Allstate Vehicle & Prop. Ins. Co. v. Donie

• Decision Date: 26 September 2022
• Docket Number: 21-cv-11057
• Parties: ALLSTATE VEHICLE AND PROPERTY INSURANCE CO., Plaintiff, v. DONALD DONIE et al., Defendants.
• Court: U.S. District Court — Eastern District of Michigan

ALLSTATE VEHICLE AND PROPERTY INSURANCE CO., Plaintiff,
v.
DONALD DONIE et al., Defendants.

No. 21-cv-11057

United States District Court, E.D. Michigan, Southern Division

September 26, 2022

DAVID R. GRAND MAGISTRATE JUDGE

OPINION AND ORDER GRANTING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT (ECF NO. 17)

SHALINA D. KUMAR UNITED STATES DISTRICT JUDGE

I. INTRODUCTION

Plaintiff Allstate filed this action against defendants Donald and Cheryl Donie and Stephen Sapienza (the Insureds) for a declaratory judgment that it owes no duty to defend or indemnify the Insureds against the action brought against them by Eugenia Miller^[1] in Livingston County

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Circuit Court (21-31074-CH). ECF No. 1. Allstate filed the motion for summary judgment under Federal Rule of Civil Procedure 56 now before the Court. ECF No. 17. The Insureds opposed Allstate's motion. ECF No. 20. The Court heard oral argument from the parties at a hearing on June 29, 2022.

II. FACTUAL BACKGROUND

Allstate issued a homeowners policy to the Donies effective October 1, 2018 through October 1, 2019. Allstate issued a homeowners policy to Sapienza effective April 13, 2018 through April 13, 2019 (referred to together as Policies). ECF Nos. 17-3, 17-4. These Policies provided coverage to the Insureds for damages they were legally obligated to pay because of bodily injury or property damage arising from an occurrence covered by the Policies. Id. at PageID.333, 372. This coverage for liability includes a defense with counsel of Allstate's choice for the Insureds if they were sued for these types of damages, even if the allegations in the underlying suit were groundless, false, or fraudulent. Id.

The Insureds were sued by their neighbor, Miller, for obstruction and interference with her easement over their adjacent properties. ECF No. 172. Miller alleges in that suit that she maintains the right to use a sixty-six-foot-wide easement from her parcel, across the Insureds' properties, to

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Mack Road and that the easement is the exclusive means of ingress and egress for the Miller property. Miller alleges that the Insureds have unlawfully interfered with her easement rights by placing a lock on the gate positioned at the entrance to Miller's property. Id.

Allstate is currently defending the Insureds in the Livingston County action, subject to a reservation of rights letter. ECF No. 1-5. In its motion in this action, Allstate argues that it has no duty to defend or indemnify the Insureds because the Policies do not provide coverage for the damages asserted by Miller in the Livingston County action. ECF No. 17. The Court agrees and grants Allstate's motion.

III. ANALYSIS

A. Jurisdiction

Allstate contends that this Court should exercise its discretionary jurisdiction under the Declaratory Judgment Act. 28 U.S.C. § 2201(a). Courts are to consider the following five factors in deciding whether to exercise their discretionary jurisdiction over declaratory judgment actions:

(1) whether the judgment would settle the controversy; (2) whether the judgment would clarify the legal relations at issue; (3) whether the declaratory remedy is being used merely for the purpose of “procedural fencing” or “to provide an arena for a race to res judicata;” (4) whether the use of a declaratory action would increase the friction between our federal and state courts and improperly encroach on state jurisdiction; and (5) whether there is an alternative remedy that is better or more effective

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United Specialty Ins. Co. v. Cole's Place, Inc., 936 F.3d 386 (2019) (quoting Grand Trunk W.R.R. Co. v. Consol. Rail Corp., 746 F.2d 323, 326 (6th Cir. 1984)).

Allstate asserts that all...