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USAA General Indemnity Co. v. McCullough

United States District Court, D. South Carolina, Orangeburg Division

February 23, 2018

USAA General Indemnity Company, Plaintiff,
v.
Jarok McCullough, Adrian C. Chandler, and Glendrella Green, Defendants.

          ORDER AND OPINION

         This matter is before the court pursuant to the parties' cross Motions for Summary Judgment (ECF Nos. 37, 38). For the reasons set forth below, the court DENIES Defendant Glendrella Green's (“Defendant Green”) Motion for Summary Judgment (ECF No. 37), and GRANTS Plaintiff USAA General Indemnity Company's Motion for Summary Judgment (ECF No. 38).[1]

         I. JURISDICTION

         This action is brought under the provision of the Federal Declaratory Judgment Act, 28 U.S.C. § 2201 et seq. (ECF No. 1.) The court has jurisdiction over this action pursuant to 28 U.S.C. § 1332. Plaintiff is a corporation organized and existing under the laws of the State of Texas with its principal place of business in San Antonio, Texas. (ECF No. 1 at 1.) All Defendants are citizens and residents of Orangeburg, South Carolina. (Id.) The amount in controversy exceeds $75, 000.00. (Id.)

         II. RELEVANT FACTUAL BACKGROUND

         A. The USAA General Indemnity Company Policy

         Plaintiff issued a policy of automobile insurance to Defendant Chandler, Policy No. 023919360G71020 (the “Policy”), which was originally to be in effect from March 19, 2015 to September 15, 2015. (ECF No. 38-2 at 1.) The Policy provides liability coverage with bodily injury limits of $25, 000 per person and $50, 000 per accident and uninsured and underinsured coverage with bodily injury limits of $25, 000 per person and $50, 000 per accident. (Id.) At the time of the accident, the Policy insured three vehicles including the 2004 Dodge Stratus.[2] (Id.)

         B. Ownership and Garaging Address of the 2004 Dodge Stratus

         On March 19, 2015, Defendant Chandler requested that Plaintiff add the 2004 Dodge Stratus, Vin No. 1B3EL36T74N209049 (the “Dodge Stratus”), to his Policy. (ECF No. 38-2 at 2.) At that time, Defendant Chandler represented that he was the registered owner and driver of the Dodge Stratus and that it was principally garaged at 1677 Johnson Street, Orangeburg, South Carolina. (See id. at 1.) However, Defendant Chandler was not the owner of the 2004 Dodge Stratus on the date the vehicle was added to the Policy or on the date of the accident. (See ECF No. 38-3.) Instead, Defendant McCullough, his son, was the registered owner of the 2004 Dodge Stratus both when the vehicle was added to Defendant Chandler's Policy and when the accident occurred. (Id.; ECF No. 38-4 at 7.)

         Defendant Chandler also misrepresented the garaging address of the Dodge Stratus. He represented to Plaintiff that the Dodge Stratus was principally garaged at his home located at 1677 Johnson Street in Orangeburg. (See ECF No. 38-2 at 1.) However, at all times relevant to this action, Defendant McCullough resided with his mother at 160 North Lake Drive, Orangeburg, South Carolina; Defendant McCullough did not live with Defendant Chandler. (ECF No. 38-4 at 5-6.) Moreover, at all times relevant to this action, the 2004 Dodge Stratus was principally garaged at Defendant McCullough's residence, not 1677 Johnson Street. (Id. at 4-5, 7, 8-9.) From the moment the 2004 Dodge Stratus was added to the Policy up to and through the time of the accident, - Defendant McCullough the owner of the Dodge Stratus - was also the only one who drove the vehicle. (Id. at 7-8.)

         C. The Accident

         On April 24, 2015, Defendant McCullough was operating the 2004 Dodge Stratus when he was involved in a single-vehicle accident in Greeleyville, South Carolina. (ECF No. 7 at ¶ 16.) At the time of the accident, Defendant Green was a passenger in Defendant McCullough's vehicle. (Id.)

         III. RELEVANT PROCEDURAL BACKGROUND

         On December 21, 2015, Defendant Green filed a Complaint in the Orangeburg County Court of Common Pleas, alleging that Defendant McCullough was negligent in his operation of a 2004 Dodge Stratus, thereby proximately causing Defendant Green's injuries. See Green v. Jarok McCullough, Civil Action No. 2015-CP-38-01534 (hereinafter “the underlying action”) (ECF No. 7 at ¶ 18). That case continues to be litigated in state court. (ECF No. 37 at 2.)

         On September 14, 2016, Plaintiff filed the present action against Defendants McCullough, Chandler, and Green. (ECF No. 1.) On August 1, 2017, Defendant Green filed a Motion for Summary Judgment asserting that she is entitled to summary judgment because (1) Plaintiff engaged in settlement negotiations with Defendant Green in the underlying state court litigation without first reserving its rights to deny coverage at a later date; and (2) Plaintiff has not produced or identified any documentation or evidence supporting the claims set forth in its Complaint. (ECF No. 37.) On August 7, 2017, Plaintiff filed a response to Defendant Green's Motion. (ECF No. 40.) As to Defendant Green's first ground, Plaintiff espouses that evidence of an attempt to compromise or settle is inadmissible against the party who made the offer and inadmissible to prove liability. (Id.) “Further, neither the doctrines of waiver or estoppel create coverage where an insurance policy is void for lack of an insurable interest.” (Id.) With regard to Defendant Green's second ground, Plaintiff posits that it did produce evidence to support its assertion that Defendant Chandler did not have an insurable interest in the 2004 Dodge Stratus. (Id.)

         On August 1, 2017, Plaintiff filed a cross Motion for Summary Judgment stating that “because the undisputed evidence confirms Defendant Chandler did not have ownership or control over the 2004 Dodge Stratus and the vehicle was not maintained at his home, the Policy is void as to the Dodge Stratus, and ...


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