Vehicle owner necessary, indispensable to dispute

Where the administrator for the decedent alleged that the owner of the vehicle that struck him was potentially liable for the fatal injuries, the vehicle owner was a necessary and indispensable party in the coverage dispute.

Background

According to the complaint, on June 18, 2021, John Siefert, the husband of plaintiff Carrie Seifert, died in a head-on collision when a Chevrolet Equinox driven by defendant Terry Lee Doyle crossed the center line. Doyle was driving a vehicle owned by defendant Pohanka Chevrolet and insured by defendant Travelers Indemnity Company of Connecticut.

Pohanka and Travelers deny that Doyle had permission to drive the car at the time of the accident and therefore refuse to provide insurance coverage. In addition to this action, Siefert is pursuing a wrongful death claim against Doyle in state court. In this action, Siefert seeks a judicial declaration that Travelers must provide its full liability limits under the insurance contract issued to Pohanka for Doyle’s liability in Seifert’s underlying wrongful death claim.

This action was originally filed in the circuit court. Travelers removed this action to this court alleging that diversity jurisdiction exists because (2) Doyle should be realigned as a plaintiff and (2) Pohanka is a nominal party whose citizenship can be disregarded for the determination of diversity jurisdiction.

Realignment

In determining whether to realign parties, courts determine the primary issue in controversy, and then align the parties according to their positions with respect to the primary issue. Here, the suit’s primary purpose is to determine whether Travelers’ insurance policy covers an accident involving a car owned by Pohanka and driven by Doyle. Doyle can therefore be realigned as a plaintiff: both he and Seifert have a clear interest in establishing that the insurance policy applies.

Nominal party

The “nominal party exception” ensures that only those parties with palpable interest in the outcome of the case, and not those without any real stake, determine whether a federal court can hear a case. A nominal party is a party that has an “immaterial interest in the subject matter of a lawsuit and who will not be affected by any judgment.” This determination of the nominal party is a “practical inquiry, focused on the particular facts and circumstances of a case.”

Based on the information currently before it, the court remains doubtful that Pohanka is a nominal party. The pleadings here go beyond establishing a “likely impact” on Pohanka. Siefert’s complaint affirmatively states that “’Pohanka has a financial interest in the outcome of this coverage dispute because it would be liable for all or a substantial portion of any payments Travelers is required to pay in connection with Ms. Siefert’s wrongful death claim against Mr. Doyle.” Travelers, to the contrary, asserts that “[t]his case can be resolved without affecting Pohanka in any reasonably foreseeable way.” Siefert, in her response, relies entirely on this representation from Travelers.

Travelers’ statement is flatly inconsistent with the allegations in Siefert’s complaint. The parties have placed conflicting assertions about Pohanka’s potential interests before the court. Given this landscape, the court cannot determine whether Pohanka — who has not answered — lacks any interest in this coverage suit based solely on a conclusory statement in a brief filed by Travelers.

Case remanded to circuit court.

Siefert v. The Travelers Indemnity Company of Connecticut, Case No. 5:23-cv—00039, Dec. 13, 2023. WDVA at Harrisonburg (Urbanski). VLW 023-3-770. 7 pp.