Golchin v. Liberty Mut. Ins. Co..

• Decision Date: 25 July 2011
• Docket Number: SJC–10794.
• Citation: 460 Mass. 222,950 N.E.2d 853
• Parties: Diane GOLCHINv.LIBERTY MUTUAL INSURANCE COMPANY.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

460 Mass. 222

950 N.E.2d 853

Diane GOLCHIN

v.LIBERTY MUTUAL INSURANCE COMPANY.

SJC–10794.

Supreme Judicial Court of Massachusetts, Worcester.

Submitted April 7, 2011.Decided July 25, 2011.

Kenneth D. Quat, Cambridge (Elliot Beresen, Framingham, with him) for the plaintiff.Myles W. McDonough (Christopher M. Reilly with him), Boston, for the defendant.Kimberly E. Winter, Weston, J. Michael Conley, Braintree, & Michael C. Najjar, Lowell, for Massachusetts Academy of Trial Attorneys, amicus curiae, submitted a brief.E. Michael Sloman, for Automobile Insurers Bureau, amicus curiae, submitted a brief.Present: IRELAND, C.J., SPINA, BOTSFORD, GANTS, & DUFFLY, JJ.SPINA, J.

In this proceeding we consider whether a claimant may seek medical expense benefits under the “medical payments” coverage (MedPay) of a standard Massachusetts automobile insurance policy (auto policy) where she has already recovered for those expenses under a separate policy of health insurance. Diane Golchin filed suit against Liberty Mutual Insurance Company (Liberty Mutual), both personally and on behalf of a putative class of similarly situated individuals, alleging that the company's failure to disburse MedPay benefits to her constituted a breach of contract, a breach of an implied covenant of good faith and fair dealing, and a violation of G.L. c. 93A, § 2. Liberty Mutual successfully moved to dismiss the complaint on the ground that Golchin is not entitled to MedPay benefits and that she has therefore failed to allege facts plausibly suggesting that she is entitled to relief. The Appeals Court affirmed in an unpublished memorandum and order pursuant to its rule 1:28. Golchin v. Liberty Mut. Ins. Co., 76 Mass.App.Ct. 1119, 923 N.E.2d 122 (2010). We granted Golchin's application for further appellate review. For the reasons set forth herein, we reverse the order allowing the motion to dismiss.

1. Standard of review. The motion judge dismissed Golchin's complaint pursuant to Mass. R. Civ. P. 12(b)(6), 365 Mass. 754 (1974), for failure to state a claim on which relief can be granted. In reviewing the sufficiency of a complaint under rule 12(b)(6), “[w]e take as true ‘the allegations of the complaint, as well as such inferences as may be drawn therefrom in the plaintiff's favor....’ Blank v. Chelmsford Ob/Gyn, P.C., 420 Mass. 404, 407

[649 N.E.2d 1102]

(1995).” Marram v. Kobrick Offshore Fund, Ltd., 442 Mass. 43, 45, 809 N.E.2d 1017 (2004), quoting Warner–Lambert Co. v. Execuquest Corp., 427 Mass. 46, 47, 691 N.E.2d 545 (1998). “What is required at the pleading stage are factual ‘allegations plausibly suggesting (not merely consistent with)’ an entitlement to relief....” Iannacchino v. Ford Motor Co., 451 Mass. 623, 636, 888 N.E.2d 879 (2008), quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). “Factual allegations must be enough to raise a right to relief above the speculative level ... [based] on the assumption that all the allegations in the complaint are true (even if doubtful in fact)....” Iannacchino v. Ford Motor Co., supra at 636, 888 N.E.2d 879, quoting Bell Atl. Corp. v. Twombly, supra at 555, 127 S.Ct. 1955.

As a result of imprecise pleading, however, it is not immediately clear that this is the proper standard of review. The motion judge ruled on what Liberty Mutual captioned as “Defendant, Liberty Mutual Insurance Company's, Motion to Dismiss Plaintiff's Complaint.” In that motion, however, Liberty Mutual asserts at least one fact—that Golchin refused to provide Liberty Mutual with a copy of her health insurance policy—that does not appear on the face of the pleading. In addition, Liberty Mutual attached to the motion a number of documents that are not contained in the pleadings, including a copy of the auto policy, Golchin's G.L. c. 93A demand letter, and Liberty Mutual's written response.

Liberty Mutual's motion can be interpreted only as a motion to dismiss Golchin's complaint pursuant to rule 12(b)(6), for failure to state a claim on which relief can be granted. However, under rule 12(b), “[i]f, on any motion asserting the defense numbered (6), ... matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment” rather than as one to dismiss. See J.W. Smith & H.B. Zobel, Rules Practice § 12.7, at 199 (2d ed. 2006). Conversion of the motion into one for summary judgment may therefore have been appropriate because Liberty Mutual's motion relies on facts and documents outside the complaint that were not excluded by the motion judge.¹

Conversion, however, is not an absolute requirement because “[w]here ... the plaintiff had notice of [the extrinsic] documents and relied on them in framing the complaint, the attachment of such documents to a motion to dismiss does not convert the motion to one for summary judgment....” Marram v. Kobrick Offshore Fund, Ltd., supra at 45 n. 4, 809 N.E.2d 1017. See J.W. Smith & H.B. Zobel, Rules Practice, supra at § 12.15, at 216. The standard Massachusetts auto policy attached by Liberty Mutual to its motion clearly falls within this category. See Marram v. Kobrick Offshore Fund, Ltd., supra. Further, the G.L. c. 93A demand letter and Liberty Mutual's response obviously were available to Golchin before she brought this action and were necessarily relied on by her in drafting the complaint. See id. It was thus unnecessary to convert Liberty Mutual's motion from one to dismiss under rule 12(b) into one for summary judgment under Mass. R. Civ. P. 56, as amended, 436 Mass. 1404 (2002). Accordingly, we apply the standard of review laid out above.

2. Facts. Considering that this is an appeal from a motion to dismiss, we summarize the pertinent facts alleged in the complaint ²:

On September 14, 2006, Golchin was involved in a motor vehicle accident while she was an occupant of her husband's car. The car was insured under a Massachusetts auto policy issued by Liberty Mutual that included optional MedPay benefits of up to $25,000. Golchin sustained significant personal injuries and, as a result of those injuries, incurred medical expenses in excess of $100,000. At the time of the accident, Golchin also was covered under a health insurance policy issued by Blue Cross and Blue Shield of Massachusetts (Blue Cross).

Liberty Mutual paid $2,000 in personal injury protection (PIP) benefits to Golchin as a result of the accident. Golchin also submitted to Liberty Mutual documentation of additional medical expenses and requested payment pursuant to the MedPay coverage provided by the Liberty Mutual policy. Liberty Mutual refused to pay these benefits, citing the fact that they already had been paid by Blue Cross under the health insurance policy.

3. Analysis. Golchin seeks benefits under a standard Massachusetts auto policy. “We interpret the words of the standard policy in light of their plain meaning, ... giving full effect to the document as a whole [,] ... consider[ing] ‘what an objectively reasonable insured, reading the relevant policy language, would expect to be covered’ ... [and] interpret[ing] the provision of the standard policy in a manner consistent with the statutory and regulatory scheme that governs such policies.” (Citations omitted.) Given v. Commerce Ins. Co., 440 Mass. 207, 209, 796 N.E.2d 1275 (2003), quoting Hazen Paper Co. v. United States Fid. & Guar. Co., 407 Mass. 689, 700, 555 N.E.2d 576 (1990). “Finally, because the approved wording of the standard policy is controlled by the Commissioner of Insurance and not by any insurer (see G.L. c. 175, § 113A), we do not construe ambiguities against the insurer.” Given v. Commerce Ins. Co., supra at 210, 796 N.E.2d 1275.

The standard policy contains two coverages implicated by Golchin's claim. First, the policy provides a maximum of $8,000 in PIP benefits. These benefits are the “central feature” of the Massachusetts “no-fault” automobile insurance system. Metropolitan Prop. & Cas. Ins. Co. v. Blue Cross & Blue Shield of Mass., Inc., 451 Mass. 389, 392, 885 N.E.2d 825 (2008) ( Metropolitan ). Under the policy, PIP benefits are payable for medical expenses, lost wages, and replacement services and may be claimed by, among others, any person who is injured while occupying an insured vehicle. The second form of relevant coverage is MedPay, one of the eight optional coverages that are offered to insureds under the standard auto policy. MedPay benefits cover “reasonable expenses for necessary medical and funeral services incurred as a result of an accident” by, among others, “anyone occupying [the insured's] auto at the time of the accident.”

Under the terms of the standard policy, if PIP benefits are available under any Massachusetts auto policy they are always paid first.³ Mejia v. American Cas. Co., 55 Mass.App.Ct. 461, 465–466, 771 N.E.2d 811 (2002) ( Mejia ) (“it is evident that when PIP coverage is available, payment under PIP is to precede any payments under [MedPay]”). So long as PIP coverage is available and has not been exhausted, MedPay benefits are not payable. See Dominguez v. Liberty Mut. Ins. Co., 429 Mass. 112, 706 N.E.2d 647 (1999) ( Dominguez ) (where claimant ignored conditions of his health insurance policy, medical expenses were denied by health insurer and were not payable by PIP); Mejia, supra at 466, 771 N.E.2d 811 (interplay of PIP, health insurance, and MedPay benefits, in light of Dominguez ).

The order in which PIP and MedPay benefits are triggered is relevant to Golchin's claim because the portion of the standard policy addressing PIP states:

“Some people have a policy of health, sickness, or disability insurance ... to provide, pay for, or reimburse the cost of medical expenses.... If so, we will pay up to $2,000 of medical expenses for any injured person. We will also pay medical expenses in excess of $2,000 for such injured person which will not be paid by a health plan.... In any...