Opinion
C.A. No. 01C-06-192-JRS
Date Submitted: June 12, 2002
Date Decided: July 9, 2002
ORDER PURSUANT TO CIVIL RULE 132
Upon Plaintiff's Motion for Summary Judgment
DENIED.Upon Defendant Continental Insurance Company's Motion to Dismiss
GRANTED.C. Scott Reese, Esquire, Attorney for the Plaintiff.
Colleen D. Shields, Esquire, Attorney for Defendant Continental Insurance Co. Norman H. Brooks, Jr., Esquire, Attorney for Defendant
Covington VAVALA, Commissioner
1. On April 15, 2000, a 2000 BMW 740 IL ("the Vehicle") which was owned by Plaintiffs Thomas P. Dougherty and Barbara J. Dougherty ("Plaintiffs") suffered damage in a collision with a vehicle owned by Defendant Constance Covington ("Covington"). The Vehicle was insured under an automobile liability insurance policy with Defendant Continental Insurance Company ("CNA"). Constance Covington, at the time of the collision, carried automobile liability insurance with Colonial Penn. The CNA policy provided first party coverage for collision damage, subject to a $500 deductible. The Colonial Penn policy provided at least $25,000 in property damage coverage.
2. Plaintiffs made a claim against the CNA policy for physical damage resulting from the collision. CNA paid $26,607.62 to have the Vehicle repaired. CNA then pursued subrogation against Colonial Penn receiving only partial reimbursement for the property damage expenditure.
3. In the current cause of action, Plaintiffs seek diminution in value, claiming the value of the Vehicle after repairs is now significantly less than its value had the accident not occurred. One question before the Court is whether diminution of value is recoverable after the Delaware Supreme Court's decision in O'Brien v. Progressive, 785 A.2d 281 (Del.Supr. 2001) (holding insurers' obligation to "repair or replace" was not ambiguous and did not contemplate payment for diminution of value).
4. Plaintiffs filed a complaint against CNA on July 3, 2001, seeking a judgment declaring they were entitled to recover for the diminution in value of the Vehicle. CNA moved for summary judgment, arguing that Delaware law does not recognize diminution in value for property damage claims for first party coverage. Plaintiffs then dismissed their direct claims against CNA and amended the complaint to add Covington as a defendant.
5. Plaintiffs' amended complaint seeks reimbursement from CNA to Colonial Penn for any amounts paid in subrogation in order to satisfy the diminished value for a judgment entered against Covington.
6. Plaintiffs have moved for summary judgment, seeking a declaration that CNA must reimburse Colonial Penn in order to comply with 21 Del. C. § 2118. Both Defendants responded to Plaintiffs' motion and CNA counters the Plaintiffs' motion with a motion to dismiss.
7. The Court held a hearing on the motions on May 24, 2002. This Order represents the Commissioner's Report pursuant to Superior Court Civil Rule 132.
8. Relying on 21 Del. C. § 2118 (g)(5), Plaintiff contends that the Court should order that Colonial Penn should pay back CNA subrogated funds in order for Plaintiff to recover diminished value from its insurer, CNA.
9. Plaintiffs seeks to have the Court circumvent what Plaintiffs themselves candidly admit is "clearly procedurally correct." Transcript of Hearing, May 24, 2002, p. 21. Plaintiffs state clearly that they hope to find an expedient way to resolve their case, rather than litigate their claim against the tortfeasor. Plaintiffs hope that the Court will resolve the issue of whether the O'Brien decision applies only to contract cases or whether that decision also prohibits recovery of diminished value for damages caused by a tortfeasor.
10. Defendants CNA and Covington oppose the Plaintiff's motion on the grounds that the matter is not ripe for adjudication because Plaintiffs have failed to include Covington's liability carrier as an indispensable party. Moreover, Defendants assert that no factual record exists on which the Court may make a declaratory judgment.
11. Delaware's Declaratory Judgment Act ("The Act"), 10 Del. C. Ch. 65, "provides a means for securing judicial relief in an expeditious and comprehensive manner." Weiner v. Selective Way Ins. Co., 793 A.2d 434, 438 (Del.Super.Ct. 2002). The Act is entitled to a liberal application. Id. (citing Hoechst Celanese Corp. v. National Union Fire Ins. Co., 623 A.2d 1133 (Del.Super.Ct. 1992). For a court to order declaratory relief, the controversy must satisfy a four-part test. "[T]he controversy must involve (1) the rights or other legal relations of the party seeking declaratory relief; (2) a claim or right or other legal interest asserted against one who has an interest in contesting the claim; (3) parties whose interests are real and adverse; and (4) an issue in dispute that is ripe for judicial determination." 10 Del. C. § 6502; Stroud v. Milliken Enterprises, Inc., 552 A.2d 476, 479 (Del.Supr. 1989).
12. Summary judgment will be granted only where there is no genuine issue as to any material fact and the moving party is a entitled to judgment as a matter of law. Burkhart v. Davies, 602 A.2d 56, 59 (Del. 1991) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986)).
13. The Plaintiffs have not yet proven their case as to diminished value against the Defendant/tortfeasor Covington. This controversy is not ripe for declaratory judgment. If the Plaintiff files a case in the Court of Common Pleas and obtains a judgment against the Defendant, the procedure that the Plaintiffs themselves admit is the appropriate, if not expedient, procedure, then the invocation of 21 Del. C. § 2118 is appropriate.
14. Defendant CNA argues that the Plaintiffs' case is not ripe for declaratory judgment because the Plaintiffs have not added an indispensable party, namely Colonial Penn. The Court need not consider this argument, as the Plaintiffs case has already been deemed not ripe for the declaration Plaintiffs seek.
15. As Justice John Harlan, Jr. opined thirty years ago, "Perhaps no characteristic of an organized and cohesive society is more fundamental than its erection and enforcement of a system of rules. . .enabling [its members] to. . .settle their differences in an orderly, predictable manner. Without such a `legal system,' social organization and cohesion are virtually impossible." Boddie v. Connecticut, 401 U.S. 371, 374-375 (1971). There is a mechanism in our legal system which allows the Plaintiffs to seek justice in this controversy. The Plaintiffs have acknowledged themselves what that mechanism is. The Court finds that declaratory judgment is not that mechanism. As a genuine issue of material fact still exists, that is, whether the alleged tortfeasor is indeed a tortfeasor, summary judgment also is not a viable means for Plaintiffs to seek resolution of this matter.
16. Accordingly, the Plaintiffs' Motion for Summary Judgment and for Declaratory Judgment is hereby DENIED. The Defendant CNA's Motion to Dismiss is GRANTED. Nothing in this Order shall prohibit Plaintiffs from filing a case in the appropriate court for the appropriate cause of action.
17. This order shall be pursuant to Delaware Superior Court Civil Rule 132. IT IS SO ORDERED AND RECOMMENDED,
ORDER
Now, this 31st day of July, 2002, IT IS THE ORDER OF THE COURT that, pursuant to Delaware Superior Court Civil Rule 132, Commissioner Vavala's well-reasoned Order dated July 9, 2002, is hereby adopted in the above-referenced matter.