Humbert v. Liberty Mut. Fire Ins. Co.
| Decision Date | 05 August 2020 |
| Docket Number | Case No. 3:19-cv-01740-SB |
| Parties | KENNETH HUMBERT, Plaintiff, v. LIBERTY MUTUAL FIRE INSURANCE COMPANY, Defendant. |
| Court | U.S. District Court — District of Oregon |
FINDINGS AND RECOMMENDATION
Plaintiff Kenneth Humbert ("Humbert") filed this action against Liberty Mutual Fire Insurance Company ("Liberty Mutual"), alleging breach of an insurance contract and seeking a declaratory judgment that the applicable underinsured motorist ("UIM") coverage limit is two million dollars. Humbert and Liberty Mutual filed cross motions for summary judgment. This Court has jurisdiction over Humbert's action pursuant to 28 U.S.C. § 1332. For the reasons discussed below, the district judge should grant Liberty Mutual's motion for summary judgment and deny Humbert's motion for summary judgment.
Liberty Mutual issued renewal Motor Carrier Policy No. A12-641-005097-058 to MDU Resources Group, Inc. ("MDU"), the first "Named Insured," with a policy period of January 1, 2018 to January 1, 2019 (the "Policy"). (Decl. of Mark Coel ("Coel Decl.") Ex. 1.) Loy Clark Pipeline Company, Inc. ("Loy Clark"), Humbert's employer, is also a "Named Insured" under the Policy. (Coel Decl. Ex. 1 at 18.)
MDU selected a $25,000 "each-person" UIM coverage limit under the Policy by signing a form titled Uninsured/Underinsured Motorists Coverage and Limit Options Oregon (the "Election Form"), on February 7, 2017. (Coel Decl. Ex. 6.) The Policy provides that "[t]he First Named Insured is authorized to act and agrees to act on behalf of all persons or organizations insured under this policy with respect to all matters pertaining to the insurance afforded by the policy." (Coel Decl. Ex. 1 at 18.)
Vicky Kunz ("Kunz"), MDU's risk manager, signed the Election Form, and she was "authorized to execute agreements relating to insurance on behalf of [MDU], and its subsidiaries, including Loy Clark[.]" (Decl. of Daniel S. Kuntz ("Kuntz Decl.") ¶ 2.) Kunz acknowledged by signing the Election Form that Liberty Mutual had "offered Uninsured Motorists—Bodily Injury Coverage at a limit equal to that for Bodily Injury Liability Coverage[,]" and that MDU's election of "$25,000 each person" would "remain in force until a named insured rescinds it in writing or until the motor vehicle bodily injury liability limits are changed." (Kuntz Decl. Ex. 1 at 3.) Liberty Mutual did not receive a request to rescind the election from MDU or Loy Clark. (Coel Decl. ¶ 8.) In 2018, MDU renewed the Policy and made no changes to its UIM coverage. (Coel Decl. Ex. 3.)
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On July 9, 2018, while working for Loy Clark, Humbert was sitting in a parked commercial dump truck when an underinsured motorist lost control of her vehicle and struck the dump truck. (Decl. of Jacob Johnstun ("Johnstun Decl.") Ex. 6 at 1.)1 Humbert received worker's compensation benefits as a result of the accident. (Decl. of Matthew C. Casey, Ex. 1.) The underinsured motorist's insurance company tendered to Humbert its liability policy limit of $100,000. (Johnstun Decl. Ex. 9.) On June 26, 2019, Liberty Mutual tendered the $25,000 each-person UIM coverage limit under the Policy. (Johnstun Decl. Ex. 11 at 2.) Humbert rejected the $25,000 tender, and continues to maintain that the Policy's UIM coverage limit is two million dollars. (Pl.'s Mot. Summ. J. at 4.)
Summary judgment is appropriate if "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(a). On a motion for summary judgment, the court must view the facts in the light most favorable to the non-moving party, and draw all reasonable inferences in favor of that party. Porter v. Cal. Dep't of Corr., 419 F.3d 885, 891 (9th Cir. 2005). The court does not assess the credibility of witnesses, weigh evidence, or determine the truth of matters in dispute. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). "Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial." Matsushita Elec. Indus.Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (citation and internal quotation marks omitted).
The issue before the Court is whether first named insured MDU's election of the $25,000 UIM coverage limit pursuant to OR. REV. STAT. § 742.502 binds named insured Loy Clark to the same coverage limit. It does.
OR. REV. STAT. § 742.502 requires that insureds carry UIM coverage equal to their bodily injury liability coverage, "unless a named insured in writing elects to lower limits." OR. REV. STAT. § 742.502(2)(a). To make a valid election of the lower limits, a named insured must sign a statement confirming that the insurance company offered UIM coverage with limits equal to bodily injury liability, and providing the price delta between the coverage limits:
If a named insured elects lower limits, the named insured shall sign a statement to elect lower limits within 60 days after the time the named insured makes the election. The statement must acknowledge that a named insured was offered uninsured motorist coverage with the limits equal to those for bodily injury liability. The statement must have a brief summary that is not part of the insurance contract and that describes what uninsured motorist coverage provides and what the underinsured coverage provides. The summary must also state the price for coverage with limits equal to the named insured's bodily injury liability limits and the price for coverage with the lower limits the named insured requested. The statement remains in force until a named insured rescinds the statement in writing or until the motor vehicle bodily injury liability limits are changed.
OR. REV. STAT. § 742.502(2)(b). The statute provides that "[a] statement electing lower limits need not be signed if . . . the policy is . . . renewed . . . or replaced by the same insurer . . . unless the liability limits of the policy are changed." OR. REV. STAT. § 742.502(2)(c).
The parties agree here that MDU is the first named insured on the Policy and that Loy Clark is also a named insured; MDU signed a valid Election Form opting for the $25,000 UIM coverage limit; MDU renewed the Policy in 2018 and did not elect to change the UIM coveragelimit; and the Policy was in effect at the time of Humbert's accident. Humbert argues that MDU was not authorized to make the lower limit election on Loy Clark's behalf, but the Policy expressly allowed MDU to do just that: "The First Named Insured [i.e., UIM] is authorized to act and agrees to act on behalf of all persons or organizations insured under this policy [i.e., Loy Clark] with respect to all matters pertaining to the insurance afforded by the policy." (Coel Decl. Ex. 1 at 18.)
There is nothing in the statutory text of OR. REV. STAT. § 742.502, or its context, to suggest that the valid election of the first named insured cannot bind other insureds where the policy so allows. Humbert acknowledges that OR. REV. STAT. § 742.502 "is plain and unambiguous" and if "the Court would only need answer 1) 'Was MDU a named insured on the policy?' and 2) 'Did MDU elect in writing lower [UIM] policy limits?' [b]oth questions would easily be answered in the affirmative, the analysis would end, and [Liberty Mutual] would prevail in its assertion that Plaintiff's upper limit of [UIM] recovery is $25,000." (Pl.'s Mot. Summ. J. at 5.) Thus, the parties agree that the text and context of OR. REV. STAT. § 742.502 is plain and unambiguous. See DCIPA, LLC v. Lucile Slater Packard Children's Hosp. at Stanford, 868 F. Supp. 2d 1042, 1055 (D. Or. 2011) ().
Under Oregon law, courts may consider the legislative history of a statute, regardless of whether the statute is ambiguous, if the legislative history is useful to the court's analysis. See Gessele v. Jack in the Box, Inc., 427 F. Supp. 3d 1276, 1299 (D. Or. 2019) .
Humbert urges the Court to consider the statute's legislative history to determine the legislature's intent. However, the only legislative history Humbert offers is a statement by a representative of the Oregon Trial Lawyers Association ("OTLA"), i.e., not a legislator, who stated that the purpose of the written election form is "'so they are aware of what they're purchasing and what they're giving up.'" (Pl.'s Mot. Summ. J. at 6) (quoting Kathleen Eyman, OTLA's Executive Director).2 According to Humbert, Eyman's statement reflects that the "Oregon legislature intended insureds to weigh their own conflicting interests" and therefore allowing the first named insured to elect the lowest UIM coverage on behalf of all the named insureds contravenes legislative intent. (Pl.'s Mot. Summ. J. at 9.)
The only legislative history Humbert cites is not useful to the Court's analysis. "Cherry-picked quotations from single legislators or of nonlegislator witnesses, are likely to be given little weight, as the likelihood that such scraps of legislative history represent the views of the institution as a whole is...
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