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Huertas v. Kingdom of Spain

March 27, 2006

GLORIA HUERTAS, PLAINTIFF,
v.
THE KINGDOM OF SPAIN ET AL., DEFENDANTS.



The opinion of the court was delivered by: Richard W. Roberts United States District Judge

MEMORANDUM OPINION

Plaintiff Gloria Huertas sued Jose Alepuz and the Kingdom of Spain, seeking a declaration of her ownership interest in a house located in the District of Columbia that was purchased by Alepuz, seeking back rent payments for that house from the Kingdom of Spain, and alleging that fraud by Alepuz caused Spain to stop paying the rent. Alepuz moved to dismiss the complaint on the ground of forum non conveniens. The Kingdom of Spain filed a claim in interpleader against the other two parties and asked that it be allowed to pay rent to the clerk of this court until the marital property dispute is decided. Magistrate Judge Alan Kay recommended granting Alepuz's motion to dismiss for forum non conveniens and dismissing or staying the claim against the Kingdom of Spain. Because a divorce action between Huertas and Alepuz involving property distribution is pending in Spain, Spain is a more appropriate forum for this dispute. The magistrate judge's Report and Recommendation will be adopted and Alepuz's motion to dismiss the claims against him for forum non conveniens will be granted. Huertas's claim against the Kingdom of Spain will be stayed pending resolution by the Spanish Court of the issue of the distribution of marital assets.

BACKGROUND

Gloria Huertas and Jose Alepuz are foreign nationals who were married in Washington, D.C. in 2000. (Compl. ¶ 8.) In April 2002, Alepuz purchased a house on Hillandale Court, N.W. in Washington, D.C. ("the Hillandale house"). (Compl. ¶ 9.) The deed to the house lists Alepuz as the "sole owner." (Compl., Ex. A, Special Warranty Deed for the Hillandale House.) In October 2002, the Kingdom of Spain leased the Hillandale house from Huertas, who was identified in the lease as the landlord, for a period starting November 1, 2002, and ending July 31, 2007 with monthly rent payments of $5,300 to be paid to Huertas. (Compl., Ex. B, Lease Agreement for the Hillandale House.) Both Huertas and Alepuz currently live in Madrid, Spain. (Alepuz's Mot. to Dismiss for Forum Non Conveniens, Ex. A, Alepuz Decl. ("Alepuz Decl.") ¶ 6, July 7, 2005.)

In September 2004, Huertas filed for divorce in the Spanish Court of First Instance, a court in Spain with jurisdiction to hear family issues such as "separation, divorce, liquidation of the marital regime, custody and alimony." (Alepuz Decl. ¶¶ 7-8.)

In February 2005, the Spanish Court of First Instance dissolved the marriage, decided the child custody dispute, and dismissed Huertas's claims regarding alimony, ownership of the Hillandale house and an inventory of the marital property, noting that these claims would be addressed in future proceedings. (Alepuz Decl. ¶ 12.)

Huertas filed a complaint in this court in March 2005, alleging that she "provided in large measure" the money to purchase the Hillandale house and that Alepuz tampered with the deed to omit her name, and that, in October 2004, Alepuz fraudulently represented to the Kingdom of Spain that it did not have to continue to pay Huertas rent. (Compl. ¶¶ 9, 10, 13.) Upon learning of the dispute regarding to whom the rent for the Hillandale house should be paid, the Kingdom of Spain stopped paying rent to Huertas, not knowing to whom the rent should properly be paid. (Kingdom of Spain's Answer at 6.) Huertas claims fraud against Alepuz, seeks a declaration that she is entitled to a minimum fifty percent interest in the Hillandale house "under the agreement of the parties and the applicable domestic relation laws," and seeks back rent from the Kingdom of Spain. (Compl. ¶¶ 10, 13, 15, 17.) Alepuz moved to dismiss alleging forum non conveniens. Magistrate Judge Kay issued a Report and Recommendation in December 2005, finding that Spain was the more appropriate forum for Huertas's claims against - 4 -Alepuz and recommending that Huertas's claim against the Kingdom of Spain be transferred to the court in Spain or stayed until the Spanish Court resolves the marital property claims. (Report and Recommendation ("R&R") at 11 n.10, 12.) Huertas objected to the R&R, and the Kingdom of Spain filed a response to the objection requesting that the recommendation to stay this action pending resolution of the marital action in Spain be adopted.

DISCUSSION

A magistrate judge's findings and recommendations to which a party objects involving a dispositive motion are reviewed de novo. 28 U.S.C. § 636(b)(1); see Landry v. F.D.I.C., 204 F.3d 1125, 1143 (D.C. Cir. 2000).

I. FORUM NON CONVENIENS

"The doctrine of forum non conveniens permits a court to dismiss an action over which it has jurisdiction when there is an adequate alternative forum in which the case can be more conveniently heard." BPA Int'l, Inc. v. Kingdom of Sweden, 281 F. Supp. 2d 73, 84-85 (D.D.C. 2003) (citing Gulf Oil Corp. v. Gilbert, 330 U.S. 501 (1947)). "A court first determines whether there is an adequate alternative forum and, if so, then proceeds to balance both private interest factors and public interest factors in favor of the respective forums." Jackson v. American University, in Cairo, 52 Fed. Appx. 518, 518 (D.C. Cir. 2002) (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241, 255-61 (1981)). "If the balance favors the foreign forum, and if the Court is convinced that plaintiff effectively can bring its case in the alternative forum, the Court may dismiss the case on grounds of forum non conveniens." KPMG Fin. Advisory Servs. Ltd. v. Diligence LLC, Civ. Action No. 05-2204, 2006 WL 335768, at *1 (D.D.C. Feb. 14, 2006) (citing Pain v. United Techs. Corp., 637 F.2d 775, 785-86 (D.C. Cir. 1980)). "The defendant has the burden on all aspects of a motion to dismiss on forum non conveniens grounds, including the obligation to establish as a prerequisite that an adequate alternative forum exists." Id.

To determine whether an adequate alternative forum exists, a court must inquire "whether the defendant is amenable to process in the foreign jurisdiction." Friends for All Children v. Lockheed Aircraft Corp., 717 F.2d 602, 607 (D.C. Cir. 1983). In rare cases, the alternative forum may be inadequate because "the remedy offered by the other forum is clearly unsatisfactory." Reyno, 454 U.S. at 255 n.22; see Nemariam v. Fed. Democratic Republic of Ethiopia, 315 F.3d 390, 395 (D.C. Cir. 2003) (reversing dismissal for forum non conveniens because plaintiff lacked a personal right to any remedy the alternative forum could provide and that remedy could be reduced by competing claims). However, a remedy will not be considered inadequate merely because the plaintiff's potential award will be smaller. Reyno, 454 U.S. at 247; In Re Disaster at Riyadh Airport, 540 F. Supp. 1141, 1145 (D.D.C. 1982).

In considering the factors in favor of the respective forums, private factors a court must balance include the ease of access to proof, the availability of compulsory process to obtain the attendance of hostile witnesses, costs of transporting witnesses, and other expenses or inefficiencies. Reyno, 454 U.S. at 241 n.6. Public factors to consider include the desirability of clearing foreign controversies from congested dockets, the extent of any local interest in the dispute, the ease with which the present forum will be able to apply foreign law, avoiding unnecessary problems with the conflict of laws, and the burden to the local jury pool in hearing a ...


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