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Walker v. Spina

United States District Court, D. New Mexico

August 28, 2018

SHIRLEY J. WALKER, Plaintiff,
v.
GREGORY J. SPINA; VALLEY EXPRESS, INC. and DIXON INSURANCE COMPANY, Defendants.

          Shavon M. Ayala Ayala P.C. Albuquerque, New Mexico --and-- Anthony James Ayala Law Offices of Anthony James Ayala Albuquerque, New Mexico Attorneys for the Plaintiff

          Raul Sedillo Alison Beaulieu Butt Thornton & Baehr PC Albuquerque, New Mexico Attorneys for the Defendants

          MEMORANDUM OPINION AND ORDER

         THIS MATTER comes before the Court on the Plaintiff's Motion to Amend Complaint for Personal Injuries and Damages, filed February 3, 2018 (Doc. 23)(“Motion”). The Court held a hearing on June 20, 2018. The primary issue is whether Plaintiff Shirley Walker may sue Great West Casualty Company as an injurer's insurer under Raskob v. Sanchez, 1998-NMSC-045, ¶ 6, 970 P.2d 580, 581-82 (“Raskob”), when the injurer is an out-of-state resident. The Court concludes that a Raskob action lies, even against an out-of-state resident, so long as: (i) the law mandates the insurance coverage; (ii) the law is meant to benefit the public; and (iii) the law does not express an intent to deny joinder. See Raskob, 1998-NMSC-045, ¶ 3, 970 P.2d at 581. Because both the New Mexico Financial Responsibility Act, N.M. Stat. Ann. §§ 66-5-201 to -239 (“NMFRA”) and North Dakota law (i) mandate that the out-of-state resident have insurance coverage; (ii) were meant to benefit the public; and (iii) the laws do not express an intent to deny joinder, the Court concludes that a Raskob action lies. Accordingly, the Court grants the Motion, and Walker may amend her complaint to add Great West as a defendant.

         FACTUAL BACKGROUND

         The Court takes its facts from Walker's Complaint for Personal Injuries and Damages (First Judicial District Court, County of Santa Fe, State of New Mexico), filed December 23, 2016, filed in federal court September 29, 2017 (Doc. 1-1)(“Complaint”). The Court provides these facts for background. It does not adopt them as the truth, and it recognizes that the facts are largely Walker's version of events.

         On July 23, 2015, Defendant Gregory J. Spina was speeding on U.S. Highway 84/285 in a commercial vehicle that Defendant Valley Express, Inc. owned. See Complaint ¶¶ 6-7, at 2. As Spina approached a red light, he realized that he was going too fast to brake, so, instead of hitting the vehicles stopped side by side in front of him, he attempted to slip between them. See Complaint ¶ 7, at 2. Rather than avoiding the stopped vehicles, however, he sideswiped both of them, causing both cars to roll into the intersection. See Complaint ¶ 7, at 2-3. Walker was driving one of the sideswiped vehicles and, as a result of Spina's actions, suffered physical and emotional injuries. See Complaint ¶¶ 7, 11, at 2-4.

         PROCEDURAL BACKGROUND

         Walker sues Spina and Valley Express, asserting negligence, [1] and sues Defendant Dixon Insurance Company, asserting that she has a claim for benefits against it under the NMFRA and Raskob for injuries that Spina's negligence caused. See Complaint ¶¶ 8-13, at 3-5. Spina and Valley Express removed the case to federal court on the basis of diversity jurisdiction. See Notice of Removal to the United States District Court for the District of New Mexico at 1, filed September 29, 2017 (Doc. 1)(“Notice of Removal”).[2] Dixon Insurance has not yet been served with the Complaint. See Draft Transcript of Motion Proceedings at 6:1-2 (taken June 20, 2018)(Beaulieu) (“Tr.”).[3]

         1. The Motion.

         Walker moves to amend the Complaint so she can substitute Great West for Dixon Insurance. See Motion at 1. She argues that, based on recent disclosures from Spina and Valley Express, she learned that Great West and not Dixon Insurance issued the relevant insurance policy. See Motion ¶ 2, at 2. She argues, thus, that, under rule 15(a)(2) of the Federal Rules of Civil Procedure, the Court should grant the amendment, because there is no evidence of “undue delay, bad faith, dilatory tactics, ” or prejudice to Spina and Valley Express. Motion ¶¶ 5-7, at 2-3.

         2. The Response.

         Spina and Valley Express respond. See Defendants' Gregory J. Spina and Valley Express, Inc.'s Response to Plaintiff's Motion to Amend at 1, filed February 16, 2018 (Doc. 25)(“Response”). They argue that the Court should not allow the amendment, because commercial motor carriers, such as Great West, are exempt from the NMFRA, so, according to Spina and Valley Express, there is no basis to hold Great West liable. See Response at 1-2. Spina and Valley Express contend that the NMFRA does not apply to Great West, because the NMFRA's purpose applies to New Mexico residents, which Spina, Valley Express, and Great West are not. See Response at 3. They also assert that the NMFRA does not apply to commercial motor vehicles, so the NMFRA would not apply here, because the car at issue is a commercial motor vehicle. See Response at 3-4 (citing N.M. Stat. Ann. § 66-5-207(D)). Finally, Spina and Valley Express argue that Raskob is inapplicable, because, according to them, the Supreme Court of New Mexico held there that an insurer could be held liable if they issued a policy in accordance with the NMFRA, but here, the policy was not issued in accordance with the NMFRA. See Response at 4.

         3. The Reply.

         Walker replies. See Plaintiff's Reply to Defendants Gregory J. Spina's and Valley Express, Inc.'s Response to Her Motion to Amend Her Complaint, filed February 20, 2018 (Doc. 26)(“Reply”). She asserts that Raskob allows Great West's joinder, notwithstanding the NMFRA, because “‘where the insurance coverage is mandated by law for the benefit of the public, generally the insurance company is a proper party.'” Reply at 1-2 (quoting Raskob, 1998-NMSC-045, ¶ 3, 970 P.2d at 581). She argues that, because the rights of persons injured in automobile accidents are determined under the law where the accident happened, New Mexico law applies. See Reply at 2. Thus, according to Walker, “if insurance coverage for the Valley vehicle Spina was driving is mandated by law, benefits the public and no language of the law expresses an intent to deny joinder, Walker may join Great West as a defendant.” Reply at 2. She concludes that, even if the NMFRA does not apply, North Dakota and federal law require insurance to cover the vehicle driven, so Raskob applies and Great West is a proper defendant. See Reply at 3.

         4. The Hearing.

         The Court held a hearing. See Tr. at 1:5-6 (Court). Walker argued that Raskob is on all fours, so Great West's joinder is proper and the Court should grant leave to amend. See Tr. at 2:19-4:2 (Ayala). Spina and Valley Express countered that Raskob cannot cover this case, because Raskob analyzes the NMFRA, which, according to Spina and Valley Express, does not apply here, because the NMFRA targets New Mexico residents, whereas Spina and Valley Express are North Dakota residents. See Tr. at 6:13-17 (Beaulieu); id. at 11:11-13 (“[T]he Raskob opinion and analysis is very specific to the New Mexico Laws [such] that the overbreadth of language would be in reference to those laws.”); id. at 15:17-16:16 (Beaulieu, Court). They also argue that Great West is not a proper party, because Walker is not in privity with Great West. See Tr. at 7:1-2 (Beaulieu). Spina and Valley Express conceded, however, that both New Mexico and North Dakota law mandate insurance coverage. See Tr. at 9:2-4 (Beaulieu, Court). The Court commented that Raskob appears to be saying that, “if the insurance coverage is mandated, then the insurance company is a proper party.” Tr. at 9:19-21 (Court). The Court noted that there might be good reasons to create exceptions to the Raskob rule, but that the Supreme Court of New Mexico, not a federal court sitting in diversity, ought to address those reasons in the first instance. See Tr. at 10:18-21 (Court).

         Spina and Valley Express contended that, should the Court allow the amendment, it would request a bifurcation, separating Great West from the rest of the matter, because there is not a direct cause of action. See Tr. at 12:24-13:4 (Beaulieu). Should the Court determine that there is a direct cause of action here, Spina and Valley Express argued that a bifurcation would still be proper, because they would be prejudiced. See Tr. at 13:11-19 (Beaulieu). Walker agreed that there should be bifurcation. See Tr. at 14:4-7 (Ayala).

         LAW REGARDING RULE 12(b)(6)

         Rule 12(b)(6) authorizes a court to dismiss a complaint for “failure to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). “The nature of a Rule 12(b)(6) motion tests the sufficiency of the allegations within the four corners of the complaint after taking those allegations as true.” Mobley v. McCormick, 40 F.3d 337, 340 (10th Cir. 1994). The Complaint's sufficiency is a question of law, and, when considering a rule 12(b)(6) motion, a court must accept as true all well-pled factual allegations in the complaint, view those allegations in the light most favorable to the nonmoving party, and draw all reasonable inferences in the plaintiff's favor. See Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007)(“[O]nly if a reasonable person could not draw . . . an inference [of plausibility] from the alleged facts would the defendant prevail on a motion to dismiss.”); Smith v. United States, 561 F.3d 1090, 1098 (10th Cir. 2009)(“[F]or purposes of resolving a Rule 12(b)(6) motion, we accept as true all well-pled factual allegations in a complaint and view these allegations in the light most favorable to the plaintiff.”)(citing Moore v. Guthrie, 438 F.3d 1036, 1039 (10th Cir. 2006)).

         A complaint need not make detailed factual allegations, yet a “pleading that offers labels and conclusions or a formulaic recitation of the elements of a cause of action” is insufficient. Ashcroft v. Iqbal, 556 U.S. at 678 (2009)(citing Bell Atl. Corp. v. Twombly, 550 U.S. at 555). “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Ashcroft v. Iqbal, 556 U.S. at 678. “Factual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact).” Bell Atl. Corp. v. Twombly, 550 U.S. at 555.

         To survive a motion to dismiss, a plaintiff's complaint must contain sufficient facts that, if assumed to be true, state a claim to relief that is plausible on its face. See Bell Atl. Corp. v. Twombly, 550 U.S. at 570; Mink v. Knox, 613 F.3d 995, 1000 (10th Cir. 2010). “A claim has facial plausibility when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. at 678 (citing Bell Atl. Corp. v. Twombly, 550 U.S. at 556). “Thus, the mere metaphysical possibility that some plaintiff could prove some set of facts in support of the pleaded claims is insufficient; the complainant must give the court reason to believe that this plaintiff has a reasonable likelihood of mustering factual support for these claims.” Ridge at Red Hawk, LLC v. Schneider, 493 F.3d 1174, 1177 (10th Cir. 2007)(emphasis omitted). The United States Court of Appeals for the Tenth Circuit has stated:

“[P]lausibility” in this context must refer to the scope of the allegations in a complaint: if they are so general that they encompass a wide swath of conduct, much of it innocent, then the plaintiffs “have not nudged their claims across the line from conceivable to plausible.” The allegations must be enough that, if assumed to be true, the plaintiff plausibly (not just speculatively) has a claim for relief.

Robbins v. Oklahoma, 519 F.3d 1242, 1247 (10th Cir. 2008)(citations omitted)(quoting Bell Atl. Corp. v. Twombly, 550 U.S. at 570). See Gallegos v. Bernalillo Cty. Board of Cty. Comm'rs, __ F.Supp.3d __, 2017 WL 4402422, at *9 (D.N.M. 2017)(Browning, J.).

         “When a party presents matters outside of the pleadings for consideration, as a general rule ‘the court must either exclude the material or treat the motion as one for summary judgment.'” Brokers' Choice of America, Inc. v. NBC Universal, Inc., 861 F.3d 1081, 1103 (10th Cir. 2017)(quoting Alexander v. Oklahoma, 382 F.3d 1206, 1214 (10th Cir. 2004)). There are three limited exceptions to this general principle: (i) documents that the complaint incorporates by reference, see Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007); (ii) “documents referred to in the complaint if the documents are central to the plaintiff's claim and the parties do not dispute the documents' authenticity, ” Jacobsen v. Deseret Book Co., 287 F.3d at 941; and (iii) “matters of which a court may take judicial notice, ” Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. at 322. See Brokers' Choice of America, Inc. v. NBC Universal, Inc., 861 F.3d 1081, 1103 (10th Cir. 2017)(holding that the district court did not err by reviewing a seminar recording and a TV episode on a rule 12(b)(6) motion, which were “attached to or referenced in the amended complaint, ” central to the plaintiff's claim, and “undisputed as to their accuracy and authenticity”). “[T]he court is permitted to take judicial notice of its own files and records, as well as facts which are a matter of public record.” Van Woudenberg v. Gibson, 211 F.3d 560, 568 (10th Cir. 2000), abrogated on other grounds by McGregor v. Gibson, 248 F.3d 946, 955 (10th Cir. 2001).

         In Gee v. Pacheco, 627 F.3d 1178 (10th Cir. 2010), the defendants “supported their motion with numerous documents, and the district court cited portions of those motions in granting the [motion to dismiss].” 627 F.3d at 1186. The Tenth Circuit held that “[s]uch reliance was improper” and that, even if “the district court did not err initially in reviewing the materials, the court improperly relied on them to refute Mr. Gee's factual assertions and effectively convert the motion to one for summary judgment.” 627 F.3d at 1186-87. In other cases, the Tenth Circuit has emphasized that, “[b]ecause the district court considered facts outside of the complaint, however, it is clear that the district court dismissed the claim under Rule 56(c) and not Rule 12(b)(6).” Nard v. City of Okla. City, 153 Fed.Appx. 529, 534 n.4 (10th Cir. 2005)(unpublished).[4] In Douglas v. Norton, 167 Fed.Appx. 698 (10th Cir. 2006)(unpublished), the Tenth Circuit addressed an untimely filed charge with the Equal Employment Opportunity Commission -- which the Tenth Circuit analogized to a statute of limitations -- and concluded that, because the requirement ...


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