Summary
In Associated Indemnity Corporation v. Manning (D.C.) 16 F. Supp. 430, the court dismissed a case similar to the one here presented, for lack of jurisdiction, for the reason that liability under the policy had attached prior to the institution of the suit for a declaratory judgment, and further because the act could not be used to defeat the jurisdiction of the state court, the action for damages having been instituted therein prior to the suit in the federal court under the Declaratory Judgment Act.
Summary of this case from Ohio Casualty Ins. v. MarrOpinion
No. 583.
September 25, 1936.
N. A. Pearson, of Seattle, Wash., for plaintiff.
J.C. McCoy, of Longview, Wash., for defendants J.M. Manning and Manning Fuel Oil Co.
E.H. Kohlhase, of Kelso, Wash., and Arthur I. Moulton, of Portland, Or., for defendants HarGld, Melvin, and Maxine Beesley, Albert Gibson, and Verlae Beesley.
In Equity. Suit by the Associated Indemnity Corporation against J.M. Manning, doing business as Manning Motors, and others.
Cause dismissed for lack of jurisdiction.
Plaintiff, a California corporation doing an insurance business, sues defendants, citizens of the state of Washington, alleging that certain of the defendants threaten to start suit against plaintiff and the defendants J.M. Manning, doing business as Manning Motors, and Manning Fuel Oil Company, a corporation, on account of a collision had by one Fleshman while, at the direction of defendant Manning, driving an automobile, and asks:
"1. That this Court enter a declaratory judgment declaring that this plaintiff is under no duty or obligation to appear and defend said suits or to assume any liability for the acts of said C.G. Fleshman or said J.M. Manning doing business as Manning Motors or Manning Fuel Oil Company, a corporation, at the time of said collision.
"2. That this Court declare that said collision and accident were not covered by plaintiff's policies
"3. That defendants be enjoined and restrained from prosecuting further their causes of action pending the decision of this cause of action.
"4. For such other and further relief as to the Court may seem just and equitable in the premises."
The complaint alleges the issuance of a policy by plaintiff to the defendant J.M. Manning, doing business as Manning Motors, insuring him with respect to accidents sustained, or alleged to have been sustained, by reason of the conduct of the insured's business as described. The complaint further alleges the issuance by plaintiff of three other policies to the defendant Manning Fuel Oil Company covering certain trucks, insuring such defendant for damages imposed by law for accidental personal injuries or death due to the use of said trucks and for accidental injury to or destruction of property.
The complaint further alleges:
"VI. That on the morning of March 27, 1936 Manning Fuel Oil Company, a corporation, had sent one of its oil trucks loaded with oil and driven by one Frank Majerus, an employee of Manning Fuel Oil Company, a corporation, to the Weyerhauser Lumber Company Mill at Longview, Washington, to deliver oil. A call for oil having come into the office of the Manning Fuel Oil Company from the Long Bell Lumber Company log pond at Longview, Washington, J.M. Manning, President of Manning Fuel Oil Company, directed one C.G. Fleshman, a garage mechanic employed by J.M. Manning doing business as Manning Motors in said garage aforesaid, to take a DeSoto Sedan automobile, owned by said J.M. Manning, doing business as Manning Motors, and drive to said Weyerhauser Mill and order said Majerus with his load of oil to take the oil over to the Long Bell Lumber Company log pond instead of to Kelso as originally planned. That said Fleshman did take said DeSoto car and did drive to said Majerus and did perform said errand and did direct said Majerus as aforesaid; that said Fleshman did nothing else other than as above set forth and was under no other orders at said time; that said errand was entirely on behalf of Manning Fuel Oil Company, a corporation, and not on behalf of J.M. Manning doing business as Manning Motors nor for any purpose of such business.
"VII. That while said Fleshman was returning to said garage he had a collision at the intersection of Fir, 26th Street, Nicholas Boulevard and Washington Way, Long-view, Washington wherein Anna Beesley received severe injuries and died shortly thereafter; that Maxine Beesley claims receiving severe injuries; that Albert Gibson and Verlae Beesley received more or less minor injuries therein."
It is also alleged that the defendants, other than the defendant Manning and the Manning Fuel Oil Company, who will herein be designated as "Claimants," are:
"Through their attorney, making claims upon J.M. Manning doing business as Manning Motors and upon Manning Fuel Oil Company, a corporation and upon this plaintiff for sums up to $10,000.00 for damages for said death and injuries; that J.M. Manning doing business as Manning Motors and Manning Fuel Oil Company, a corporation are making demand upon this plaintiff to defend them from the law suits which claimants' attorney has threatened to file immediately and to pay any judgment that may be rendered when said action or actions are tried and if a judgment is rendered against J.M. Manning doing business as Manning Motors or Manning Fuel Oil Company, a corporation, to pay same. This plaintiff declines to do.
"XII. That it is the plaintiff's contention that plaintiff's policies did not cover said J.M. Manning doing business as Manning Motors or Manning Fuel Oil Company, a corporation, or said employee C.G. Fleshman at the time of said collision; that said employee was on no business or matter covered by the policies herein at said time and asks this Court to so adjudicate.
"XIII. That this action is brought under the Declaratory Judgment Act of Congress of June 14, 1934 and Amendment Act August 30, 1935, Section 405 (Section 400 Title 28 U.S.C.A.); that a controversy exists between claimants and plaintiff and between claimants together with said J.M. Manning doing business as Manning Motors and Manning Fuel Oil Company, a corporation and plaintiff as to whether plaintiff should appear and defend said actions and pay said judgments if rendered.
"XIV. That the amount in controversy exceeds the sum of $3,000.00 and up to $10,000.00 exclusive of interest and costs.
"XV. That defendants and each of them other than J.M. Manning doing business as Manning Motors and Manning Fuel Oil Company, if not already done, threaten to start suit against defendant J.M. Manning doing business as Manning Motors and Manning Fuel Oil Company, a corporation, and this plaintiff and will, unless restrained, prosecute said suits to judgment before this instant suit is decided; that it is necessary that this instant suit be decided prior to the bringing of defendants' suits or the trial thereof in order that this plaintiff may know whether or not to appear and defend said suits when commenced and the defense thereof tendered to plaintiff; that unless this Court declares whether or not this plaintiff must appear and defend said suits prior to said answering of said suits and trial thereof irreparable harm will be done this plaintiff as judgment will be taken against defendant J.M. Manning doing business as Manning Motors and/or against Manning Fuel Oil Company, a corporation, and garnishment or other process served on this plaintiff." (Italics the court's.)
A hearing having been had upon the motion of the claimants for a dismissal of the complaint for want of equity or right to relief against the moving defendants, the court ordered a hearing upon the question of the court's jurisdiction.
The Declaratory Judgment Act (Jud. Code, § 274d), as amended (title 28 U.S.C.A. § 400) provides:
"(1) In cases of actual controversy except with respect to Federal taxes the courts of the United States shall have power upon petition, declaration, complaint, or other appropriate pleadings to declare rights and other legal relations of any interested party petitioning for such declaration, whether or not further relief is or could be prayed, and such declaration shall have the force and effect of a final judgment or decree and be reviewable as such.
"(2) Further relief based on a declaratory judgment or decree may be granted whenever necessary or proper. The application shall be by petition to a court having jurisdiction to grant the relief. If the application be deemed sufficient, the court shall, on reasonable notice, require any adverse party, whose rights have been adjudicated by the declaration, to show cause why further relief should not be granted forthwith.
"(3) When a declaration of right or the granting of further relief based thereon shall involve the determination of issues of fact triable by a jury, such issues may be submitted to a jury in the form of interrogatories, with proper instructions by the court, whether a general verdict be required or not."
In any suit brought by claimants against the defendants Manning and the oil company, they are not concerned with whether the plaintiff, in its policies, has undertaken to defend such a suit or not.
Beyond question one of the major objects sought in the enactment of the Declaratory judgment Law was the lessening of litigation.
If the court has jurisdiction of this proceeding, it will determine as a fact upon whose business Fleshman, the driver of the automobile, was engaged at the time of the collision.
If, by the Declaratory Judgment Law, litigation is to be lessened and not increased, a determination by the court of that fact will be conclusive alike not only as between plaintiff and defendants but between the defendants also.
Claimants have a right to elect to sue the defendant Manning or/and the defendant oil company. If claimants have a right to join the plaintiff as a defendant in such a suit, Landaker v. Anderson, 145 Wn. 660, 261 P. 388; Johnson v. McGilchrist, 174 Wn. 178-181 et seq., 24 P.2d 607, they are not obliged to do so.
Of a suit by any of claimants against the defendant Manning or/and the defendant oil company there can be no doubt that the state court alone has jurisdiction. This court would not have jurisdiction to enjoin such a suit.
To give the declaratory judgment statute the scope required to support the court's jurisdiction invoked by the bill in the present suit affords too facile a means for defeating the jurisdiction of the state court to warrant giving it such construction, in the absence of a clearly expressed intention. If, in the causes cited from the Fifth Circuit, a different conclusion has been reached, with such conclusion I am unable to agree. In Pan American Petroleum Co. et al. v. Chase Nat. Bank of City of New York (C.C.A.) 83 F.2d 447, the bill of complaint was of an ancillary nature.
If the declaratory judgment statute provides a jurisdiction of the nature supporting bills quia timet, Meeker v. Baxter (C.C.A.) 83 F.2d 183-187, the present cause is not one under the statute because it is brought after liability, if any, has attached.
The cause will be dismissed for lack of jurisdiction. Any order embodying the foregoing ruling will be settled upon notice.
The clerk is directed to notify the attorneys for the parties of the filing of this decision.