QBE Insurance Corporation v. Green et al
Filing
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MEMORANDUM OPINION & ORDER: 1. that A.H., a Minor, By and Through her Parents and Next Friends, Lindsay and Michael Halls Motion for Permissive Intervention 16 is DENIED; 2. that A.H., a Minor, By and Through her Parents and Next Friends, Lindsay and Michael Halls Motion for Oral Argument 17 is DENIED AS MOOT. Signed by Judge Joseph M. Hood on 10/24/2014.(lc)cc: COR
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF KENTUCKY
CENTRAL DIVISION at LEXINGTON
QBE INSURANCE CORPORATION,
Plaintiff,
v.
LARRY GREEN and
CLAUDIA GREEN,
Defendants.
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Civil Case No.
5:14-cv-300-JMH
MEMORANDUM OPINION
AND ORDER
***
This matter is before the Court upon A.H., a minor, by and
through her Parents and Next Friends, Lindsay and Michael Hall’s
Motion for Permissive Intervention pursuant to Fed. R. Civ. P.
24(b). [DE 16].1 Plaintiff QBE Insurance Corporation having filed
a response [DE 24], this motion is now ripe for adjudication.
I. Background
In
the
interest
of
brevity,
the
Court
incorporates
by
reference the facts of this case as outlined in the Memorandum
Opinion and Order dated September 30, 2014. [DE 20].
II. Analysis
Federal Rule of Civil Procedure 24 governs when a party may
intervene. Applying Rule 24, the Sixth Circuit has held:
1
A.H.’s initial motion discussed intervention of right, but later included a
request for permissive intervention in her Reply to Plaintiff’s response. [DE
16]. This Court construed this as a Motion for Permissive Intervention and
deferred ruling until the existing parties to this action had an opportunity
to respond. [DE 20].
To intervene permissively, a proposed intervenor
must establish that the motion for intervention is
timely and alleges at least one common question of law
or fact. ...[T]he district court must then balance
undue delay and prejudice to the original parties, if
any, and any other relevant factors to determine
whether, in the court's discretion, intervention
should be allowed.
United States v. Michigan, 424 F.3d 438, 445 (6th Cir. 2005)
(citations
omitted).
conclusion
that
Plaintiff
A.H.’s
motion
provides
for
no
objection
permissive
to
intervention
the
is
timely, thus the Court turns to the remaining issues.
At a basic level, there is a common question of fact in
A.H.’s
claims
and
this
action.
Plaintiff’s
complaint
alleges
that it is not responsible for the Greens’ insurance coverage
for several reasons, one of which is because the alleged injury
did not occur in a common area. [DE 1 at ¶ 12]. A.H.’s motion
for
intervention
alleges
that
the
injury
occurred
on
common
property. [DE 16 at 7].2
However, the nature of A.H.’s claim and the action before
this Court are very different. The matter before this Court is
the interpretation of an insurance contract. A.H. is not a party
to that contract but has an interest in its proceeds, which she
seeks to recover based on tort claims in state court. Federal
courts have found that under similar circumstances, permissive
2
Notably, this is also a question in A.H.’s state court action against
Heritage Condominiums (who filed a complaint as third party plaintiffs in
that action against the Defendants in this action, Claudia and Larry Green),
because Heritage’s liability turns on where the injury occurred. [DE 1-2 at ¶
4].
2
intervention is not appropriate. See generally Reliastar Life
Ins. Co. v. MKP Investments, 565 F. App'x 369, 374-75 (6th Cir.
2014)
(upholding
lower
court’s
denial
of
permissive
intervention, where request to intervene was based solely on
intervenor’s interest in the proceeds of the insurance policy,
there
was
no
common
question
of
law
or
fact);
Philadelphia
Indem. Ins. Co. v. Youth Alive, Inc., CIV.A. 3:09CV347-S, 2010
WL 1416708, at *3 (W.D. Ky. Mar. 31, 2010) (denying permissive
intervention where intervenor’s “claims clearly differ from the
issue
and
far
exceed
the
scope
of
the
singular
matter
of
coverage to be addressed in the declaratory judgment action.”);
Liberty Mut. Ins. Co. v. Treesdale, Inc., 419 F.3d 216, 227-28
(3d Cir. 2005) (upholding district court’s denial of permissive
intervention
interpretation
where
of
the
an
action
insurance
before
contract,
it
turned
whereas
on
the
intervenors
sought to adjudicate whether insured had caused asbestos-related
bodily injuries.).
Furthermore, as a non-party to the insurance contract, A.H.
has not indicated that she will offer any additional insight
into how it should be interpreted.3 Instead, A.H.’s participation
may bring in unrelated issues connected to her state law tort
claims. Thus, intervention “would only serve to complicate and
3
Certainly, an amicus brief is an alternative means by which A.H. may file
her arguments with the Court.
3
delay
this
litigation.”
Redland
Ins.
Co.
v.
Chillingsworth
Venture, Ltd., 171 F.R.D. 206, 208 (N.D. Ohio 1997) (denying
permissive intervention by four parties who were not parties to
the insurance contract before the court); see also Grange Mut.
Cas. Co. v. Corinthian Custom Homes, Inc., CIV.A. 3:07-0020,
2007 WL 3287343 (M.D. Tenn. Nov. 5, 2007) (allowing permissive
intervention where movants where third-party beneficiaries to
insurance contract being interpreted);
Trinity Universal Ins.
Co. v. Turner Funeral Home, 1:02-CV-231, 2003 WL 25269317 (E.D.
Tenn. Sept. 18, 2003).
Finally, A.H.’s intervention would be futile because her
claim presents no actual case or controversy against Plaintiff
QBE Insurance Corporation. A.H. seeks a declaration from this
Court
that
Defendants
Plaintiff
Larry
and
QBE
has
Claudia
an
Green
obligation
if
the
to
Greens
indemnify
are
found
liable for A.H.’s injury. [DE 7 at 6]. A federal court may
provide relief by means of a declaratory judgment only “in a
case of actual controversy within its jurisdiction” pursuant to
29 U.S.C. § 2201. See also Coffman v. Breeze Corp., 323 U.S.
316,
324
(1945).
Thus,
“as
a
matter
of
policy,
the
federal
courts will decline the request for a declaration of rights by
the injured party when state law prevents an injured party from
filing a direct action against the insurer.” Allstate Ins. Co.
v. Hayes, 442 Mich. 56, 69, 499 N.W.2d 743, n.13 (1993) (citing
4
cases); see also Scott v. State Farm Fire & Cas. Co., No. 1313287, 2014 WL 3054651, *5-*6, n.2 (E.D. Mich. July 7, 2014)
(discussing Hayes and clarifying that a declaratory judgment of
this
sort
is
available
in
federal
court,
but
only
when
the
injured party has a judgment in hand). Kentucky law does not
provide for filing a “direct action” against an insurer by an
injured party and, thus, in Kentucky, a tort claimant’s rights
against a tortfeasor’s insurer do not mature until the tort
claimant recovers a judgment against the tortfeasor. See Cuppy
v. General Accident Fire & Life Assurance Corp., 378 S.W.2d 629,
632 (Ky. 1964); Morell v. Star Taxi, 343 F. App'x 54, 57 (6th
Cir. 2009) (applying Cuppy, 378 S.W.2d at 629).
At the present time, A.H. has only a speculative claim as a
putative third-party beneficiary to the contract of insurance
between
QBE
and
the
Greens.
Thus,
A.H.
has
no
standing
to
proceed on her counterclaim against QBE or, alternatively, her
claim
is
not
yet
ripe.
In
any
event,
there
is
no
actual
controversy presented by A.H.’s counterclaim for a declaratory
judgment.
For
the
reasons
stated
herein,
request to intervene in this matter.
Accordingly, IT IS ORDERED:
5
the
Court
denies
A.H.’s
(1) that A.H., a Minor, By and Through her Parents and Next
Friends,
Lindsay
and
Michael
Hall’s
Motion
for
Permissive
Intervention [DE 16] is DENIED;
(2) that A.H., a Minor, By and Through her Parents and Next
Friends, Lindsay and Michael Hall’s Motion for Oral Argument [DE
17] is DENIED AS MOOT.
This the 24th day of October, 2014.
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