Stewart Engineering, Inc. v. Continental Casualty Company et al

Filing 47

ORDER granting 45 Motion to Dismiss for Failure to State a Claim. Clark Nexsen is DISMISSED WITHOUT PREDJUDICE from this action pursuant to Rule 21 of the Federal Rules of Civil Procedure. Signed by Senior Judge James C. Fox on 11/16/2016. (Grady, B.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
No. 5:15-CV-377-F

STEWART ENGINEERING, INC.,

)
)
Plaintiff,
)
)
)
vs.
)
)
CONTINENTAL CASUALTY
)
COMPANY, ZURICH AMERICAN
)
INSURANCE COMPANY, SKANSKA
USA BUILDING, INC., and CLARK
)
NEXSEN, INC.,
)
)
Defendants.
)
~~~~~~~~~~~~~~-)

ORDER

Before the court is the motion of Clark N exsen, Inc. to dismiss pursuant to Rule 12(b)( 6)
and (c), or alternatively, Rule 21 of the Federal Rules of Civil Procedure. [DE 45]. Plaintiff did
not respond.

I.

BACKGROUND

Plaintiff brings suit against its insurer, Continental Casualty Company ("CNA''), 1
pursuant to 28 U.S.C. § 2201 seeking an adjudication of its rights and obligations under the
Architects/Engineers Professional and Pollution Incident Liability Insurance ("the Policy")
issued by CNA. In particular, Plaintiff seeks a declaration that CNA is obligated to defend and
indemnify Plaintiff in connection with claims2 against Plaintiff relating to the separate collapses
of two pedestrian bridges located on the Wake Technical Community College ("WTCC")

The parties identify Continental Casualty Company by the acronym, CNA. For consistency purposes, the
court does the same.
2

Plaintiff classifies the claims as follows: (1) the Rosales-Nava/Lopez claims; (2) the
ChavezJHemande:zJVargas claims; (3) the Skanska/Zurich claims; (4) the Clark Nexsen claim; and (5) the WTCC
claims. These claims include wrongful death, personal injury and property damage. Am. Compl. ~ 2.

Stewart Eng'g, Inc. v. Continental Casualty Co. et al.
No. 5:15-CV-377-F
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Northern Campus in Raleigh, North Carolina.
According to the amended complaint, WTCC contracted with Clark Nexsen, Inc. ("Clark
Nexsen") 3 to provide architectural design services for the design of, inter alia, two pedestrian
bridges. Am. Compl.

iii! 18, 20-21.

Clark Nexsen contracted with Stewart to provide structural

engineering design services for both bridges. Id.

if 20. Subsequently, CNA issued the Policy

with a policy term from April 21, 2014 to April 21, 2015. Id.

if 30; [DE 25-1 at 2]. On

November 13, 2014, the first bridge collapsed. The second bridge collapsed on November 14,
2014. Am. Compl.

iii! 27-28.

In April 2015, Plaintiff contacted CNA regarding coverage for

claims made against the Policy associated with the collapsed bridges. Id.

if 71. CNA informed

Plaintiff that the Policy's per claim $3,000,000 limit of liability applied to all claims arising out
of the collapse of both bridges. Id. Plaintiff disputes CNA's interpretation of the Policy and
argues CNA has an obligation· to indemnify Plaintiff up to the aggregate policy limit of
$5,000,000. Id.

if 2.
II.

LEGAL STANDARD 4

Rule 21 governs the misjoinder of parties and allows the court to, inter alia, drop a party.
FED.

R. Crv. P. 21. "Dismissal of a misjoined party under Rule 21 is without prejudice; a claim

by or against such a party may be refiled as a separate suit." John S. Clark Co. v. Travelers
Indem. Co., 359 F. Supp. 2d 429,437 (M.D.N.C. 2004). Misjoinder occurs when a single party
or multiple parties fail to satisfy the requirements for permissive joinder under Rule 20. See id.
Under Rule 20, multiple defendants may be joined in one action where: (1) "any right to relief is
The original contract was between WCCC and Pearce Brinkley Cease & Lee, P.A. ("Pearce").
Subsequently, Pearce merged with Clark Nexsen. For ease ofreference, the court refers to Clark Nexsen.
4

Because the court resolves this motion based on Federal Rule of Procedure 21, the court does not reach
Clark Nexsen's alternative requests for dismissal for failure to state a claim or dismissal on the pleadings pursuant to
Rule 12(b)(6) and 12(c), respectively. Accordingly, it does not address the legal standards governing Rule 12(b)(6)
and 12(c).

Stewart Eng'g, Inc. v. Continental Casualty Co. et al.
No. 5:15-CV-377-F
Page 3

asserted against them jointly, severally, or in the alternative with respect to or arising out of the
same transaction, occurrence, or series of transactions or occurrences;" and (2) "any question of
law or fact common to all defendants will arise in the action." FED. R. Crv. P. 20(a)(2). It is
well-settled that a district court has broad discretion under Rule 21. Matthew Bender, Moore's
Federal Practice§ 21.05 (3d ed. 2011) ("Rule 21 gives the court tools to jettison those parties and
claims that are not within its jurisdiction or that are not conveniently prosecuted together,
preserving parties and claims that are properly before it.").

III.

DISCUSSION

Plaintiff brings two causes of action: (1) declaratory judgment and (2) breach of contract.
Both claims are against CNA only. Plaintiff asserts no claims against Clark Nexsen. Rather, in
its amended complaint, Plaintiff states only that Clark Nexsen is "named in this action in order to
adjudicate any rights [it has], or allegedly ha[s], under [the Policy]." 5

Am. Compl. ~ 3.

Moreover, there is no question of law or fact common to all defendants. Plaintiff brought this
action seeking a declaration that CNA is obligated to defend and indemnify Plaintiff up to the
aggregate limit ($5,000,000.00) of the Policy and that in failing to defend and indemnify
Plaintiff, CNA breached its obligation under the Policy.

Accordingly, the court finds the

dismissal of Clark N exsen pursuant to Rule 21 is appropriate.
IV.

CONCLUSION

For the foregoing reasons, Clark Nexsen's Motion to Dismiss or Drop Party [DE 45] is
ALLOWED.

Clark Nexsen is DISMISSED WITHOUT PREDJUDICE from this action

pursuant to Rule 21 of the Federal Rules of Civil Procedure.

Plaintiff also provides the same rationale for naming Zurich American Insurance Company and Skanska
USA Building, Inc. as defendants. Am. Compl. if 3.

Stewart Eng'g, Inc. v. Continental Casualty Co. et al.
No. 5:15-CV-377-F

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SO ORDERED.
This the 16th day of November, 2016.

MES C.FOX
: :United States District Judge