United States District Court, E.D. North Carolina, Western Division
TERRENCE W. BOYLE UNITED STATES DISTRICT JUDGE
matter is before the court on the plaintiffs motion for
default judgment [DE 12] and the memorandum filed in support
of the motion for default judgment [DE 14]. For the reasons
discussed below, Plaintiffs motion is granted.
New Hampshire Insurance Company ("New Hampshire")
initiated this declaratory judgment action against defendant
Freddie Royster, Administrator of the Estate of Eric Royster,
on March 9, 2016. New Hampshire seeks a declaratory judgment
that the commercial automobile insurance policy New Hampshire
issued to Newesco, Inc. affords no coverage to the defendant
with respect to an accident that occurred on December 2,
2014. This case is brought pursuant to the Federal
Declaratory Judgment Act, 28 U.S.C. §2201, et seq. and
Rule 57 of the Federal Rules of Civil Procedure. The record
shows that New Hampshire served defendant with process
pursuant to Rule 4 of the Federal Rules of Civil Procedure on
May 6, 2016. [DE 8]. Defendant did not file a responsive
pleading to the complaint, and the Clerk of Court entered an
entry of default against defendant on July 11, 2016. [DE 10].
The motion for entry of default was served on defendant by
Hampshire now moves for default judgment as against
defendant. This motion for default judgment was filed on
December 23, 2016 and also served on defendant by U.S. Mail.
Defendant has not appeared or defended this action in any
to 28 U.S.C. § 1332, this Court has original
jurisdiction over matters where the amount in controversy
exceeds the value of $75, 000 and is between citizens of
different States. 28 U.S.C. § 1332(a). In the present
case, the plaintiff is a citizen of Illinois and New York.
Defendant is a citizen of North Carolina. Accordingly, there
is complete diversity of citizenship between the parties. In
declaratory judgment actions, the amount in controversy is
measured by the value of the object of the litigation.
Francis v. Allstate Ins. Co., 709 F.3d 362, 367 (4th
Cir. 2013). The amount in controversy in the present matter
is the value of the demand made by defendant for UM benefits
under the New Hampshire Policy, specifically $1 million.
Because this demand exceeds the jurisdictional amount
required under 28 U.S.C. § 1332(a), this Court has
subject matter jurisdiction over this declaratory judgment
Court has personal jurisdiction over defendant. Rule 4 of the
Federal Rules of Civil Procedure allows an individual to be
served by leaving a copy of the Summons and Complaint at the
individual's residence with someone of suitable age and
discretion who resides there. Fed.R.Civ.P. 4(e)(2)(B). On May
6, 2016, C.R. Williams, Deputy Sheriff of Harnett County,
North Carolina, left the Summons and Complaint with Zeala
Royster, a person of suitable age and discretion who resided
at the same residence as the defendant. [DE 8]. Accordingly,
this Court as personal jurisdiction over defendant.
Federal Declaratory Judgment Act allows a federal court to
declare the rights, obligations and liabilities of parties to
a contract. 28 U.S.C. § 2201. It is well established
that a declaration of parties' rights under an insurance
policy is an appropriate subject for a declaratory judgment
action. United Capitol Ins. Co. v. Kapiloff, 155
F.3d 488, 494 (4th Cir. 1998). A federal court cannot refuse
to entertain a declaratory judgment action that is properly
within its jurisdiction unless there is good cause.
Nautilus Ins. Co. v. Winchester Homes, 15 F.3d 371,
375 (4th Cir. 1994).
default, the well-pleaded facts alleged in the complaint are
deemed admitted. See Ryan v. Homecomings Fin.
Network, 253 F.3d 778, 780 (4th Cir. 2001). Based on the
plaintiffs complaint, the following facts are established.
Royster was a long-distance truck driver who lived in Harnett
County, North Carolina. He entered into a Contractor
Agreement and Lease to transport household goods and other
items throughout the United States for Atlas Van Lines. To
carry out his duties and responsibilities under the
Contractor Agreement and Lease, Mr. Royster was assigned to
drive a 1995 Peterbilt Tractor ("95 Peterbilt
Tractor"). The 95 Peterbilt Tractor was licensed and
registered in the State of Indiana.
to December 2, 2014, Mr. Royster was requested to haul a load
of household goods from North Carolina to California. As Mr.
Royster was driving the 95 Peterbilt Tractor westbound on
IH-20 near Waskom, Harrison County, Texas, the trailer
connected to the 95 Peterbilt Tractor caught fire. Upon
discovering the fire, Mr. Royster pulled the 95 Peterbilt
Tractor and attached trailer to the side of the westbound
lanes of IH-20 to disconnect the trailer from the 95
disconnecting the trailer from the 95 Peterbilt Tractor, Mr.
Royster left the vehicle parked on the side of the westbound
lanes of travel on IH-20, crossed a grass median, and walked
to the side of the eastbound lanes of travel on Interstate
80. At that same time, George Allen Edwards was driving a
pickup truck in the eastbound lanes of travel on 1-80. Mr.
Edwards' vehicle struck Mr. Royster as Mr. Royster was
walking or standing along the side of the eastbound lanes of
travel on 1-80, resulting in Mr. Royster's death. Mr.
Royster was located away from the 95 Peterbilt Tractor when
he was struck by Mr. Edwards' vehicle. At the time of the
accident, Mr. Edwards was not covered under any automobile
Hampshire issued a commercial automobile insurance policy to
Newesco, Inc., Policy No. 01-CA-019049744-0, with effective
dates of December 31, 2013 through December 31, 2014
("New Hampshire Policy"). Newesco, Inc.
specifically rejected uninsured motorist ("UM")
coverage for all vehicles covered under the New Hampshire
Policy that are registered in Indiana. The rejection of UM
coverage was made pursuant to a valid Indiana Notice
Uninsured and Underinsured Motorist Coverage form, Form No.
62589 (9/10), which was signed by Newesco on February 14,
2014 and made effective from the inception of the New
Hampshire Policy on December 31, 2013 forward. An endorsement
was added to the New Hampshire Policy which ...