Opinion ID: 224251
Heading Depth: 1
Heading Rank: 1

Heading: Jurisdiction of the Principal Claim

Text: 9 The Insurance Company is a corporation organized under the laws of Wisconsin and is not a citizen of Oklahoma. Harvey and Collier are citizens of Oklahoma. 10 There was a genuine dispute between the Insurance Company and Harvey with respect to the obligation of the Insurance Company to defend the state court action and to pay any judgment within the limits of the policy that Collier might recover against Harvey therein. 11 The mere fact that Harvey asserted a defense in the state court action which, if adjudged to be true, would establish that the claim of Collier for injuries was not within the coverage of the policy would not constitute an admission on the part of Harvey that the Insurance Company was not obligated to defend the state court action or render the controversy, between the Insurance Company and Harvey respecting the former's obligation to defend the state court action, non-substantial. 12 The policy obligated the Insurance Company to defend in Harvey's name and his behalf any suit brought against him alleging an injury within the coverage of the policy, even if such suit be groundless. The duty of the Insurance Company to defend must be determined, not from the facts asserted by Harvey as a defense to Collier's claim, but from the allegations of Collier's petition in the state court action, seeking to recover damages for personal injuries against Harvey. 3 Such petition alleged facts in support of a claim for damages for personal injuries. If such facts were true, Harvey was liable to Collier on such claim and his liability was within the coverage of the policy. 13 Accordingly, it is our conclusion that there was an existing substantial controversy between the Insurance Company and Harvey, that Harvey should not be realigned as a party plaintiff for the purpose of determining jurisdiction, and that the court had jurisdiction of the principal claim. 4 American Fidelity Casualty Co. v. Service Oil Co., 4 Cir., 164 F.2d 478, Indemnity Insurance Co. of North America v. Schriefer, 4 Cir., 142 F.2d 851, and State Farm Mutual Automobile Insurance Co. v. Hugee, 4 Cir., 115 F.2d 298, 132 A.L.R. 188, are distinguishable. In each of those cases, the insurance company admitted its obligation to defend the state court action and there was no real controversy between the insurance company and the insured.