BEERS v. HILLORY

• Citation: 2010 OK CIV APP 99,241 P.3d 285
• Decision Date: 09 September 2010
• Docket Number: 411. Released for Publication by Order of the Court of Civil Appeals of Oklahoma,Division No. 2.,No. 107,107
• Parties: George Allen BEERS, Plaintiff/Appellant, v. Dorothy HILLORY, Defendant, and Northland Insurance Company, a Minnesota corporation, Defendant/Appellee.
• Court: United States State Court of Criminal Appeals of Oklahoma. Court of Civil Appeals of Oklahoma

241 P.3d 285

2010 OK CIV APP 99

George Allen BEERS, Plaintiff/Appellant,

v. Dorothy HILLORY, Defendant,andNorthland Insurance Company, a Minnesota corporation, Defendant/Appellee.

No. 107,411. Released for Publication by Order of the Court of Civil Appeals of Oklahoma, Division No. 2.

Court of Civil Appeals of Oklahoma,Division No. 2.

Sept. 9, 2010.

COPYRIGHT MATERIAL OMITTED.

Appeal from the District Court of Okmulgee County, Oklahoma; Honorable Duane Woodliff, Trial Judge.

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED FOR FURTHER PROCEEDINGS.

Michael Green, Tulsa, OK, for Plaintiff/Appellant.

D. Lynn Babb, Oklahoma City, OK, for Defendants/Appellees.

JOHN F. FISCHER, Presiding Judge.

[1] ¶ 1 George Allen Beers appeals the district court's order granting his automobile insurance carrier Northland Insurance Company's motion for summary judgment. Beers sued NIC, claiming that NIC breached the insurance contract and its duty of good faith and fair dealing by unreasonably delaying payment of his claim for uninsured motorist (UM) benefits. ¹ Although the district court correctly disposed of some aspects of Beers's claim, we find that disputed issues of material fact exist with respect to other aspects of that claim, precluding summary judgment.

BACKGROUND

I. Pre-Litigation

¶ 2 On March 6, 2006, Beers was involved in an automobile accident with defendant Dorothy Hillory. Beers sustained injuries in the accident and subsequently underwent back surgery. On April 13, 2006, attorney Michael Green sent a letter to NIC advising that he had been retained by Beers to pursue recovery for his injuries as a result of the accident. Green requested certain information regarding UM coverage and NIC's investigation of the accident. The letter also advised: “This office has been assigned a portion of any recovery for professional services rendered.”

¶ 3 On April 17, 2006, NIC issued a $5,000 check, the policy limit for Beers's medical benefit coverage. The check was made payable to Beers and Green. Neither objected. On or about May 11, 2006, NIC assigned the Beers claim to its adjuster Jacqueline Adamson, who worked in NIC's office in St. Paul, Minnesota. In reviewing the claim file to date, Adamson noted that there did not appear to be a complete set of Beers's medical bills and medical records. She also noted that Beers had suffered from a back condition that pre-existed the accident. On May 31, 2006, Adamson asked Green to provide a signed medical authorization from Beers so that she could obtain records from Beers's primary care physician and a more complete set of records of his post-accident medical treatment.

¶ 4 By letter dated October 31, 2006, Green advised Adamson that Hillory's insurance carrier had offered Beers the $50,000 liability limit of Hillory's policy. In this letter, Green referred Adamson to 36 O.S. Supp.2004 § 3636, which provides that a UM insurer, on receipt of its insured's notice of settlement with the tortfeasor, has 60 days to either substitute its payment for that of the liability insurer or waive its subrogation rights. ² When Adamson received this letter from Green on November 9, she had documented medical expenses in her file of approximately $10,000.

¶ 5 Adamson contacted Green's office by telephone to request a copy of the declarations page of Hillory's insurance policy to verify her liability limit. In that conversation, she also repeated her request for the signed medical authorization and medical provider information. Adamson testified at her deposition that, during the phone call on November 3, 2006, Green's legal assistant had assured her that she would be sending the tender letter, the results of the asset check on Hillory, and “the information I had been requesting since May of 2006 with medical authorizations and medical providers listed so that I could obtain all of the information to fully evaluate Mr. Beers's injury and condition prior to the March 1, 2006 accident and verify what injuries he has sustained as a result of [that] accident.” ³

¶ 6 On November 7, 2006, Adamson received a copy of an asset check on Hillory sent by fax from Green's legal assistant. On December 15, Adamson received the liability limit verification by fax, and on December 19, Green's legal assistant faxed Adamson an updated summary of medical expenses incurred by Beers. On the following day, December 20, 2006, Adamson wrote to Green: “Please be advised that we will not be substituting payment and we waive subrogation rights against Mrs. Hillory. Kindly provide me with the previously requested information so we can evaluate your client's claim.”

¶ 7 In his October 2006 letter notifying Adamson of the offer of the tortfeasor's liability limit, Green stated that he previously had supplied Adamson with a signed medical authorization. The record indicates that Green had delegated this task, along with several others, to his legal assistant. Beers would later state in an affidavit, however, that “NIC did not send to me a medical authorization to sign.”

¶ 8 Green's legal assistant wrote a letter to Adamson on January 31, 2007, wherein she stated:

I have previously forwarded to you medical bills and records for the treatment received by George for the injuries in [ sic ] sustained in the accident.... His medical bills are in excess of $100,000.00, the total coverage available.... Please advise as to the status of your completion of the evaluation of George's UM claim.

In a letter dated March 8, 2007, attorney Green advised Adamson that Beers had been released from treatment by his surgeon. Green requested that Adamson contact his legal assistant regarding completion of NIC's investigation of Beers's UM claim. In his next letter to Adamson on April 16, Green requested that she contact the legal assistant within the next week or “we will otherwise be forced to file a Petition for bad faith against [NIC] due to your lack of communication.”

¶ 9 Although Adamson still had not received all of the medical information she requested to fully evaluate the UM claim, and/or a signed authorization to obtain Beers's medical records, she made what she described as a “business decision” to give Beers “the benefit of the doubt” that all of his $100,000 medical expense claim resulted from the automobile accident. Adamson determined, on March 9, 2007, that it would be “a prudent course of action” to extend the UM policy limits to Beers. Before communicating the offer to Green, Adamson contacted NIC's counsel for advice regarding handling of medical liens and seeking a release from Beers. While awaiting response from NIC's counsel, Adamson continued her work on other aspects of Beers's accident claim including speaking with the liability carrier's adjuster regarding the incomplete documentation of Beers's commercial vehicle “downtime” loss.

¶ 10 In a letter dated May 18, 2007, Adamson sent a letter to attorney Green, offering to settle, for the $50,000 policy limit, “any and all UIM claims, including all liens and subrogation interests.” Included with the letter was a document entitled “Release and Defense, Indemnity and Hold Harmless Agreement” (Release) to be signed by both Beers and Green. Regarding the Release, Adamson wrote to Green:

If your client is agreeable to this settlement, a draft release is enclosed. Please have the release properly executed (dated, signed and notarized) and return the original release to me along with your firm's tax identification information. Upon receipt of the original release, I will issue the settlement draft.

¶ 11 The Release generated further correspondence between Adamson and Green. On May 21, 2007, Green responded advising Adamson: “I will not agree to sign the release and indemnity agreement. Please forward a Release of All Claims to my office for George's [Beers's] signature only.” Adamson's reply, dated June 12, 2007, acknowledged Green's refusal to sign the Release. Adamson instead requested “documentation establishing that all of the medical providers' liens have been satisfied and released.”

¶ 12 In a letter dated June 15, 2007, attorney Green advised Adamson: “The medical providers have not been paid. Please list as payees George Beers, Michael R. Green (my tax ID # is ...) and all lienholders on the check for your policy limits and forward to our office with the release of all claims immediately.” On June 20, Green sent a letter “Via Fax” to Adamson, again requesting a release that did not require his signature. Green concluded this letter by stating: “If I do not receive the new Release by June 27, 2007, then we will pursue all available legal remedies.” Adamson's response to Green, sent “Via Fax” on July 2, included the following:

We previously requested information about lienholders. I refer you to our prior requests to provide:

A list of medical providers (name and address) who provided treatment to claimant for the accident.

A copy of all bills for claimant's medical care and expenses.

An accounting of all payments made to or on behalf of claimant for medical, wage or any other expenses incurred relating to the accident, including the amount paid, the name and address of the party making payment, the name and address of the party to whom payment was made.

This information has still not been provided.

Please either provide the above information; or a list of each medical provider which provided treatment to Mr. Beers for which bills are unpaid and/or liens exist. ⁴

¶ 13 On the same day that he received Adamson's faxed request, Green replied to Adamson, repeating that “the lienholders have not been paid.” Green again requested a check made payable to Beers and himself, as counsel, but this time he specified five medical providers to be added as payees on the check.

¶ 14 On July 11, 2007, Adamson sent a revised release and hold harmless document to Green that did not require his signature but only that of Beers. Green did not return...