Hartwell v. Am. Fid. Assurance Co.
| Decision Date | 17 September 2020 |
| Docket Number | No. SD 36561,SD 36561 |
| Citation | 607 S.W.3d 807 |
| Parties | Vanessa HARTWELL, Appellant, v. AMERICAN FIDELITY ASSURANCE COMPANY, Respondent. |
| Court | Missouri Court of Appeals |
Appellant's attorney: J. Michael Baker.
Respondent's attorneys: Clark H. Cole and Mark P. Ohlms, Saint Louis.
Vanessa Hartwell ("Hartwell") appeals the trial court's judgment granting Rule 74.04 summary judgment in favor of American Fidelity Assurance Company ("AFA") on Hartwell's petition for breach of insurance contract (Count I) and vexatious refusal to pay an insurance claim (Count II).1 In three points, Hartwell contends that the trial court erred in granting summary judgment because (1) "the trial Court failed to construe a policy ambiguity against [AFA]"; (2) "[AFA] did not state or support multiple elemental, material facts necessary for a proper summary judgment record under Rule 74.04(c)’s numbered-paragraphs-and-responses framework" and "a genuine issue of material fact exists"; and, (3) [Hartwell]’s Count II for vexatious refusal does not fail where [Hartwell]’s count for breach of contract does not fail." Determining that Hartwell's second and third points are meritorious, we reverse the trial court's judgment and remand the case for further proceedings consistent with this opinion.
The following background is undisputed. Hartwell was the holder of and an insured under an insurance policy issued by AFA ("the Policy") that was in full force and effect for the dates at issue. Hartwell filed an insurance claim with AFA seeking the "Hospital Confinement Benefit" under the Policy for a period of hospitalization from June 11, 2018, through July 4, 2018. AFA agreed with Hartwell that she was hospitalized at Saint Francis Medical Center ("SFMC") from June 11, 2018, through June 19, 2018, and paid the benefits Hartwell claimed for those dates. It denied, however, that she was entitled to the Hospital Confinement Benefit for the remainder of the days at issue, June 20, 2018, to July 4, 2018.
AFA filed a motion for summary judgment on both counts in Hartwell's petition on the basis of its affirmative allegations that, for the period in which Hartwell is seeking benefits, she was not confined as a patient in a Hospital. The trial court ultimately granted this motion and entered judgment accordingly.
Hartwell now timely appeals the trial court's judgment in favor of AFA. Additional relevant facts are provided below, as we discuss Hartwell's three points relied on.
"The interpretation of an insurance policy, and the determination whether coverage and exclusion provisions are ambiguous, are questions of law that this Court reviews de novo. " Burns v. Smith , 303 S.W.3d 505, 509 (Mo. banc 2010). "Where, as here, the trial court granted summary judgment, this Court also applies a de novo standard of review." Id. This means we "give no deference to the trial court's decision[,]" but rather "employ the same criteria the trial court should have used in deciding whether to grant the motion." Haulers Ins. Co., Inc. v. Pounds , 272 S.W.3d 902, 904 (Mo. App. 2008) (internal citations omitted).
In her first point, Hartwell contends as follows:
The trial court erred in entering summary judgment in [AFA]’s favor on [Hartwell]’s breach of contract Count I because the trial Court failed to construe a policy ambiguity against [AFA] in that the [P]olicy gives then takes away a benefit where the [P]olicy benefit section promises payment in the event the insured is confined in a Hospital and charged room and board; one definition section of the [P]olicy provides for the hospital [Hartwell] was confined in to fit the definition of what "Hospital means" vesting the benefit; however, a subsequent definition section providing for what "Hospital shall not mean" attempts to take away the benefit if the very same hospital is used by the insured as "a place for rehabilitation."
We disagree.
"In construing the terms of an insurance policy, this Court applies the meaning which would be attached by an ordinary person of average understanding if purchasing insurance, and resolves ambiguities in favor of the insured." Seeck v. Geico Gen. Ins. Co. , 212 S.W.3d 129, 132 (Mo. banc 2007) (internal quotation marks and citations omitted). "An ambiguity exists when there is duplicity, indistinctness, or uncertainty in the meaning of the language of the policy." Id. (internal quotation marks omitted). If an "insurance clause appears to provide coverage but other clauses indicate that such coverage is not provided, then the policy is ambiguous, and the ambiguity will be resolved in favor of coverage for the insured." Id. at 134. However, "[t]he mere presence of an exclusion does not render an insurance policy ambiguous." Floyd-Tunnell v. Shelter Mut. Ins. Co. , 439 S.W.3d 215, 221 (Mo. banc 2014). "An insured cannot create an ambiguity by reading only a part of the policy and claiming that, read in isolation, that portion of the policy suggests a level of coverage greater than the policy actually provides when read as a whole." Owners Ins. Co. v. Craig , 514 S.W.3d 614, 617 (Mo. banc 2017).
With these principles in mind, we turn to the Hospital definition, which states, in toto :
(Emphasis added.)
Hartwell argues that, under the Hospital definition, an institution's satisfaction of the first part of the definition (detailing inclusion criteria for a licensed institution), when first considered, provides coverage under the Policy's Hospital Confinement Benefit, but that if that same institution also satisfies the second part of the definition (detailing exclusion criteria for institutions used by the insured in certain manners), when thereafter considered, then the second part takes away the coverage provided by the first part. This, according to Hartwell, without any citation to supporting authority, means that the definition is ambiguous. This argument is incorrect, however, because Hartwell reads the two parts of the Hospital definition in isolation, instead of reading them together as required.
No duplicity, indistinctness, or uncertainty exists between the first and second parts of the Hospital definition. The first part is concerned with certain prescribed institutional characteristics and the second part is concerned with proscribed manners in which the insured used the institution. When read as a whole, see Owners Ins. Co. , 514 S.W.3d at 617, it requires that, in order to qualify for inclusion within the Hospital definition, a licensed institution must satisfy the definition's first part but an institution is excluded from that term if it is used by the insured in any manner described in the definition's second part. Thus, to an ordinary person of average understanding, an institution qualifies under the Hospital definition if it (1) satisfies the definition's first part and (2) was not used by the insured in a manner proscribed in the second part. The same person would also understand that, in a different context, an institution, although meeting the Hospital definition's first part, does not qualify as a Hospital if it was used by an insured in a manner described and excluded by the second part.
Where there is no ambiguity in an insurance policy, a court enforces the policy as written. Peters v. Employers Mut. Casualty Co. , 853 S.W.2d 300, 302 (Mo. banc.1993). Because there is no ambiguity in the Policy as alleged, Hartwell's first point is denied.
Having determined that the Hospital definition is not ambiguous, we next turn to Hartwell's second point relating to the application of that definition to the summary judgment record. This point consists of two, separate arguments contending as follows:
The trial court erred in entering summary judgment in [AFA]’s favor because [AFA] was not entitled to summary judgment in that [1] [AFA] did not state or support multiple elemental, material facts necessary for a proper summary...
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