Criterion Insurance v. Quillen

THOMSEN, Chief Judge. Defendants have moved to dismiss this declaratory judgment action for lack of a sufficient amount in controversy to support diversity jurisdiction. 28 U.S. C.A. § 1332(a). The amended complaint alleges that plaintiff issued an automobile liability policy to defendant Quillen covering a truck which he owned; that the policy was obtained by a material misrepresentation entitling the insurer to have the policy declared void; that while the truck was being driven by defendant Ford, it injured defendant Elburn. Elburn sued Quillen and Ford in a State Court for personal injuries, claiming $220,000 damages. The policy contained the familiar limits of liability — $10,000 for injuries sustained by one person, $20,000 for injuries arising out of one accident, and $5,000 for property damage. But the insurer also agreed to defend actions brought against persons insured by the policy alleging injuries covered thereby and to pay certain expenses, interest and costs in such actions. The question presented by the pending motion is whether the attorneys’ fees and other expenses which have been and will be incurred in defending the action in the State Court increase the amount in controversy beyond $10,000. Precisely the same question was answered in the affirmative by Judge Grim in Allstate Insurance Co. v. Dillard, E.D.Pa., 190 F.Supp. 111. This Court agrees, for the reasons stated by Judge Grim. The following cases announce principles which support this decision, directly or by analogy: Packard v. Banton, 264 U.S. 140, 44 S.Ct. 257, 68 L.Ed. 596; Aetna Cas. & Sur. Co. v. Yeatts, 4 Cir., 99 F.2d 665; United States F. & G. Co. v. Pierson, 8 Cir., 97 F.2d 560; Home Ins. Co. of New York v. Trotter, 8 Cir., 130 F.2d 800; Travelers Ins. Co. v. Young, D. N.J., 18 F.Supp. 450; Matthews v. Allstate Insurance Co., E.D.Va., 194 F. Supp. 459. The motion to dismiss is hereby denied.