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Canal Insurance Co. v. Dara Transport

July 1, 2010

CANAL INSURANCE COMPANY, PLAINTIFF,
v.
DARA TRANSPORT, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Oliver W. Wanger United States District Judge

MEMORANDUM DECISION ON DEFENDANTS' MOTION TO DISMISS

I. INTRODUCTION

Canal Insurance Company ("Plaintiff") is proceeding with an action for declaratory relief pursuant to 28 U.S.C. §§ 2201 and 2202 against Dara Transport, Inc. ("Dara Transport"), Chandararoth Pok ("Chandararoth"), Sila Sok, and Darryl R. Pok ("Moving Defendants").

Plaintiff filed its complaint on December 2, 2009. (Doc. 1). Plaintiff filed requests for entry of default judgments against Dara Transport and Chandararoth on March 9, 2010. (Docs. 9, 10). On March 12, 2010, the Clerk of the Court entered default judgments against Dara Transport and Chandararoth. (Docs. 13, 14).

Defendants filed a motion to dismiss the complaint or, in the alternative, to stay Plaintiff's action pending resolution of a related case being litigated in state court. (Doc. 15). Plaintiff filed opposition to the motion to dismiss on May 13, 2010. (Doc. 19). Defendants filed a reply on May 29, 2010. (Doc. 20).

II. FACTUAL BACKGROUND

On March 28, 2007, Noch Pok ("Decedent") died while operating a 1999 Freightliner tractor and 1994 Great Dane trailer ("subject vehicle"). (Complaint at 2). Decedent lost control of the subject vehicle while traveling on Interstate Highway 395 in Bishop, California. (Complaint at 2). Decedent's spouse and son are the Moving Defendants in the instant action. (Complaint at 2).

Moving Defendants filed a state court action against Dara Transport and Chandararoth for wrongful death on March 25, 2009 in the California Superior Court for the County of Los Angeles. (Complaint at 5). Dara Transport is an interstate commercial trucking company based in the State of Rhode Island, and Chandararoth is an individual and an officer of Dara Transport. (Complaint at 2). Moving Defendants' complaint in the state court action alleges that Chandararoth owned, serviced, repaired, and was otherwise responsible for the maintenance and operation of the subject vehicle that allegedly caused Decedent's death. (Complaint, Ex. B at 3). The state court complaint also alleges that Dara and Chandararoth were legally responsible for the operation and loading of the subject vehicle. (Complaint, Ex. B at 4). Moving Defendant's state court complaint alleges that Dara Transport and Chandararoth were negligent in the maintenance and service of the subject vehicle, and that as a result of Dara and Chandararoth's negligence, the subject vehicle was incapable of operating properly and proximately caused decedent's death. (Complaint, Ex. B at 4).

Plaintiff Canal Insurance Company is Dara Transport's insurer. (Complaint at 5). Dara Transport and Chandararoth tendered defense of the Moving Defendants' state court action to Plaintiff pursuant to the terms of their insurance agreement, and Plaintiff commenced defense of the action. (Complaint at 7). Plaintiff continues to defend the ongoing litigation in state court under a reservation of rights. (Complaint at 2, 7).

On December 2, 2009, Plaintiff filed this case seeking a declaratory judgment that the insurance policy between Plaintiff and Dara Transport does not cover the underlying claim. Plaintiff's complaint alleges that the Moving Defendants' state court action is not covered by the insurance policy because, inter alia,:

1) Dara Transport did not in fact own the subject vehicle;

2) Decedent was not operating the subject vehicle with the permission of Dara Transport at the time of Decedent's death, or was operating the vehicle beyond the scope of Dara Transport's permission;

3) Decedent was operating the vehicle pursuant to a long term leased owner-operator agreement or other agreement subject to an exclusion under the insurance policy; and

4) Dara Transport's liability is predicated on an obligation for which Dara Transport or an unknown insurer may be held liable under a workmen's compensation, unemployment compensation, disability benefits law, or similar law by ...


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