Thursday, May 20, 2004

Dismissal of dec action reversed despite pendency of underlying proceeding in state court

In Penn-America Insurance Co. v. Coffey, the Fourth Circuit in an opinion by Judge Niemeyer, joined by Judge Michael and Senior Judge Hamilton, reversed the dismissal by Judge Smith of the E.D. Va. of a declaratory judgment action brought by an insurer seeking a determination of its duty to defend the defendant in a case pending in state court. The appeals court emphasized that the two cases involve different issues, as the duty to defend will depend not on the actual facts, but on the allegations made in the claimagainst the insured.

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