Opinion
No. 3:18-cv-00517-PK
08-20-2018
STATE FARM FIRE AND CASUALTY CO., Plaintiff, v. DANIEL SELLARS, et al., Defendants.
FINDINGS AND RECOMMENDATION
PAPAK, Magistrate Judge :
Plaintiff State Farm Fire and Casualty Co. (State Farm) brings this interpleader action, seeking a declaration on its obligation to pay proceeds under State Farm renters' insurance policy no. 37-CB-D540-6 (the Policy). State Farm alleges that a fire originated in the insured location, an apartment in Portland, causing property damage to others, and that each of the named Defendants "potentially may make a claim to the proceeds" of the Policy based on losses caused by the fire. Compl. ¶ 22, ECF No. 1.
State Farm now moves for an order discharging it from further liability and awarding attorney's fees and costs in an amount to be determined. ECF No. 20. Although none of the Defendants oppose State Farm's motion, Defendant Truck Insurance Exchange (Truck Insurance) has filed an answer seeking $786,132.92 "plus an amount to be determined," from State Farm. Truck Insurance's Answer ¶ 19, ECF No. 15.
BACKGROUND
On March 26, 2018, State Farm filed its Motion for Interpleader Deposit, seeking to deposit the amount of the Policy proceeds, $300,000, ECF No. 2, On March 28, 2018, this court granted State Farm's Motion for Interpleader Deposit and ordered that State Farm's tendered funds of $300,000 be deposited into this court's registry pending final judgment. ECF No. 5. On April 10, 2018, this court acknowledged receipt of State Farm's deposit. ECF No. 6. On April 20, 2018, State Farm filed the motion to discharge it from further liability. ECF No. 20. As noted, no Defendant has opposed State Farm's motion.
On April 20, 2018, the same day that State Farm filed its motion to discharge, Truck Insurance filed its Answer (Answer). Truck Insurance alleges it insures Commons at Timber Creek, the apartment building in Portland where the fire occurred, and that State Farm's insureds, Daniel and Melana Sellars, "rented and resided in Apt. 199 within the building." Answer ¶ 15. Truck Insurance alleges Daniel Sellars negligently caused a fire on the deck of the apartment "while cooking bacon on a propane barbecue." Answer ¶ 16. Truck Insurance alleges that under its policy, it has paid benefits of $786,132.92 to its insured Commons at Timber Creek, and that the claim "remains open with $251,524.00 in possible future expenditures." Answer ¶ 18. Truck Insurance seeks "the policy proceeds of the subject State Farm policy." Answer ¶ 21.
DISCUSSION
I. Legal Standards for Interpleader Actions
This court "has jurisdiction over this statutory interpleader action pursuant to [28 U.S.C. § 1335] because the proceeds at stake exceed $500 and two or more of the adverse claimants are citizens of different states." Primerica Life Ins. Co. v. Ross, No. CV 06-763-PK, 2006 WL 317044, at *2 (D. Or. Nov. 1, 2006). In an action for statutory interpleader, "a disinterested insurance company facing multiple claims for one fund may pay the fund into the registry of the court and be discharged from any further liability." Id. (citing 28 U.S.C. § 2361). "The purpose of interpleader is for the stakeholder to 'protect itself against the problems posed by multiple claimants to a single fund.'" Mack v. Kuckenmeister, 619 F.3d 1010, 1024 (9th Cir. 2010) (quoting Minn. Mut. Life Ins. Co. v. Ensley, 174 F.3d 977, 980 (9th Cir. 1999)). "Furthermore, the court may enjoin all claimants from instituting or prosecuting any legal action for payment or recovery of the proceeds at stake." Primerica Life Ins., 2006 WL 317044, at *2 (citing 28 U.S.C. § 2361).
II. State Farm's Motion for Discharge
In State Farm's motion for discharge, it notes that "the amount of claims do exceed the $300,000 of available insurance limits." State Farm's Mot. Order 4. Although Truck Insurance's Answer alleges damages more than double the amount tendered by State Farm, the Answer seeks only "the policy proceeds of the subject State Farm policy." Answer ¶ 21. Neither Truck Insurance nor any other Defendant has objected to the discharge of State Farm. I therefore recommend granting State Farm's motion for discharge with prejudice from all claims and liability related to the Policy.
III. Award of Attorney's Fees and Costs
This court has discretion to award attorney's fees and costs to the disinterested stakeholder in an interpleader action. Primerica Life Ins., 2006 WL 317044, at *2 (citing Abex Corp. v. Ski's Enterprises, Inc., 748 F.2d 513, 516, (9th Cir.1984)). "The amount of fees and costs to be awarded in an interpleader action . . . is limited to those fees that are incurred in filing the action and pursuing the stakeholder's discharge from liability." Id. (citing Schirmer Stevedoring Co. v. Seaboard Stevedoring Corp., 306 F.2d 188, 194 (9th Cir. 1962)). "Fees and costs are to be paid out of the funds deposited into the registry." Id. (citing Mass. Mut. Life Ins. Co. v. Morris, 61 F.2d 104, 105 (9th Cr. 1932)).
Here, State Farm states that it will submit a separate motion for attorney's fees and costs under Federal Rule of Civil Procedure 54. I conclude that State Farm has shown that it is entitled to attorney's fees and costs, in a reasonable amount to be determined by this court.
CONCLUSION
State Farm's Motion for Order to Discharge Plaintiff From Further Liability and Award of Attorneys' Fees and Costs, ECF No. 20, should be GRANTED. This court should enter the proposed Order of Discharge, ECF No. 20-2.
SCHEDULING ORDER
The Findings and Recommendation will be referred to a district judge. Objections, if any, are due fourteen (14) days from service of the Findings and Recommendation. If no objections are filed, then the Findings and Recommendation will go under advisement on that date.
If objections are filed, then a response is due fourteen (14) days after being served with a copy of the objections. When the response is due or filed, whichever date is earlier, the Findings and Recommendation will go under advisement.
Dated this 20th day of August, 2018
/s/_________
Honorable Paul Papak
United States Magistrate Judge