                                                                                      [PUBLISH]


                      IN THE UNITED STATES COURT OF APPEALS

                               FOR THE ELEVENTH CIRCUIT
                                                                             FILED
                                                                     U.S. COURT OF APPEALS
                                  ________________________             ELEVENTH CIRCUIT
                                                                            04/30/99
                                         No. 97-2531                    THOMAS K. KAHN
                                  ________________________                   CLERK

                             D. C. Docket No. 96-1077-CIV-T-17B


JOSEPH J. RASH,

                                                                              Plaintiff-Appellant,

                                              versus

JOANN H. RASH,

                                                                             Defendant-Appellee.

                                  ________________________

                          Appeal from the United States District Court
                              for the Middle District of Florida
                               _________________________
                                    (April 30, 1999)


Before BARKETT, Circuit Judge, GODBOLD and GOODWIN*, Senior Circuit Judges.


GODBOLD, Senior Circuit Judge:

       This case involves a dispute in federal court between a former husband and wife over the

priority to be accorded to two competing state court judgments entered in the courts of different

________________
*Honorable Alfred T. Goodwin, Senior U.S. Circuit Judge for the Ninth Circuit, sitting by
designation.
 states.
       Both husband and wife had contacts with the states of Florida and New Jersey. On

February 25, 1994 the husband sued for divorce in state court in Florida. On March 14 the wife

was served with process under Fla. Stat. Ann. § 48.193, which provides that, for persons

maintaining a matrimonial domicile in the state, Florida has personal jurisdiction with respect to

a proceeding for alimony, child support, or division of property in connection with an action to

dissolve a marriage. The wife entered no appearance in the Florida case.

       On March 21, 1994 the wife sued for divorce in state court in New Jersey. The next day

she filed in the New Jersey court an emergency application asking that the husband be restrained

from proceeding in the Florida divorce action. The court set a “return” for March 29 and

directed that the husband be given notice.

       On March 29, 1994 the husband filed a response, describing contacts that he and his wife

had with Florida and describing the filing of the Florida divorce action and service of process on

his wife. The wife filed a response, alleging that the parties’ residence was New Jersey and

denying Florida residence. The same day, March 29, the court heard oral argument with counsel

for both parties present and participating.

       On March 31, 1994 the New Jersey court entered an order finding that the husband was

subject to the in personam jurisdiction of the New Jersey court and restraining him from

proceeding in personam against the wife in the Florida divorce action and from obtaining relief

on any issues regarding distribution of personal and real property, attorney fees, cost and suit

money, or the parties’ marital debts.




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       In the March 31 order the New Jersey court set the matter down for a plenary hearing on

May 10, 1994, on whether the temporary injunction should be made permanent and for other

relief. However, the hearing was not conducted on May 10.

       On July 8, despite the New Jersey injunction, the husband filed a motion for leave to

proceed in Florida, which the Florida court granted.

       On October 21 the Florida court entered a “Final Judgment of Dissolution of Marriage.”

The husband had appeared and submitted his testimony and other evidence. The wife had

entered no appearance. The court found that the husband had been a resident of Florida for six

months next preceding the filing of his petition and that the court had jurisdiction of the parties.

It directed that real property in New Jersey should be equally divided between husband and wife,

that the husband should have sole ownership of his Pennsylvania Retirement System pension,

and declared that the wife have no form of alimony or support from the husband. The court

expressly retained jurisdiction for the purpose of enforcing all terms and provisions of the final

judgment.

       On November 17, 1994 the wife asked the New Jersey court to direct that proceeds of a

sale that had been made of the New Jersey real estate be held in escrow and that the husband be

held in contempt for violating the injunctive order of March 31.

       On December 5, 1994 the New Jersey court ordered the real estate proceeds held in

escrow.

       On December 9, 1994 the New Jersey court conducted a hearing on the issue of

jurisdiction. Both parties were present with their counsel and testimony was taken.




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       On December 14 the New Jersey court entered an order finding that Florida had

inappropriately asserted in personam jurisdiction over the wife, that New Jersey had sole in

personam jurisdiction over both parties, and that it was the appropriate forum to resolve those

issues relating to distribution of property and support.

       On December 19 the husband filed an answer and counterclaim in the New Jersey case.

       On June 19, 1995 the New Jersey court entered a “Final Judgment of Divorce.” It ruled

that both parties and counsel had appeared before it. It found that the wife had resided in New

Jersey for more than a year preceding the filing of the suit and that jurisdiction had been

acquired over the husband. The court divided New Jersey real property and a trailer located in

Florida and held the wife was entitled to alimony and half of the husband’s social security

payments and of his disability pension.

       On March 18, 1996 the New Jersey court acting “pursuant to the terms of the Final

Judgment of Divorce” entered on June 19, 1995 directed fifty percent of the husband’s pension

to be distributed to the wife.

       The husband brought this suit against the wife on May 31, 1996 in the United States

District Court, M.D. Florida, under the Federal Declaratory Judgment Act, 28 U.S.C. §§ 2201-

02, alleging that the Florida judgment dissolving the marriage and dividing property is valid, as

opposed to the later New Jersey judgment that also purported to dissolve the marriage and divide

property.

       The wife moved to dismiss this case. The district judge held that the federal court, as a

court of limited jurisdiction, did not have subject matter jurisdiction, on the ground that federal

courts usually decline review of domestic relation cases over which state courts traditionally


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have jurisdiction. Although the court concluded that it lacked subject matter jurisdiction it also

found that the Florida judgment was not entitled to full faith and credit because the New Jersey

court had found (at the temporary injunction stage in March 1994) that Florida did not have

personal jurisdiction over the wife. The court dismissed the case and the husband appealed.

         In our decision, Rash v. Rash, 147 F.3d 1291 (11th Cir. 1998) this panel ruled with the

wife and held that Florida was required to give full faith and credit to the New Jersey order

entered March 31, 1994. On reconsideration we adhere to the view that the wife prevails but on

a different ground, that Florida is required to give full faith and credit to the New Jersey

judgment entered June 19, 1995. We withdraw the prior opinion and substitute this opinion in its

place.

         The husband filed a motion to file out of time a petition for rehearing/rehearing en banc.

The panel pointed out to counsel that a judgment need be given only the same credit, validity and

effect that it had in the state where it was pronounced and noted that the parties had not briefed

New Jersey law on this issue. Therefore, the panel called on the parties to file supplemental

briefs on the issue of whether the New Jersey order of March 31 was entitled to full faith and

credit under the law of New Jersey. Supplemental briefs have been filed. The panel has

considered those briefs and reconsidered the case.

         First, we look to the jurisdiction of the federal court to consider this case. Diversity

jurisdiction under 28 U.S.C. § 1332 is subject to a judicially created exemption for domestic

relations and probate cases. But the exception is narrowly confined; it is not an absolute rule,

but rather the question is whether the court in its discretion should abstain. Kirby v. Mellenger,

830 F.2d 176, 179 (11th Cir. 1987). The court should abstain only when hearing the claim would


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require the court to delve into the parties’ domestic affairs. Ingram v. Hayes, 866 F.2d 368, 370

(11th Cir. 1988). Primarily, this case is a dispute over assets -- alimony, rights to pension, and

real property in New Jersey and Florida -- and only secondarily of domestic differences. It is not

a dispute over a single decree but over which of two competing state decrees should be enforced.

Also it concerns the interests of two states and of their respective courts in protecting their

judgments and their constitutional entitlement to full faith and credit. It does not raise the types

of concerns that justify application of the domestic relations exception.

       District courts will enforce a divorce decree of a court of another state under the full faith

and credit clause. Williams v. North Carolina, 325 U.S. 226 (1945). The federal court is open to

consider claims that the courts of one state have not given the full faith and credit to the

judgment of a sister state that is required by Article IV, § 1 of the Constitution. The discharge of

this duty does not make the court a court of probate and divorce. Id. at 232-33. Accordingly

there is federal jurisdiction over this proceeding.

       We conclude that the March 31 order lacked the finality New Jersey requires of an order

to entitle it to full faith and credit. Whether action by a court possesses the necessary finality to

be a final judgment is determined by the local law of the state of rendition. Restatement (Second)

of Conflict of Laws § 107 (1971). A judgment is not a final judgment if further judicial action

by the rendering court is required to resolve the matter litigated. Id. at cmt. a. A second court is

free to refuse to honor a sister state judgment insofar as the judgment remains subject to

modification by the original court. Id. at cmt. c.

       In Paramore v. Paramore, 108 A.2d 455-458 (N.J. Super. Ct. App. Div. 1954) the New

Jersey court said:


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                In my judgment the faith and credit contemplated by the
                constitution and the laws only extends to judgments or decrees,
                and has no reference whatsoever to process in the nature of an
                execution. . .

                The transcendent force given by the federal laws to the judicial
                proceedings of sister states is confined to such judicial
                determinations as possess the quality of judgment; it does not
                extend to proceedings in the nature of execution, or to orders
                merely ancillary to some special form of relief.

(citations omitted).

        In Frank v. Frank, 81 A.2d 172 (N.J. 1951) the New Jersey Supreme Court was faced

with whether full faith and credit would be given to a Florida decree. It held that the Florida

decree was merely an adjudication of contempt that could be modified, vacated or changed. It

was, therefore, not a final judgment entitled to enforcement under full faith and credit principles.

Though addressing a Florida order the case applied New Jersey’s rule requiring finality pursuant

to standards of the rendering state as a prerequisite for full faith and credit.

        When we apply New Jersey law to the New Jersey order of May 31 it appears that New

Jersey would not extend full faith and credit to such an order. It was only an order pendente lite

with the issue of jurisdiction to be finally determined in a later plenary hearing. The effect of an

interlocutory order on the finality of a judgment depends on the law of the rendering state.

Scoles and Hay, Conflict of Laws 963 (1992). Moreover, injunctions against litigation in sister

states are said not to be entitled to full faith and credit. Id. at 981.

        We turn then to the consequences of the final judgment entered in New Jersey on June

19, 1995 and the earlier Florida judgment of October 21, 1994. Where a party appears for the

purpose of litigating the question of jurisdiction, presents its case and is fully heard, he is

thereafter concluded on the judgment of the court to which he has submitted the matter. Baldwin

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v. Iowa State Traveling Men’s Ass’n, 283 U.S. 522 (1931). Baldwin presents the situation in

which the court has proceeded to judgment on the issue of jurisdiction. In the present case the

only court that has addressed the issue of jurisdiction with both parties present and participating

is the New Jersey court. It determined the place of jurisdiction as New Jersey.

       The husband contends that the Florida judgment controls because it was first in time and

that the Florida court had in personam jurisdiction over the wife, pursuant to Fla. Stat. Ann. §

48.193(1)(e). That argument is unavailing. The wife had not appeared in the Florida case and

was in default. A defendant may defeat subsequent enforcement of a default judgment in another

forum by demonstrating that the judgment issued from a court lacking personal jurisdiction even

if the court entering the default determined that it had personal jurisdiction over the defendant.

Borg-Warner Acceptance Corp. v. Lovett & Tharpe, Inc., 734 F.2d 639, 640-41 (11th Cir. 1984);

Hazen Research, Inc. v. Omega Minerals, Inc., 497 F.2d 151, 154 (5th Cir. 1974); 18 Charles

Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 4430 (1981).

       The wife was free to question in the New Jersey proceedings the determination by the

Florida court that it had personal jurisdiction over the parties. The New Jersey court, with both

parties present and participating, was free to rule on the jurisdictional issue in its plenary hearing

of December 9, 1994, and to enter its order of December 14, 1994, and its final judgment of

March 6, 1995. That judgment controls. New Jersey is the only court with jurisdiction over both

parties to have determined the issue of jurisdiction. That judgment is entitled to full faith and

credit. The purported final judgment entered in Florida is not entitled to full faith and credit

because a court with jurisdiction -- New Jersey -- has found that Florida lacked jurisdiction. If

the husband wished to question the judgment of the New Jersey court concerning jurisdiction he


                                                  8
could have done so in the courts of New Jersey where both parties were present and

participating.

       The previous opinion of this court is VACATED and this opinion substituted in its place.

The judgment of the district court is AFFIRMED. The husband may, if he chooses, file a

petition for rehearing/rehearing en banc under the usual procedures of this court.




                                                9
BARKETT, Circuit Judge, concurring:

        I concur with the majority in its holding that the October 21, 1994 judgment of the Florida

court is not entitled to full faith and credit. This is not a case where both parties appeared to present

their respective positions in both jurisdictions. To the contrary, Ms. Rash never appeared by counsel

or otherwise before the Florida court, and instead continued to prosecute her claim in New Jersey.

In contrast, Mr. Rash did appear with counsel in New Jersey and participated fully in the case there.

The New Jersey court’s determination of December 14, 1994 that the Florida court lacked personal

jurisdiction over Ms. Rash was reached after a hearing at which both parties were represented and

were able to present their arguments. The New Jersey court was thus the first court of competent

jurisdiction to pass judgment in this case, and we are therefore obliged to give its judgment, and not

that of the Florida court, full faith and credit. Where a “defendant makes no appearance and the

judgment goes by default, the defendant may defeat subsequent enforcement in another forum by

demonstrating that the judgment issued from a court lacking personal jurisdiction.” Hazen Research

Inc. v. Omega Minerals, Inc., 497 F.2d 151 (5th Cir. 1974); see also Baldwin v. Iowa State Traveling

Men’s Assoc., 283 U.S. 522, 525 (1931) (“[The defendant] had the election not to appear at all. If,

in the absence of appearance, the court had proceeded to judgment, and the present suit had been

brought thereon, respondent could have raised and tried out the issue in the present action, because

it would never have had its day in court with respect to jurisdiction.”).




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