United States District Court, District of Columbia
ALAN KAY, Magistrate Judge.
Plaintiff 21st Century North America Insurance Company ("Plaintiff" or 21st Century") and Defendant Nationwide General Insurance Company ("Defendant" or "Nationwide") have consented to proceed before the undersigned for all purposes and trial. ( See Docket Entry .) Currently before the Court is Plaintiff's Motion for Summary Judgment ("Motion") , Nationwide's Memorandum of Points and Authorities in opposition to the Motion ("Opposition")  and 21st Century's reply ("Reply") . For the reasons explained herein, Plaintiff's Motion will be DENIED. A separate Order accompanies this Memorandum Opinion.
This case arises from an underlying civil action brought in the Superior Court for the District of Columbia, which resulted in a partial settlement. (Mot. at 1, 3.) Plaintiff in that civil action was Paul Washington. ( Id. ) Defendants were Jose Chacon, Felipe Perez, and 21st Century. ( Id. ) Mr. Washington brought suit for damages arising under a motor vehicle accident ("MVA") in the District of Columbia ("DC") involving Mr. Perez's automobile. ( Id. ) The circumstances of the MVA are as follows: Mr. Perez lent his automobile, which was insured under a policy issued by Nationwide, to Mr. Chacon. (Mot. Attach. 1 ¶ 1, 4.) Mr. Chacon was operating the vehicle in DC when he was involved in an accident with Mr. Washington. (Mot. Attach. 1 ¶ 4.) Mr. Washington filed a claim with Nationwide seeking coverage for the incident. (Mot. Attach. 1 ¶ 9.) Nationwide denied coverage because, while the insurance policy at issue included liability insurance for personal injury up to $300, 000, Nationwide determined that Mr. Perez had made a material misrepresentation in his application and declared the policy void ab initio. (Opp'n at 2.)
Upon denial of coverage from Nationwide, Mr. Washington sued Mr. Chacon for alleged negligence, Mr. Perez alleging vicarious liability, and 21st Century for an alleged breach of his insurance policy. (Mot. Attach. 1, Statement of Facts, ¶ 10, 11.) 21st Century settled with Mr. Washington for $100, 000 in exchange for release of claims against 21st Century. (Mot. Attach. ¶ 13.)
Upon settlement with 21st Century, Mr. Washington obtained coverage through his own insurance policy under the uninsured/underinsured ("UM/UIM") provision, which had a limit of $100, 000. (Mot. Attach. 1 at 2, 4.) 21st Century avers that the UM/UIM liability coverage only applies when the limits of liability to the uninsured motor vehicle have been exhausted or where the insurance company of the uninsured motor vehicle, in this case Nationwide, legally denied coverage. (Mot. Attach.1 ¶ 8.)
In the instant case, Plaintiff 21st Century seeks a declaration that Defendant Nationwide is obligated to provide primary coverage and pay for the alleged damages sought by Mr. Wasington. (Mot. at 1); (Compl. ¶ 2.) Specifically, Plaintiff seeks a judicial declaration that the Mr. Perez's Nationwide policy was in effect at the time of the MVA, that Nationwide had an obligation to indemnify Mr. Perez and Mr. Chacon in connection with the claims made by Mr. Washington, and that Nationwide must indemnify 21st Century for the $100, 000 settlement payment to Mr. Washington. (Mot. at 1.) Plaintiff's Motion claims, first, that District of Columbia law applies to this case, and second, that under District of Columbia law, Defendant was not legally able to rescind Mr. Perez's insurance policy under the District's compulsory/no-fault motor vehicle insurance law ("No-Fault Law"). (Mot. at 2) (citing D.C. Code §§ 31-2406, 35-2403(b)).
Defendant challenges the application of District of Columbia law, and instead contends that Virginia law applies. (Opp'n at 4.) If Virginia law applies, the Defendant argues, the insurance policy issued to Mr. Perez was legally declared void ab initio and Nationwide has no obligation to provide primary coverage or to indemnify the parties for claims pursued by Mr. Washington. (Opp'n at 3.)
II. STANDARD OF REVIEW
Summary judgment is appropriate when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED.R.CIV.P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322, (1986); Diamond v. Atwood, 43 F.3d 1538, 1540 (D.C.Cir.1995). To determine which facts are "material, " a court must look to the substantive law on which each claim rests. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A "genuine issue" is one whose resolution could establish an element of a claim or defense and, therefore, affect the outcome of the action. Celotex, 477 U.S. at 322; Anderson, 477 U.S. at 248.
When considering a motion for summary judgment, the court may not make credibility determinations or weigh the evidence; the evidence must be analyzed in the light most favorable to the nonmoving party, with all justifiable inferences drawn in their favor. Anderson, 477 U.S. at 255. The nonmoving party must establish more than the "mere scintilla of evidence" in support of its position. Id. at 252. The nonmoving party, however, cannot rely on "mere allegations or denials..., but... must set forth specific facts" Anderson, 477 U.S. at 248.
A. Choice of Law
The parties disagree as to whether the law of Virginia or the law of the District of Columbia governs the case. In a diversity case, the Court must apply the choice of law principles of the forum state which, in this case, is the District of Columbia. Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487, 496 (1941) (citing Erie R. Co. v. Tompkins, 304 U.S. 64 (1938)). The District "chooses between jurisdictions by inquiring into the relations of the two jurisdictions to the controversy, the interests involved, and whether application of foreign law would offend a strong and clearly defined policy.'" Gray v. Grain Dealers Mut. Ins. Co., 871 ...