Rossman v. State Farm Mut. Auto. Ins. Co.
| Decision Date | 30 October 1987 |
| Docket Number | Nos. 86-1711,86-1707,86-1706,s. 86-1711 |
| Citation | 832 F.2d 282 |
| Parties | Timothy Allen ROSSMAN, Administrator of the Estate of Paula K. Rossman, deceased; Jodi S. Rossman, Plaintiff-Appellee, and Kelly Richards, Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, an Illinois corporation, Defendant-Appellant, and Consolidated Insurance Company, an Indiana corporation; the Protective Casualty Insurance Company, a Missouri corporation; Prudential Property and Casualty Insurance Company, a New Jersey corporation, Defendant. Timothy Allen ROSSMAN, Administrator of the Estate of Paula K. Rossman, deceased; Jodi S. Rossman, Plaintiff-Appellant, and Kelly Richards, Plaintiff, v. CONSOLIDATED INSURANCE COMPANY, an Indiana corporation; the Protective Casualty Insurance Company, a Missouri corporation; State Farm Mutual Automobile Insurance Company, an Illinois corporation; Prudential Property and Casualty Insurance Company, a New Jersey corporation, Defendant-Appellee. Timothy Allen ROSSMAN, Administrator of the Estate of Paula K. Rossman, deceased; Jodi S. Rossman; Kelly Richards, Plaintiff-Appellee, v. CONSOLIDATED INSURANCE COMPANY, an Indiana corporation, Defendant-Appellant, and The Protective Casualty Insurance Company, a Missouri corporation; State Farm Mutual Automobile Insurance Company, an Illinois corporation; Prudential Property and Casualty Insurance Company, a New Jersey corporation, Defendant. Timothy Allen ROSSMAN, Administrator of the Estate of Paula K. Rossman, deceased; Jodi S. Rossman; Kelly Richards, Plaintiff-Appellee, v. PRUDENTIAL PROPERTY AND CASUALTY INSURANCE COMPANY, a New Jersey corporation, Defendant-Appellant, and Consolidated Insurance Company, an Indiana corporation; the Protective Casualty Insurance Company, a Missouri corporation; State Farm Mutual Automobile Insurance Company, an Illinois corporation, Defendant. (L) and 86-1714. |
| Court | U.S. Court of Appeals — Fourth Circuit |
Palmer S. Rutherford, Jr., Henry W. Austin, Jr. (Willcox & Savage, P.C., Norfolk, Va., on brief), John George Crandley (Preston, Wilson & Crandley, Virginia Beach, Va., on brief), Alan Brody Rashkind (Vicki H. Devine, Furniss, Davis & Rashkind, Norfolk, Va., on brief), for appellants.
James Clayton Lewis (John W. Drescher, Lyle, Siegel, Drescher and Croshaw, P.C., Virginia Beach, Va., on brief), for appellees.
Before SPROUSE, CHAPMAN and WILKINSON, Circuit Judges.
This declaratory judgment action was brought to determine the rights and obligations of four insurance carriers with respect to two state judgments entered on wrongful death and personal injury claims arising out of an automobile accident. The carriers involved are Consolidated Insurance Company (Consolidated), Protective Casualty Insurance Company (Protective), State Farm Mutual Automobile Insurance Company (State Farm), and Prudential Property and Casualty Insurance Company (Prudential).
Paula K. Rossman was killed and Jodi S. Rossman was injured when their 1969 Triumph collided with a 1977 Mazda driven by Kelly Richards. Appellees Timothy A. Rossman, on behalf of the estate of Paula Rossman, and Jodi Rossman sued Kelly Richards in Virginia state court for wrongful death and personal injury. They won judgments against him for $193,353.90 on the wrongful death claim, and $24,000 for compensatory and $10,000 in punitive damages on the personal injury claim.
In the declaratory judgment action below, the district court held that Consolidated and Protective were proratably liable to indemnify Kelly Richards to the limits of their respective policies, and that they bore equal responsibility for his lawyers' fees and court costs. It also held State Farm liable for the punitive damages. In addition, the trial court denied the Rossmans' motion for sanctions against Consolidated under Fed.R.Civ.P. 11.
Consolidated and State Farm now appeal from the declaratory judgment, and the Rossmans appeal the denial of sanctions. We agree with the district court that Consolidated and Protective are proratably liable on their policies, but we reverse its holding that State Farm is obligated on the punitive claim. We also affirm the district court's denial of sanctions and its allocation of Kelly Richards' defense costs.
Kelly Richards (Kelly) and his father, Richard D. Richards (Richard) bought the Mazda in 1981, with the father contributing most of the purchase price. Both of their names appear on the title. At the time of the purchase, Kelly was living at home with his parents in Rockford, Illinois. Consolidated issued an endorsement covering the Mazda to Richard's auto insurance policy. The policy noted that Kelly was the Mazda's principal driver, and that it was garaged in Illinois. Richard paid the premiums in Illinois.
Kelly then enlisted in the Navy, and was assigned to duty at Fort Story in Virginia Beach, Virginia. He asked his father if he could bring the Mazda to Virginia. Richard was reluctant, but told Kelly that he could take the car to Virginia if he obtained his own insurance on it. Kelly obtained some insurance with Protective in September, 1981, but he did not show the policy to his father, and Richard did not drop Kelly from his policy with Consolidated. The collision occurred in October, 1981.
Richard's policy with Consolidated provided liability coverage limits of $300,000 per person and $500,000 per accident. The Consolidated policy stated that
We will pay damages for bodily injury or property damage for which any covered person becomes legally responsible because of an auto accident. We will settle or defend, as we consider appropriate, any claim or suit asking for these damages. In addition to our limit of liability, we will pay all defense costs we incur.
The policy further provided that it applied only to accidents and losses which occurred within the policy territory, defined as "1) The United States of America, its territories or possessions; 2) Puerto Rico; or 3) Canada."
Kelly's policy with Protective had liability limits of $10,000 per person and $20,000 per accident, and specifically excluded coverage for punitive damages. Two days before the accident, Jodi Rossman obtained insurance with State Farm for her 1969 Triumph. That policy provided for uninsured motorist protection with maximum coverage limits of $25,000 per person and $50,000 per accident. Jodi Rossman was also the named insured on a Prudential policy covering the family's 1971 Volkswagen. The Prudential policy included uninsured motorist coverage of $15,000/$30,000.
After the accident, the Rossmans instituted this declaratory judgment suit in federal district court in the Eastern District of Virginia. Consolidated challenged the court's personal jurisdiction under the Virginia long-arm statute, Va.Code Sec. 8.01-328.1 (1987 Cum.Supp.), but the district judge found that the court had personal jurisdiction. After a bench trial on April 4, 1985, the trial court found that Consolidated and Protective were proratably liable for coverage on Kelly Richards and were required to share the cost of defending him. The Rossmans then filed for Rule 11 sanctions, alleging that Consolidated had engaged in dilatory tactics. Their motion was denied on August 23, 1985. On December 3, 1985, the estate of Paula Rossman won a judgment against Kelly in Virginia state court of $193,353.90 on the wrongful death claim. On July 24, 1986, Jodi Rossman won a judgment against Kelly, also in the state courts of Virginia, of $24,000 in compensatory damages and $10,000 in punitive damages on the personal injury claim.
Meanwhile, Consolidated attempted to appeal the declaratory judgment. On February 5, 1986, however, this court dismissed the appeal, stating that it did not have jurisdiction to consider the matter because the district court had yet to rule on the liability of State Farm and Prudential and to allocate the cost of defending Kelly. On October 16, 1986, the district court ruled on the remaining issues and held, inter alia, that State Farm was liable for the punitive damage award. On November 4, 1986, the district court amended its judgment, ordering Consolidated to reimburse Protective for fifty percent of the cost of defending Kelly in the state court actions.
The parties now appeal the various rulings of the district court.
Consolidated argues that the district court lacked personal jurisdiction over it. Consolidated states that it has no agents or offices in Virginia and conducts no business there. Consolidated also notes that its policy was written, issued, and delivered in Illinois, and that the Mazda was principally garaged in Illinois. Consolidated thus contends that its connection with Virginia was insufficient to meet the requirements of due process and of the Virginia long-arm statute. 1 We hold, however, that Consolidated's contacts with Virginia were sufficient to establish personal jurisdiction.
It is well settled that a defendant must have "minimum contacts" with the forum state before that state's exercise of personal jurisdiction satisfies the requirements of due process. International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945); World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291, 100 S.Ct. 559, 564, 62 L.Ed.2d 490 (1980). While there is no mechanical test of personal jurisdiction, "minimum contacts" requires that the absent defendant purposefully avail himself of the privilege of conducting business in the forum state. Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239, 2 L.Ed.2d 1283 (1958). The unilateral activity of one seeking to claim some relationship with the defendant cannot satisfy the minimum contacts requirement. Id.; Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474, 105 S.Ct. 2174, 2183, 85 L.Ed.2d 528 (1985); Chung v. NANA Development Corp., 783 F.2d 1124, 1127 (4th Cir.1986). "[T]he defendant's conduct and connection with the...
To continue reading
Request your trial
-
Satterfield v. Gov't Emps. Ins. Co.
... ... is legitimate under the laws of the forum state[.]" Far West Capital, Inc. v. Towne , 46 F.3d 1071, 1074 ... residents when insurers refuse to pay a claim." Rossman v. State Farm Mutual Automobile Insurance Co. , 832 F.2d ... "boasts that it is the second-largest private passenger auto insurer in the United States and employs more than 36,000 ... ...
-
Bahn v. Chicago Motor Club Ins. Co.
... ... , and the car was titled and registered in that state under Lockheed's name. In 1985, however, Mr. and Mrs. Bahn ... See also Farmers Ins. Exch. v. Portage La Prairie Mut. Ins. Co., 907 F.2d 911, 913 (9th Cir.1990); Lynch v. New Jersey Auto. Full Ins. Underwriting Ass'n, 762 F.Supp. 101, 103 ... Typical of these cases is Rossman v. State Farm Mut. Auto. Ins. Co., 832 F.2d 282 (4th ... ...
-
Richardson v. William Sneider & Assocs., LLC
... ... the plaintiff where the plaintiff failed to state a claim); GlobalSantaFe Corp. v ... See, e.g. , Rossman v. State Farm Mut. Auto. Ins. Co. , 832 F.2d 282, ... ...
-
Waste Management, Inc. v. Admiral Ins. Co.
... ... Insurance Company; Constitution State Insurance Company; ... Continental Casualty Company; The ... Limited, Defendants, ... Auto-Owners Insurance Company; Canadian General Insurance ... See, e.g., Farmers Ins. Exch. v. Portage La Prairie Mut. Ins. Co., 907 F.2d 911, 913-14 (9th Cir.1990); Rossman v. State Farm Mut. Auto Ins. Co., 832 F.2d 282, 286 (4th Cir.1987); ... ...
-
CHAPTER 10 Directors and Officers Liability and Professional Liability Insurance
...Life Insurance Co., 129 Wash.2d 572, 919 P.2d 589 (1996). [38] See: Fourth Circuit: Rossman v. State Farm Mutual Automobile Insurance Co., 832 F.2d 282 (4th Cir. 1987). Fifth Circuit: Northwestern National Casualty Co. v. McNulty, 307 F.2d 432 (5th Cir. 1962). Seventh Circuit: Utica Mutual ......
-
Chapter 9
...Life Insurance Co., 129 Wash.2d 572, 919 P.2d 589 (1996). [38] See: Fourth Circuit: Rossman v. State Farm Mutual Automobile Insurance Co., 832 F.2d 282 (4th Cir. 1987). Fifth Circuit: Northwestern National Casualty Co. v. McNulty, 307 F.2d 432 (5th Cir. 1962). Seventh Circuit: Utica Mutual ......
-
Trial Practice and Procedure - John O'shea Sullivan and Ashby L. Kent
...v. M/V Charm, 19 F.3d 624, 627 (11th Cir. 1994)). 66. Id. 67. Id. 68. Id. at 1214-15 (citing Rossman v. State Farm Mutual Auto Ins. Co., 832 F.2d 282, 287 (4th Cir. 1987)). The court noted that insurers presumably offer this type of broad coverage to induce customers to buy their policies a......