Declaratory Relief Requirements In California
A cardinal rule of pleading is that only the ultimate facts need be alleged. (Semole v. Sansoucie (1972) 28 Cal. App. 3d 714, 719 [104 Cal. Rptr. 897].)
In a declaratory relief action, the ultimate facts are those facts establishing the existence of an actual controversy. (Code Civ. Proc., 1060.)
Facts showing exhaustion of the underlying limits merely establish the insured's right to recovery, not whether an actual controversy exists between the parties. However, to be entitled to declaratory relief, a party need not establish that it is also entitled to a favorable judgment.
As stated in Wellenkamp v. Bank of America (1978) 21 Cal. 3d 943, 947 [148 Cal. Rptr. 379, 582 P.2d 970]: "A complaint for declaratory relief is legally sufficient if it sets forth facts showing the existence of an actual controversy relating to the legal rights and duties of the parties under a written instrument or with respect to property and requests that the rights and duties of the parties be adjudged by the court.
If these requirements are met and no basis for declining declaratory relief appears, the court should declare the rights of the parties whether or not the facts alleged establish that the plaintiff is entitled to favorable declaration."