Estate of Griego v. Reliance

• Decision Date: 01 February 2000
• Docket Number: No. 19,568.,19,568.
• Citation: 997 P.2d 150,128 N.M. 676
• Parties: ESTATE OF Jerome J. GRIEGO, By and Through Eleanor GRIEGO, Individually and as Personal Representative of the Estate of Jerome J. Griego, Plaintiffs-Appellants, v. RELIANCE STANDARD LIFE INSURANCE COMPANY, Defendant-Appellee.
• Court: Court of Appeals of New Mexico

997 P.2d 150

128 N.M. 676

ESTATE OF Jerome J. GRIEGO, By and Through Eleanor GRIEGO, Individually and as Personal Representative of the Estate of Jerome J. Griego, Plaintiffs-Appellants, v. RELIANCE STANDARD LIFE INSURANCE COMPANY, Defendant-Appellee.

No. 19,568.

Court of Appeals of New Mexico.

February 1, 2000.

Steve Vogel, Albuquerque, Steven C. Henry, Albuquerque, Steven L. Tucker, Tucker Law Firm, P.C., Santa Fe, for Appellants.

Carl J. Butkus, R. Galen Reimer, Butkus & Reimer, P.C., Albuquerque, for Appellee.

OPINION

PICKARD, Chief Judge.

{1} Eleanor Griego, individually and as personal representative of her deceased husband's estate, the Estate of Jerome J. Griego (Plaintiffs), filed suit against Reliance Standard Life Insurance Company (Reliance) for failing to convert Mr. Griego's group life insurance policy to an individual life insurance policy after he submitted a conversion application requesting Reliance to do so. The trial court dismissed Plaintiffs' suit after granting Reliance's motion for summary judgment on the grounds that Reliance had mailed Mr. Griego a notice to pay the premium, which he failed to pay. On appeal. Plaintiffs argue the trial court erred because (1) Reliance had a duty to inform Mr. Griego of the payment he had to remit in order to convert his insurance coverage and (2) Plaintiffs raised a factual issue as to whether Reliance breached its duty by presenting evidence that Mr. Griego did not receive a premium notice. Reliance argues the trial court did not err either on the duty issue or on the breach issue, but that even if it did, this Court cannot review its decision because Plaintiffs failed to timely file a notice of appeal. We take jurisdiction of this case and reverse.

BACKGROUND AND PROCEDURAL HISTORY

{2} Mr. Griego (Decedent) was employed by the City of Albuquerque (City) for a period of 25 years. As a City employee, Decedent was insured under a group life insurance policy (Policy) issued and maintained by Reliance. The City paid the policy premiums for Decedent while he was employed by the City.

{3} On July 1, 1993, Decedent retired from his employment with the City. As a covered City employee. Decedent had the right to convert (portate) the Policy to an individual policy upon his retirement. The Policy provided that in order for Decedent to portate his insurance coverage, he had to submit a written request within 31 days of his retirement. The Policy further provided that the effective date of conversion would be the thirty-first day following his retirement so long as "written request has been made [and] the premiums paid."

{4} Reliance distributed summaries of the Policy and its portability features to City employees like Decedent. One such policy summary provided that a covered employee like Decedent could portate his insurance by notifying Reliance "in writing within 31 days from the date [he retired] [and] . . . remit[ting] the necessary premiums when due.... [Emphasis added.]" That same summary stated the premiums would be "billed directly to [the insured] on a quarterly, semi-annual or annual basis. [Emphasis added.]"

{5} While Reliance distributed these summaries to inform City employees about their conversion rights under their group policies, it inserted a proviso into these materials that "[i]f a conflict exists between a statement in [these summaries] and any provision of the Policy, the Policy will govern." This proviso reflected the integrated nature of the Policy, which stated: "The entire contract. . . is the Policy, your application[,] . . . and any endorsements and amendments. . . ."

{6} Six days after he retired. Decedent filled out an application to portate his Policy. Reliance received Decedent's application on July 27, 1993. Reliance mailed Decedent an uncertified letter acknowledging receipt of his application on September 2, 1993. There is evidence that seven days later, Reliance mailed Decedent a letter advising him that in order to portate his Policy, he had to remit a premium payment in the amount of $44.72 by October 11, 1993. Plaintiffs deny that Decedent ever received that letter. According to that same letter, if Decedent did not remit payment by October 11. Reliance would close his file and "there [would be] no coverage in force."

{7} In January 1994, Decedent was hospitalized and was seriously ill for several months afterwards. On April 2, 1994, Decedent died. A few days later, Mrs. Griego filed a claim with Reliance for benefits as the sole beneficiary under her husband's Policy. Reliance denied her claim on the grounds that Decedent had failed to remit a premium payment.

{8} Plaintiffs filed suit, seeking damages from Reliance based on claims of breach of contract, insurance bad faith, violation of the New Mexico Unfair Practices Act, and negligence. In June 1997, Reliance filed the first of two motions for summary judgment. In September 1997, Plaintiffs filed the first of two motions to amend their complaint. The trial court heard Reliance's first motion for summary judgment on October 27, 1997. At the conclusion of the hearing, the trial court took Reliance's motion under advisement.

{9} On the following day, the trial court sent a letter ruling to the parties' attorneys in which it indicated it was going to grant Reliance's motion for summary judgment. The trial court directed Reliance to prepare the summary judgment order. The basis for the trial court's ruling was that due to Decedent's failure to remit a premium payment, "no new policy ever existed."

{10} In November 1997, Plaintiffs filed their second motion to amend their complaint. Plaintiffs asked the trial court to hear their motion to amend before entering the proposed summary judgment order Reliance had prepared. Plaintiffs made this request "to ensure that the [c]ourt has jurisdiction. . . regarding whether a life insurance policy existed." On January 23, 1998, the trial court entered an order granting Plaintiffs' motion, and, on the same day, Plaintiffs filed their first amended complaint.

{11} On February 26, 1998, the trial court entered its "Order on Defendant Reliance Standard Life Insurance Company's Motion for Summary Judgment." The next day, Reliance filed an amended answer to Plaintiffs' first amended complaint. In March 1998, Reliance filed its motion for summary judgment "as to Plaintiff's [sic] First Amended Complaint." Reliance argued, among other things, that the trial court's February 26 summary judgment order was res judicata on the claims raised in Plaintiffs' first amended complaint.

{12} In May 1998, the trial court heard Reliance's second motion for summary' judgment. At the hearing's conclusion, the trial court announced it would grant Reliance's motion. On May 19, 1998, the trial court entered its "Order on Defendant Reliance Standard Life Insurance Company's Second Motion for Summary Judgment." On June 17, 1998, Plaintiffs filed their Notice of Appeal from the trial court's May order.

DISCUSSION

I. JURISDICTION

{13} Reliance claims this Court lacks jurisdiction over this appeal because Plaintiffs failed to timely appeal the trial court's first order of summary judgment. An order must be final to be appealable. See Kelly Inn No. 102, Inc. v. Kapnison, 113 N.M. 231, 238, 824 P.2d 1033, 1040 (1992)

. An order is not considered final unless all issues of law and fact have been determined and the case disposed of by the trial court to the fullest extent possible. See Executive Sports Club, Inc. v. First Plaza Trust, 1998-NMSC-008, ¶ 5, 125 N.M. 78, 957 P.2d 63. The trial court entered its first summary judgment order on February 26, 1998. Reliance asserts that Plaintiffs had thirty days within which to appeal this order. Plaintiffs did not file a notice of appeal, however, until June 17, 1998. Reliance thus argues Plaintiffs' appeal is untimely.

{14} On February 26, the trial court effectively had two complaints before it—Plaintiffs' original complaint and Plaintiffs' amended complaint. In its February order, the trial court expressly granted Reliance's motion for summary judgment that had "come before [it] for hearing on October 27, 1997." Reliance's October motion pertained solely to Plaintiffs' original complaint as it was the only complaint Plaintiffs had pending before the trial court at that time. The trial court's order did not grant, nor could it have granted. Reliance's as yet nonexistent second motion for summary judgment on Plaintiffs' first amended complaint. The trial court's order did not address all issues of law and fact before it nor did it dispose of Plaintiffs' first amended complaint to the fullest extent possible. See id. Therefore we hold the trial court's February order was not a final order.

{15} Our holding is not disturbed by Reliance's argument that because Plaintiffs' amended complaint superseded its original complaint, the trial court's February order, which was entered after Plaintiffs filed their amended complaint, must be deemed a final order. While we do not disagree with Reliance's assertion that Plaintiffs' original complaint became a legal nullity when they filed their amended complaint, we do not see how that fact alters our conclusion. But see Klasner v. Klasner, 23 N.M. 627, 630, 170 P. 745, 746 ("[T]he amended complaint . . . supersedes and supplants the original complaint."). If Plaintiffs' original complaint is a nullity, then the trial court's order must also be a nullity because it expressly granted Reliance's summary judgment motion only insofar as it pertained to Plaintiffs' original complaint. The trial court's only viable summary judgment order is its May 19, 1998, order, from which Plaintiffs timely appealed on June 17, 1998.

II. DUTY TO NOTIFY

{16} The trial court granted Reliance's second motion for summary judgment pertaining to the first amended complaint on the grounds that Decedent failed to remit a premium payment and thus failed to portate his Policy. While Plaint...