Amica Mut. Ins. Co. v. Gibbs Armstrong Borochoff Mullican & Hart
| Decision Date | 28 July 2011 |
| Docket Number | Case No. 10-CV-218-TCK-TLW |
| Court | U.S. District Court — Northern District of Oklahoma |
| Parties | AMICA MUTUAL INSURANCE COMPANY, Plaintiff, v. GIBBS ARMSTRONG BOROCHOFF MULLICAN & HART, P.C., GEORGE GIBBS, an individual, and GEORGE MULLICAN, an individual, Defendants. |
Before the Court is Defendants' Motion to Dismiss First Amended Complaint (Doc. 17), wherein Defendants move for dismissal of plaintiff's First Amended Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) ("Rule 12(b)(6)").
The following facts are alleged in plaintiff's First Amended Complaint. Plaintiff Amica Mutual Insurance Company ("Amica") insured Larry Cantrell ("Cantrell") under a personal automobile insurance policy that provided uninsured/underinsured ("UM/UIM") coverage. Cantrell was a police officer for the City of Sapulpa and was killed in a motor vehicle accident while on duty on July 31, 2005. Iris Cantrell ("Mrs. Cantrell"), Cantrell's mother, was appointed personal representative of Cantrell's estate and contended that the accident was caused as a result of the negligence of an uninsured or underinsured motorist. Cantrell's estate submitted a UM/UIM claim to Amica as a result of the accident and death of Cantrell.
In February 2007, Amica retained Defendants Gibbs Armstrong Borochoff Mullican & Hart("Law Firm") and George Gibbs ("Gibbs") for "coverage advice and additional advice with respect to Amica's investigation of the UM claim presented by [Mrs. Cantrell]." .) On March 13, 2007, Gibbs provided a written coverage opinion to Amica, concluding that uninsured motorist coverage did not apply to Mrs. Cantrell's claim. Specifically, Gibbs stated:
We believe the police vehicle which your insured and his father occupied at the time of the accident does not meet the definition of an uninsured motor vehicle pursuant to the [P]olicy. Therefore, we feel the uninsured motorist coverage does not apply.
(Id. ¶ 9 ("First Coverage Opinion").) Amica alleges that the First Coverage Opinion was in error and that Gibbs drafted a second opinion ("Second Coverage Opinion") dated March 16, 2007, revising his opinion and concluding that "[Cantrell] would obviously meet the definition of an insured under the Uninsured Motorist Coverage Section Policy." (Id. ¶ 11.) However, Gibbs concluded that Amica's ultimate liability analysis was correct because "we have no reason to believe that (the other driver involved in the accident with Cantrell) was more than 50 percent at fault for the subject accident" based on (1) Oklahoma Highway Patrol's conclusion that "[C]antrell was traveling at an excessive rate of speed at the time of the accident and (2) the adverse driver was not in [Cantrell's] lane at the time [Cantrell] swerved to avoid a collision with the adverse vehicle." (Id. ¶ 13.) Amica relied on Gibb's advice and subsequently denied Mrs. Cantrell's claim. Amica also generally alleges that Gibbs advised Amica to "close its file without communicating its [denial] decision to Mrs. Cantrell" and "keep a low profile and let sleeping dogs lie." (Id.) In addition, Amica contends that Gibbs did not recommend hiring an accident reconstructionist or suggest that Amica pursue any additional avenues of investigation.
Mrs. Cantrell, as administratrix of Cantrell's estate, filed suit against Amica for bad faith and breach of contract on April 14, 2008 in Creek County, Oklahoma ("underlying action"). Law Firmcontinued its representation of Amica, defending Amica against Mrs. Cantrell's suit. Specifically, Defendant George Mullican ("Mullican") handled the underlying action on behalf of Law Firm. Amica alleges that Mullican "was convinced that [Mrs. Cantrell's] bad faith claim was without merit and that the advice provided to Amica by Law Firm was sound." (Id. ¶ 15.) Amica further alleges that the lawsuit could have been settled for $200,000.00 but that Mullican discouraged any attempt to settle, instead recommending that Amica pursue discovery and eventually file a motion for summary judgment.
The underlying action was removed to this court on September 17, 2008 and assigned to the Honorable Judge Claire V. Eagan. Amica contends that "[b]y early 2009, [it] began questioning the advice it had been given by Law Firm, Gibbs, and Mullican." (Id. ¶ 18.) In March 2009, Amica reassigned the underlying action to another law firm and "became convinced that the advice it had been given by Law Firm, Gibbs[,] and Mullican was erroneous and that such advice had actually increased the value of plaintiff's bad faith claim." (Id. ¶ 19.)
Amica filed a motion for summary judgment in the underlying action, which was denied by Judge Eagan. Judge Eagan found that there were genuine issues of material fact sufficient to preclude summary judgment on the breach of contract claim, including facts regarding the location of the vehicles involved in Cantrell's accident and Cantrell's speed. (See Doc. 126 in Case No. 08-CV-0546-CVE-PJC).1 Judge Eagan also denied summary judgment on the bad faith claim, findingthat Mrs. Cantrell raised genuine issues of fact as to whether Amica "overlooked relevant material facts, and as to whether a more thorough investigation would have produced relevant information." (Id. 11.) Specifically, Judge Eagan cited questions of fact regarding whether Amica could have discovered additional relevant information had it hired its own accident reconstructionist. Judge Eagan also found:
Mrs. Cantrell has also offered sufficient evidence from which a jury could find that [Amica] handled her claim in bad faith. Mrs. Cantrell has offered evidence that [Amica] originally was not going to investigate her claim at all[,] attempted to keep her from retaining an attorney[,] and closed her filed without communicating its decision to her in a timely manner. Mrs. Cantrell did not learn of [Amica's] decision until over a year and a half after she notified [Amica]. When discussing the insurer's duty of good faith and fair dealing the Oklahoma Supreme Court has stated that "[o]f particular importance is the delicate position of the insured after a loss is incurred. . . ." [Buzzard v. Farmers Ins. Co., Inc., 824 P.2d 1105, 1109 (Okla. 1991).] Particularly in light of its knowledge that Mrs. Cantrell lost her son and husband, a jury could reasonably find that [Amica's] conduct towards Mrs. Cantrell was unreasonable under the circumstances.
(Id. 11-12.) The underlying matter was settled subsequent to Judge Eagan's summary judgment ruling and was therefore never tried to a jury. Amica represents that the settlement amount was "substantially in excess of $200,000.[00]" (Id. ¶ 23). Amica now brings suit against Defendants for contribution, professional negligence/legal malpractice, and indemnity. Defendants have moved to dismiss all claims.
In considering a motion to dismiss under Rule 12(b)(6), a court must determine whether the plaintiff has stated a claim upon which relief may be granted. The inquiry is "whether the complaint contains 'enough facts to state a claim to relief that is plausible on its face.'" Ridge at Red Hawk, LLC v. Schneider, 493 F.3d 1174, 1177 (10th Cir. 2007) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544)). In order to survive a Rule 12(b)(6) motion to dismiss, a plaintiff must "'nudge [ ][his] claims across the line from conceivable to plausible.'" Schneider, 493 F.3d at 1177 (quoting Twombly, 550 U.S. at 570). Thus, "the mere metaphysical possibility that some plaintiff could prove some set of facts in support of the pleaded claims is insufficient; the complaint must give the court reason to believe that this plaintiff has a reasonable likelihood of mustering factual support for these claims." Schneider, 493 F.3d at 1177.
The Tenth Circuit has interpreted "plausibility," the term used by the Supreme Court in Twombly, to "refer to the scope of the allegations in a complaint" rather than to mean "likely to be true." Robbins v. Okla. ex rel. Okla. Dep't of Human Servs., 519 F.3d 1242, 1247 (10th Cir. 2008). Thus, "if [allegations] 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." Id. (internal quotations omitted). "The allegations must be enough that, if assumed to be true, the plaintiff plausibly (not just speculatively) has a claim for relief." Id. "This requirement of plausibility serves not only to weed out claims that do not (in the absence of additional allegations) have a reasonable prospect of success, but also to inform the defendants of the actual grounds of the claim against them." Id. at 1248. In addition, the Tenth Circuit has stated that "the degree of specificity necessary to establish plausibility and fair notice, and therefore the need to include sufficient factual allegations, depends on context," and that whether a defendant receives fair notice "depends on the type of case." Id.
The right to contribution is set forth in Okla. Stat. tit. 12, § 832 ("Section 832"), which provides:
To continue reading
Request your trial