State Farm Fire and Casualty Company v. Peitz et al

Filing 59

MEMORANDUM AND ORDER - IT IS HEREBY ORDERED that State Farms Motion for Dismissal and Discharge is GRANTED. (Doc. 44 ). Plaintiff State Farm, having deposited with the Registry of the Court on January 17, 2018, the entire per occurrence policy limits of Policy Number 25-B7-H816-6, insuring Defendants Stephen Peitz, Jr. and Mark Harris, is hereby dismissed with prejudice from this action and is hereby discharged from any and all liability for payment of claims made against Defendants Pei tz and/or Harris, arising out of a fire discovered on August 14, 2017, at the Westport Crossing Condominiums. The Clerk of the Court shall retain the funds deposited by Plaintiff in the Registry of the Court pending final resolution of these proce edings. A separate Order of Partial Dismissal will accompany this Memorandum and Order. IT IS FURTHER ORDERED that Defendant Westports Motion to Dismiss Defendant Granicks Crossclaim is DENIED as moot. (Doc. 27 ). IT IS FURTHER ORDERED that Defenda nts Robert and Deborah Granicks Motion to Dismiss seeking dismissal without prejudice of their counterclaim against State Farm and all their crossclaims against the other Defendants is GRANTED. (Doc. 29 ). IT IS FURTHER ORDERED that Defendants Ro bert and Deborah Granicks Motion to Dismiss Mahers Crossclaim is DENIED as moot. (Doc. 50 ). IT IS FURTHER ORDERED that Defendant Jeffrey Mahers Motion for Leave to File Dismissal Without Prejudice seeking dismissal without prejudice of his cross claims against the other Defendants is GRANTED. (Doc. 55 ). IT IS FURTHER ORDERED that Defendant Jeffrey Mahers Motion to Dismiss seeking dismissal of his counterclaim against State Farm is GRANTED. (Doc. 57 ). Signed by Magistrate Judge Nannette A. Baker on 6/12/18. (cc: finance) (KJS)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
STATE FARM FIRE AND CASUALTY CO., )
)
)
Plaintiff,
)
)
v.
)
)
STEPHEN G. PEITZ, JR., et al.,
)
)
Defendants.
)

Case No. 4:17-CV-2927 NAB

MEMORANDUM AND ORDER
On December 26, 2017, State Farm Fire and Casualty Company (“State Farm”)
commenced this action by filing a Complaint in Interpleader. Presently before the Court is State
Farm’s unopposed “Motion for Dismissal and Discharge and for Entry or Preliminary Order in
Interpleader.” (Doc. 44). Also pending before the Court in this matter are several related
motions, including Defendant Westport Crossing Condominium Association’s (“Westport”)
“Motion to Dismiss Defendant Granicks’ Crossclaim” (Doc. 27); Defendants Robert and
Deborah Granick’s (“Granicks”) “Motion to Dismiss” their pending counterclaim and
crossclaims (Doc. 29); Granicks’ “Motion to Dismiss Defendant Maher’s Crossclaim” (Doc. 50);
Defendant Jeffrey Maher’s (“Maher”) “Motion for Leave to File Dismissal Without Prejudice”
(Doc. 55); and Maher’s “Motion to Dismiss” his counterclaim against State Farm (Doc. 57). The
parties have consented to the jurisdiction of the undersigned United States Magistrate Judge
pursuant to 28 U.S.C. § 636(c)(1). (Doc. 25). For the reasons discussed below, all the motions
currently before the Court in this matter will be granted except for Westport’s “Motion to

Dismiss” (Doc. 27), and the Granicks’ “Motion to Dismiss Maher’s Crossclaim” (Doc. 50), both
of which will be denied as moot.
I. Background
On August 14, 2017, a fire started on the wooden deck of Stephen Peitz’s (“Peitz”)
condominium, damaging a number of the surrounding units in the Westport Crossing
Condominiums located at 11579 Tawny Ash Court in St. Louis, Missouri. Peitz had a renter’s
insurance policy through State Farm that was effective on the date of the fire. This State Farm
policy, Policy Number 25-B7-H816-6, has an applicable policy limit of $300,000.00 per
occurrence, regardless of the number of claims or claimants. The affected condominium
residents and owners filed multiple claims with State Farm, and as of the date of the filing of this
action, claims had been made against the State Farm policy issued to Peitz in an amount
exceeding $444.787.00. In order to resolve the various claims arising out of the fire, State Farm
filed this interpleader action pursuant to 28 U.S.C. § 1335, and named as interpleaded defendants
all the condominium residents and owners who had submitted claims with State Farm against the
Peitz policy. State Farm paid $300,000.00 into the Registry of the Court as the interpleaded res
for equitable distribution.
Some of the affected neighbors also filed claims with their own insurance company. At
the time of the fire, Auto Club Family Insurance insured interpleaded defendants Jason Squires,
Crystal Squires, and Carl Goodman, and has issued payments exceeding $120,000.00 to the
Squires and $50,000.00 to Goodman as a result of damages caused by the fire. Auto Club
subsequently filed a petition to intervene in this action, asserting that they are subrogated to the
rights of the Squires and Goodman, and that petition was granted on May 21, 2018. (Doc. 51).

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On March 7, 2018, the Granicks filed a counterclaim against State Farm and crossclaims
against all the interpleaded defendants (Doc. 23). Subsequently, on March 26, 2018, Westport
filed a motion to dismiss the Granicks’ crossclaim against it. (Doc. 27). On April 2, 2018, the
Granicks filed a motion to dismiss without prejudice all of their crossclaims against the other
defendants, as well as their counterclaim against State Farm. (Doc. 29). On May 9, 2018,
defendant Maher filed a counterclaim against State Farm (Doc. 38), and crossclaims against all
the other interpleaded defendants (Doc. 39). On May 16, 2018, State Farm filed the instant
motion for discharge (Doc. 44), which is unopposed by the other parties. On May 18, 2018, the
Granicks filed a motion to dismiss Maher’s crossclaim. (Doc. 50). On May 23, 2018, Maher filed
a motion to dismiss without prejudice his crossclaims against all other defendants. (Doc. 55).
Lastly, on May 29, 2018, Maher filed a motion to dismiss his counterclaim against State Farm.
(Doc. 57).
II. Discussion
The Court will turn first to Plaintiff’s unopposed motion for interpleader relief. Plaintiff
moves the Court to enter an order in interpleader dismissing State Farm with prejudice from the
action and discharging it from any further liability for payment of claims against defendants
Peitz and Harris, who were the insureds under Policy Number 25-B7-H816-6, for damages
allegedly resulting from the fire.
Interpleader is a procedural device that allows a party holding money or property to join
in a single suit two or more parties asserting mutually exclusive claims to the fund. In this way
the stakeholder, in this case State Farm, is freed from the threat of multiple liability. See Gaines
v. Sunray Oil Co., 539 F.2d 1136, 1141 (8th Cir. 1976). A party may bring a claim under
statutory interpleader, governed by 28 U.S.C. § 1335, as State Farm did here, or under Rule 22 of

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the Federal Rules of Civil Procedure. The same principles apply to both statutory and rule
interpleader, and the only differences between the two involve procedural requirements such as
jurisdiction, venue, service of process, and amount in controversy. See Wittry v. Nw. Mut. Life
Ins. Co., 727 F.Supp. 498, 500 (D. Minn. 1989).
In an interpleader action brought pursuant to 28 U.S.C. § 1335, the district court must
first determine whether the requirements of the statute have been met and whether the
stakeholder may be relieved from liability. During this first step, the court “determines whether
the prerequisites to rule or statutory interpleader have been met by examining such things as the
citizenship of the litigants, the merits of the asserted threat of multiple vexation, and, if
interpleader is sought under the statute, the sufficiency of the stakeholder’s deposit or bond . . ..”
Vanderlinden v. Metro. Life Ins. Co., 137 F.Supp. 2d 1160, 1164 (D. Neb. 2001). If these
requirements are met, the court may dismiss the disinterested stakeholder from the interpleader
action, leaving the claimants to litigate, adjust, or settle their conflicting claims among
themselves. Id.
The interpleader statute requires that the value of the money in the plaintiff’s possession
be in an amount of $500.00 or more, and that there be at least two adverse claimants of diverse
citizenship asserting claims to the money or property. 28 U.S.C. § 1335(a)(1). In the instant
case, the requirements of the statute have been met. The record shows that there are competing
claims by minimally diverse parties on a single obligation. Also, State Farm’s interest in this
case is confined to the $300,000.00 proceeds from the insurance policy, and State Farm asserts
no remaining claim to the res deposited in the Registry of the Court, and is therefore a
disinterested stakeholder. And finally, the value of the disputed property exceeds $500.00.

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Accordingly, an interpleader action is appropriate, and State Farm’s motion will be
granted. See Wells Fargo Bank, N.A. v. ESM Fund I, LP, 785 F.Supp. 2d 188, 198 (S.D.N.Y.
2011) (when interpleader is appropriate, a disinterested stakeholder is entitled to discharge and
protection from further liability arising out of any claims to the funds at issue in the action).
The Court turns next to the multiple pending motions to dismiss various counterclaims
and crossclaims. On April 2, 2018, Defendants Robert and Deborah Granick filed a “Motion to
Dismiss” seeking dismissal without prejudice of their counterclaim against State Farm and all
their crossclaims against the other Defendants. (Doc. 29). However, Plaintiff State Farm and
Defendant Westport had already responded to the Granicks’ crossclaim prior to Granicks’ filing
of their Motion to Dismiss. (Docs. 26 and 27).
Because the Granicks’ dismissal was not filed prior to Plaintiff State Farm’s answer or
Defendant Westport’s motion to dismiss, nor was it filed with the signatures of all parties who
have appeared, it does not satisfy the requirements for a voluntary dismissal without a court
order pursuant to Rule 41(a)(1)(A). Thus, the Court will construe the dismissal as a motion to
dismiss pursuant to Rule 41(a)(2), which permits the Court to dismiss an action upon a party’s
request by court order. The Court finds that the motion should be granted. Additionally, because
State Farm is being dismissed with prejudice from this action, the dismissal of the Granicks’
counterclaim against State Farm is likewise with prejudice.
Furthermore, because the Court is granting the Granicks’ motion to dismiss their
counterclaims and crossclaims, the Court will dismiss Defendant Westport’s “Motion to Dismiss
Defendant Granicks’ Crossclaim” as moot. (Doc. 27).
On May 23, 2018, Defendant Jeffrey Maher filed a “Motion for Leave to File Dismissal
Without Prejudice” seeking dismissal without prejudice of his crossclaims against the other

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Defendants. (Doc. 55). The Granicks had already responded to Maher’s crossclaim prior to
Maher filing his Motion to Dismiss. (Doc. 50).
Because Defendant Maher’s dismissal was not filed prior to the Granicks’ motion to
dismiss, nor was it filed with the signatures of all parties who have appeared, it too does not
satisfy the requirements for a voluntary dismissal without a court order pursuant to Rule
41(a)(1)(A). Thus, the Court will construe the dismissal as a motion to dismiss pursuant to Rule
41(a)(2), which permits the Court to dismiss an action upon a party’s request by court order. The
Court finds that the motion should be granted. (Doc. 55)
Additionally, because the Court is granting Maher’s motion to dismiss his crossclaims,
the Court will dismiss the Granicks’ Motion to Dismiss Maher’s Crossclaim as moot. (Doc. 50).
On May 29, 2018, Maher also filed a “Motion to Dismiss” seeking dismissal without
prejudice of his counterclaim against State Farm. (Doc. 57). Because State Farm has not
answered or otherwise responded to Maher’s counterclaim, voluntary dismissal is proper, and the
Court finds that Maher’s Motion to Dismiss should be granted. However, as noted above,
because State Farm is concurrently being dismissed from this action with prejudice, the Court
notes that the dismissal of Maher’s Motion to Dismiss his counterclaim against State Farm is
likewise with prejudice.
Accordingly,
IT IS HEREBY ORDERED that State Farm’s Motion for Dismissal and Discharge is
GRANTED. (Doc. 44). Plaintiff State Farm, having deposited with the Registry of the Court on
January 17, 2018, the entire per occurrence policy limits of Policy Number 25-B7-H816-6,
insuring Defendants Stephen Peitz, Jr. and Mark Harris, is hereby dismissed with prejudice from
this action and is hereby discharged from any and all liability for payment of claims made

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against Defendants Peitz and/or Harris, arising out of a fire discovered on August 14, 2017, at
the Westport Crossing Condominiums. The Clerk of the Court shall retain the funds deposited by
Plaintiff in the Registry of the Court pending final resolution of these proceedings.
A separate Order of Partial Dismissal will accompany this Memorandum and Order.
IT IS FURTHER ORDERED that Defendant Westport’s “Motion to Dismiss Defendant
Granicks’ Crossclaim” is DENIED as moot. (Doc. 27).
IT IS FURTHER ORDERED that Defendants Robert and Deborah Granick’s “Motion
to Dismiss” seeking dismissal without prejudice of their counterclaim against State Farm and all
their crossclaims against the other Defendants is GRANTED. (Doc. 29).
IT IS FURTHER ORDERED that Defendants Robert and Deborah Granick’s Motion to
Dismiss Maher’s Crossclaim is DENIED as moot. (Doc. 50).
IT IS FURTHER ORDERED that Defendant Jeffrey Maher’s “Motion for Leave to File
Dismissal Without Prejudice” seeking dismissal without prejudice of his crossclaims against the
other Defendants is GRANTED. (Doc. 55).
IT IS FURTHER ORDERED that Defendant Jeffrey Maher’s “Motion to Dismiss”
seeking dismissal of his counterclaim against State Farm is GRANTED. (Doc. 57).
Dated this 12th day of June, 2018.

/s/ Nannette A. Baker
NANNETTE A. BAKER
UNITED STATES MAGISTRATE JUDGE

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