Arnold v. Farmers Ins. Co. of Arizona, CIV 09–0330 JB/WDS.

• Decision Date: 29 September 2011
• Docket Number: No. CIV 09–0330 JB/WDS.,CIV 09–0330 JB/WDS.
• Citation: 827 F.Supp.2d 1289
• Parties: Harold ARNOLD, for himself and all others similarly situated, Jimmy Jaramillo, for himself and all others similarly situated, Gary Wise, for himself and all others similarly situated, Plaintiffs, v. FARMERS INSURANCE COMPANY OF ARIZONA, an Arizona corporation; Farmers Group, Inc., a Nevada corporation, Defendants.
• Court: U.S. District Court — District of New Mexico

827 F.Supp.2d 1289

Harold ARNOLD, for himself and all others similarly situated, Jimmy Jaramillo, for himself and all others similarly situated, Gary Wise, for himself and all others similarly situated, Plaintiffs,

v.FARMERS INSURANCE COMPANY OF ARIZONA, an Arizona corporation; Farmers Group, Inc., a Nevada corporation, Defendants.

No. CIV 09–0330 JB/WDS.

United States District Court, D. New Mexico.

Sept. 29, 2011.

Matthew L. Garcia, Bach & Garcia, LLC, and Geoffrey R. Romero, Law Offices of Geoffrey R. Romero, Albuquerque, NM, for the Plaintiffs.

Ross L. Crown, Lewis and Roca, LLP, Albuquerque, NM, and Steven J. Hulsman, Emily Cates, Lewis and Roca, LLP, Phoenix, AZ, for the Defendants.

MEMORANDUM OPINION AND ORDER

JAMES O. BROWNING, District Judge.

THIS MATTER comes before the Court on the Plaintiffs' Motion for Reconsideration of Order Granting Summary Judgment, for Relief from Judgment, or to Alter or Amend the Judgment, and Request for Certification to the Supreme Court of New Mexico, filed December 9, 2010 (Doc. 101)(“Motion for Reconsideration”). The Court held a hearing on July 26, 2011. The primary issues are whether: (i) the Plaintiffs have presented controlling precedent to demonstrate that the Court clearly erred in declining to interpret the New Mexico Uninsured Motorist Act, NMSA 1978, § 66–5–301A, (“UMA”) to require coverage for loss of use; (ii) the Court should certify the underlying issues in the case to the Supreme Court of New Mexico; and (iii) whether the Court erred in deciding that, as a matter of law, the UMA does not provide coverage for theft of the Plaintiffs' personal property. Because the Plaintiffs' request for certification to the Supreme Court of New Mexico was made in the alternative, and because certification on issues would not be appropriate after the Court has rendered judgment in favor of the Defendants, the Court will deny the untimely request to certify the issue. Because the Court is persuaded, after carefully reviewing the Supreme Court of New Mexico's opinions, that New Mexico's highest court would, if the issues were presented to it, hold that the UMA provides coverage for loss of use, the Court will reconsider that portion of its Memorandum Opinion and Order, filed November 12, 2010, 760 F.Supp.2d 1272 (D.N.M.2010) (Doc. 99)(“MOO”).

Because the Court remains confident, however, that the Supreme Court of New Mexico would support the Court's alternative holding that New Mexico courts would not award loss-of-use damages for theft of property because there has been no accompanying physical damage to the property, summary judgment in favor of the Defendant remains appropriate on the alternative grounds the Court discussed in its opinion. Thus, the Court will not reconsider the alternative grounds on which it granted summary judgment in favor of the Defendant and will not set aside its final judgment.

PROCEDURAL BACKGROUND

On April 2, 2010, the Plaintiffs filed their Motion for Summary Judgment Declaring Uninsured Motorist Property Damage Coverage Is Applicable to the Plaintiffs' Losses. See (Doc. 57). On April 28, 2010, the Defendants filed their Opposition to Plaintiffs' Motion for Summary Judgment and Cross–Motion for Summary Judgment. See (Doc. 63). The Plaintiffs in their motion asked the Court to declare that uninsured motorist property damage coverage applies to the Plaintiffs' losses. On August 17, 2010, the Court held a hearing on the two motions.

In its fifty-three page MOO, the Court concluded:

[T]he phrase “injury to or destruction of property” in the UMA does not require coverage for loss of use, because the New Mexico Legislature's omission of loss of use language in the UMA indicates that the Legislature intended the omission, and even though New Mexico courts liberally construe the UMA, the Court declines to disregard the statute's plain language.

MOO at 2. Because the Court found that the UMA does not require coverage for the Plaintiffs' loss-of-use claims for its stolen property because there is no accompanying physical damage, the Court granted summary judgment on all claims in the Defendants' favor. See MOO at 52. The Court then entered final judgment. See Final Judgment, filed November 12, 2010 (Doc. 100).

On December 9, 2010, the Plaintiffs filed their Motion for Reconsideration under rules 59 and 60 of the Federal Rules of Civil Procedure. See Motion for Reconsideration. They contend that the Court's ruling “is a significant departure from decades of New Mexico jurisprudence.” Motion for Reconsideration at 3. Specifically, they point to the consistent expression of policy concerns in New Mexico cases promoting a liberal interpretation of the UMA. See Motion for Reconsideration at 3. They also point to some recent New Mexico cases on the issue as well as some dicta from a Court of Appeals of New Mexico opinion, Montano v. Allstate, 135 N.M. 681, 92 P.3d 1255 (Ct.App.2004), rev'd on other grounds, 135 N.M. 681, 92 P.3d 1255, suggesting that loss-of-use damages may be available under the UMA. See Motion for Reconsideration at 5. The Plaintiffs alternatively request that the Court withdraw its MOO and corresponding final judgment, and certify the questions presented for review to the Supreme Court of New Mexico. See Motion for Reconsideration at 15–16.

On January 26, 2011, the Defendants filed their Opposition to Plaintiffs' Motion for Reconsideration/Alter or Amend and Plaintiffs' Request for Certification to the Supreme Court of New Mexico. See (Doc. 106)(“Response”). In their response, the Defendants emphasize that granting a motion for reconsideration would not be proper under these circumstances. See Response at 3. The Defendants contend that the Court has already thoroughly addressed the issues in the case, and that any additional authority the Plaintiffs cite does not justify the Court reconsidering its decision. See Motion for Reconsideration at 4–9. Additionally, the Defendants argue that certification to the Supreme Court of New Mexico is not appropriate given that the Court has already decided these issues. See Response at 10–12.

At the hearing, the Plaintiffs argued that New Mexico state courts consistently construe the UMA liberally. See Transcript of Hearing at 3:8–13 (taken July 26, 2011)(“Tr.”)(Romero).¹ The Plaintiffs emphasized that this Court looked at restrictive terms from other statutory schemes for insurance coverage and in doing so did not properly interpret the UMA. See Tr. at 5:4–10 (Romero). They stated that the Court authored an opinion that for the first time defines UMA coverage more narrowly than Mandatory Financial Responsibility Act (“MFRA”) coverage. See Tr. at 7:1–8 (Romero). The Court and the Plaintiffs engaged in a dialogue about how helpful the Court of Appeals of New Mexico decision in Montano v. Allstate would be in deciding this issue. See Tr. at 11:16–12:16 (Court, Romero). The Plaintiffs then argued that certification to the Supreme Court of New Mexico is in the interests of judicial economy. See Tr. at 13:5–13 (Romero). The Plaintiffs also contended that the Court's analysis in its alternative holding was incorrect, because “[t]he uninsured motorist act does not use the term ‘property damage.’ It uses the terms ‘injury to property or destruction thereof.... [Under Clark v. Cassetty, 71 N.M. 89, 376 P.2d 37 (1962) ], injury means damage to a property interest or infringement of an interest.’ ” Tr. at 5:17–24 (Romero).

The Defendants emphasized at the hearing that a motion for reconsideration is not a proper way to address this issue given the Court's thorough opinion and the thorough briefing on these issues already. See Tr. 15:16–25 (Hulsman). The Defendants then argued that Montano v. Allstate does not provide much help in deciding these issues. See Tr. at 16:7–17:15, 18:5–19:20 (Court, Hulsman). In a subsequent letter to the Court, the Defendants point out that, the “Plaintiffs' loss of use theory involves only injury to the insured, with Plaintiffs conceding that the theft did not injure their property at all.” Letter to the Court at 2, filed August 11, 2011 (Doc. 112)(“Aug. 11, 2011 Letter”).

LAW REGARDING MOTIONS TO RECONSIDER UNDER RULES 59(e) AND 60 ²

The United States Court of Appeals for the Tenth Circuit has recognized:

Generally, a “motion for reconsideration, not recognized by the Federal Rules of Civil Procedure, Clough v. Rush, 959 F.2d 182, 186 n. 4 (10th Cir.1992), may be construed in one of two ways: if filed within 10 days of the district court's entry of judgment, it is treated as a motion to alter or amend the judgment under Rule 59(e); if filed more than 10 days after entry of judgment, it is treated as a motion for relief from judgment under Rule 60(b).” Computerized Thermal Imaging, Inc. v. Bloomberg, L.P., 312 F.3d 1292, 1296 n. 3 (10th Cir.2002).

Price v. Philpot, 420 F.3d 1158, 1167 n. 9 (10th Cir.2005). The time limit in rule 59(e) is now twenty-eight days rather than ten days. See Fed.R.Civ.P. 59(e). A motion for reconsideration is an “inappropriate vehicle[ ] to reargue an issue previously addressed by the court when the motion merely advances new arguments, or supporting facts which were available at the time of the original motion.” Servants of Paraclete v. Does, 204 F.3d 1005, 1012 (10th Cir.2000). “Grounds warranting a motion to reconsider include (1) an intervening change in the controlling law, (2) new evidence previously unavailable, and (3) the need to correct clear error or prevent manifest injustice.” Servants of Paraclete v. Does, 204 F.3d at 1012. “Thus, a motion for reconsideration is appropriate where the court has misapprehended the facts, a party's position, or the controlling law.” Servants of Paraclete v. Does, 204 F.3d at 1012 (citation omitted). A district court has considerable discretion in ruling on a motion to reconsider. See Phelps v. Hamilton, 122 F.3d 1309, 1324 (10th Cir.1997).

Rule 60 more generally authorizes a district court to “[o...