Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-91-06246/USCOURTS-ca10-91-06246-0/pdf.json

Parties Involved:
Earl Dennett
Appellee
Select Insurance Company
Appellant

Document Text:

F1L£.J D 

STl'.11.ITES COURT OF APPEAL.JTnitcd stat~s Court q! App:...b UNITED .n ::t-' Tent~ Clrcu1, 

TENTH CIRCUIT 

SELECT INSURANCE COMPANY, a Texas 

Corporation, 

Plaintiff-Appellant, 

v. 

EARL DENNETT, doing business as 

Dennett's Conoco, 

Defendant-Appellee. 

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ORDER AND JUDGMENT* 

FcJ OJ 1992 

ROBERT L. HOECKEE 

Clerl~ 

Nos. 91-6232 and 

91-6246 

(D.C. No.CIV-90-2053-W) 

(W. Dist. Okla. ) 

Before LOGAN, BARRETT and EBEL, Circuit Judges. 

After examining the briefs and the appellate record, this 

panel has determined unanimously that oral argument would not 

materially assist the determination of this appeal. See Fed. R. 

App. P. 34(a); Tenth Cir. R. 34.1.9. The cause is therefore 

ordered submitted without oral argument. 

Select Insurance Company, a Texas corporation, (Select) 

appeals the order of the district court dismissing it's 

declaratory judgment action against Earl Dennett d/b/a Dennett's 

Conoco (Dennett). 

* This Order and Judgment has no precedential value and shall not 

be cited, or used by any court within the Tenth Circuit, except 

for purposes of establishing the doctrines of the law of the case, 

res judicata, or collateral estoppel. 10th Cir. R. 36.3. 

Appellate Case: 91-6246 Document: 010110221642 Date Filed: 02/03/1992 Page: 1 
The instant case evolved from an altercation between Dennett 

and J. Dean Brack (Brack) which resulted in Dennett's arrest on a 

charge of battery. Dennett was found guilty of battery by the 

Municipal Court of Hutchinson, Kansas, fined, and assessed court 

costs. No appeal was taken from the judgment. Several months 

later, Brack filed a civil action in a Kansas state district court 

seeking damages as a result of the altercation. Dennett 

subsequently made demand upon Select for a defense and for 

indemnification. 

Select responded that its policy contained an exclusion for 

intentional acts, and that it was accordingly not obligated to 

indemnify or to provide Dennett with a defense. After the denial 

was communicated to Dennett, he continued to make repeated demands 

upon Select to provide him with a defense and indemnification. 

Select subsequently filed this action seeking a declaration of its 

rights and liabilities under the policy. 

After reviewing the arguments and authority submitted by the 

parties, the district court determined that a dismissal of 

Select's complaint was warranted. The district court's 

determination was based upon Dennett's collateral lawsuit pending 

in state court, in which the issue of the nature of Dennett's acts 

could more effectively and economically be resolved. 

On appeal, Select contends that the district court abused its 

discretion by denying it a forum in which to have its policy 

rights and obligations declared, and by its treatment of 

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Appellate Case: 91-6246 Document: 010110221642 Date Filed: 02/03/1992 Page: 2 
collateral estoppel as an evidentiary issue and not a matter of 

1 substantive law. 

Reviewing the district court's order dismissing the 

declaratory judgment action under a clear abuse of discretion 

standard, see Kunkel v. Continental Casualty Co., 866 F.2d 1269 

(10th Cir. 1989), we affirm. 

In Kunkel, at 1275, this Court observed: 

Federal courts as a general rule cite Borchard's 

treatise on declaratory judgments in deciding the 

propriety of declaratory relief. (Citations omitted). 

Accordingly, a court in the exercise of its discretion 

should declare the parties' rights and obligations when 

the judgment will (1) clarify or settle the legal 

relations in issue and (2) terminate or afford relief 

from the uncertainty giving rise to the proceeding. 

(citing E. Borchard, Declaratory Judgments at 299 (2d 

ed. 1941)). 

We held, however, that a federal court should not entertain 

a declaratory judgment action if the same fact-dependent issues 

are likely to be decided in a pending proceeding. Id. at 1276. 

See also, Brillhart v. Excess Ins. Co., 316 U.S. 491, 495 (1942); 

Western Casualty and Surety Co. v. Teel, 391 F.2d 764, 766 (10th 

Cir. 1968). 

The Supreme Court has concluded that the decision whether to 

entertain a declaratory judgment action is a matter 

to the sound discretion of the trial court. 

left solely 

Alabama State 

Federation of Labor v. McAdory, 325 U.S. 450, 462 (1945). See 

also, Farmers Alliance Mut. Ins. Co. v. Jones, 570 F.2d 1384, 1386 

(10th Cir. 1978). The Supreme Court has stated that the 

Declaratory Judgment Act "is an enabling Act, which confers a 

1Because our determination of Select's first contention is 

dispositive, we will not address the second contention. 

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Appellate Case: 91-6246 Document: 010110221642 Date Filed: 02/03/1992 Page: 3 
discretion on the courts rather than an absolute right upon the 

litigant." Green v. Mansour, 474 U.S. 64, 72 (1985) (citing, 

Public Service Comm'n v. Wycoff Co., 344 U.S. 237, 241 (1952)). 

See also, Public Affairs Press v. Rickover, 369 U.S. 111, 112 

(1961). 

The adjudication of the action brought by Brack in the 

Kansas state district court of Reno County, Kansas, should 

determine the issue of whether Dennett's actions were intentional, 

thus resolving the coverage issue complained of in the instant 

case. Select chose not to be involved in Dennett's defense, and 

therefore, cannot now complain that fact-dependent issues will be 

resolved in its absence. 

Kunkel clearly indicates that the district court has broad 

discretion whether or not to entertain a declaratory judgment 

action. We agree with the district court's conclusion that the 

same fact-depende nt issues presented here are likely to be decided 

in the pending state court action, and that the usefulness of the 

declaratory judgment action "[i]s outweighed in this case by the 

fact that there is another lawsuit pending in which the nature of 

Mr. Dennett's acts can be more effectively and economically 

resolved." (Appendix to Brie f of Appellant Select, Ta b 8, p. 

000100). 

We hold that the district court's dismissal of Select's 

complaint for declaratory judgment was not an abuse of discretion. 

AFFIRMED. 

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Entere d for the Court: 

James E. Barrett, 

Se nior United S, Jtes 

Circuit Judge 

Appellate Case: 91-6246 Document: 010110221642 Date Filed: 02/03/1992 Page: 4