Tolbert v. Cook

• Decision Date: 23 April 2014
• Docket Number: C/A No.: 8:13-03312-GRA
• Court: U.S. District Court — District of South Carolina
• Parties: Brittany Tolbert, Plaintiff, v. Markela Cook, Defendant.

Brittany Tolbert, Plaintiff, v. Markela Cook, Defendant.

C/A No.: 8:13-03312-GRA

UNITED STATES DISTRICT COURT DISTRICT OF SOUTH CAROLINA ANDERSON/GREENWOOD DIVISION

Dated: April 23, 2014

ORDER

(Written Opinion)

This matter is before the Court on Plaintiff Brittany Tolbert's Motion to Join Other Parties and Amend Pleadings. ECF No. 20. Plaintiff commenced this action on November 27, 2013, pursuant to 28 U.S.C. § 1332, seeking actual and punitive damages and claiming personal injuries as a result of Defendant's alleged negligence, gross negligence, and negligence per se while driving her motor vehicle. See ECF No. 1. Plaintiff alleges that Defendant struck her while she was walking in a pedestrian crosswalk in Newberry, South Carolina. Id. Defendant has agreed to tender the limits of her $50,000.00 liability policy. ECF No. 20-1. However, the insurance policy covering Defendant's vehicle does not adequately cover the expenses incurred by Plaintiff as a result of her injuries and thus, the underinsured motorist ("UIM") provisions of two policies issued to Plaintiff's parents are in dispute. ECF Nos. 20, 20-1, & 23. As a result, Plaintiff seeks to add her insurance carriers, Nationwide Affinity Insurance Company of America ("Nationwide Affinity") and Nationwide Insurance Company of America ("Nationwide") (collectively, the "Nationwide Entities"), as defendants to the present action. ECF Nos. 20 & 20-1.

The Nationwide Entities jointly filed a declaratory judgment action against Plaintiff in the Superior Court of Wake County, North Carolina, for the purpose of determining UIM coverage. ECF Nos. 20 at 2 & 23 at 2. Despite the pending North Carolina action, Plaintiff argues that the Nationwide Entities are necessary parties to the instant action because the only remaining point of contention in this case is the amount of UIM benefits Plaintiff is to receive, which requires a determination of whether the UIM policies may be stacked. ECF Nos. 20 & 20-1.¹ The Nationwide Affinity policy issued to Plaintiff's mother provides potential UIM coverage of $50,000.00 per person, and the Nationwide policy issued to Plaintiff's father provides potential UIM coverage of $50,000.00 per person. ECF Nos. 20-1 & 23. The Nationwide Entities filed a Response in Opposition to Plaintiff's Motion to Join Other Parties and Amend Pleadings. See ECF No. 23. Plaintiff did not file a Reply in support of her Motion. After reviewing the parties' submissions, this Court finds that Plaintiff's Motion is DENIED.

Discussion

Leave to amend under Rule 15(a) is not granted automatically. Deasy v. Hill, 833 F.2d 38, 40 (4th Cir. 1987). Generally, motions to amend under Rule 15 should be freely granted when justice so requires. Fed. R. Civ. P. 15(a)(2). However, theSupreme Court has construed the phrase "when justice so requires" to preclude granting leave to amend when any of the following are found to exist: "undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of the amendment, etc." Foman v. Davis, 371 U.S. 178, 182 (1962); see also Steinburg v. Chesterfield Cnty. Planning Comm'n, 527 F.3d 377, 390 (4th Cir. 2008); United States v. Pittman, 209 F.3d 314, 317 (4th Cir. 2000). The Nationwide Entities argue that allowing Plaintiff to amend her Complaint to add them as parties to the present action would be futile for three reasons: (1) this Court lacks subject matter jurisdiction over Plaintiff's proposed declaratory judgment action because the amount in controversy is not satisfied; (2) this Court lacks supplemental jurisdiction over Plaintiff's claims; and (3) even if subject matter jurisdiction exists, this Court should abstain from hearing the coverage disputes because a declaratory judgment action between Plaintiff and the Nationwide Entities is already pending in North Carolina. ECF No. 23 at 3.

"'Futility' means that the complaint, as amended, would fail to state a claim upon which relief could be granted." Glassman v. Computervision Corp., 90 F.3d 617, 623 (1st Cir. 1996). A court may deny a motion to amend on the ground of futility "when the proposed amendment is clearly insufficient or frivolous on its face." Johnson v. Oroweat Foods Co., 785 F.2d 503, 510 (4th Cir.1986); see also Perkins v. U.S., 55 F.3d 910, 917 (4th Cir. 1995) (If an amended complaint could not withstand a motion to dismiss, then the motion to amend should be denied as "futile.").

A. This Court Lacks Subject Matter Jurisdiction

The Nationwide Entities argue that, as this Court's subject matter jurisdiction is based on diversity jurisdiction under 28 U.S.C. § 1332, Plaintiff's proposed amendment lacks the requisite jurisdictional amount of greater than $75,000.² ECF No. 23 at 4-5.

The amount in controversy for purposes of a declaratory judgment action is measured by the "value of the object of the litigation." Toler v. State Farm Mut. Auto. Ins. Co., 25 F. App'x 141, 143 (4th Cir. 2001) (quoting Hunt v. Wash. State Apple Adver. Comm'n, 432 U.S. 333, 347 (1977)). "In determining whether the 'value of the object of the litigation' is sufficient to satisfy the amount in controversy requirement, the Court should grant a dismissal only where it appears to a legal certainty that the controversy involves less than $75,000." Fairfield Resorts, Inc. v. Fairfield Mountains Prop. Owners Ass'n, Inc., No. 1:06CV191, 2006 WL 1801547, at *2 (W.D.N.C. June 28, 2006) (emphasis in original). It is well settled in the Fourth Circuit that the test for determining the amount in controversy in a diversity proceeding is the "either-viewpoint rule" which is concerned with "the pecuniary result to either party which [a] judgment would produce." Dixon v. Edwards, 290 F.3d 699, 710 (4th Cir. 2002) (citing Gov't Emps. Ins. Co. v. Lally, 327 F.2d 568, 569 (4th Cir. 1964)); see also Gonzalez v. Fairgale Props. Co., 241 F.Supp.2d 512, 517 (D. Md. 2002). Under the "either-viewpoint" rule, the amount-in-controversy requirement is satisfied if either the gain to the plaintiff or the cost to the defendant is greater than $75,000. See Gonzalez, 241 F.Supp.2d at 517. The party "seeking dismissal based on the amountin controversy must show that it is legally impossible for the plaintiff to recover the jurisdictional amount." VCA Cenvet, Inc. v. Chadwell Animal Hosp., LLC, Civil No. JKB-11-1763, 2011 WL 6257190, at *1 (D. Md. Nov. 29, 2011) (citing Wiggins v. N. Am. Equitable Life Assurance Co., 644 F.2d 1014, 1017 (4th Cir. 1981)).

The rules of aggregation are fairly simple. A single plaintiff's claims against several defendants can be aggregated for jurisdictional purposes only if the defendants are jointly liable to the plaintiff on each claim. Sovereign Camp Woodmen v. O'Neil, 266 U.S. 292, 297-98 (1924); see also Jewell v. Grain Dealers Mut. Ins. Co., 290 F.2d 11, 13 (5th Cir. 1961) ("This rule is applicable to suits against two or more insurance companies, each of which has separately insured against a stated risk for a sum less than the jurisdictional amount."). However, where the liability alleged is separate, rather than joint, aggregation is not permitted even if the claims arise out of the same transaction. See Ex Parte Phoenix Ins. Co., 117 U.S. 367, 369 (1886); see also Jewell, 290 F.2d at 13 (holding that "no joint liability of the defendant insurance companies" exists to "permit[] the claims against them to be joined for determining jurisdiction"). The Fourth Circuit has similarly held that "[i]f a single plaintiff joins several parties as defendants, the plaintiff may not aggregate the various claims unless the defendants' liability is common, undivided, or joint." Liberty Mut. Fire Ins. Co. v. Hayes, 122 F.3d 1061, at *2 (4th Cir. 1997) (unpublished table decision) (per curiam) (internal citation omitted). Moreover, "[a]ggregation is keyed to the type of recovery, not the factual relatedness of the claims." Id. The Hayes Court denied a plaintiff's attempt to aggregate claims against multiple insurers where he had not stated a joint and several claim against them. See id.

In this case, Plaintiff's "total claimed damages stemming from the accident are not at issue for purposes of determining the amount in controversy," id. at 3, because Plaintiff's basis for joining the Nationwide Entities as Defendants under Fed. R. Civ. P. 19 is to pursue a declaratory judgment action concerning the UIM policies under Fed. R. Civ. P. 57. See supra note 1; see also ECF No. 20 at 2-3. Plaintiff seeks to recover from each of the Nationwide Entities separately, and Plaintiff does not state a joint and several claim for insurance coverage. Therefore, under the general rules of aggregation, the $50,000.00 policy limits afforded by the Nationwide Affinity policy and the $50,000.00 policy limits afforded by the Nationwide policy cannot be aggregated to satisfy the jurisdictional amount. This Court finds that the Nationwide Entities have proven to a legal certainty that the amount in controversy is insufficient. See Erie Ins. Prop. & Cas. Co. v. Stricklin, No. 5:13CV30, 2013 WL 6265843, at *3 (N.D.W. Va. Dec. 4, 2013) ("As the policy at issue, insomuch as it concerns underinsured motorist benefits, is limited to $50,000.00, it follows that the amount in controversy is no more than $50,000.00. Such an amount is insufficient to establish the amount in controversy required for diversity jurisdiction and, thus, this Court lacks subject matter jurisdiction."). Accordingly, the proposed amendment and joinder of Nationwide Affinity and Nationwide would be futile.

B. This Court Does Not Have Supplemental Jurisdiction

Plaintiff asserts she is entitled to add the Nationwide Entities as Defendants pursuant to Fed. R. Civ. P. 19 as they are necessary parties. ECF No. 20 at 2. However, the Nationwide Entities argue that "the Court cannot use supplemental...