Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-3_11-cv-08043/USCOURTS-azd-3_11-cv-08043-0/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 28:2201 Declaratory Judgment (Insurance)

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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

United Specialty Insurance Company,

 Plaintiff,

vs.

The Klark Organization I; Bradbury

Stamm Construction, Inc.,

 Defendants.

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No. CV-11-8043-PCT-PGR

 

 ORDER

 

Through its three-count Second Amended Complaint (Doc. 13), plaintiff

United Specialty Insurance Company seeks a declaration that it has no duty to

defend or indemnify its insured, defendant The Klark Organization I, in connection

with a construction defect lawsuit brought against Klark by defendant Bradbury

Stamm Construction, Inc., due to various exclusions from coverage in the three

commercial general liability insurance policies it issued to Klark.

On September 2, 2011, United Specialty and Bradbury Stamm filed a

Stipulated Motion for Entry of Final Order of Judgment for United Specialty

Insurance Company (Doc. 17), wherein they agree to the entry of a final judgment

in United Specialty’s favor providing in part that none of the insurance policies at

issue provide coverage for the construction defect lawsuit, including any

Case 3:11-cv-08043-PGR Document 24 Filed 10/11/11 Page 1 of 3
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indemnity or defense obligations. Conspicuously absent from the stipulated

motion is any specific request, much less any supporting argument, seeking

certification for a final judgment against Bradbury Stamm pursuant to

Fed.R.Civ.P. 54(b) (“When an action presents more than one claim for relief ... or

when multiple parties are involved, the court may direct entry of a final judgment

as to one or more, but fewer than all, claims or parties only if the court expressly

determines that there is no just reason for delay.”) A specific Rule 54(b) request

was required at the time the stipulated motion was filed because Klark was then

an existing party to the action inasmuch as it had already been served with

process and, although it had failed to make an appearance, it had not then had

default or default judgment entered against it. See Patchick v. Kensington

Publishing Corp., 743 F.2d 675, 677 (9th Cir.1984) (noting that a dismissal order

is not final if any defendant upon whom service has been made remains in the

action.) Entry of a final judgment resolving United Specialty’s claims against

Bradbury Stamm cannot therefore properly occur prior to the entry of judgment

against Klark.

United Specialty filed an Application for Entry of Default of Defendant The

Klark Organization (Doc. 18) on September 2, 2011, and the Clerk of the Court

entered default against Klark (Doc. 20) on September 7, 2011. On September 8,

2011, United Specialty filed a Motion for Entry of Default Judgment Against

Defendant The Klark Organization (Doc. 21), wherein it seeks entry of judgment

against Klark pursuant to Fed.R.Civ.P. 55(b)(2) declaring that it does not have a

duty under its three insurance policies issued to Klark to defend Klark against the

lawsuit brought against it by Bradbury Stamm or to indemnify it for any settlement

or judgment in that lawsuit. Since a review of the record shows that Klark was

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1

 The record also establishes that Klark was served with United

Specialty’s First Amended Complaint, and, via United Specialty, with the Court’s

Order (Doc. 12), entered on July 12, 2011, that admonished the parties that they

could not stipulate to an extension of time for Klark to file an answer without the

Court’s approval and that required Klark to respond to the complaint.

2

 The proposed form of judgment shall be consistent with the

requirements of Fed.R.Civ.P. 54(a) (“A judgment should not include recitals of

pleadings, a master’s report, or a record of prior proceedings.”)

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served with the Second Amended Complaint and that Klark has failed to answer

or otherwise respond to the Second Amended Complaint1

, and that Klark has

properly been defaulted, the Court finds that United Specialty has established

that a declaratory default judgment should be entered Klark. Therefore,

IT IS ORDERED that plaintiff United Specialty Insurance Company’s

Motion for Entry of Default Judgment Against Defendant The Klark Organization

(Doc. 21) is granted.

IT IS FURTHER ORDERED that the Stipulated Motion for Entry of Final

Order of Judgment for United Specialty Insurance Company (Doc. 17) is granted

to the extent that plaintiff United Specialty Insurance Company shall submit a

proposed form of judgment resolving the entirety of this action no later than

October 21, 2011.

2

DATED this 11th day of October, 2011.

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