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State ex rel. Universal Underwriters Insurance Co. v. Wilson

Supreme Court of West Virginia

June 1, 2017

STATE OF WEST VIRGINIA EX REL. UNIVERSAL UNDERWRITERS INSURANCE COMPANY, AND ZURICH AMERICAN INSURANCE COMPANY, Petitioners
v.
THE HONORABLE PATRICK N. WILSON, JUDGE OF THE CIRCUIT COURT OF MARION COUNTY, WEST VIRGINIA, CHRISTINA M. VARVEL, ADMINISTRATRIX OF THE ESTATE OF DAVID RALPH ALLEN, DECEASED, SALVATORE CAVA, DAN'S CAR WORLD, LLC, DAN CAVA'S TOYOTA WORLD, AND DANIEL A. CAVA, Respondents

          Submitted: May 3, 2017

         PETITION FOR WRIT OF PROHIBITION WRIT GRANTED AS MOULDED

          Arie M. Spitz, Esq., Jill C. Rice, Esq., Dinsmore & Shohl LLP, Charleston, West Virginia, Counsel for Petitioners, Universal Underwriters Insurance Co., and Zurich American Insurance Co.,

          Jeffrey M. Wakefield, Esq., Flaherty Sensabaugh Bonasso PLLC, Charleston, West Virginia, Attorney for Amicus Curiae West Virginia Insurance Federation

          Gregory H. Schillace, Esq., Schillace Law Office, Clarksburg, West Virginia, Counsel for Respondents, Salvatore Cava, Dan's Car, World, LLC, Dan Cava's, Toyota World, and Daniel A. Cava

          SYLLABUS

         1. "'A writ of prohibition will not issue to prevent a simple abuse of discretion by a trial court. It will only issue where the trial court has no jurisdiction or having such jurisdiction exceeds its legitimate powers. W.Va. Code 53-1-1.' Syl. Pt. 2, State ex rel. Peacher v. Sencindiver, 160 W.Va. 314, 233 S.E.2d 425 (1977)." Syl. Pt. 1, State ex rel. York v. W.Va. Office of Disciplinary Counsel, 231 W.Va. 183, 744 S.E.2d 293 (2013).

         2. "This Court, on its own motion, will take notice of lack of jurisdiction at any time or at any stage of the litigation pending therein." Syl. Pt. 2, In re Boggs' Estate, 135 W.Va. 288, 63 S.E.2d 497 (1951).

         3. Subject matter jurisdiction does not exist over claims that are not ripe for adjudication.

          WORKMAN JUSTICE

         The petitioners herein and defendants below, Universal Underwriters Insurance Company, and Zurich American Insurance Company (hereinafter collectively "Zurich"), [1] invoke this Court's original jurisdiction seeking a writ of prohibition to prevent enforcement of the December 8, 2016, order entered by the Honorable Patrick N. Wilson, Judge of the Circuit Court of Marion County, West Virginia. In that order, the circuit court denied Zurich's motion to dismiss the cross-claims of the respondents herein and defendants below, Salvatore Cava, Daniel A. Cava, and Dan's Car World, LLC, d/b/a Dan Cava's Toyota World (hereinafter collectively the "Cava defendants" and/or individually). After review of the appendix record and briefs of the parties, contemplation of the matters raised during oral arguments, and full consideration of the applicable law, we find the Cava defendants' cross-claims against Zurich are not ripe for adjudication. Thus, the circuit court lacked subject matter jurisdiction. Accordingly, we grant a writ of prohibition, as moulded.[2]

          I. FACTUAL AND PROCEDURAL HISTORY

         A. The Underlying Litigation

         On May 30, 2014, nineteen-year-old Salvatore Cava was driving a 2014 Toyota Rav4 sports utility vehicle when he was involved in a motor vehicle accident with sixty-six-year-old David R. Allen, who was driving a motorcycle. Mr. Allen suffered catastrophic injuries in the accident and died nine days later at Ruby Memorial Hospital in Morgantown, West Virginia.

         Salvatore Cava, a college student residing in his parents' home, is the son of Daniel A. Cava, member of Dan's Car World, LLC, d/b/a Dan Cava's Toyota World ("Dan's Car World"). This business owned the Rav4. Salvatore Cava was an employee of Dan's Car World, although he was not engaged in any activity on behalf of the business at the time of the collision.[3] It is undisputed that Salvatore Cava was driving the Rav4 with permission from his father at the time of the accident. Dan's Car World purchased the insurance policy at issue from Zurich. Part 500 of this policy, titled "garage coverage, " provides up to $300, 000 in liability coverage. Part 980 of this policy, titled "commercial umbrella coverage, " provides up to $5, 000, 000 in liability coverage.

          In December 2014, the plaintiff below, Christina M. Varvel, Administratrix of Mr. Allen's estate, filed suit against Salvatore Cava and Dan's Car World with respect to the vehicular accident. She alleged that Salvatore Cava was an employee, agent, and/or servant of Dan's Car World. The plaintiff also asserted a declaratory judgment action against Zurich to determine the amount of insurance coverage available.[4]

         Zurich determined that the complaint triggered its duty to defend under the policy; it retained counsel for Salvatore Cava and separate counsel for Dan's Car World. Zurich also retained counsel to defend itself in the declaratory judgment action brought by the plaintiff. Zurich admitted that the garage policy provides liability coverage to Salvatore Cava with respect to the plaintiff's claims. However, Zurich maintained that the umbrella policy did not cover the plaintiff's claims.[5] Zurich offered the plaintiff $300, 000 to settle this matter, and she rejected the offer. The plaintiff contends the umbrella policy provides additional liability coverage with respect to this lawsuit.

         In January 2016, the plaintiff filed a motion for leave to file her first amended complaint, which the circuit court granted in March 2016. In her amended complaint, the plaintiff added Daniel A. Cava as an individual defendant and asserted negligent entrustment and family use claims against him. Defense counsel for Daniel A. Cava, retained by Zurich, answered the amended complaint on his behalf and denied all claims.

         B. The Cava Defendants' Cross-claims

         In March 2016, the Cava defendants, by personal counsel, mounted a sweeping attack on Zurich's defense strategy or alleged lack thereof, and filed individual cross-claims against Zurich.[6] The Cava defendants asserted two counts in the cross-claims: in Count I, they alleged violations of the Unfair Trade Practices Act ("UTPA"), West Virginia Code § 33-11-4 (2011), [7] and breach of contract; in Count II, they alleged breach of the "common law duty to deal fairly and in good faith" in the investigation, defense and indemnification of this action. The Cava defendants asserted, generally, that Zurich placed its interest above theirs during the course of this litigation, and acted in bad faith by failing to investigate the matter properly and settle the case. They accused Zurich of engaging in intentional, wrongful litigation conduct.

         Specifically, Salvatore Cava asserted that he has suffered, and continues to suffer, "emotional and mental distress, " some of which has "resulted in physical consequences" arising from the vehicle collision, the death of Mr. Allen, the police investigation, the allegations that the collision was his fault, "as well as, the institution of this civil action[.]" He further stated his "emotional stress and mental anguish" have been and continue "to be increased and compounded by the wrongful, reckless and intentional conduct" of Zurich. Salvatore Cava noted that prior to the institution of the plaintiff's civil action, he made a demand on behalf of Zurich "that all claims of the plaintiff be immediately resolved within the policy limit of all policies[.]"

          Daniel A. Cava asserted he advised a representative of Zurich, prior to the motor vehicle accident, to make sure Salvatore Cava was an insured on all policies issued by Zurich. He claimed to have "endured additional mental and emotional strain" as a result of the mental and emotional strain of Salvatore Cava. He asserted Zurich engaged in wrongful litigation conduct, such as attempting to obtain a court order to take his deposition, which the circuit court denied, [8] and not objecting to the plaintiff's motion to amend her complaint to add Daniel A. Cava as a defendant.

         Dan's Car World asserted that Zurich engaged in wrongful litigation conduct by "falsely asserting" that Salvatore Cava was not an employee of the business. Dan's Car World demanded the same damages as Salvatore Cava and Daniel A. Cava, specifically:

(a) That it have judgment against [Zurich] in the amount of any judgment awarded to the plaintiff in this action;
(b) That it have judgment against [Zurich] for compensatory damages in an amount to be determined at the trial of this action, said damages to include, but not be limited to, the cost and reasonable attorneys' fees . . . in the defense of this action;
(c) That [it] be awarded its costs herein expended, including reasonable attorneys' fees in prosecution of this civil action, all in accordance with ...

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