Maryland Cas. Co. v. Pacific Coal & Oil Co., 312 U.S. 270 (1941)

Please note: this case begins in mid-page. It therefore shares a citation with the last page of the previous case. If you are attempting to follow a link to the last page of 312 U.S. 262, click here.

Maryland Casualty Co. v. Pacific Coal & Oil Co.

No. 194

January 9, 1941
Decided February 3, 1941
312 U.S. 270

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE SIXTH CIRCUIT

Syllabus

1. To support a suit under the Declaratory Judgment Act, the facts must show a substantial controversy, real and immediate, between parties having adverse legal interests. P. 273.

2. An insurer issued a policy covering liability of the insured for personal injuries caused by automobiles "hired by the insured." Under the policy and the state law, an injured party could keep the policy from lapsing by serving notice of the accident, etc., if the insured failed to do so; and, if successful in obtaining judgment against the insured, could enforce it by supplementary proceedings against the insurer. The insured having been sued in the state court for personal injuries sustained in a collision between a truck driven by an employee of the insured and the automobile of the claimant, the insurer brought suit in the federal court against the insured and the claimant, alleging that the truck was not "hired by the insured" and contending that it was not bound to defend the state court suit or to indemnify the insured.

Held:

(1) That diverse citizenship and jurisdictional amount being present, the insurer’s suit involved an "actual controversy" cognizable under the Declaratory Judgment Act. P. 273.

(2) An injunction to restrain the proceedings in the state court is prohibited by § 265 of the Judicial Code. P. 274.

111 F.2d 214 reversed.

Certiorari, 311 U.S. 625, to review the affirmance of a decree in a suit for a declaratory judgment.