McIver

This is an action for declaratory relief. Requisite jurisdictional requirements of diversity of citizenship and amount in controversy are present. The insurance company seeks a judicial declaration determining its non-liability upon one of its policies; and asks to be exonerated from the duty of defending a personal injury suit brought against its assured, and also from liability to satisfy any possible judgment in that suit.

The stipulated facts are these: The Lumbermen’s Mutual Casualty Company issued a policy of automobile liability insurance to Leotia Mclver and Jeff Clark upon an automobile owned by the former. On January 26, 1939, and during the effective period of the policy, this automobile was involved in an accident at Fourteenth and Montana Streets in Santa Monica, California. At that time the automobile was driven through a stop sign into the intersection, and while traveling on the wrong side of the street knocked down and severely injured Loraine Johnson, a pedestrian who was crossing the street in the cross-walk.

A suit, predicated upon negligence, was instituted in the Superior Court of Los Angeles county by Loraine Johnson against the defendants Mclver and…