United States District Court, D. Maryland
DEBORAH K. CHASANOW, UNITED STATES DISTRICT JUDGE.
pending and ready for resolution in this declaratory judgment
action is the motion for summary judgment filed by Plaintiff
State Farm and Casualty Company (“Plaintiff”).
(ECF No. 60). The issues have been briefed, and the court now
rules, no hearing being deemed necessary. Local Rule 105.6.
For the following reasons, the motion for summary judgment
will be granted.
case centers around the actions of George W. Huguely, V
(“Defendant”) and his responsibility for the
death of Yeardley Love in May 2010. An earlier memorandum
opinion, (ECF No. 30), outlines the specifics of the multiple
actions arising from that event. Therefore, only a brief
summary is necessary. In a criminal case, a jury in the
Circuit Court for the City of Charlottesville, Virginia found
Defendant responsible for the death of Yeardley Love and
guilty of second degree murder. Huguely v.
Commonwealth, 63 Va.App. 92, 105 (2014). In a civil
case, Sharon D. Love (Ms. Love), as administrator of the
estate of Yeardley Love, brought a civil suit against
Defendant in the Circuit Court for the City of
Charlottesville. Her amended complaint alleges that Defendant
was the proximate cause of Yeardley Love's injuries and
death. The case in this court concerns whether Plaintiff, an
insurance company, is contractually obligated to defend and
to indemnify Defendant in the civil case. Interested party
Andrew Murphy, III, Defendant's step-father (together
with Defendant and interested party Marta Murphy,
“Respondents”), purchased a homeowners'
insurance policy (“the Policy”) from Plaintiff
for Respondents' home in Maryland. (ECF No. 60-3). The
Policy includes broad indemnification provisions stating that
“[i]f a claim is made or a suit is brought against an
insured for damages because of bodily injury. . . to which
this coverage applies, caused by an occurrence, we will: 1.
pay up to our limit of liability for the damages for which
the insured is legally liable; and 2. provide a defense at
our expense[.]” (Id., at 20). The Policy
defines “occurrence” as “an accident,
including exposure to conditions, which results in. . .
bodily injury[.]” (Id., at 7). The Policy
excludes coverage for injury that is “either expected
or intended by the insured; or. . . the result of willful and
malicious acts of the insured[, ]” (the
“Exclusions”). (Id., at 21).
Ms. Love filed her complaint in the civil case, Defendant
sought coverage from both Plaintiff, (ECF No. 1, ¶ 22),
and Chartis Property Casualty Company
(“Chartis”), which insured Mr. and Mrs. Murphy
under two other policies (see Case No. DKC-13-1479,
ECF No. 1). Chartis initially provided a defense for
Defendant under a reservation of rights. (Id. ¶
50). On May 20, 2013, Chartis filed a declaratory judgment
action in this court (the “Chartis Case”) and on
March 20, 2017, this court granted Chartis's motion for
summary judgment and declared that Chartis had no duty to
defend or to indemnify Defendant in the civil case.
November 1, 2013, Plaintiff initiated this suit, naming
Respondents and Ms. Love as interested parties and seeking a
declaratory judgment that it was not required to defend or to
indemnify Defendant in the civil case under the Policy. On
December 9, 2016, after a stay pending Defendant's direct
appeal in the criminal case and the lifting of the stay upon
Defendant's exhaustion of all direct appeals in his
criminal proceedings, Plaintiff filed a motion for summary
judgment and argued that both the Exclusions and
Defendant's failure to cooperate with Plaintiff's
investigation provided bases to deny coverage. (ECF No. 23).
After full briefing and a hearing, the court denied
Plaintiff's motion for summary judgment and concluded
that genuine disputes about material facts existed regarding
whether the intentional acts exclusion applied and whether
Defendant's failure to cooperate with Plaintiff's
investigation prejudiced Plaintiff. (ECF No. 30).
March 4, 2019, after Ms. Love unsuccessfully appealed this
court's decision in the Chartis Case and unsuccessfully
petitioned for en banc review, Plaintiff filed an amended
complaint. (ECF No. 49). Plaintiff explains that Ms. Love
“non-suited” the civil case in May 2018 and
“re-initiated” the action in December 2018.
(Id., at 3 ¶ 12). Plaintiff additionally
explains that “[a] nonsuit is a procedure permitted in
Virginia state court which allows a [p]laintiff to dismiss
the action and re-file the same action within [six]
months.” (Id., at 4 n.1). Plaintiff emphasizes
that Ms. Love's re-filed complaint “removed any
reference to negligence and/or gross negligence and [her]
claims are now limited to claims of intentional and willful
conduct and her only cause of action is for assault and
battery.” (Id., at 6 ¶ 25). The amended
complaint names Respondents as interested parties but does
not name Ms. Love as an interested party. (Id., at
1). Plaintiff explains: “As of December 2018, the Love
family has taken the position that [because] it has limited
its civil claims against [Defendant] to [a]ssault and
[b]attery, it no longer challenges [Plaintiff's] position
on insurance coverage. . . [and] has withdrawn its
participation in this declaratory proceeding.” (ECF No.
60-1, at 3 ¶ 4).
April 1, 2019, Respondents filed an answer and counterclaim
to Plaintiff's amended complaint. (ECF No. 52). On April
22, 2019, Plaintiff answered. (ECF No. 55). On May 31, 2019,
Plaintiff filed a motion for summary judgment. (ECF No. 60).
On July 19, 2019, Respondents responded and stated:
“Due to a number of factors, Respondents have decided
to take no position on the [m]otion. Respondents respectfully
defer to the [c]ourt to rule on the [m]otion as it sees
fit.” (ECF No. 64, at 1). On July 29, 2019, Plaintiff
replied. (ECF No. 65).
Standard of Review
judgment will be granted only if “there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a);
see Celotex Corp. v. Catrett, 477 U.S. 317, 322
(1986); Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 250 (1986). To prevail on a motion for summary judgment,
the moving party generally bears the burden of showing that
there is no genuine dispute as to any material fact.
Liberty Lobby, 477 U.S. at 248-50. A dispute about a
material fact is genuine “if the evidence is such that
a reasonable jury could return a verdict for the nonmoving
party.” Id. at 249. In undertaking this
inquiry, a court must view the facts and the reasonable
inferences drawn therefrom “in the light most favorable
to the party opposing the motion, ” Matsushita
Elec. Indus. v. Zenith Radio Corp., 475 U.S. 574, 587
(1986) (quoting United States v. Diebold, Inc., 369
U.S. 654, 655 (1962)); see also EEOC v. Navy Fed. Credit
Union, 424 F.3d 397, 405 (4th Cir. 2005), but
a “party cannot create a genuine dispute of material
fact through mere speculation or compilation of inferences,
” Shina v. Shalala, 166 F.Supp.2d 373, 375
(D.Md. 2001) (citation omitted).
diversity actions, a district court applies the substantive
law and choice of law rules of the state in which the court
sits. Padco Advisors, Inc. v. Omdahl, 179 F.Supp.2d
600, 605 (D.Md. 2002) (citing Erie R.R. Co. v.
Tompkins, 304 U.S. 64 (1938)). In contract claims,
Maryland applies the doctrine of lex loci
contractus, meaning the law of the place where the
contract was made applies. Allstate Ins. Co. v.
Hart, 327 Md. 526, 529 (1992). “The locus
contractus is the place where the last act is performed
which makes an agreement a binding contract.” Grain
Dealers Mut. Ins. Co. v. Van Buskirk, 241 Md. 58, 65-66
(1965). In an insurance contract, the delivery of the policy
and the payment of the premiums constitute these “last
acts.” Id. (citing Sun Ins. Office, Ltd.
v. Mallick, 160 Md. 71, 81 (1931)). Although it appears
that the Policy was addressed to Mr. Murphy in California,
(ECF No. 60-3, at 1), Plaintiff contends that it was
delivered to the Murphys at their Maryland address and that
Maryland substantive law applies to the dispute (ECF No.
60-1, at 7-8). Plaintiff argues in the alternative that
California law would apply Maryland law because the property
insured was in Maryland. (Id., at 8). Ms. Love and
Respondents did not brief the pending motion. Previously,
they did not dispute that Maryland substantive law was
applicable. (ECF No. 30, at 8). Maryland law does not,
however, govern procedural rules in this court, even when
jurisdiction is based on diversity.
Declaratory Judgment While State Action is Pending
standards guide the inquiry as to the propriety of
declaratory relief in federal courts, even when the case is
under the court's diversity jurisdiction.”
White v. Nat'l Union Fire Ins. Co., 913 F.2d
165, 167 (4th Cir. 1990). Under federal law,
district courts have “some measure of discretion [as to
whether] to entertain a declaratory judgment action that is
otherwise properly within its jurisdiction.”
Nautilus Ins. Co. v. Winchester Homes, Inc., 15 F.3d
371, 375 (4th Cir. 1994). The United States Court
of Appeals for the Fourth Circuit has held that district
courts should not entertain a declaratory judgment action
during the pendency of a related state proceeding “when
the result would be to ‘try a controversy by piecemeal,
or to try particular issues without settling the entire
controversy.'”Mitcheson v. ...