United States District Court, E.D. Michigan, Southern Division
OPINION AND ORDER DECLINING TO EXERCISE JURISDICTION
OVER PLAINTIFF'S AND DEFENDANTS' ACTIONS FOR
TERRENCE G. BERG, UNITED STATES DISTRICT JUDGE
case involves the duty of an excess insurer to indemnify and
defend the insured. Plaintiff Selective Insurance Company of
America (“Selective”) seeks a judgment declaring
that it does not have a duty to defend Defendant Kemp
Building and Development Company (“Kemp”) in an
ongoing, Michigan state court lawsuit filed by an employee
injured on a construction job. Defendants-Kemp and Cincinnati
Insurance Company (“Cincinnati”), Kemp's
primary in- surer-seek a judgment declaring the opposite;
that is, that Plaintiff does have a duty to indemnify and
defend Kemp in the underlying Michigan lawsuit.
has filed a motion for partial judgment on the pleadings.
Dkt. 7. Defendants oppose this motion and have filed a
counter motion for summary judgment. Dkt. 9.
Court heard oral argument on this matter on July 19, 2017, in
Court has discretionary jurisdiction over actions for a
declaratory judgment, pursuant to the Declaratory Judgment
Act. 28 U.S.C. § 2201(a). For the reasons outlined below
and stated on the record at oral argument, the Court declines
to exercise its jurisdiction over this matter. Accordingly,
Plaintiff's motion for partial judgment on the pleadings
is DENIED, Defendants' motion for partial summary
judgment is DENIED, and this case is DISMISSED.
Kemp was hired as the general contractor for a construction
project (“the project”), Dkt. 7, Pg. ID 345, and
Defendant Cincinnati issued a primary insurance policy to
Kemp. Kemp then hired Kehrig Steel, Inc.
(“Kehrig”) as a steel subcontractor for the
project, Dkt. 9, Pg. ID 375, and Plaintiff Selective issued a
primary insurance policy to Kehrig. Dkt. 9, Pg. ID 376. Then,
Kemp and Kehrig entered into a contract stating that
Kehrig's primary in-surer-that is, Plaintiff
Selective-would insure Kemp as an additional insured for the
work Kehrig performed. Dkt. 9, Pg. ID 375. The practical
result of this contract was that Plaintiff became Kemp's
excess insurer (and Cincinnati remained Kemp's primary
insurer). Dkt. 9, Pg. ID 380.
working on site of the project, an ironworker working for
Kehrig was injured. Dkt. 9, Pg. ID 379; Dkt. 9-8, Pg. ID 760.
He sued Kehrig and Kemp. Dkt. 9, Pg. ID 379. The lawsuit is
currently pending in Macomb County Circuit Court, case number
14-3846-NI. Dkt. 7, Pg. ID 344. After the lawsuit was
initiated, Cincinnati contacted Plaintiff, requesting that it
defend Kemp in the case. Dkt. 1-3, Pg. ID 287. Plaintiff
responded, declining, and denying that it has any duty to do
so. Dkt. 1-4, Pg. ID 304.
then brought this action, seeking a declaration that it has
no duty to defend Kemp. Dkt. 1, Pg. IDs 1-2. Since this
lawsuit was filed, the parties have stipulated to several
issues, including that: Plaintiff will insure Kemp as an
additional insured, Plaintiff's insurance of Kemp is in
excess, and Plaintiff will indemnify Kemp if and when
Cincinnati's policy is exhausted. Dkt. 11, Pg. ID 938.
The only issue remaining is whether Plaintiff has a duty to
defend Kemp. Dkt. 1, Pg. ID 18.
argument, the parties altered their positions somewhat.
Defendant Cincinnati revised its position by stating that it
was no longer asking this Court for summary judgment, but
rather stated its preference for the Macomb County Circuit
Court to resolve this issue. Plaintiff, when asked by the
Court how this question met the applicable factors for
exercising declaratory judgment authority required by the
Sixth Circuit, discussed in greater detail below, conceded
that the case was not a good fit.
district court's exercise of jurisdiction under the
Declaratory Judgment Act is discretionary. Brillhart v.
Excess Ins. Co., 316 U.S. 491, 494 (1942). The
Sixth Circuit has articulated five factors for district
courts to balance in ...