dismd by agrmt.) 1999) (insureds motion to transfer erroneously granted); Southern County Mut. 1997)2; see also State Farm Lloyds v. stream title to the propertyan essential element of an action to quiet titleand, in the court of appeals' view, the pleadings alleged "the wrong cause of action," the court concluded that the Brumleys' pleadings did not support the judgment.9 6 603 S.W.3d 449, 451 (Tex. P., also addresses declaratory judgments, by reference to 28 U.S.C. The underlying liability suit arose from an accident in which one defendant, while intoxicated, hit the plaintiffs vehicle, killing their daughter. Insrs v. American Home Assur. Tex. The answer may depend upon whether the insurer has defended or simply denied coverage, and the extent to which the issue is actually material to, and fully litigated in, the underlying dispute. Further, while it is unlikely that an insurer wishes to proceed, without protective order, to establish evidence that demonstrates the insureds liability as the insurer has not yet prevailed on its coverage defenses it is also unclear under what standard the insured should be able to protect otherwise discoverable information, simply because it is damaging. Civ. denied); ANR Prod. App.Fort Worth 1973, writ refd n.r.e.). Co., 975 S.W.2d 329, 332 (Tex. PDF WHEN IS A DECLARATORY JUDGMENT PROPER? - Harris County, Texas Co., 975 S.W.2d 329 (Tex. In Foust v. Ranger Ins. P. 26; Tex. Tex. R. CIV. 1996) (nevertheless refraining from determining coverage for indemnity, on the basis of judicial economy). DECLARATORY JUDGMENT ACTIONS - ryderlaw.com See, e.g., Ohio Cas. Sec. PDF Preserving Coverage Defenses Prac. Rule 38(c), TEX. the enforceability of a non-compete, considerations before initiating legal action, cease and desist letters, declaratory judgments, seeking damages, requesting injunctive relief, and potential remedies available under the Defend Trade Secrets Act (DTSA). App.Amarillo 1997, no pet.). Further necessary or proper relief based on a declaratory judgment or decree may be granted, after reasonable notice and hearing, against any adverse party whose rights have been determined by such judgment. As a matter of law, the duty to defend is broader than the duty to indemnify, and an insurer's duty to defend is triggered as long as there is a "reasonable possibility" that the insurer may have to indemnify the insured under the policy. See, e.g., Wilton v. Seven Falls Co., 515 U.S. 277, 286 (1995). In American, the insurer agreed to defend the insured in an underlying personal injury action but reserved its right to deny coverage to the extent that the insurer was prejudiced due to the insured's late notice of the action. The county where the contract was formed may also be a proper venue. 1969); Getty Oil v. Ins. 37.003. Co. v. Marathon Ashland Petrol., L.L.C., 87 F. Supp. Oftentimes, the insurer has no duty to indemnify. When to file is often determined by what is at issue. 1996); Williamson v. State Farm Lloyds, 76 S.W.3d 64 (Tex. Id. Co. v. Bradleys Elec., Inc., 993 S.W.2d 673 (Tex. 1995). PDF Affirmative and Defensive Pleadings in Insurance Coverage and Bad Faith Instead, plaintiffs alleged River Entertainment was negligent for allowing the defendant to leave, in his own vehicle, when they should have known his driving ability was impaired. App.Dallas 2001, pet. The crop-dusting involved only one flight, but several passes during which herbicide was released, and during which wind direction and velocity varied. The controversy is ripe, because the insurer is called upon to defend, and because the existence of coverage may impact the outcome of the suit. See McCarthy Bros. Co. v. Continental Lloyds, 7 S.W.3d 725 (Tex. App.Austin 1998, pet. 37.001. See Bailey, 133 F.3d at 369 n.4; Travelers Ins. DECLARATIONS RELATING TO LIABILITY FOR SALES AND USE TAXES OF ANOTHER STATE. Id. Ins. (c) Notwithstanding Section 22.001, Property Code, a person described by Subsection (a) may obtain a determination under this chapter when the sole issue concerning title to real property is the determination of the proper boundary line between adjoining properties. 959, Sec. The complaint allegation rule can pose a problem with declaratory relief. 1995); but cf. Corp., 817 F.Supp. Co. v. Wade, 827 S.W.2d 448 (Tex. Exclusive news, data and analytics for financial market professionals. Jan. 25, 2019) is a mandamus case involving an insurer's motion to dismiss a declaratory judgment action by a law firm seeking a declaration of non-liability for malpractice in representing the insurer and advising it did not owe a defense in an underlying suit. See Scottsdale Ins. 3 0 obj App.Fort Worth 1961, writ refd n.r.e.) 1991), affd in part, 961 F.2d 213 (5th Cir. Declaratory judgment actions are oftentimes filed in federal court. Houston, TX 77056 Even before the Texas Supreme Courts opinion in Griffin, federal courts recognized that indemnity presented an actual controversy and was justiciable, prior to judgment in the underlying liability suit. (a) This chapter may be cited as the Uniform Declaratory Judgments Act. Co. v. Gandy, 925 S.W.2d 696 (Tex. When declaratory relief will not be effective in settling the controversy, the court may decline to grant it. This is an action for declaratory judgment pursuant to the Federal Declaratory Judgment Act, 28 U.S.C. The Fifth Circuit overruled prior case law to conform with the Supreme Courts ruling. App. . Disclaimer. )1^Hl]TgxY8Ubs,! 9@Dyp*l8sA!N\X The declaratory action may also bring the coverage issues into focus for the plaintiff, and assist the insured in negotiating settlement. The court may refuse to render or enter a declaratory judgment or decree if the judgment or decree would not terminate the uncertainty or controversy giving rise to the proceeding. App.Texarkana 2003, pet. Co. v. Port Auth. In this chapter, "person" means an individual, partnership, joint-stock company, unincorporated association or society, or municipal or other corporation of any character. App.Corpus Christi 1982, no writ), the court declared that the rule was that use of extrinsic evidence was allowed to determine coverage, but not to determine facts that would establish the insurers liability. 1 0 obj 1996). Ins. In this instance, both state and federal courts have readily allowed the use of extrinsic evidence to determine the duty to defend. In holding that Nautilus was entitled to recoupment of defense costs, the Court reasoned that the right to recoupment was not governed by the insurance policy at issue, but rather the right is afforded to the insurer under the theory of common law unjust enrichment. Of N.Y. & N.J., 166 A.D.3d 464 (1st Dep't 2018); Max Specialty Ins. at 451-53. A separate issue exists, however, as to the facts and testimony relating to the liability event, and the evidence that has been accumulated or produced in the underlying case. denied); see also State Farm Fire & Cas. App.Waco 1943, no writ); Superior Ins. Ohio Cas. (As amended Dec. 29, 1948, eff. Co. v. Fraiman, 514 S.W.2d 343, 346 (Tex. See, e.g., Standard Fire Ins. C.M.W., 53 S.W.3d 877 (Tex. endobj Dec. 1, 2007. Fla. Stat. The Murphys opposed Wells Fargo's motion, arguing, among other things, that Wells Fargo's claims should not be characterized as requesting declaratory relief. PDF In the Circuit Court of The Second Judicial Circuit in And for Leon The Court held that insurers are entitled to recoupment even where the policy at issue does not expressly provide such a right. App.Houston [14th Dist.] COURT REFUSAL TO RENDER. Co. v. Burch, 442 S.W.2d 331 (Tex. ); State Farm Lloyds Ins. June 29, 2021 - A standard feature of CGL policies is the duty to defend, which obligates insurance companies to defend an insured even if there is ultimately no duty to indemnify. See, e.g., Boring & Tunneling Co. v. Salazar, 782 S.W.2d 284, 289-90 (Tex. In other respects the Uniform Declaratory Judgment Act affords a guide to the scope and function of the Federal act. The Court also held that its decision is in line with what has "historically been the majority approach." Elements of Declaratory Judgment in Texas: Strategies & Ethics in DEC Civ. Co., 2000 Tex. App.Corpus Christi 1975, writ refd n.r.e.) Group, 946 F.Supp. Id. Co. v. Cooper Machinery Corp., 817 F.Supp. (a) A court of record within its jurisdiction has power to declare rights, status, and other legal relations whether or not further relief is or could be claimed. Ins. Ins. 1993) (whether accident arose from liquor liability); Acceptance Ins. Sec. <> LEXIS 1736 (Tex. Typically, the first-filed suit has dominant jurisdiction. It may be appropriate for courts to abstain, in certain circumstances. In RSL Funding, LLC v. Pippins, No. Courts have struggled with the issue of what can be resolved in the declaratory judgment action, when the issue determining coverage may also be material in the underlying case. Declaratory Judgment These rules govern the procedure for obtaining a declaratory judgment under 28 U.S.C. App.Dallas 1992, writ denied); U.S. Fire Ins. 37.008 provides that the court may refuse to render a declaratory judgment if the judgment would not terminate the uncertainty or controversy giving rise to the proceeding. See TEX. aspects of insurance coverage including directors and officers liability, professional liability, Sept. 1, 1985. The Federal act is broader in scope. 1965, writ refd n.r.e.) Suite 400 1170 (1933). denied) (refusing to allow use of extrinsic evidence to disprove alleged facts). Co. v. Trejo, 39 F.3d 585 (5th Cir. 37.008. ydXOEp Pzz2 -Ia5D(eUE02Xd#zG5 ;}srmVY9c~Vqz6#tUy/`ck$cVpxKCoo,}o{T#@TQ]%5|@Rtx~K9jptm> oL 120.53. Co. v. WSG Investors, LLC, 09-cv-05237, 2012 WL 3150577 (E.D.N.Y. App.Dallas 1992, writ denied) (insurer not collaterally estopped from challenging findings); United States Fire Ins. The Uniform Declaratory Judgments Act (the "UDJA") does not extend a trial court's jurisdiction, and a litigant's request for declaratory relief does not confer jurisdiction on a court or change a suit's underlying nature. There are several defenses that should be considered in a suit for declaratory relief in both state and federal court. (prior judgment not res judicata as to amended pleading that alleged new facts, not involving completed operations); St. Paul Ins. at 332. Co. v. Taylor, 832 S.W.2d 645 (Tex. Co. of Texas, 1998 Tex. Co. v. River Entertainment, 998 F.2d 311, 315 (5th Cir.