State Farm Mutual Automobile Insurance Company v. Deerfield Hutterian Brethren, Inc. et al

Filing 16

ORDER denying 8 Motion for Default Judgment. Signed by U.S. District Judge Charles B. Kornmann on 03/30/2017. (SAC)

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FILED MAR 30 2017 ~~ UNITED STATES DISTRICT COURT DISTRICT OF SOUTH DAKOTA NORTHERN DIVISION STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, 1: 16-CV-1016-CBK Plaintiff, ORDER vs. DEERFIELD HUTTERIAN BRETHREN INC. and JANOS STAHL, Defendants. The plaintiff has moved for default judgment pursuant to the plaintiffs affidavit and application for default judgment. The Court, having examined the proofs and being fully advised, finds this matter to be untimely. At this time, the plaintiff has a conflict of interest in defending Janos Stahl in the wrongful death action and simultaneously seeking a declaratory judgment that is adverse to his interests. "A conflict of interest exists when the injured person's claim against the insured is such that it could be sustained on different grounds, one of which is within the insurer's obligation to indemnify and another of which is not." St. Paul Fire & Marine Ins. Co. v. Engelmann, 639 N.W.2d 192, 200 (S.D. 2002). In the plaintiffs complaint, it asserts that Janos Stahl did not have the consent of Deerfield Colony to drive the 2000 GMC Jimmy off its property on February 9, 2014. There is a conflict of interest because the jury in the wrongful death action will decide the issue of whether Janos had implied permission to drive the 2000 GMC Jimmy on public roads that night. The answer to such question will be helpful in determining whether the automobile accident is covered by the insurance policy. "By reserving the noncoverage issue, a conflict of interest will be avoided and the interests of the insured and the insurer in defending against the injured claimant will be identical." Id. Therefore, the Court finds the issue of coverage is not yet fit for adjudication, and that there will be little hardship to the parties in withholding court consideration, as this matter lacks ripeness. IT IS ORDERED: 1. Plaintiffs motion for default judgment, Doc. 8, is denied. 2. Plaintiffs case is dismissed without prejudice. DATED this 30th day of March, 2017. BY THE COURT: CHARLES B. KORNMANN United States District Judge

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