Hardware Mut. Casualty Co. v. Schantz, 12594.
| Decision Date | 28 December 1949 |
| Docket Number | No. 12594.,12594. |
| Citation | 178 F.2d 779 |
| Parties | HARDWARE MUT. CASUALTY CO. v. SCHANTZ et al. |
| Court | U.S. Court of Appeals — Fifth Circuit |
J. L. Lancaster, Jr., Dallas, Tex., for appellant.
E. E. Murphy, San Angelo, Tex., Earl W. Smith, San Angelo, Tex., for appellees.
Before HUTCHESON, WALLER and RUSSELL, Circuit Judges.
Appellant filed a complaint for a declaratory judgment seeking an adjudication of the rights of the parties under a policy of public liability, or indemnity, insurance, issued to appellee, Schantz. Appellees sought to have the cause dismissed for lack of jurisdiction, asserting that since the amount involved had not then been determined, jurisdiction was not made to appear. Without any adjudication of the merits, the lower Court, agreeing with appellees that the Court lacked jurisdiction, dismissed the suit.1
Therefore, the question for our determination is solely whether or not the trial Court had jurisdiction and not whether the plaintiff was liable under its policy.
At the time of the bringing of this suit there was pending in the State Court a suit against the executors of Schantz for more than $100,000 for the wrongful death of a third party. There had been demands by Schantz or his executors and a refusal by the Insurance Company to defend that suit and it was in an effort to escape liability to defend the State Court suit and to indemnify the assured against any judgment rendered therein against Schantz's estate that the Insurance Company sought a declaratory judgment.
The jurisdictional requisites for maintaining a suit for a declaratory judgment in the present case are, diversity of citizenship and an actual controversy involving in excess of $3,000.2
The parties are in dispute as to the coverage of the policy sought to be construed. The Insurance Company strenuously denies liability, and with equal vigor appellees assert coverage. This constitutes an actual controversy. The policy in question has a limit of $25,000 in case of death or injury of one person and a greater amount in case of death or injury of additional persons. The record clearly indicates that the suit in the State Court involves an amount in excess of $100,000, and presents a contingent liability greatly in excess of $3,000. This supplies the requisite amount in controversy. Appellees are citizens of Texas and appellant is a citizen of Wisconsin.
It is settled that where there is an actual controversy over rights valued in excess of $3,000, whether contingent or liquidated, a declaratory judgment may be rendered in the Federal Court. American Machines & Metals, Inc., v. DeBothezat Impeller Company, 2 Cir., 166 F.2d 535; Pennsylvania Casualty Company v. Upchurch, 5 Cir., 139 F.2d 892. Even in cases where the District Court has a discretion in the determination of its jurisdiction in actions for declaratory...
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