles Alan Wright, Arthur R. Miller

& Edward H. Cooper,

14 FEDERAL PRACTICE AND PROCEDURE: JURISDICTION

Cae Rs Ee ea ew ke oe ee ek 3

1

I. JURISDICTIONAL REQuisires Not MET

To sue under 28 U.S.C. § 1332, Congress has determined

that there must be “complete diversity of citizenship.” Owen

Equipment & Erection Co. v. Kroger, 437 U.S. 365, 377 (1978).

Complete diversity must be manifest “as a threshold matter”.

Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 95

(1998). “Standing to sue is part of .. . what it takes to make a

justiciable case.” Whitmore v. Arkansas, 495 U.S. 149, 155

(1990).

In the case at bar, Wallace Bennett signed a seminal

Agency Agreement having extensively detailed rights and

duties with Edward Williams Coutts & Partners, Ltd., an

unincorporated British insurance agency. [See Bennett

Petition for Certiorari, pp. 13-15] Thereafter Lloyds of

London caused a sequence of unilateral “assignments”

whereby Coutts was wholly displaced by “Substituted

agent” Castle Agency; followed by “AUA9"; then by

“Equitas”; then to the “Society of Lloyds”, the designated

unincorporated-society-and-also corporation plaintiff

herein. [Docs. 32, 178; Doc. 244, pp. 114-119].

Wallace Bennett became a constituent Member of “The

Society” (#24021C) and a “Name” in Lloyds “community”.

[Compare this factually with Lloyds assertion that there exists

“complete diversity” between ““The Society and Bennett”. ]

Under the applicable law set forth in II. below, requisite

§ 1332 complete diversity is not clearly met; the Society should

not be regarded as having unquestioned standing to sue through

these assignments and as if it were a typical corporation; the

case should be dismissed for failure of fundamental jurisdiction.

2

Il. DETERMINATIVE FACTS AND LAW

. Section 1332(a)(2), 28 U.S. Code specifically requires

foreign plaintiffs to be “citizens or subjects of a foreign

state. .. .” “The Society of Lloyds”, designated collection agent

for a consortium, is not itself comprised, even primarily, of

“subjects of a foreign state”. This failure should have been

revealed by a non-U.S. government corporate disclosure

statement required of Lloyds by Supreme Court Rule 30.6.

For diversity determinations, American case law deems an

unincorporated association to be “a citizen of every state in

which its members reside”. [Hence requisite § 1332 diversity is

not present.] Hummel v. Townsend, 883 F.2d 367, 369 (5® Cir.

1989). Carden v. Arkoma Associates, 494 U.S. 185 (1989).

The Seventh Circuit Court in Indiana Gas Company, Inc.

v. Home Insurance Company, 141 F.3d 314, 316 (1998) held

that complete diversity was lacking in that Lloyds case and

dismissed the litigation pronouncing this policy:

This approach reflects a strong reluctance to extend

the diversity jurisdiction by judicial interpretation — a

reluctance that has characterized the Supreme Court’s

jurisprudence ever since Strawbridge held that

complete diversity is essential.

Id. at 319. [Quoted therein was Mitchell v. Maurer, 293 U.S.

237, 244 (1934):

[E]very federal appellate court has a special obligation

to “satisfy itself not only of its own jurisdiction; but

also that of the lower courts in a cause under review”,

even though the parties are prepared to concede it. ]}

3

Kramer v. Caribbean Mills, Inc., 394 U.S. 823, 827-829 (1969)

indicated factors that exclude jurisdiction recognition of

successive assignments, especially among entities as to which

truly independent status and consideration are questionable:

... there can be little doubt that the assignment was

for purposes of collection. ...“... motivated ... to

make diversity jurisdiction available. . . .”

If federal jurisdiction could be created by assignments

of this kind, .. . a vast quantity of ordinary contract

and tort litigation could be channeled into the federal

courts at the will of one of the parties. Such

“manufacture of Federal jurisdiction” was the very

thing which Congress intended to prevent when it

enacted § 1359 and its predecessors.

To this effect also see Dweck v. Japan CBM Corporation, 877

F.2d 790, 792-793 (9® Cir. 1989).

Prudential Oil Corp. v. Phillips Petroleum Co., 546 F.2d

469, 475 (2™ Cir. 1976) concluded:

... It was suggested by the Supreme Court almost a

century ago that an intercorporate assignment between

a parent and its subsidiary should be treated as

presumptively ineffective for jurisdictional purposes.”

An evident absence of consideration especially taints

the substantive bona fides of Lloyds’ “assignments” herein.

See 14 Wright, Miller & Cooper, Federal Practice and

Procedure § 3639, at p. 109 (2d ed. 1985).

-

4

III. THe DEEPER PROBLEM OF ENFORCEABILITY IN UTAH

oF Tus Foreicn-Nation [English| JUDGMENT

Although this particular 28 U.S.C. § 1332 case should be

dismissed outright for lack of a clear showing by Lloyds of

standing to sue and complete diversity jurisdiction, the history

of this important international litigation provides a timely

context for the High Court to deal with entwined federal — state

relationships.

Two principal vectors impinge: a concern to pay special

deference to agreed English contract clauses, processes and

adjudications / opposed to a Congressional mandate tnat except

in “federal — question” cases [28 U.S.C. § 1331], the law and

equity of the involved forum state “shall be regarded as rules

of decision.”

The ratio decidendi of the Tenth Circuit opinion at bar

seems: “We have already determined that the English judicial

system 1s procedurally above reproach” [Op. p. 38]; and that

“We have no choice under Hilton [c.f. analysis in Bennett

Petition for Cert. p. 10] . . . “but to examine the entirety of the

foreign judicial system, and not the particularity of individual

judgments.” [Op. p. 32]

The Tenth Circuit did qualify the conviction of its overall

endorsement: “English courts found Lloyds guilty of negligence

with respect to their Names” [Op. p. 10] and “Lloyds had been

guilty of serious negligence and/or fraud” [Op. p. 8].

Clauses that prospectively disenable parties from pursuing

statutory remedies in international cases have been questioned

by the Supreme Court: Mitsubishi Motors Corp. v. Soler

Chrysler-Plymouth, Inc., 473 U.S. 614 (1985) at p. 637, n. 19,

{2 quoted in Vimar Segures Y Reaseguros, S. A. v. M/V Sky

Reefer, 515 U.S. 528 (1995, The Supreme Court stated:

5

... | Restatement (Third) of Foreign Relations Law of

the United States § 482(2)(d) (1986) (‘A court in the

United States need not recognize a judgment of the

court of a foreign state if . . . the judgment itself is

repugnant to the public policy of the United States”).

Were there no subsequent opportunity for review and

were we persuaded that “the choice-of-forum and

choice-of-law clauses operated in tandem as a

prospective waiver of a party’s right to pursue

statutory remedies ..., we would have little

hesitation in condemning the agreement as against

public policy.”

Vimar Seguros, at p. 540, ] 2. [Emphasis added. ]

Under The Rules of Decision Act, 28 U.S.C. § 1652, state

law — not federal, not foreign — should govern the resolution of

the legal and equitable claims and defenses of true divergent

parties in a § 1332 action. Erie Railroad Co. v. Tompkins, 304

US. 64 (1938); Guaranty Trust Co. v. York, 326 U.S. 99 (1945);

and Wainwright v. Goode, 464 U.S. 78 (1983): “The views of

the State’s highest court with respect to state law are binding on

the federal courts-“74d-at p. 84, J 2; “the petition for certiorari is

granted, the judgment of the Court of Appeals ... is

reversed. ...” /d. at p. 87, ¥ 3.

The late eminent constitutional authority Charles: Alan

Wright put it this way:

The federal court must keep in mind . . . that its function

is... .to choose the rule it believes the state court, from

all that is known about its methods in reaching

decisions, is likely in the future to adopt.

Wright, Law or FEDERAL Courts (5 ed. 1994) at p. 397.

6

Current Utah Supreme Court Chief Justice Christine M.

Durham presciently emphasized in an article published in 1989

that a State may afford greater protections than under similarly

worded federal statutes. See Bennett Petition for Certiorari,

p. 28.

The Tenth Circuit Court did not understandingly apply this

fundamental tenet of federal — state jurisprudence, and ignored

what should have been controlling state law.' The Supreme Court

declared in United States v. Rutherford, 442 U.S. 554, 555

(1979):

Under our constitutional framework, federal courts do

not sit as councils of revision empowered to rewrite

Legislation in accord with their own conceptions of

prudent public policy. :

Whatever some federal court somewhere might determine,

for example, about waiverability of federal securities act

protections, the Utah Uniform Securities Act is unmistakable:

there can be no waiver of compliance with its investor

protections [UTAH Cope ANN. § 61-1-22(9)], and no suit can be

brought in Utah on any investment contract that is in violation

of the statute [UTAH Cope ANN. § 61-1-22(8)]. Other outcome-

altering statutes, UTAH Cope ANN. 78-22b-107(3) and 78-22b-

114, should also have been looked at relative to ordering

enforcement executions in this state. The questions were not

certified to the Utah Supreme Court, although motions for such

were made.

' “A federal court sitting in diversity applies the choice of law

rules of the state in which it sits.” Klaxon Co. v. Stentor Elec. Mfg. Co.,

313 U.S. 487 (1941). Erie established that there was to be no general

_ “federal common law.” Even Congress has no power to declare

substantive rules of common law applicable in a state; and only Congress

can determine lower federal court subject-matter jurisdiction. [As with

many other states, Utah has not adopted the Uniform Foreign - Money

Judgments Recognition Act. (10" Cir. Op. p. 31)]