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ATHRIDGE v. AETNA CAS. AND SUR. CO.
September 17, 2001
THOMAS P. ATHRIDGE, ET AL., PLAINTIFFS,
AETNA CASUALTY AND SURETY CO., DEFENDANT.
The opinion of the court was delivered by: Facciola, United States Magistrate Judge.
This matter is before me on Defendant's Motion for Summary Judgment on
Remaining Counts and Plaintiffs' Cross-Motion for Partial Summary
Judgment on the Issue of Indemnification. For the reasons set forth
below, defendant's motion will be granted and plaintiffs' denied.
On July 29, 1987, Jorge Iglesias ("Jorge"), age sixteen, entered the
home of his aunt and uncle ("the Rivas") who were out of the country on
vacation. He found the keys to their Volkswagen Jetta and took the car.
While driving the Rivas's Jetta in the District of Columbia, Jorge struck
and severely injured plaintiff, Thomas Athridge ("Tommy").*fn1 The
accident generated a series of lawsuits.*fn2 Plaintiffs brought the
present action against Jorge's insurer, Aetna Casualty and Surety Company
("Aetna"), asserting theories of indemnification, tortious conduct, and
unfair trade practices.
The late Judge Harold Greene, while presiding over one of these
lawsuits and after learning that Jorge was contemplating bankruptcy and
the consequential discharge of a substantial judgment that had been
awarded to Tommy, ordered Jorge to assign whatever rights he had against
Aetna to Tommy. Thus, the current complaint combines claims Tommy makes
on his own behalf as well as those he makes as Jorge's assignee.
In a Memorandum Opinion and Order dated March 2, 2001,*fn3 this Court
entered summary judgment in favor of Aetna on count two of plaintiffs'
amended complaint, breach of fiduciary duty and breach of the duty of due
care, good faith and fair dealing. Plaintiffs' Amended Complaint
("Pls.Amend.Comp."), ¶ 29.*fn4 Aetna now moves for summary judgment
on plaintiffs' remaining three counts: indemnification. intentional
infliction of emotional distress and abuse of process, and unfair trade
practices. The Athridges have filed a cross motion for partial summary
judgment on the issue of indemnification.
In seeking summary judgment on the issue of indemnification, Aetna
argues that it is not liable to plaintiffs because a policy exclusion
operates to bar coverage in this case. Defendant's Memorandum in Support
of Defendant's Motion for Summary Judgment on Remaining Counts
("Def.Mot.") at 10. In their cross-motion for summary judgment, the
Athridges contend that: 1) the "reasonable belief" exclusion that Aetna
relies on does not apply to named insureds and family members like
Jorge, and 2) if the exclusion does in fact apply to named insureds and
family members, the exclusion is void because it is contrary to the
public policy expressed in D.C.'s No-Fault statute, D.C.Code §§ 35-2101
et seq. (2001 Supp.). Plaintiffs' Cross Motion for Partial Summary
Judgment on the Issue of Indemnification ("Pls.Cross Mot.") at 3, 10.
A. "Reasonable Belief" Exclusion
The first issue before me is whether Exclusion No. 11 of the Aetna
policy, which precludes coverage for a vehicle used "without a reasonable
belief that [the driver] is entitled to do so," applies to a family
member of the named insured operating the vehicle. The relevant
provisions of the Aetna policy issued to Jorge's father, Jesus Iglesias,
PART B. LIABILITY COVERAGE
We will pay damages for bodily injury or property
damage for which any covered person becomes legally
responsible because of an auto accident.
"Covered person" as used in this Part means:
1. You or any family member*fn6 for the ownership,
maintenance or use of any auto or trailer.
2. Any person using your covered auto.
We do not provide Liability Coverage:
6. For any person while employed or otherwise engaged
in the business or occupation of selling, repairing,
servicing, storing or parking of vehicles designed for
use mainly on public highways, including road testing
and delivery. This exclusion does not apply to the
ownership, maintenance or use of your covered auto by
you, any family member, or any partner, agent or
employee of you or any family member.
11. For any person using a vehicle without a
reasonable belief that the person is entitled to do
The parties do not dispute that Jorge Iglesias is a "family member" of
the named insured, Jesus Iglesias, and is therefore a "covered person" as
defined by the policy. However, Aetna argues that the policy provides no
coverage for Jorge Iglesias because Exclusion No. 11 bars coverage for
any person using a vehicle without a reasonable belief of entitlement to
do so, including family members like Jorge. Def. Mot. at 8. In their
cross-motion for summary judgment, the Athridges argue that "named
insureds and resident family members" are a distinct and mutually
exclusive group from "any person" referred to in Exclusion No. 11. Pls.
CrossMot. at 4. In other words, plaintiffs assert that Exclusion No. 11
applies only to persons other than the named insureds and resident family
Since jurisdiction in this case is based on diversity of citizenship,
this issue must be decided in accordance with the District of Columbia
law. Keefe Co. v. Americable Intern., Inc., 219 F.3d 669, 670 (D.C.Cir.
2000); Bennett Enterprises, Inc. v. Domino's Pizza, Inc. 45 F.3d 493, 497
(D.C.Cir. 1995); Tidler v. Eli Lilly & Co., 851 F.2d 418, 424
(D.C.Cir. 1988). As the court of appeals stated in the latter case:
Plaintiffs nonetheless ask this court "to construct
[a] market share approach" for DES daughter cases out
of whole cloth, using for a pattern only bits and
pieces of the decisions of courts in remote states.
Judicial pioneers must no doubt make bold forays into
terra incognita in order to chart the way to justice,
but that is not the office of a federal court
exercising diversity jurisdiction. Ours is the more
modest challenge, faithfully to apply the law of the
state that the courts of the jurisdiction in which we
sit, the District of Columbia, would apply had the
case been filed with them. Erie R.R. v. Tompkins,
304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938);
Klaxon Co. v. Stentor Electric Manufacturing Co.,
313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941). As
the Supreme Court has made clear, "A federal court in
a diversity case is not free to engraft onto those
state rules exceptions or modifications which may
commend themselves to the federal court, but which
have not commended themselves to the State in which
the federal court sits." Day and Zimmermann, Inc. v.
Challoner, 423 U.S. 3, 4, 96 S.Ct. 167, 168, 46
L.Ed.2d 3 (1975); see also Steorts v. American
Airlines, Inc., 647 F.2d 194, 197 n. 32 (D.C.Cir.
1981). Thus, we take the law of the appropriate
jurisdiction as we find it; and we leave it
undisturbed. See Cantwell v. University of
Massachusetts, 551 F.2d 879, 880 (1st Cir. 1977). As
the First Circuit aptly expressed this fundamental
rule of federal diversity jurisdiction:
Absent some authoritative signal from the
legislature or the [state courts], we see no basis
for even considering the pros and cons of innovative
theories. . . . We must apply the law of the forum
as we infer it presently to be, not as it might come
to be. . . . [W]e see no basis for applying any rule
other than the traditional one. Dayton v. Peck, Stow
& Wilcox Co., 739 F.2d 690, 694-95 (1st Cir.
1984) (footnotes omitted); see also Answering
Service, Inc. v. Egan, 728 F.2d 1500, 1504 & n.
* (D.C.Cir. 1984).
There is another guiding principle, however, unique to the District of
Columbia: in the absence of controlling precedent, courts interpreting
the law of the District of Columbia look to the law of Maryland.*fn7
Turning now to the exclusion at issue, whether one derives the holding
from existing District of Columbia precedents or looks directly to
Maryland law, the result is the same: the exclusion of a person who does
not have a reasonable belief that he had permission to drive the car
applies to a family member just as it does to anyone else.
First, as to existing District of Columbia precedents, the rules
pertaining to the construction of ...