[Cite as Owners Ins. Co. v. Westfield Ins. Co., 2010-Ohio-1499.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
ALLEN COUNTY
OWNERS INSURANCE COMPANY,
PLAINTIFF-APPELLANT, CASE NO. 1-09-60
v.
WESTFIELD INSURANCE COMPANY, OPINION
DEFENDANT-APPELLEE.
Appeal from Allen County Common Pleas Court
Trial Court No. CV 2009 0837
Judgment Affirmed
Date of Decision: April 5, 2010
APPEARANCES:
Matthew J. Smith for Appellant
Paul A. MacKenzie for Appellee
Case No. 1-09-60
SHAW, J.
{¶1} Plaintiff-Appellant Owners Insurance Company (“Owners”) appeals
the November 5, 2009 Judgment Entry of the Allen County Court of Common
Pleas dismissing Owners complaint against Defendant-Appellee Westfield
Insurance Company (“Westfield”) on the basis of the doctrine of forum non
conveniens.
{¶2} The underlying factual background of this appeal is as follows.
Owners and Westfield are both Ohio corporations in the business of insurance.
Owners issued a policy insuring Paul W. Kerns, dba Kerns Electrical Services
(“Kerns”), located in Kipling, Ohio, effective from October 9, 2004 to October 9,
2005. In April of 2005, Larry Morlan, dba Morlan Enterprises (“Morlan”), a
general contractor and a Westfield policyholder located in Parkersburg, West
Virginia, hired Kerns to perform electrical work on an Alltel Communications
tower located in Wyoming County, West Virginia. Kerns completed the job
within two weeks.
{¶3} Several months later on September 15, 2005, Bobby Messer was
seriously injured, while working on the same Alltel Communications tower, when
he came into contact with an energized 7200-volt electric transformer. Messer’s
left arm and right leg required amputation as a result of this incident. On October
11, 2006, Messer and his wife (the “Messers”) filed a lawsuit in Wyoming County,
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West Virginia based on Messer’s personal injury arising out the accident. On
September 6, 2007, the Messers amended their complaint to add Morlan as a
defendant. Morlan filed a third-party complaint against Kerns claiming that any
liability it had for Messer’s injury was a result of the work performed by Kerns.
The Messers subsequently amended their complaint to also include claims directly
against Kerns.
{¶4} Owners retained counsel to defend Kerns and Westfield retained
counsel to defend Morlan in the West Virginia action. Mediation was scheduled
for March 5, 2009 and the trial was set for April 27, 2009.
{¶5} On March 3, 2009, counsel retained by Westfield to defend Morlan
submitted a letter to Owners demanding that Owners tender Morlan’s legal
defense and also indemnify Westfield for all claims asserted by the Messers
against Morlan. As the basis for the demand letter, counsel argued that Owners
had a legal obligation to defend Morlan pursuant to a Certificate of Insurance
issued by Owners and delivered to Morlan. The Certificate of Insurance, dated
March 3, 2005, included Morlan as an additional insured under Kern’s General
Liability Policy with Owners. The stated effective policy term on the Certificate
of Insurance was October 9, 2004 to October 5, 2005. Westfield refused to engage
in any further settlement negotiations taking the position that Owners had primary
coverage of Morlan during the circumstances giving rise to the Messers’ injuries.
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{¶6} Owners, for its part, claimed that an independent insurance agent
located in Cambridge, Ohio, issued the Certificate of Insurance without its
knowledge. Nevertheless, on March 5, 2009, Owners undertook the defense of
Morlan in the mediation proceedings. On March 24, 2009, Morlan amended its
third-party complaint in the West Virginia action to include claims directly against
Owners. The third-party complaint alleged breach of contract and extracontractual
claims arising out of Owner’s coverage of Morlan in the Messers’ tort action.
Owners filed a motion to dismiss claiming that the West Virginia court lacked
personal jurisdiction over Owners because it does not issue policies in West
Virginia. Owners’ motion to dismiss remains pending in the West Virginia case.
{¶7} During this time, Owners filed an action for Declaratory Judgment in
the Guernsey County Court of Common Pleas in Cambridge, Ohio, naming the
Messers, Kerns, Morlan and Westfield as defendants. Morlan and Westfield filed
respective motions to dismiss based on forum non conveniens. In April of 2009,
Owners reached a settlement agreement with the Messers wherein Owners agreed
to pay $425,000 to the Messers on Morlan’s behalf. However, Owners reserved
its rights as to coverage declaring that the settlement was not an admission of
coverage or liability on behalf of Owners. And Owners also made a demand for
contribution from Westfield based on the $425,000 Owners paid to the Messers.
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Westfield subsequently refused Owners’ contribution demands for the settlement
payment made to the Messers.
{¶8} On June 19, 2009, the Guernsey County Court of Common Pleas
dismissed Owners’ action for Declaratory Judgment based on the principle of
forum non conveniens. The court specifically noted that Owners could better
pursue adjudication of all of these matters in the pending West Virginia case. On
July 9, 2009, the Messers signed A Release of All Claims, thereby releasing all
their claims against Morlan. However, Morlan’s claims against Owners still
remained as part of the pending West Virginia action.
{¶9} On August 14, 2009, Owners filed a Complaint for Declaratory
Judgment and Equitable Contribution against Westfield in the Allen County court
of Common Pleas, in Lima, Ohio. On November 5, 2009, the Allen County court
also dismissed Owner’s complaint based on the doctrine of forum non conveniens.
The court stated that it considered the relevant public and private interests
involved and the particular facts of the case finding that:
* * * Ohio has no overriding interest in deciding the case. It
does not involve a localized controversy. It is a broad action for
contribution based on a settlement paid in West Virginia based
on claims originating in West Virginia and involves policies
issued and witnesses residing in West Virginia.
The trial court then dismissed the case noting that “many of the same issues could
be covered” in the litigation pending in West Virginia.
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{¶10} Owners now appeals to this Court asserting one assignment of error.
THE TRIAL COURT ERRED IN GRANTING WESTFIELD
INSURANCE COMPANY’S MOTION TO DISMISS ON THE
BASIS OF FORUM NON CONVENIENS IN VIOLATION OF
THE CONSTITUTION OF THE STATE OF OHIO AND IN
CONTRAVENTION OF THE FACTS OF THIS CASE
{¶11} In the sole assignment of error, Owners argues that the decision of
the Allen County court to dismiss its complaint based upon the doctrine of forum
non conveniens was improper. Specifically, Owners asserts two points as the basis
of its appeal. First, Owners claims that the trial court’s decision violates the Ohio
Constitution by denying Owners, an Ohio plaintiff, to proceed with this case in an
Ohio court against an Ohio defendant. Second, Owners argues that the trial court
misconstrued the facts of this case when it determined that West Virginia is a more
convenient forum to resolve Owners’ claims against Westfield.
{¶12} Initially, we note that in support of its first assertion Owners relies
on Article I, Section 16 of the Ohio Constitution which states:
All courts shall be open, and every person, for an injury done
him in his land, goods, person, or reputation, shall have remedy
by due course of law, and shall have justice administered
without denial or delay.
However, in response to an identical argument based on the principle forum non
conveniens, the Supreme Court of Ohio has specifically stated that:
The right of “every person” to bring an action in an Ohio court
is not an unlimited, absolute guarantee that every cognizable
claim filed in a court of general jurisdiction will be litigated to a
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final conclusion in such court. Litigants may find their claims
barred by a reasonable statute of limitations, stayed by lawful
injunction, dismissed by summary judgment and tempered by
any number of other devices consonant with due process or “due
course of law.” The doctrine of forum non conveniens is one
such device, which, when applied according to the case-specific
guidelines * * * fulfills rather than denies the constitutional
guarantee that every person “shall have justice administered
without denial or delay.”
Chambers v. Merrell-Dow Pharmaceuticals (1988), 35 Ohio St.3d 123, 132, 519
N.E.2d 370 (internal citations omitted).
{¶13} Thus, the more pertinent inquiry before us pertains to Owners’
second issue: whether the relevant facts and circumstances of this case supported
the trial court’s decision to dismiss Owner’s complaint on the basis of the doctrine
of forum non conveniens.
{¶14} The doctrine of forum non conveniens permits “a court having
proper jurisdiction to dismiss an action when to do so would further the ends of
justice and promote the convenience of the parties as an inherent power of the
trial court[.]” Chambers, 35 Ohio St.3d at 125, 519 N.E.2d 370. The deciding
court must consider the facts of each case in determining whether dismissal on the
basis of forum non conveniens is proper. This assessment requires balancing the
private interests of the litigants and the public interest involving the courts and
citizens of the forum state. Chambers, 35 Ohio St.3d at 126-127, 519 N.E.2d 370;
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Travelers Casualty & Surety Co. v. Cincinnati Gas & Electric Co., 169 Ohio
App.3d 207, 210 2006-Ohio-5350, 862 N.E. 2d 201.
{¶15} Important private interests include (1) the relative ease of access to
sources of proof; (2) availability of compulsory process for attendance of
unwilling witnesses; (3) the cost of obtaining attendance of willing witnesses; (4)
the possibility of a view of the premises, if appropriate; and (5) all other practical
problems that make trial of a case easy, expeditious, and inexpensive. Chambers,
35 Ohio St.3d at 126-127, 519 N.E.2d 370;
{¶16} Important public interests include (1) the administrative difficulties
and delay to other litigants caused by congested court calendars; (2) the imposition
of jury duty upon the citizens of a community that has very little relation to the
litigation; (3) a local interest in having localized controversies decided at home;
and (4) the appropriateness of litigating a case in a forum familiar with the
applicable law. Id. at 127.
{¶17} Furthermore, the decision of whether to grant a motion to dismiss on
the basis of forum non conveniens rests within the sound discretion of the trial
court and will not be reversed absent an abuse of that discretion. Id. An abuse of
discretion implies “not merely error of judgment, but perversity of will, passion,
prejudice, partiality, or moral delinquency.’” Chambers at 133, 519 N.E.2d 370,
quoting State ex rel. Commercial Lovelace Motor Freight, Inc. v. Lancaster
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(1986), 22 Ohio St.3d 191, 193, 489 N.E.2d 288. Moreover, “where the court has
considered all relevant public and private interest factors, and where its balancing
of these factors is reasonable, its decision deserves substantial deference.”
Chambers, 35 Ohio St.3d at 127. “Once a court has determined that the alternate
forum is more convenient, the common law doctrine requires the court to dismiss
the action.” Id.
{¶18} In the instant case, the trial court affirmatively stated its
consideration of all the relevant public and private interest factors in determining
whether a dismissal based on forum non conveniens was appropriate in this case.
The factor the trial court found most significant was the existence of Morlan’s
case against Owners which remained pending in West Virginia.
{¶19} In its decision dismissing Owners’ complaint, the trial court
acknowledged that the precise issue of contribution between Owners and
Westfield was not yet part of the litigation in the pending West Virginia case.
Rather, the substantive issue being litigated in the West Virginia case is the nature
and the extent of Owner’s insurance coverage of Morlan in the underlying tort
action. However, in our view, Owner’s current complaint filed with the Allen
County court requesting contribution and declaratory relief would require that
court to determine coverage issues that significantly overlap with matters already
pending before the West Virginia court.
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{¶20} For example, the questions pertaining to coverage and contribution
arising from the Certificate of Insurance issued by Owners on behalf of Morlan
make the judicial construction of the Certificate of Insurance arguably the single
most essential determination at issue in the pending West Virginia litigation. In
dismissing this case, we believe the trial court recognized the potential risk of two
courts in different jurisdictions arriving at disparate interpretations of the rights
and responsibilities of all the litigants involved based upon the same documents
and policy language.
{¶21} In response, Owners presents this case as simply one for contribution
between an Ohio plaintiff and Ohio defendant based on an Ohio insurance policy.
However, it is not clear from the record before us if Owners’ action for declaratory
judgment and equitable contribution is based strictly on an Ohio Insurance policy.
The Certificate of Insurance in question was issued by an Ohio agent for coverage
of a West Virginia Corporation who conducts its business only in West Virginia.
{¶22} Furthermore, the Ohio contacts with the present case are, at best,
limited. Not only was West Virginia the venue where Messer’s personal injury
occurred creating the catalyst for this lawsuit; it is also the state where all of the
transactions of direct relevance to Owner’s present complaint occurred. The
Certificate of Insurance and underlying policy upon which Owners now seeks
declaratory relief was ultimately delivered to a West Virginia party and purports to
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provide coverage for Morlan, a West Virginia citizen. Owners tendered its
defense of Morlan in West Virginia based upon its then-perceived obligations
arising out of the Certificate of Insurance. Additionally, West Virginia was the
site where Owners negotiated the settlement payment to the Messers on behalf of
Morlan for which it now seeks contribution from Westfield in this case.
{¶23} In sum, Owners is currently involved in a pending West Virginia
lawsuit based, in part, on the rights and responsibilities invoked by a Certificate of
Insurance which ultimately will be construed by a West Virginia court as having
provided insurance coverage by Owners for Morlan or not. It appears to us that
whether Owner’s is entitled to contribution from Westfield for settlement money
paid to the Messers on behalf of Morlan or whether Owners is ruled to have paid
the settlement as a “volunteer” and not pursuant to any coverage obligations will
turn, in large part, upon the judicial construction of the Certificate of Insurance
and any underlying policy language brought into play thereby.
{¶24} In other words, it is our conclusion that a determination of precise
coverage by Owners for Morlan is in any event, a necessary predicate to any
determination as to whether Owners then may have contribution rights against
Westfield for money paid on Morlan’s behalf. Although Westfield is not yet a
party to the West Virginia litigation, every other ingredient necessary to resolve
the issue of contribution is already included in the pending West Virginia case.
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{¶25} Based on the foregoing, we cannot conclude that the trial court
abused its discretion in dismissing Owners’ complaint for declaratory judgment
and equitable contribution based on the principle of forum non conveniens. On the
contrary, our review of the record reveals that the trial court considered all
relevant public and private interest factors, balanced these factors reasonably in its
deliberation and as such, its decision deserves substantial deference.
{¶26} For all these reasons, Owner’s assignment of error is overruled and
the Judgment of the Allen County Court of Common Pleas is affirmed.
Judgment Affirmed
WILLAMOWSKI, P.J. and ROGERS, J., concur.
/jlr
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