Title: USAA Casualty Ins. Co. v. Randolph

State: virginia

Issuer: Virginia Supreme Court

Document:

Present: All the Justices 
USAA CASUALTY INSURANCE 
COMPANY, ET AL. 
 
v. 
Record No. 971083  OPINION BY JUSTICE BARBARA MILANO KEENAN 
 February 27, 1998 
TRACY LEE RANDOLPH, ET AL. 
 
FROM THE CIRCUIT COURT OF LOUDOUN COUNTY 
Carleton Penn, Judge Designate 
 
In this appeal, we consider a procedural challenge to the  
use of a declaratory judgment proceeding for resolving the issue 
whether an employee’s injury arose out of and in the course of 
his employment. 
In October 1995, Kevin Martin was working as a truck driver 
for Southern States Cooperative, Inc., t/a Southern States 
Leesburg Petroleum Services (Southern States).  Martin’s job 
required him to be “on call” to respond to customer requests for 
service during the weekend beginning Friday, October 13, 1995.  
Pursuant to company policy, Martin planned to use a company-
owned truck for the period he was “on call.” 
At the end of his regular work shift on October 13, Martin 
began to transfer his personal belongings from his car, which 
was in Southern States’ employee parking lot, to the company-
owned truck.  During this process, Martin noticed that his 
hunting rifle was in the trunk of his car and that the rifle 
case was open.  When Martin attempted to close the rifle case, 
the rifle discharged a bullet which traveled through the wall of 
the trunk and struck Tracy Lee Randolph, another Southern States 
employee, in the left leg.  There is no allegation that this 
shooting was intentional. 
At the time of the shooting, Martin’s car was insured by a 
motor vehicle liability insurance policy issued by USAA Casualty 
Insurance Company (USAA), which provided coverage for injuries 
caused by Martin’s negligent or reckless use of the car.  
Martin’s homeowner’s liability insurance policy, also issued by 
USAA, provided coverage for injuries resulting from Martin’s 
negligent or reckless acts.  USAA denied liability under each 
policy for Randolph’s injury on the ground that Randolph was 
injured on Southern States’ property while Martin was in the 
course of his employment.  Southern States’ workers’ 
compensation carrier, Southern States Underwriters, Inc., t/a 
Southern States Insurance Exchange (Underwriters), also denied 
liability for Randolph’s injury, stating that the injury did not 
arise out of or in the course of Randolph’s employment. 
Randolph filed a bill of complaint for declaratory judgment 
in the trial court against several defendants, including USAA, 
Southern States, Underwriters, and Kevin Martin.  The bill of 
complaint requested a declaration that USAA was liable for 
Randolph’s injury under either or both of the insurance policies 
issued by USAA. 
 
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At a bench trial, Randolph’s counsel informed the 
chancellor that the sole issue he was asking the chancellor to 
decide was “whether the Workers’ Compensation bar applies.”  
Randolph’s counsel further stated that he “was not going to get 
into which one of the various USAA policies might apply.”  USAA 
and Martin (collectively, USAA) objected to Randolph’s use of a 
declaratory judgment proceeding to resolve the issue concerning 
the workers’ compensation bar. 
After hearing the evidence, the chancellor ruled that the 
request for declaratory relief was appropriate because the suit 
involved an “antagonistic assertion and denial of right.”  The 
chancellor then held that the injury did not arise out of 
Randolph’s employment and, thus, that the Virginia Workers’ 
Compensation Act, Code §§ 65.2-100 through -1310, did not bar 
Randolph from filing a tort action. 
On appeal, USAA contends that the chancellor erred in 
entering a declaratory judgment on the issue whether Randolph’s 
injuries arose out of and in the course of his employment.  USAA 
argues that declaratory judgment did not lie in this case 
because the suit raised an issue to be decided in a future tort 
action and did not involve a determination of Randolph’s rights 
under a written instrument. 
Southern States and Randolph (collectively, Randolph) 
contend that the trial court did not err in entering a 
 
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declaratory judgment because the bill of complaint requested a 
determination whether Randolph had a right to file a workers’ 
compensation claim or a right to institute a personal injury 
action.  Randolph also asserts that the declaratory judgment 
suit was an appropriate and efficient mechanism for joining all 
parties in interest for the conclusive determination of these 
rights.  We disagree with Randolph. 
Under the Declaratory Judgment Act, Code §§ 8.01-184 
through –191, circuit courts have the authority to make “binding 
adjudications of right” in cases of “actual controversy” when 
there is “antagonistic assertion and denial of right.”  Code § 
8.01-184; Blue Cross & Blue Shield v. St. Mary’s Hosp., 245 Va. 
24, 35, 426 S.E.2d 117, 123 (1993); Erie Ins. Group v. Hughes, 
240 Va. 165, 170, 393 S.E.2d 210, 212 (1990); Reisen v. Aetna 
Life & Cas. Co., 225 Va. 327, 331, 302 S.E.2d 529, 531 (1983).  
The purpose of this enactment is to provide relief from the 
uncertainty arising out of controversies over legal rights.  
Code § 8.01-191; Erie, 240 Va. at 170, 393 S.E.2d at 212; 
Reisen, 225 Va. at 331, 302 S.E.2d at 531. 
The Declaratory Judgment Act does not give trial courts the 
authority to render advisory opinions, to decide moot questions, 
or to answer inquiries that are merely speculative.  St. Mary’s, 
245 Va. at 35, 426 S.E.2d at 123; Hughes, 240 Va. at 170, 393 
S.E.2d at 212; Reisen, 225 Va. at 331, 302 S.E.2d at 531.  The 
 
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Act also is not to be used as an instrument of procedural 
fencing, either to secure delay or to choose a forum.  Liberty 
Mut. Ins. Co. v. Bishop, 211 Va. 414, 419, 177 S.E.2d 519, 522 
(1970); Williams v. Southern Bank, 203 Va. 657, 662, 125 S.E.2d 
803, 807 (1962). 
The authority to enter a declaratory judgment is 
discretionary and must be exercised with great care and caution.  
Bishop, 211 Va. at 421, 177 S.E.2d at 524.  As a rule, this 
authority will not be exercised when some other mode of 
proceeding is provided.  Id.  
The fact that multiple actions may be avoided if a 
declaratory judgment is entered is not always a ground for the 
trial court to exercise its jurisdiction.  There must also be 
some real necessity for the exercise of jurisdiction on this 
basis.  Id. at 419, 177 S.E.2d at 522-23; Williams, 203 Va. at 
663, 125 S.E.2d at 807.  Further, when a declaratory judgment 
regarding a disputed fact would be determinative of issues, 
rather than a construction of definite stated rights, status, or 
other relations, commonly expressed in written instruments, the 
case is not appropriate for declaratory judgment.  Bishop, 211 
Va. at 420, 177 S.E.2d at 523; Williams, 203 Va. at 663, 125 
S.E.2d at 807. 
Our decisions in Bishop and Williams illustrate some of 
these basic principles.  In Bishop, two insurers which had 
 
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defended and settled a wrongful death action requested entry of 
a declaratory judgment against Liberty Mutual Insurance Company 
(Liberty Mutual).  The two insurers effectively contended that 
Liberty Mutual was liable to them because they defended, 
settled, and paid under their policies a claim that should have 
been defended, settled, and paid by Liberty Mutual.  The trial 
court entered a declaratory judgment decreeing recovery in favor 
of the two insurers. 
On appeal, Liberty Mutual maintained that the disputed 
claim was not appropriate for resolution by means of declaratory 
judgment.  We agreed because, when the petition for declaratory 
judgment was filed, the various claims and rights asserted had 
accrued and matured, and the wrongs alleged had been suffered.  
211 Va. at 421, 177 S.E.2d at 524.  Thus, no rights between the 
parties remained unsettled and other modes of proceeding were 
available for resolution of the dispute.  See id.
In Williams, a former customer of a bank threatened to file 
eleven actions for malicious prosecution against the bank, based 
on information the bank gave to a prosecutor that led to the 
indictment of the customer on eleven charges of larceny.  When 
the customer was acquitted on two of the larceny charges, the 
remaining indictments were terminated by nolle prosequi on 
motion by the prosecutor.  The bank filed a petition for 
declaratory judgment requesting a determination whether the bank 
 
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could be held liable in a civil suit for the alleged malicious 
prosecution.  The trial court entered a declaratory judgment 
decreeing that the bank had made a full disclosure of all 
material facts to the prosecutor, and the court permanently 
enjoined the customer from instituting any malicious prosecution 
actions based on the bank’s conduct.  203 Va. at 658-59, 125 
S.E.2d at 804-05. 
We reversed the trial court’s decree, holding that 
declaratory judgment did not lie because the only controversy in 
the suit involved a disputed issue, namely, whether the bank 
made a full disclosure of the facts to the prosecutor.  203 Va. 
at 663, 125 S.E.2d at 807.  The determination of that issue, 
rather than an adjudication of any rights of the parties, was 
the true object of the proceeding.  Id.  We also noted that the 
trial court’s decree improperly allowed the bank to choose its 
own forum in equity.  Id. at 663, 125 S.E.2d at 808. 
The present case suffers from many of the same defects that 
required reversal of the decrees in Bishop and Williams.  Like 
Bishop, the present case involves claims and rights that had 
accrued and matured when the bill of complaint was filed.  Thus, 
declaratory judgment did not lie because other remedies were 
available to Randolph, namely, a claim for workers’ compensation 
benefits or an action at law.  See Bishop, 211 Va. at 421, 177 
S.E.2d at 524. 
 
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Like Williams, the present case is inappropriate for 
declaratory judgment because the case does not involve a 
determination of rights, but only involves a disputed issue to 
be determined in future litigation between the parties, namely, 
whether Randolph’s injuries arose out of and in the course of 
his employment.  The chancellor’s entry of a declaratory 
judgment also improperly allowed Randolph to choose a forum for 
the determination of this issue.  See Williams, 203 Va. at 663, 
125 S.E.2d at 808. 
We find no merit in Randolph’s contention that the present 
case is similar to our decision in Reisen.  There, we were 
presented with an actual controversy requiring the 
interpretation of rights under an insurance policy.  The 
controversy involved the insurer’s duty to defend a pending tort 
action.  We held that the determination of this coverage 
question was appropriate for declaratory judgment because the 
determination guided the parties in their future conduct in 
relation to each other, and saved them from jeopardizing their 
interests by taking undirected action incident to their rights.  
225 Va. at 335, 302 S.E.2d at 533.  The present case is 
dissimilar to Reisen because Randolph did not seek any 
adjudication of rights but only requested a determination of the 
 
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issue whether his injuries arose out of and in the course of his 
employment.*
For these reasons, we will reverse the trial court’s decree 
and dismiss the bill of complaint for declaratory judgment. 
Reversed and dismissed.
                     
* Based on our decision, we do not reach USAA’s remaining 
assignment of error challenging the merits of the chancellor’s 
decision. 
 
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