Opinion · Supreme Court of the United States
Maryland Casualty Co. v. Pacific Coal & Oil Co.
Md. Cas. Co. v. Pac. Coal & Oil Co., 61 S. Ct. 510 (1941)
- Type
- Opinion
- Court
- Supreme Court of the United States
- Jurisdiction
- Federal
- Date
- 1941-02-03
- Topic
- general
holding that a case was moot when a cable television licensee no longer could or wanted to operate a cable system | holding that declaratory relief is available to an insurance company alleging it was not liable to defend or indemnify an insured | holding that there is an actual controversy between an insurer and the party injured by the insured | holding that declaratory judgment action was ripe where state action was pending, and state law gave party the right to sue the other | holding that declaratory relief was available to an insurance company that alleged it was not liable to defend or indemnify an insured | holding that declaratory judgment action was ripe where state action was pending, and state law gave party the right to sue the other | holding that an insurer’s federal declaratory judgment action on coverage issue was sufficiently ripe for resolution even prior to the underlying state court liability action proceeding to judgment | holding that declaratory judgment action presented an actual controversy between insurer and injured third party, where the latter could have proceeded directly against the former in certain limited circumstances pursuant to state law | holding that an “actual controversy” exists in a declaratory judgment action between an insurer and an injured party where state law permits the injured party to seek recovery from the insurer | holding that there was an actual controversy between the insurer and the injured third party where “the facts alleged” reflected that the insured had claimed the injury was covered by the insurance policy | holding that a federal court should generally entertain a declaratory judgment action “(1 | holding that a federal court should generally entertain a declaratory judgment action “(1 | holding that “actual controversy” within meaning of Declaratory Judgment Act exists only where “there is a substantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant the issuance of a declaratory judgment” | holding suit by insurance company against insured and claimant, seeking declaration it had no duty to indemnify insured, was justiciable under Declaratory Judgment Act | concluding that “the complaint in the instant case presents such a controversy is plain[,]” even when the insurer brought its declaratory judgment action before judgment was entered by the state court in the underlying tort action | admonishing that a declaratory action is not ripe unless “the facts alleged, under all the circumstances, show that there is a substantial controversy ... of sufficient immediacy and reality” | holding that the insurer established a case and controversy between itself and the state court plaintiff, who sued the insured in state court, where the insurer asked the court to interpret the policy it issued to the insured | noting that central to the ripeness requirement is that courts should not endeavor to resolve contingencies that may or may not occur as expected or may not happen at all | finding that insurer had standing to sue insured for declaration that insurer had no duty to indemnify under the insurance agreement | stating that an actual controversy existed because third party to the insurance policy had sued the insured in state court | holding that a declaratory judgment action brought by an insurance company against its injured and an injured party seeking liability determination against the insured in a state court action does constitute an actual controversy within the meaning of the Declaratory Judgment Act | holding that an actual case or controversy existed between insurer who brought declaratory judgment action against insured and injured third party where injured party was entitled under state law to bring action against the insurer if he obtained a judgment against the insured party | admonishing that a declaratory action is not ripe unless "the facts alleged, under all the circumstances, show that there
Citator
- Cited by
- 1097 opinions
No appearance for respondents.
While the policy was in force, a collision occurred between an automobile driven by respondent Orteca and a truck driven by an employee of the insured. Orteca brought an action in an Ohio state court against the insured to recover damages resulting from injuries sustained in this collision. Apparently this action has not proceeded to judgment.
Petitioner then brought this action against the insured and Orteca. Its complaint set forth the facts detailed above and further alleged that at the time of the collision the employee of the insured was driving a truck sold to him by the insured on a conditional sales contract.Page 272Petitioner claimed that this truck was not one "hired by the insured" and hence that it was not liable to defend the action by Orteca against the insured or to indemnify the latter if Orteca prevailed. It sought a declaratory judgment to this effect against the insured and Orteca, and a temporary injunction restraining the proceedings in the state court pending final judgment in this suit.
Orteca demurred to the complaint on the ground that it did not state a cause of action against him. The District Court sustained his demurrer and the Circuit Court of Appeals affirmed.111 F.2d 214. We granted certiorari,311 U.S. 625, to resolve the conflict with the decisions of other Circuit Courts of Appeals cited in the note.1
The question is whether petitioner's allegations are sufficient to entitle it to the declaratory relief prayed in its complaint. This raises the question whether there is an "actual controversy" within the meaning of the Declaratory Judgment Act (Judicial Code § 274d, 28 U.S.C. § 400), since the District Court is without power to grant declaratory relief unless such a controversy exists.Nashville, C. St. L. Ry. Co. v.Wallace,288 U.S. 249,259; U.S.C.A. Constitution, Art. III, § 2.Page 273
The difference between an abstract question and a "controversy" contemplated by the Declaratory Judgment Act is necessarily one of degree, and it would be difficult, if it would be possible, to fashion a precise test for determining in every case whether there is such a controversy. Basically, the question in each case is whether the facts alleged, under all the circumstances, show that there is a substantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant the issuance of a declaratory judgment. SeeAetna Life Ins. Co. v.Haworth,300 U.S. 227,239-242. It is immaterial that frequently, in the declaratory judgment suit, the positions of the parties in the conventional suit are reversed; the inquiry is the same in either case.Nashville, C. St. L. Ry. Co. v.Wallace, supra, p. 261.
That the complaint in the instant case presents such a controversy is plain. Orteca is now seeking a judgment against the insured in an action which the latter claims is covered by the policy, and §§ 9510-3 and 9510-4 of the Ohio Code (Page's Ohio General Code, Vol. 6, §§ 9510-3, 9510-4) give Orteca a statutory right to proceed against petitioner by supplemental process and action if he obtains a final judgment against the insured which the latter does not satisfy within thirty days after its rendition. CompareMaryland Casualty Co. v.UnitedCorporation,111 F.2d 443,446;Central Surety InsuranceCorp. v.Norris,103 F.2d 116,117;U.S. Fidelity GuarantyCo. v.Pierson,97 F.2d 560,562. Moreover, Orteca may perform the conditions of the policy issued to the insured requiring notice of the accident, notice of suit, etc., in order to prevent lapse of the policy through failure of the insured to perform such conditions.Hartford Accident Indemnity Co. v.Randall,125 Ohio St. 581;183 N.E. 433; see also,Lindv.State Automobile Mutual Insurance Assn.,128 Ohio St. 1;190 N.E. 138;Page 274State Automobile Mutual Insurance Assn. v.Friedman,122 Ohio St. 334;171 N.E. 591.
It is clear that there is an actual controversy between petitioner and the insured. CompareAetna Life Ins. Co. v.Haworth, supra. If we held contrariwise as to Orteca because, as to him, the controversy were yet too remote, it is possible that opposite interpretations of the policy might be announced by the federal and state courts. For the federal court, in a judgment not binding on Orteca might determine that petitioner was not obligated under the policy, while the state court, in a supplemental proceeding by Orteca against petitioner, might conclude otherwise. CompareCentral Surety Insurance Corp. v.Norris, supra, p. 117;Aetna Casualty Surety Co. v.Yeatts,99 F.2d 665,670.
Thus we hold that there is an actual controversy between petitioner and Orteca, and hence, that petitioner's complaint states a cause of action against the latter. However, our decision does not authorize issuance of the injunction prayed by petitioner. Judicial Code § 265, 28 U.S.C. § 379; seeCentralSurety Insurance Corp. v.Norris, supra, p. 117;MarylandCasualty Co. v.Consumers Finance Service, Inc.,101 F.2d 514,516;Aetna Casualty Surety Co. v.Yeatts, supra, p. 670.
The judgment of the Circuit Court of Appeals is reversed and the cause is remanded for further proceedings in conformity with this opinion.Reversed.
MR. JUSTICE BLACK did not participate in the consideration or decision of this case.Page 275
- Page 272Maryland Casualty Co. v.United Corporation,111 F.2d 443;Central Surety Insurance Corp. v.Norris,103 F.2d 116;Maryland Casualty Co. v.Consumers Finance Service, Inc.,101 F.2d 514;Aetna Casualty Surety Co. v.Yeatts,99 F.2d 665; U.S.Fidelity Guaranty Co. v.Pierson,97 F.2d 560;Associated Indemnity Corp. v.Manning,92 F.2d 168. See also,Employers' Liability Assurance Corp. v.Ryan,109 F.2d 690;C.E. Carnes Co. v.Employers' Liability Assurance Corp.,101 F.2d 739;Standard Accident Insurance Co. v.Alexander,Inc.,23 F. Supp. 807;U.S. Fidelity Guaranty Co. v.Pierson,21 F. Supp. 678;Builders Manufacturers MutualCasualty Co. v.Paquette,21 F. Supp. 858;TravelersInsurance Co. v.Young,18 F. Supp. 450;Commercial CasualtyInsurance Co. v.Humphrey,13 F. Supp. 174. ↩