DeCoite

Dissenting.

I respectfully dissent for essentially the same reasons expressed in my dissents from the decisions in Government Employees Ins. Co. v. Dizol, 108 F.3d 999 (9th Cir.1997) and Budget Rent-A-Car v. Crawford, 108 F.3d 1075 (9th Cir.1997). In this case, as in those eases, there is no pending state court ease in which the issues between these parties could be litigated. The record is barren of any reason why the district court should refuse to exercise its diversity and declaratory judgment jurisdiction. Indeed, if the district court correctly ruled that there is no duty to indemnify or defend on the part of Budget, there probably never will be any action by the parties injured in the accident. We should decide the merits of this appeal now, rather than require everyone to continue to dangle nearly five years after the accident.

Budget Rent-A-Car Systems, Inc. (Budget) appeals from the district court’s summary judgment. Budget filed this declaratory relief action in federal court against one of its customers, Clayton DeCoite, and four persons allegedly injured by DeCoite in a traffic accident. Budget sought a declaration that it had no duty to defend or indemnify DeCoite because he misrepresented his driving record on the rental form. The district court held that Budget was obliged to indemnify, but not defend, DeCoite under Hawaii law. The district court had jurisdiction under 28 U.S.C. § 1332 . We have jurisdiction over this timely appeal pursuant to 28 U.S.C. § 1291 .

The district court did not indicate whether it considered the discretionary nature of its jurisdiction under the Declaratory Judgment Act. In accordance with our recent decisions in Government Employees Insurance v. Dizol, 108 F.3d 999 (9th Cir.1997), and Budget Rentr-A-Car v. Crawford, 108 F.3d 1075 (9th Cir.1997) (Crawford), we must remand this case to the district court to *1134 allow it to exercise that discretion in the first instance.

I

On July 15, 1993, DeCoite rented a car from Budget at Budget’s Honolulu airport…