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National Farmers Union Property and Casualty Co. v. Willard

United States District Court, D. Colorado

August 15, 2017



          William J. Martínez United States District Judge

         This case arises out of an accident on October 25, 2016 in which Jason Torres was fatally hit by a vehicle driven by Defendant Chance Willard. (ECF No. 1 ¶¶ 20-22.) At the time of the accident, the vehicle driven by Chance Willard was listed as an insured vehicle under a policy issued by Plaintiff National Farmers Union Property and Casualty Company (“NFU”). (Id. ¶¶ 11, 20.) NFU alleges that Chance Willard was listed as an “excluded driver” under the subject policy, such that any claims related to the October 25, 2016 accident are not covered. (Id. ¶¶ 19, 28.) Accordingly, NFU asserts that it owes no duty to defend or indemnify. (Id. ¶ 29.)

         Before the Court are two motions to dismiss under Federal Rule of Civil Procedure 12(b)(1): one motion filed by Defendants John, Dana, and Chance Willard (the “Willard Defendants”), and the other filed by Defendant Perla Crystal Torres (“Torres”). (See ECF Nos. 13, 25.) For the reasons set forth below, the Defendants' respective motions are granted.

         I. BACKGROUND

         Around 8:30 a.m. on October 25, 2016, Chance Willard was driving the Willard family pickup in Weld County, Colorado, when he collided with the rear of Jason Torres' vehicle. (ECF No. 13 at 2; ECF No. 29 at 1; ECF No. 29-1 at 2.)[1] Tragically, Jason Torres “died at the scene as a result of injuries suffered in the collision.” (ECF No. 29 at 1.) According to NFU, the Willard Defendants have sought coverage under the subject policy for claims arising from the accident. (ECF No. 1 ¶ 27.) However, neither the spouse of Jason Torres, nor his estate, have filed an underlying tort action against the Willard Defendants. (ECF No. 13 at 2; ECF No. 29 at 3.)

         In December 2012-almost four years before the accident-Chance Willard was “charged with driving under the influence, [which resulted] in his driver's license being revoked.” (ECF No. 1 ¶ 14.) As a result, in April 2013, “Dana Willard contacted the insurance agent . . . and asked to have Chance Willard excluded from the policy.” (Id. ¶ 15.) “The policy renewal for the period April 23, 2013 to October 23, 2013 was issued with declarations listing Chance Willard as ‘EXCLUDED.'” (Id. ¶ 18 (capitalization in the original).) Each policy renewal, including the renewal for the period October 23, 2016 through April 23, 2017 “lists Chance Willard as ‘EXCLUDED' in the declarations[.]” (Id. ¶ 19.) Thus, Chance Willard was listed as an excluded driver at the time he collided with Jason Torres.

         On December 23, 2016, NFU filed the instant action seeking a declaratory judgment that states: (1) “Chance Willard was an excluded driver under the Policy”; (2) “the Policy provides no coverage for any claims related to the October 25, 2016 accident”; and (3) “NFU has no duty to defend or indemnify the Willards.” (Id. at 6.)

         On January 25, 2017, the Willard Defendants filed their motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(1), stating that “[t]his case must be dismissed for failure to comply with the most basic tenant[sic] of federal court jurisdiction: it does not present an actual case or controversy which is ripe for adjudication.” (ECF No. 13 at 1.) On February 22, 2017, Torres filed her motion to dismiss adopting “all arguments of law contained in the Willard Defendants' motion for lack of subject matter jurisdiction.” (ECF No. 25 at 1.) Shortly thereafter, on February 23, 2017, NFU responded (ECF No. 29), and the Willard Defendants replied on March 9, 2017 (ECF No. 35).


         Under Federal Rule of Civil Procedure 12(b)(1), a defendant may move to dismiss a case by asserting that the Court lacks subject-matter jurisdiction over the claims in the operative complaint. See Fed. R. Civ. P. 12(b)(1). “District courts have limited subject matter jurisdiction and may hear cases when empowered to do so by the Constitution and by act of Congress.” Randil v. Sanborn W. Camps, Inc., 384 F.3d 1220, 1225 (10th Cir. 2004) (internal quotation marks omitted). “A court lacking jurisdiction cannot render judgment but must dismiss the case at any stage of the proceedings in which it becomes apparent that jurisdiction is lacking.” Basso v. Utah Power & Light Co., 495 F.2d 906, 909 (10th Cir. 1974).

         Rule 12(b)(1) motions generally take one of two forms: a facial attack or a factual attack. When reviewing a facial attack on a complaint pursuant to Rule 12(b)(1), the Court accepts the allegations of the complaint as true. Holt v. United States, 46 F.3d 1000, 1002 (10th Cir. 1995). A factual attack does not permit the court to presume the complaint's factual allegations are true, although the court does have “wide discretion to allow affidavits, other documents, and a limited evidentiary hearing to resolve disputed jurisdictional facts under Rule 12(b)(1).” Id. In such circumstances, the court's reference to evidence beyond the pleadings will not convert the motion to one under Rules 56 or 12(b)(6), unless the jurisdictional question is intertwined with the merits of the case. Id. Here, the parties have offered declarations and other documents in connection with their respective motions to dismiss, creating a factual attack on the Court's subject matter jurisdiction.

         III. ANALYSIS

         The party seeking to invoke federal jurisdiction bears the burden of proving that subject matter jurisdiction exists. See Lindstrom v. United States, 510 F.3d 1191, 1193 (10th Cir. 2007) (“The litigant asserting jurisdiction must carry the burden of proving it by a preponderance of the evidence.”). In addressing this burden, NFU asserts that this action is properly before the Court because “[t]his action presents an actual controversy appropriate for a Declaratory Judgment.” (ECF No. 29 at 3.)

         The Federal Declaratory Judgment Act provides that “[i]n a case of actual controversy within its jurisdiction, . . . any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought.” 28 U.S.C. § 2201(a). “The phrase ‘case of actual controversy' in the Act refers to the type of ‘Cases' or “Controversies' that are justiciable under Article III of the United States Constitution.” Columbian Fin. Corp. v. BancInsure, Inc., 650 F.3d 1372, 1376 (10th Cir. 2011) (citations omitted). The Tenth Circuit has cautioned that “Article III has long been interpreted as forbidding federal courts from rendering advisory opinions.” Id. “It is not the role of federal courts to resolve abstract issues of law. Rather, they are to review disputes arising out of specific facts when the resolution of the dispute will have practical consequences to the conduct of the parties.” Id. The central question in deciding whether a declaratory judgment action satisfies the case or controversy ...

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