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COLTON v. SWAIN

United States District Court, Northern District of Illinois


April 24, 1973

ROBERT COLTON, PLAINTIFF,
v.
JOHN B. SWAIN ET AL., DEFENDANTS AND THIRD PARTY PLAINTIFFS, V. PACIFIC INDEMNITY COMPANY, A CORPORATION, THIRD PARTY DEFENDANT.

The opinion of the court was delivered by: Bauer, District Judge.

MEMORANDUM OPINION AND ORDER

This cause comes on the third party defendant's motion to strike and dismiss the third party complaint.

The complaint in the instant action sets forth a claim for redress of an alleged civil rights violation pursuant to 42 U.S.C. § 1983 and 28 U.S.C. § 1331 and 1343. The plaintiff is Robert Colton, a citizen of the United States and a resident of Naperville, Illinois. The defendants are John B. Swain, Gerald Smithson, Elmer P. Alsip, Paul Sahs, Clyde Motter, Daniel Leonard, Allen MacKechie, and Edwin Simpson, all of whom during the time in question were duly appointed and acting police officers and deputy sheriffs of the Du Page County Sheriff's Office.

In the complaint the plaintiff alleges, inter alia, the following facts:

  1.  On or about May 25, 1972 the plaintiff was
      peaceably conducting himself in Naperville,
      Illinois.

  2.  The defendants were all acting under the
      color of state law and the scope of their
      employment as deputy sheriffs of Du Page
      County, Illinois.

  3.  Each of the defendants menaced and threatened
      the plaintiff with firearms. The defendant
      John B. Swain, set upon, pushed and pummelled
      the plaintiff, threw him to the ground and
      struck him repeatedly with a blackjack. Then
      each of the defendants kicked, beat and
      viciously attacked the plaintiff with their
      feet and hands inflicting injury to the
      plaintiff. The plaintiff was then dragged and
      pushed into the County Jail by the
      defendants.

  4.  At the jail, the plaintiff was searched and
      found to be in possession of certain drugs
      which had been prescribed by a duly licensed
      physician as medication for the plaintiff's
      epilepsy.

  5.  The defendant was falsely and without
      probable cause charged with the following
      crimes:

      a) criminal damage to property of the County
      of Du Page;

      b) unlawful possession of a controlled
      substance; and

      c) obstructing a police officer in the
      performance of his duties.

      Thereafter the Office of the State's Attorney
      of Du Page County chose not to prosecute the
      plaintiff for the first two of offenses
      listed above, and the plaintiff was

      found not guilty of the third offense and
      discharged on August 15, 1972.

The plaintiff claims that the above described actions of the defendants deprived him of his civil rights in violation of 42 U.S.C. § 1983. The plaintiff seeks damages in the amount of $50,000 plus the cost of maintaining the instant suit.

The defendants have filed a third party complaint pursuant to Rule 14 of the Federal Rules of Civil Procedure against Pacific Indemnity Company ("Pacific"), the third party defendant. The third party plaintiff seeks a declaration of the respective rights and duties regarding the comprehensive general liability insurance policy issued to them; an injunction requiring Pacific to assume the defense of the third party plaintiffs; to pay for any damages which may result from the instant action, plus the cost of defending this action. The defendants in the third party complaint allege the following facts, inter alia:

  1.  On or about May 25, 1972 there was in full
      force and effect a certain policy of
      comprehensive general liability insurance,
      number LI 20930, issued by the third party
      defendant Pacific to the County of Du Page,
      Illinois.

  2.  The insurance policy provides, in relevant
      part:

      a) Each of the following is an insured under
      this insurance to the extent set forth
      below: . . .

      (b) any elected or appointed official, or any
      employee of the named insured while acting
      within the scope of his duties as
      such; . . . .

      b) The company will pay on behalf of the
      insured all sums which the insured shall
      become legally obligated to pay as damages
      because of A. Bodily injury . . . to which
      this insurance applies caused by an
      occurrence and the company shall have the
      right and duty to defend any suit against the
      insured seeking damages on account of such
      bodily injury . . . even if any of the
      allegations of the suit are groundless, false
      or fraudulent.

      c) The company will pay on behalf of the
      insured all sums which the insured shall
      become legally obligated to pay as damages
      because of injury sustained by any
      person . . . and arising out of (A) false
      arrest, detention or imprisonment or
      malicious prosecution, . . . (C) wrongful
      entry or eviction, or other invasion of the
      right of private occupancy; if such offense
      is committed during the policy period within
      the United States of America, its territories
      or possessions, or Canada, and the company
      shall have the right and duty to defend any
      suit against the insured seeking damages on
      account of such personal injury even if any
      of the allegations of the suit are
      groundless, false or fraudulent. . . .

  3.  The defendants in the instant civil rights
      action are covered by Pacific's insurance
      policy and Pacific should defend the action
      and, if necessary, pay any judgment entered
      by this Court.

  4.  The third party defendant Pacific has failed
      and refused to undertake the defense of the
      defendants and provide the coverage which is
      contracted for in the insurance policy.

Pacific Indemnity Company, the third party defendant, in support of its motion to strike and dismiss the third party complaint, contends:

  1.  The policy of insurance upon which the third
      party plaintiffs

      rely provides that the insured may not
      maintain an action against the company until
      a final judgment has been rendered against
      the insured.

  2.  This Court is bound by Erie and must
      follow the substantive law of Illinois which
      does not permit direct action against the
      insurer before liability is established
      against the insured.

  3.  The policy provides coverage for false
      arrest, detention or imprisonment or
      malicious prosecution and the original
      complaint is for a unique cause of action
      called a civil rights action pursuant to
      42 U.S.C. § 1983.

  4.  Rule 14 is designed to avoid circuity of
      action, to speed and expedite the hearing of
      cases and this third party complaint would
      only slow the proceedings of the original
      cause of action.

  5.  Rule 14 is designed to find economy by
      combining proceedings and no economy would be
      gained in this case.

  6.  Rule 14 is to be applied judiciously so as to
      avoid delay and confusion.

  7.  The insertion of the third party defendant
      insurance carrier will serve only to
      interject prejudice in the instant case.

The third party plaintiffs contend that the instant motion is without merit.

It is the opinion of this Court that the third party defendant's motion to strike and dismiss the third party complaint should be denied.

I.  THE INSTANT THIRD PARTY COMPLAINT IS PROPER AND
    APPROPRIATE UNDER RULE 14 OF THE FEDERAL RULES OF CIVIL
    PROCEDURE.

The third party defendant contends that the third party complaint is not proper because it violates: (a) the no action clause of the insurance contract,*fn1 (b) the Illinois prohibition against direct action against an insurer, and (c) the spirit of speed and economy of cases on which Rule 14 is predicated and because it may interject prejudice in the instant case.

It is well settled that a no action clause in an insurance policy similar to the one in dispute in the instant action is not a bar to a third party complaint against the insurer. Vaughn v. United States, 225 F. Supp. 890 (W.D.Tenn. 1964); Jordan v. Stephens, 7 F.R.D. 140 (W.D.Mo. 1945). The object of Rule 14 is to facilitate litigation, to save costs, to bring all of the litigants into one proceeding, and to dispose of an entire matter without the expense and labor of many suits and many trials. For this Court to give effect to such a no-action clause would merely result in a duplication of litigation and place additional burdens on an already over burdened court system. Further, since the third party defendant has allegedly breached its contract by refusing to defend the third party plaintiff, the third party defendant should not be permitted to interpose as a bar to this action the contractual provisions of a contract it has allegedly repudiated.

  The Illinois prohibition against direct action against an
insurer is not a bar to a third party complaint

under Rule 14. Since the original complaint alleges a federal
cause of action based on violations of a federal statute, the
third party complaint is ancillary to the primary claim and
not necessarily dependent on state law or policy for its
determination. See Revere Copper and Brass Incorporated v.
Aetna Casualty and Surety Company, 426 F.2d 709 (5th Cir.
1970). Further, federal courts have allowed third party
complaints under Rule 14 regardless of state policy based on
the federal procedural policy of efficiency in litigation. See
Pucheu v. National Surety Corporation, 87 F. Supp. 558 (W.D.La.
1949). Federal courts have generally allowed third party
complaints against insurers in actions brought under federal
question jurisdiction. Taggert v. United States, 262 F. Supp. 572
 (D.C.Pa. 1967); Barker v. United States, 233 F. Supp. 455
(D.C. Ga. 1964); Nistendirk v. United States, 225 F. Supp. 884
(D.C.Mo. 1964). The instant third party complaint is not a
direct action against an insurer but rather a means of
combining a number of related law suits in a manner which will
not only economize on court time but also the time, effort and
expense of all the litigants. Thus the third party complaint
neither violates Illinois policy nor controvenes the purpose of
Rule 14 in that it will provide speedy, efficient and complete
litigation of an entire controversy. Further, this ruling is
within the Court's sound discretion and the general policy that
Rule 14 be liberally construed. Southern Railway Co. v. Fox,
339 F.2d 560 (5th Cir. 1964); Thomas v. Malco Refineries Inc.,
214 F.2d 884 (10th Cir. 1954); Gateway Realty Co. v.
Carri-Craft, Inc., 53 F.R.D. 303 (D.C. Mo. 1971); Powell v.
Kull, 53 F.R.D. 380 (D.C.Pa. 1971).

The third party defendants contend that the interjection of the third party insurance carrier will only serve to impose prejudice in the trial of the instant action. It is the opinion of this Court that the third party defendant has failed to present a clear case of prejudice and that if Pacific does, in the future, make a showing of prejudice this Court can and will quickly remedy the situation.

II. THE DEFENDANTS' ALLEGED VIOLATION OF THE CIVIL RIGHTS ACT,
    42 U.S.C. § 1983 IS NOT EXCLUDED PER SE FROM COVERAGE UNDER
    THE INSURANCE POLICY IN QUESTION.

The third party defendant contends that the insurance policy in question does not cover the unique constitutional tort*fn2 of a civil rights action pursuant to 42 U.S.C. § 1983. The insurance policy does not specifically include or exclude from coverage a tort based on federal civil rights violations.

After examining the pleadings it is clear to this Court that the plaintiff Robert Colton could have brought the instant action as either a civil rights violation, as he did, or as a tort action for false arrest, false imprisonment and malicious prosecution.*fn3

The crux of the plaintiff's complaint is that the defendants under the color of state law deprived the plaintiff of his constitutional rights by committing the common law tort of false arrest, false imprisonment, and malicious prosecution. A tort action for false arrest, false imprisonment and malicious prosecution would be covered by the insurance policy. Thus the plaintiff's exercise of his option to proceed with the instant action under the Civil Rights Act rather than as a common law tort action (which would definitely be covered by the insurance policy) should not operate to inflict a penalty on defendants and deny them insurance coverage. Further, it is a long established policy of federal courts to liberally construe insurance contracts in favor of the insured and against the insurer. Bremen State Bank v. Hartford Accident and Indemnity Co. et al., 427 F.2d 425 (7th Cir. 1970); Ocean Accident and Guarantee Corp. v. Aconomy Erectors, Inc., 224 F.2d 242 (7th Cir. 1955).

The insurance contract and the pleadings thus far reveal that the third party defendant's cursory denial of coverage is not consistent with the insurance contract and the pleadings in the instant action and thus does not provide sufficient basis for striking or dismissing the third party complaint.

Accordingly, it is hereby ordered that the third party defendant's motion to strike and dismiss the third party complaint is denied.


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