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37.005. Ins. A. Co. of N. v. Texas Air Control Bd., 852 S.W.2d 440, 446 (Tex. While abstention doctrine is more frequently an issue in federal court, state courts can also abstain. Co. v. Quinn-L Capital Corp., 3 F.3d 877 (5th Cir. See Murray, 437 S.W.2d 264 (Tex. Issues also arise, when the underlying case is still proceeding, as to the extent to which the insurer can discover information which could also be relevant, and potentially damaging, in the underlying liability suit. Since the duty to defend is based solely on the live pleadings, a declaratory judgment is arguably based only on the pleading in effect, and is not determinative as to any subsequent amended or supplemental pleading. 1364 (N.D. Tex. Typically, an anti-suit injunction is appropriate in limited instances: 1) to address a threat to the courts jurisdiction; 2) to prevent the evasion of important public policy; 3) to prevent a multiplicity of suits; or 4) to protect a party from vexatious or harassing litigation. 37.002. One common element circuit courts often point to is whether the suit was brought . App.El Paso 2000, no pet. Prior to the Grapevine Excavation case, the Fifth Circuit had construed 38.006 to exempt insurers from paying attorneys fees in breach of contract actions. 1996); Williamson v. State Farm Lloyds, 76 S.W.3d 64 (Tex. FFC Home Page / 5 Reasons to file a Declaratory Judgment. 1998); Monticello Ins. %%EOF
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Co. v. Cooper Machinery Corp., 817 F.Supp. 1998) (holding that Texas Declaratory Judgment Act was not controlling, substantive law, and did not justify fee award to defendants). Co. v. Burch, 442 S.W.2d 331 (Tex. 1979, no writ) (not justiciable controversy); Boorhem-Fields, Inc. v. Burlington Northern Railroad Co., 884 S.W.2d 530 (Tex. An action or proceeding is not open to objection on the ground that a declaratory judgment or decree is prayed for. Texas Uniform Declaratory Judgments Act, You can get sample motions here: Declaratory Relief Declaratory Judgment and Rights. In Gandy, the court broadened the scope of re-litigation, noting that in no event, however, is a judgment for plaintiff against defendant rendered without a fully adversarial trial, binding on defendants insurer . The claims involved crop-dusting, which allegedly damaged abutting fields because of herbicide drift. Because the insurer would be allowed to re-litigate, after the underlying case is resolved, there is no reason to delay the inevitable. A declaratory judgment is a legal determination by the court, which resolves legal uncertainties in a controversy. Although efforts are occasionally made, it is inappropriate for the insurer to be joined as a defendant in a liability suit. Over the past few decades, Texas family lawyers have engaged in a legal fiction: Let's tie a bow around the package of a partition and exchange agreement by seeking to have the agreement made the subject of a declaratory judgment action. Co. v. Murray, 437 S.W.2d 264, 265-66 (Tex. In addition, in many instances, a protective order will allow broad discovery, without fear of disclosure to the plaintiff. After St. Paul filed its declaratory action in federal court, the claimant filed suit in state court in the same court in which the two prior suits had been filed. The insurer refused to pay the judgment, on the basis that the insureds conduct constituted a willful violation of a penal statute, and was thus excluded by the policy. Similarly, courts have held that an insurance company has no right to intervene in the liability action against the insured to seek a coverage determination. Despite its title, this order would not be a final judgment because it does not dispose of all claims at issue in the lawsuit. Copyright 2013 - 2023. 3 0 obj
Declaratory Judgment. The court remanded for consideration of these factors. declaratory judgment be granted as requested herein, and Plaintiff be awarded costs and reasonable and necessary attorney's fees, and for such other and further relief that may be awarded at law or in equity. 651-389-5000, 10001 Reunion Place Sept. 1, 1987; Acts 1999, 76th Leg., ch. See Bernard v. Gulf Ins. ); Rice v. Alamo Rent-A-Car, Inc., 987 S.W.2d 231 (Tex. A developing issue has been the extent to which declaratory relief is available to determine an insurers indemnity obligations, while the underlying suit is pending. . 2010), Sec. A marriage might be void for other reasons, but not because the spouses are of the same sex. In older cases, courts allowed broad introduction of extrinsic evidence in a declaratory judgment context. hbbd```b``3@$i6D2j`5`YOe= "Ydl_02]fIk`|g Indemnity is based on the actual facts establishing liability in the underlying suit. 2005); In re Marriage of Byrne, 179 Ill.App.3d 944 (1st Dist. Federal courts have typically held that declaratory relief is discretionary, and a federal court has broad authority to stay or dismiss an action seeking a declaratory judgment. Co. v. Vandewater, 907 S.W.2d 491 (Tex. 2000) (staying declaratory action because of motion to join insurer in state court liability suit). App.Dallas 2001, no pet.) 45 . Group, Inc., 946 F.Supp. In cases involving duty to indemnify, there may be issues as to whether the indemnity facts were fully litigated in an actual trial, or whether the facts can be re-litigated, construing Gandy and Maldonado. Ins. 1997); Trinity Universal Ins. Sec. A person claiming to be the surviving spouse should file a claim for declaratory judgment to determine if there was a legal common law marriage. The Declaratory Judgment Act states "Courts of record, within their respective jurisdictions, shall have power to declare rights, status, and other legal relations." See 42 Pa. C.S.A. any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought. Co. v. Patriot Sec., Inc., 926 F.Supp. Co., 95 S.W.3d 702 (Tex. Under this rule, the insurers defense obligations are determined by the allegations of the pleadings and the language of the insurance policy, without regard to the actual facts. Ins. (4) to determine rights or legal relations of an independent executor or independent administrator regarding fiduciary fees and the settling of accounts. & Rem. While the law is less clear, Federal courts, applying Texas law, have reached a similar conclusion. 4 0 obj
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Where suits are filed in two states, one court may abstain in favor of the first-filed suit. Sec. Typically, the first-filed suit has dominant jurisdiction. Federal courts are especially reluctant to exercise jurisdiction if there is a parallel state court proceeding even if subsequently filed that includes all necessary parties and will resolve the issues. We are posting this information just for educational purposes and not as a practice of law. Texas Air Control Bd., 852 S.W.2d at 444. Because the Declaratory Judgment Act expressly allows plaintiffs who win declaratory relief to seek injunctive relief either simultaneously or subsequently, any losing defendant will know that the potential for sanctions is only one step away. Cty. App.Corpus Christi 1982, no writ), the court declared that the rule was that use of extrinsic evidence was allowed to determine coverage, but not to determine facts that would establish the insurers liability. 2 The courts decision has been described as carving out an exception, rather than overruling prior law. Sec. Arbitration is not used very often in Texas family law cases. Saint Paul, MN 55102 ), Code of Judical Conduct, Canon 3 B (c) obtaining the advice of a disinterested expert on the law applicable to a proceeding before the judge if the judge gives notice to the parties of the person consulted and the substance of the advice, and affords the parties reasonable opportunity to respond;. There are exceptions, however, (1) when conduct estops a party from asserting prior active jurisdiction; (2) where parties are lacking; or (3) where there is lack of intent to prosecute. 1941); and there is every reason for not reducing declaratory . See Brillhart v. Excess Ins. A declaratory judgment is one that simply declares the rights, status, or other legal relations of the parties without ordering anything to be done. 1989). Federal Jurisdiction Issues A. Diversity Jurisdiction 1. As amended through January 27, 2023. Westport v. Atchley, Russell, Waldrop & Hlavinka, 267 F. Supp. Co., 975 S.W.2d 329, 332 n.1 (Tex. Sec. App.Dallas 2001, pet. Lazaro C. Olivarez Family Trust Page 3 of 10 Electronically Filed 11/30/2016 4:52:31 PM Hidalgo County District Clerks Reviewed By: Jennifer Sinder b) Judgment No.2: That trustees cannot use trust funds to respond to this motion for declaratory judgments pursuant to page 14 paragraph numbered 20 of the trust documents because the court's . Co. v. Tandy Corp., 986 F.2d 94, 96 (5th Cir. Many of our courses are available here. App.Houston 1965, writ refd n.r.e.) The award is subject to reversal only if it is arbitrary and unreasonable. (c) Notwithstanding Section 22.001, Property Code, a person described by Subsection (a) may obtain a determination under this chapter when the sole issue concerning title to real property is the determination of the proper boundary line between adjoining properties. The court, in the coverage action, concluded that there was a conflict of interest and a lack of privity, and therefore the insurer was not collaterally estopped from re-litigating the existence of false imprisonment. & Liab. 7) whether the federal court is being called on to construe a state judicial decree involving the same parties and entered by the court before whom the parallel state suit between the same parties is pending. On appeal, HTC challenged: " (1) the district court's exclusion of three of HTC's requested jury instructions; (2) the district court's declaratory judgment that Ericsson had complied with . Frontier Pac. 1996) (nevertheless refraining from determining coverage for indemnity, on the basis of judicial economy). denied). (no right to new trial because of amended petition where suit brought and determined based on prior petition). The petition in the underlying suit was amended, however, and all references to alcohol were deleted. <>
See State Farm Fire & Cas. As Texas law remains uncertain regarding reimbursement of defense costs, and as many insureds are not financially capable of repayment, the defense issue may be rendered moot either practically or legally by delay. 959, Sec. Sec. Sept. 1, 1985. New Orleans, LA 70130 P., also addresses declaratory judgments, by reference to 28 U.S.C. denied, 511 U.S. 1032 (1994). Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex. denied); see also State Farm Fire & Cas. A Declaratory Judgment allows you to establish with your court what your rights are before you take steps which might involve you in costly litigation. 45 (N.D. Tex. CODE provides, in subpart (a), that: When declaratory relief is sought, all persons who have or claim any interest that would be affected by the declaration must be made parties. denied). (prior judgment not res judicata as to amended pleading that alleged new facts, not involving completed operations); St. Paul Ins. See Hartford Ins. & Rem. Suite 1400 Ins. 1. App.San Antonio 1998, pet. A binding adjudication of the rights and status of litigants even though no consequential relief is awarded. The Declaratory Judgment Act itself provides that a "declaration shall have the force and effect of a final judgment or decree," 28 U. S. C. 2201; eminent authority anticipated that declaratory judgments would be res judicata, E. Borchard, Declaratory Judgments 10-11 (2d ed. 1997)2; see also State Farm Lloyds v. The insured was located in Hidalgo County, the car was purchased in Hidalgo County, and the salesman contacted the agent by phone, from Hidalgo County, to add the car to the policy. Yes*! In part, of course, the scope of discovery will be determined by the nature of the issue. (whether driver qualified as an insured); John Deere Ins. DEFINITION. Ins. Nevertheless, some courts have concluded that declaratory relief is inappropriate where another cause of action is fully mature and provides an appropriate remedy at law. A motion for declaratory judgment is an appropriate vehicle for determining the validity of a prenuptial agreement. Tex. (a) A court of record within its jurisdiction has power to declare rights, status, and other legal relations whether or not further relief is or could be claimed. 2d 719 (S.D. App.Dallas 1998, no pet.). App. R. Civ. The most common exception for extrinsic evidence is when the pleadings simply do not assert facts that would determine coverage. The author would like to thank the Texas Tech Law School Foundation for its generous support. " (emphasis added)). Texas follows the American Rule Nor can an insurer join the claimants and address the issues through interpleader. Sept. 1, 1999. Co. v. Childress, 650 S.W.2d 770, 775-76 (Tex. Tex. 31 Sec. [ii], You have the right to ask your state court for relief if you have a statute that says you do, like Texas statute says, A court of record within its jurisdiction has power to declare rights, status, and other legal relations whether or not further relief is or could be claimed[viii](Most states have an act like this. ydXOEp Pzz2 -Ia5D(eUE02Xd#zG5 ;}srmVY9c~Vqz6#tUy/`ck$cVpxKCoo,}o{T#@TQ]%5|@Rtx~K9jptm>
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Tex. Protective orders are still relatively simple, and can usually be subject to an agreed motion in federal court. See Great American Ins. (a) This chapter may be cited as the Uniform Declaratory Judgments Act. Tex. App.Fort Worth 1973, writ refd n.r.e.). See, e.g., Texas Assn of Bus. 1, eff. Read this complete Texas Estates Code - EST 257.101. App.Austin 2003, no pet. * Associate Professor of Law, Texas Tech University School of Law. denied); State Farm Lloyds v. <>
denied) (failure to satisfy burden is not finding of proof of opposite). R. Civ. See, e.g., State Farm Fire & Cas. 2.401 (a) (West 2006) 1996) (insurer not estopped from litigating employment issue). 2283. Rule 38(c), TEX. CODE ANN. See McCarthy Bros. Co. v. Continental Lloyds, 7 S.W.3d 725 (Tex. No. 37.002 provides that the chapter is remedial: Its purpose is to settle and to afford relief from uncertainty and in security with respect to rights, status, and other legal relations; and it is to be legally construed and administered. The Act does not create or enlarge jurisdiction. 10, eff. If any facts within the scope of coverage are determined, however, an insurer is required to defend. <>
Defense counsel may, nonetheless, have protected certain information from disclosure, for fear that it was effect coverage, and violate counsels own ethical obligations. One of the factors the courts will review is whether the declaratory action is filed in anticipation of a state court suit. denied). 05-05-00061-CV, citing Bonham State Bank v. Beadle, 907 S.W.2d 465, 467 (Tex. Coverage disputes under liability policies are well-suited for declaratory actions. 37.010. REVIEW. Co. v. Gaskins, 572 S.W.2d 573, 575 (Tex. See Fed. ("[B]ecause the trial court judgment rests upon the specific grounds set out in the findings of fact and conclusions of law that accompany the judgment, we are not permitted to assume omitted findings or conclusions necessary to any other grounds for the judgment, even . Dept. Foust v. Ranger Ins. 1, eff. 37.003. Admiral Ins. An insurer should not be held to have waived its right to litigate coverage by defending under reservation of rights, or by delay in filing a declaratory judgment action. (on petition for mandamus, found claimant was not third party beneficiary and had no right to intervene in declaratory action). Prac. Co. v. Ward, 107 S.W.3d 820 (Tex. App.Texarkana 2003, pet. (c) The enumerations in Sections 37.004 and 37.005 do not limit or restrict the exercise of the general powers conferred in this section in any proceeding in which declaratory relief is sought and a judgment or decree will terminate the controversy or remove an uncertainty. Co. v. Deering Mgmt. 168 0 obj
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(although judgment reversed on coverage, no indication courts refusal to award fees to either party was abuse of discretion). Determination of title is only dispute to be raised by declaratory judgment. Ellison sought a declaratory judgment to that effect and also brought claims for trespass to try title, trespass to real property, conversion, unlawful drainage, gross negligence, and nonpayment of oil and gas proceeds. 2201, and further provides for a jury trial. 1 Justice Smith was perhaps prescient in his dissent, concluding that a justiciable controversy existed. and Laju Patel Beaumont, Texas civil litigation lawyers represented Defendant accused of paying kickbacks. App.Houston [14th Dist.] See, e.g., City of Galveston v. Giles, 902 S.W.2d 167 (Tex. Federated Mut. In re Houston Specialty Insurance Co., 569 S.W.3d 138 (Tex. There are a number of instances in which extrinsic evidence may be at issue: Extrinsic evidence may be used to show that the person sued does not qualify as an insured, or that the vehicle or equipment in issue is not insured. Acts 1985, 69th Leg., ch. 1993) (Colorado River factors inapplicable in declaratory judgment action); Granite State Ins. App.El Paso 1976, writ refd n.r.e.) Co. v. Ochoa, 19 S.W.3d 452 (Tex. Federal: Declaratory Judgment Act, 28 U.S.C. Last week, the Texas Supreme Court settled a long-running dispute and upheld an appeals court's ruling that claimants can use the Uniform Declaratory Judgments Act to establish a carrier's liability for uninsured/underinsured ("UM/UIM") motorist benefits under the claimant's policy and obtain attorney's fees as well. App.San Antonio 1998, pet. If no facts within the scope of coverage are alleged, an insurer is not required to defend. PRAC. It may be appropriate for courts to abstain, in certain circumstances. 8 0 obj
Local venue flavor/influences II. Step 1: Written Notice to Vacate. Ohio Cas. Allstate Ins. A plaintiff is the side that starts the lawsuit by filing a complaint or petition with the court.A plaintiff files the lawsuit to get the court to force the defendant to do something, such as pay money damages. A declaratory judgments purpose is to prevent costly litigation, remove uncertainty, terminate the controversy[ii], and to protect its citizens from injury, debt, damage and penalties;before any loss has been suffered or any offense committed.. See, e.g., Commercial Metals Co. v. Balfour, Guthrie & Co., Ltd., 577 F.2d 264 (5th Cir. See the resource below for more details. [i]Since the state requires that you file some sort of lawsuit to protect your rights and time to your child and your property, and most state statutes authorize the use of state power to affect these rights, you should consider using declaratory judgment to establish what process and procedure your court will use to protect you and your child from the harm of a court completely ignoring process and procedure required for fundamental rights. The Fifth Circuit reviewed abstention under the Burford and Colorado River doctrines, and concluded that neither was applicable. (A) A person interested under a deed, will, written contract, or other writings constituting a contract or whose rights, status, or other legal relations are affected by statute, municipal ordinance, contract, or franchise may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract or franchise and obtain a declaration of rights, status, or other legal relations there under. Recent cases discussing the enforceability of policy buy-backs suggest there may be other exceptions in which a statutory insurance requirement renders a claimant an intended beneficiary. If a proceeding under this chapter involves the determination of an issue of fact, the issue may be tried and determined in the same manner as issues of fact are tried and determined in other civil actions in the court in which the proceeding is pending. App.Houston [1st Dist.] Auto Ins. Ins. We are not attorneys. DECLARATORY JUDGMENTS 37.001. A court can dismiss a declaratory action even if it fails to meet the stringent standards for abstention. Co., 542 S.W.2d 429 (Tex. The court recognized that the insurer was defending, but the coverage issue would not be litigated in the underlying case, so declaratory relief was appropriate. A declaration does not prejudice the rights of a person not a party to the proceeding. Co. v. Bradleys Elec., Inc., 993 S.W.2d 673 (Tex. (b) The declaration may be either affirmative or negative in form and effect, and the declaration has the force and effect of a final judgment or decree. ***It is your responsibility to make sure that this is appropriate for your individual case. 39 F.3d at 591. 1998). "Undoubtedly, the degree of control the agreement ultimately exerts over the parties' rights in the . 1993). Under Texas law, a duty to defend is determined by the complaint allegation rule. 1993); McLaren v. Imperial Cas. Where Can I Get More Information and Training? There was also a declaration that the insurer owed neither defense nor indemnity to the wife. An action or proceeding is not open to objection on the ground that a declaratory judgment or decree is prayed for. [vii] Texas Code of Judicial Conduct Texas Code of Judicial Conduct Canon B 3 (c) (c) obtaining the advice of a disinterested expert on the law applicable to a proceeding before the judge if the judge gives notice to the parties of the person consulted and the substance of the advice, and affords the parties reasonable opportunity to respond; All of our books are available in electronic form in the membership site. Civ. Co. v. Gandy, 925 S.W.2d 696 (Tex. History of Declaratory Judgments The history of declaratory judgments began in the U.S. in the early 1900s. Co. v. Sassin, 894 F.Supp. The Act provides you with a mechanism to get a ruling from the court before you are dragged through costly litigation. The court may refuse to render or enter a declaratory judgment or decree if the judgment or decree would not terminate the uncertainty or controversy giving rise to the proceeding. C.M.W., 53 S.W.3d 877 (Tex. Co. of Texas v. Erskine, 169 S.W.2d 731 (Tex. Co. v. Am. Co. v. Ochoa, 19 S.W.3d 452 (Tex. For our purposes, "litigation" refers to the filing and prosecuting of a real estate-related lawsuit, or defense against one, in the Texas county civil courts at law or the civil district courts. Co. v. may declare the rights. Through the years, many family lawyers have recommended taking additional steps to assure the sanctity of a partition agreement, including initiating a declaratory judgment action to seek a. See Bocquet v. Herring, 972 S.W.2d 19 (Tex. 37.004. 7531-7541. App.Austin 1999, no pet.) Civ. As amended through January 27, 2023. Olympic Financial Group, Inc., ("Olympic Financial") and Abdulaziz Sugule appealed a judgment dismissing their declaratory judgment action without prejudice after the district court granted the Department of Financial Institutions' ("Department") motion to dismiss. 2001). 905 (a) (5), appeals are from judgments, not orders a common . Co., 418 S.W.2d 712, 715-16 (Tex. Co. v. Trejo, 39 F.3d 585 (5th Cir. This information is not a substitute for an attorney. A separate issue exists, however, as to the facts and testimony relating to the liability event, and the evidence that has been accumulated or produced in the underlying case. Co. v. Carmichael, 1998 Tex. 1992), cert. 1999) (insureds motion to transfer erroneously granted); Southern County Mut. P. 26; Tex. 1965, writ refd n.r.e.) 1 Partner, Scheef & Stone, LLP, Frisco, Texas. App.Corpus Christi 2000, no writ). E.g., Wilton v. Seven Falls Co., 515 U.S. 277 (1995); American States Ins. See Employers Cas. App.Corpus Christi 1982, no writ) (could not consider facts of ownership that conflicted with petition); Calderon v. Mid-Century Indem. declaratory judgment action or dismiss the case. 8. Sept. 1, 1985. The U.S. Supreme Court's 2015 ruling in Obergefell v. The Federal Declaratory Judgment Act creates a remedy, not a basis for jurisdiction. You may use the information for your individual case only. 1997); Heyden Newport Chemical Corp. v. So. SHORT TITLE, CONSTRUCTION, INTERPRETATION. <>
(driver excluded); see also Tri-Coastal Contrs, Inc. v. Hartford Undwrs Ins. Co. v. Boll, 392 S.W.2d 158, 161 (Tex. Id. Code Ann. App.Houston [14th Dist.] . 3, Ch. A declaratory judgment claim can be useful in a wide variety of circumstances. (a) In a case of actual controversy within its jurisdiction, except with respect to Federal taxes . SHORT TITLE, CONSTRUCTION, INTERPRETATION. The existence of another adequate remedy does not preclude a declaratory judgment that is otherwise appropriate. Respondent contends the Supreme Court's holding in Obergefell v. Hodges, 576 U.S. 644 (2015), the "state courts are split as to whether the ruling (in Obergefell) applies retroactively to any marriage." Respondent's Mtn. Co., 981 S.W.2d 861 (Tex. In state court, an order to seal discovery requires that the parties jump through a number of additional hoops, but protective orders are still available. A declaratory judgment must be based on an actual controversy, and cannot be merely advisory. 7 0 obj
1998); see also Abraxas Petroleum Corp. v. Hornburg, 20 S.W.3d 741 (Tex. The insurer denied defense based on the liquor liability exclusion and filed a declaratory judgment action. App.Corpus Christi 1992, writ denied) (whether boat was being used for business pursuit); International Serv. If your state does not have a declaratory judgment statute that provides you the ability to be heard on your constitutional rights consider filing in federal court for this relief. P. 301; Logan v. Mullis, 686 S.W.2d 605, 609 (Tex . 2201. App.Amarillo 1976, writ refd n.r.e. If the order resolves the entire action, then the answer is easy. When to file is often determined by what is at issue. Sec. The woman appealed, arguing the evidence was factually insufficient to support the finding there was no mutual intent to be married. Sec. DECLARATIONS RELATING TO LIABILITY FOR SALES AND USE TAXES OF ANOTHER STATE. Co. v. River Entertainment, 998 F.2d 311, 315 (5th Cir. 37.006. On the other hand, in some instances, principally those in which only indemnity is at issue, or where stay or abstention is likely, there may be no benefit to early filing. dismd, 507 U.S. 1026 (1993); cf. Cf. 214-871-8200, One Riverway 1995, no writ); Employers Cas. In determining amount in controversy, the court may consider policy limits and defense costs, and is not necessarily limited by the damages pleaded in the underlying suit. 959, Sec. Background This case involves a dispute over a . However, each party must still plead for relief and carry its own burden of proof. A declaratory judgment is typically requested when a party is threatened with a lawsuit but the lawsuit has not yet been filed; or when a party or parties believe that their rights under law and/or contract might conflict; or as part of a counterclaim to prevent further lawsuits from the same plaintiff (for example, when only a contract claim is 97 (E.D. The District Court of Delaware dismissed a generic drug company's declaratory judgment counterclaims of non-infringement and invalidity, finding that the court no longer had subject.