Dumont v. Saskatchewan Government Ins.
| Citation | 258 F.3d 880 |
| Decision Date | 11 June 2001 |
| Docket Number | No. 00-3599,00-3599 |
| Parties | (8th Cir. 2001) PAUL ARI CHARLES JOSEPH DUMONT; YOLANDA JANE CAMPBELL; JACQUELINE THERESA MARIE DIZY; BRENDA LYNNE WALTERS; MICHELLE SHARON GOEBEL; DAVID GEORGE SMITH; SUSAN MYVOLL, Plaintiffs - Appellants, v. SASKATCHEWAN GOVERNMENT INSURANCE (SGI), Defendant - Appellee. Submitted: |
| Court | United States Courts of Appeals. United States Court of Appeals (8th Circuit) |
Appeal from the United States District Court for the District of North Dakota
Before WOLLMAN, Chief Judge, HAMILTON1 and MURPHY, Circuit Judges. HAMILTON, Circuit Judge:
The present civil action involves an insurance coverage dispute between Saskatchewan Government Insurance (SGI), a Canadian Crown corporation, and the seven surviving adult children (the Dumont/Smith Families)2 of three Canadian citizens killed in a fiery automobile accident in North Dakota caused by a head-on collision with a grossly intoxicated driver. The Dumont/Smith Families initiated the action.
Based upon mandatory arbitration clauses contained in the two identical insurance policies at issue, the district court3 ordered the parties to arbitrate their dispute in the Province of Saskatchewan, Canada. The parties proceeded to arbitration as ordered by the district court, with the Dumont/Smith Families preserving their objection to the ordered arbitration. The Canadian arbitration panel issued a decision in favor of SGI, which the Queen's Bench of Regina, Saskatchewan, Canada approved by entry of a Canadian judgment in favor of SGI. Upon motion by SGI, the district court dismissed the present action based upon the doctrine of res judicata. The Dumont/Smith Families noted a timely appeal. We affirm.
On August 6, 1994, a vehicle driven by North Dakota resident Lisa Ward crossed the centerline of Highway 1804 in Williams County, North Dakota, at a high rate of speed, and collided head-on with a Canadian vehicle occupied by Canadian citizens Ernest Smith, his wife Helen Smith, and Mary Dumont. Upon impact, the Canadian vehicle burst into flames that consumed the vehicle and the three Canadian citizens. Both Lisa Ward and the single passenger in her vehicle also lost their lives in the accident. At the time of the accident, Lisa Ward did not have automobile liability insurance, did not have a driver's license, and was grossly intoxicated.
Ernest and Helen Smith were named insureds under an automobile liability insurance policy issued by SGI.4 Mary Dumont was the named insured under an identical automobile liability insurance policy also issued by SGI. For the remainder of this opinion, we will refer collectively to these identical insurance policies as "the Policies."
Each of the Policies provided one million Canadian dollars in automobile liability coverage and one million Canadian dollars in family security coverage. The Policies also provided that the named insured had coverage while his or her vehicle was in Canada or the United States. With respect to extra-territorial coverage and under the part of the Policies entitled "Liability," the Policies provided as follows:
We recognize that laws and other rules differ from place to place. Because of this we will raise your amount of coverage to meet the minimum coverage required by local law in the place where the accident took place. And if necessary we will change your coverage to meet local law in the place where the accident took place.
(J.A. 137).
Under the parts of the Policies entitled "Injury Payments," the Policies provided uninsured motorist coverage (the Uninsured Motorist Coverage portions of the Policies). In this regard, the Policies specified that if the insured was injured or died in an accident caused by an uninsured motorist in a place without a plan that deals with injury or death caused by an uninsured motorist, the insured "may collect from [SGI]." (J.A. 132). The very next sentence states: "We will act as if we covered the other motor vehicle." Id.
The Policies required arbitration of disputes between the insured and SGI regarding whether the insured is entitled to payment of any amount under the Uninsured Motorist Coverage portions of the Policies, and if so, the amount of such payment. The Policies required that the "provisions of The Arbitration Act (Saskatchewan) shall apply to the arbitration," but did not specify the substantive law that should apply. (J.A. 133).
Under the parts of the Policies entitled "Family Security," the Policies provided family security coverage (the Family Security Coverage portions of the Policies). Under the Policies, family security coverage allows "anyone who, under Saskatchewan law, would have the right to bring an action against the [Uninsured] Motorist, if the accident had happened in Saskatchewan, for damages because of" the insured's bodily injury or death, to recover an amount (not to exceed one million Canadian dollars) equal to the uninsured motorist's liability in such an action. (J.A. 139). The Policies specified the procedure a claimant under the Family Security Coverage Portions of the Policies must follow when the accident, caused by an uninsured motorist, occurred outside Saskatchewan, Canada. First, the claimant "shall bring an action to judgment against the alleged" uninsured motorist. (J.A. 141). The judgment will bind SGI with respect to the issue of the uninsured motorist's liability, but not with respect to the amount of damages the claimant is found legally entitled to recover from the alleged uninsured motorist. If the claimant and SGI cannot agree upon whether any amount is due under the Family Security Coverage portions of the Policies or what the amount of any such payment should be, the Policies provide that "either or both of these issues shall be determined by arbitration," with "[t]he question of an appropriate dollar amount of compensation" to be determined under the law of Saskatchewan and matters of procedure to be governed by "[t]he Arbitration Act (Saskatchewan)." Id. Notably, the Fatal Accidents Act of Saskatchewan, R.S.S. 1978, c. F-11, limits the recovery of damages of adult children in parental wrongful death actions to pecuniary losses.
Approximately one year after the accident, pursuant to North Dakota Century Code § 32-21-01, the Dumont/Smith Families brought a wrongful death action, in North Dakota state court, against the estate of Lisa Ward. The action sought compensation for economic losses (e.g., burial costs), as well as compensation for pain and suffering and loss of society, counsel, and companionship. See N.D. Cent. Code § 32-03.2-04 ().
Following a two-day bench trial, the North Dakota state court found Lisa Ward was the sole proximate cause of the deaths of Ernest Smith, Helen Smith, and Mary Dumont. The North Dakota state court thereafter entered judgment in favor of the Dumont/Smith Families totaling 2,075,000 in United States dollars plus 75,091 in Canadian dollars.
Although the Dumont/Smith Families repeatedly requested that SGI participate in the state court action, SGI refused. Instead, SGI informed the Dumont/Smith Families that it waived the Policies' respective requirements that the family members obtain a judgment against the estate of Lisa Ward before filing a claim for payment under the Family Security Coverage portions of the Policies. However, SGI insisted that the amounts payable the Dumont/Smith Families under the Policies be determined by arbitration in Canada, under the law of Saskatchewan, as specifically required by the Policies.
On June 19, 1996, the Dumont/Smith Families filed the present action against SGI in state court, in Williams County, North Dakota.5 The complaint sought compensatory damages under the Policies sufficient to satisfy the judgment against the estate of Lisa Ward. The complaint also sought punitive damages to sanction SGI for its alleged bad faith in refusing to settle.
SGI subsequently removed the action to the United States District Court for the District of North Dakota on the basis of diversity jurisdiction. The district court accepted removal based on diversity jurisdiction pursuant to 28 U.S.C. § 1332(a).6 Prior to SGI answering the complaint, the Dumont/Smith Families filed a motion for partial summary judgment to determine SGI's liability to be bound by the judgment entered in the state wrongful death action. SGI filed its answer and moved to dismiss the complaint for lack of personal jurisdiction and on the basis of forum non conveniens.
On April 3, 1996, the district court: (1) denied SGI's motion to dismiss for lack of personal jurisdiction; (2) denied the Dumont/Smith Families' motion for partial summary judgment; (3) ordered the parties to participate in binding arbitration in accordance with the terms of the Policies; (4) denied, as moot, SGI's motion to dismiss on the basis of forum non conveniens; and (5) stayed all further proceedings in the matter pending completion of arbitration. The Dumont/Smith Families filed a motion for reconsideration, pursuant to Federal Rule of Civil Procedure 60(b), which the district court denied. The district court also denied a motion by the Dumont/Smith Families requesting the district court: (1) to order SGI to submit to arbitration under the supervision, authority, and jurisdiction of the district court and the United States Federal Arbitration Act; and (2) to order the arbitration to proceed under North Dakota procedural law.
The parties proceeded to arbitration before a three-member arbitration panel in Regina, Saskatchewan, Canada....
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