United States District Court, D. Oregon, Portland Division
OPINION AND ORDER
JANICE M. STEWART, Magistrate Judge.
Beaverton Toyota Co., Inc. ("Beaverton Toyota") was insured under Garage Liability Policy No. 9029193 issued by defendant, Federated Mutual Insurance Company ("Federated") to Russ Auto Group ("Russ Auto") on August 4, 2011 for the period from June 28, 2011, to June 28, 2012 ("Federated Garage Policy"). This case involves a dispute over coverage under that policy involving a vehicle sold by Beaverton Toyota to Erin Douge ("Douge") on February 18, 2012. The next day, while driving southbound in the northbound lanes of Oregon Highway 217, Douge collided head on with the vehicle of Hillary Maxfield ("Maxfield"). In December 2012, Maxfield filed a personal injury action against Douge in Washington County Circuit Court for the State of Oregon, Maxfield v. Douge, Case No. C127766CV ("Underlying Action"). Christ Decl., ¶ 2 & Ex. 1.
Plaintiff, Safeco Insurance Company of Oregon ("Safeco"), issued an automobile policy to Douge's parents for the period from March 10, 2011, to March 10, 2012 ("Safeco Policy"). Durham Decl., ¶ 5 & Ex. 9. On December 20, 2012, Safeco's attorney tendered the defense of the Underlying Action to Federated. Christ Decl., ¶ 2. Federated denied the tender. Id.
On March 11, 2013, Safeco filed this action in Washington County Circuit Court against Federated, seeking a declaratory judgment that: (1) Federated owes a duty to defend Douge in the action filed by Maxfield; (2) Safeco is entitled to contribution from Federated for the cost of defending Douge in the action filed by Maxfield; (3) Safeco is entitled to contribution from Federated for the cost of any settlement or judgment in the action filed by Maxfield; and (4) Federated's coverage is primary and Safeco's is excess with respect to Maxfield's claim against Douge. Notice of Removal, Ex. 1, ¶ 12. Federated then timely removed that action to this court based on 28 USC § 1441 and 28 USC § 1332.
Safeco is an Oregon corporation with its principal place of business in Oregon. Federated is a Minnesota corporation with its principal place of business in Minnesota. Notice of Removal, ¶ 7. Based on the more than $166, 000.00 in damages requested in the Underlying Action filed by Maxfield, the amount in controversy in this declaratory action exceeds $75, 000.00, exclusive of interest and costs. Id ; see Hunt v. Wash. State Apple Adver. Comm'n, 432 U.S. 333, 347 (1977) ("In actions seeking declaratory or injunctive relief, it is well established that the amount in controversy is measured by the value of the object of the litigation."); Budget Rent-A-Car, Inc. v. Higashiguchi., 109 F.3d 1471, 1473 (9th Cir 1997) (In an action for declaratory relief, where "the applicability of... liability coverage to a particular occurrence is at issue, the amount in controversy is the value of the underlying potential tort action."). Accordingly, this court has jurisdiction pursuant to 28 USC § 1332.
All parties have consented to allow a Magistrate Judge to enter final orders and judgment in this case in accordance with FRCP 73 and 28 USC § 636(c). Federated and Safeco have both filed Motions for Summary Judgment (dockets #14 and #19). For the reasons that follow, Federated's motion is granted and Safeco's motion is denied.
A party is entitled to summary judgment if the "movant shows that there is no genuine dispute as to any material fact and the movant is entitled to summary judgment as a matter of law." FRCP 56(a). The moving party must show an absence of an issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the moving party does so, the nonmoving party must "go beyond the pleadings" and designate specific facts showing a "genuine issue for trial." Id at 324, citing FRCP 56(e). The court must "not weigh the evidence or determine the truth of the matter, but only determine whether there is a genuine issue for trial." Balint v. Carson City, Nev., 180 F.3d 1047, 1054 (9th Cir 1999) (citation omitted). A " scintilla of evidence, ' or evidence that is merely colorable' or not significantly probative, '" does not present a genuine issue of material fact. United Steelworkers of Am. v. Phelps Dodge Corp., 865 F.2d 1539, 1542 (9th Cir 1989) (citation omitted). The substantive law governing a claim or defense determines whether a fact is material. Addisu v. Fred Meyer, Inc., 198 F.3d 1130, 1134 (9th Cir 2000) (citation omitted). The court must view the inferences drawn from the facts "in the light most favorable to the non-moving party." Bravo v. City of Santa Maria, 665 F.3d 1076, 1083 (9th Cir 2011) (citations omitted).
I. Purchase Transaction
On Saturday, February 18, 2012, Douge negotiated the purchase of a 2011 Toyota Yaris ("Yaris") from Beaverton Toyota for $14, 635.00. Complaint, ¶¶ 4-5. Douge made a $2, 000.00 down payment, leaving the remainder to be financed. Complaint ¶ 6 & Ex. A; Fortiere Decl., ¶¶ 4, 15 & Ex. 1.
In connection with the purchase, Douge and Beaverton Toyota executed the following documents, among others: (1) a motor vehicle purchase agreement; (2) a vehicle service agreement application; (3) a prepaid maintenance program application; (4) an application for title and registration; (5) a "7 Day Trial Exchange Privilege"; (6) an "as is" Agreement; (7) an agreement to provide accidental physical damage insurance for the vehicle; and (8) a Retail Installment Contract ("Contract"). Fortiere Decl., ¶¶ 4-11 & Exs. 1-8. In a section titled "CONSUMER PAPER, " the Contract provides as follows:
Sales Transaction Subject to Approval of Financing. The sale of the vehicle to you is subject to approval of financing. You agree to provide Dealer with all credit and income information reasonably required, and otherwise exert your best efforts, to have the Retail Installment Contract (contract) purchased by a third party. In the event that a third party declines to purchase the contract, Dealer reserves the right to carry the contract in house or to declare the purchase null and void. The Dealer has 14 days from the date the purchaser takes possession of the vehicle to obtain irrevocable acceptance of funding by a third party ...