Rawlins v. Esurance Prop. & Cas. Ins. Co.

Docket Number4:21-CV-660 RLW
Decision Date26 January 2022
PartiesVICKIE RAWLINS, on behalf of herself and all others similarly situated, Plaintiff, v. ESURANCE PROPERY AND CASUALTY INSURANCE COMPANY, Defendant.
CourtU.S. District Court — Eastern District of Missouri
MEMORANDUM AND ORDER

RONNIE L. WHITE, UNITED STATES DISTRICT JUDGE.

Vickie Rawlins brings this suit against Esurance Property and Casualty Insurance Company (“Esurance” or Defendant) for breach of an insurance contract. Plaintiff Rawlins brings suit on behalf of herself and those similarly situated. This matter is before the Court on Esurance's motion to dismiss for failure to state a claim pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. (ECF No. 8). Plaintiff opposes the motion, which is fully briefed and ripe for review. For the reasons that follow, the Court denies Esurance's motion to dismiss for failure to state a claim.

I. Background

On February 12, 2021, Plaintiff filed a Class Action Petition in the Circuit Court of St. Louis County, Missouri. In her state court petition (hereinafter “Complaint”) Plaintiff alleges Esurance breached the terms of its automobile insurance policy by failing to include sales tax when it made a loss claim payment. According to the Complaint, Esurance issued Plaintiff a Personal Auto Policy (the “Policy”), which provided that in the event Plaintiff's covered vehicle sustained loss, Esurance would pay for the loss “in money or repair or replace the damaged or stolen property.”[1] (ECF No. 4 at 3). The Complaint further alleges the Policy provides that in the event Esurance pays for the loss in money, the payment “will include the applicable sales tax for the damaged or stolen property.” Id.

According to Plaintiff, she insured a 2002 Toyota RAV4 under the Policy. On March 30, 2016, the insured vehicle sustained loss or damage. Plaintiff filed a claim for property damage. Plaintiff alleges Esurance determined her vehicle to be a total loss.

According to the Complaint, Esurance determined the value of Plaintiff's 2002 Toyota RAV4 to be $5, 788.00, and the applicable sales tax on the adjusted vehicle to be $411.70. She alleges her vehicle's valuation was calculated by a third-party vendor, CC Information Services, Inc. (“CC”). Plaintiff attached a copy of CC's valuation report to the Complaint. (ECF No. 4, Ex. 1 at 44). According to Plaintiff, she was paid the “adjusted vehicle value” of $5, 788.00, plus $14.00 for fees, minus a $500.00 deductible, for a total money payment of $5, 302.00. Esurance did not include any sales tax in its payment. Plaintiff claims that by failing to include sales tax in making payment for loss, Esurance breached its contract with her. Plaintiff brings one count against Defendant for Breach of Contract.

Plaintiff seeks to bring a putative class action against Esurance. She asks that she be allowed to represent the following class of insureds:

All Missouri insureds, under a policy issued by Esurance covering a vehicle with private-passenger auto physical damage coverage for comprehensive or collision loss, who, within the applicable statute of limitations prior to the filing of this lawsuit through the date of the certification Order, submitted a first-party property damage claim determined by Esurance to constitute a covered loss claim and where the loss claim payment did not include sales tax.

(ECF No. 4 at 4).

Esurance removed the state action to this Court on the basis of diversity jurisdiction, pursuant to 28 U.S.C. §§ 1332, 1441 and 1453.[2] Defendant did not file an answer to the Complaint, but rather filed a motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6). Esurance moves to dismiss based on the following arguments: (1) under a Missouri statute, an insured never has to pay sales tax on a replacement vehicle following a total loss; (2) Plaintiff lacks standing to sue because she does not allege she paid any sales tax; (3) the Policy requires Defendant to pay for loss, not Actual Cash Value, which is a limit on liability and not a contractual obligation; (4) even if the Policy required payment of Actual Cash Value, sales tax would not be included in the loss calculation.

II. Legal Standard

To survive a motion to dismiss for failure to state a claim, “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.' Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is facially plausible “where the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Blomker v. Jewell, 831 F.3d 1051, 1055 (8th Cir. 2016) (quotation omitted). The facts alleged must “raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555. A complaint must offer more than ‘labels and conclusions' or ‘a formulaic recitation of the elements of a cause of action' to state a plausible claim for relief. Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555).

On a motion to dismiss, the Court accepts as true all of the factual allegations contained in the complaint, even if it appears that “actual proof of those facts is improbable, ” Twombly, 550 U.S. at 556, and reviews the complaint to determine whether its allegations show that the pleader is entitled to relief. Id. at 555-56; Fed.R.Civ.P. 8(a)(2). The principle that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions, however. Iqbal, 556 U.S. at 678 (stating [t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice”). Although legal conclusions can provide the framework for a complaint, they must be supported by factual allegations. Id.

III. Discussion
A. Breach of Contract Claim

Before addressing the standing issue and the implications of a Missouri statute, the Court will first address whether the Complaint states a claim for breach of contract.

To state a claim for breach of contract under Missouri law, Plaintiff must allege facts demonstrating (1) the existence and terms of a contract, (2) that Plaintiff performed pursuant to the contract, (3) that Defendant breached the contract, and (4) that Plaintiff suffered damages resulting from the breach. Fuller v. Partee, 540 S.W.3d 864, 871 (Mo.Ct.App. 2018). According to Missouri law, a court interpreting an insurance policy should “give[ ] the policy language its plain meaning, or the meaning that would be attached by an ordinary purchaser of insurance.” Seaton v. Shelter Mut. Ins. Co., 574 S.W.3d 245, 247 (Mo. 2019) (quoting Doe Run Res. Corp. v. Am. Guarantee & Liab. Ins., 531 S.W.3d 508, 511 (Mo. 2017)). Further, courts “should not interpret policy provisions in isolation but rather evaluate policies as a whole.” Ritchie v. Allied Prop. & Cas. Ins. Co., 307 S.W.3d 132, 135 (Mo. 2009). When an insurance policy is “clear and unambiguous, ” the court must enforce the policy as written. Seaton, 574 S.W.3d at 247. If, however, “the policy is ambiguous, . . . any ambiguity must be resolved against the insurer-drafter.” Ballas Nails & Spa, LLC v. Travelers Cas. Ins. Co. of Am., 511 F.Supp.3d 978, 981 (E.D. Mo. 2021) (quoting Allen v. Cont'l W. Ins. Co., 436 S.W.3d 548, 554 (Mo. 2014)). “Language is ambiguous if it is reasonably open to different constructions, ” or “when there is duplicity, indistinctness, or uncertainty in [its] meaning.” Johnson v. Safeco Ins. Co. of Illinois, 983 F.3d 323, 330 (8th Cir. 2020) (quoting Burns v. Smith, 303 S.W.3d 505, 509 (Mo. 2010) and Seaton, 574 S.W.3d at 247).

There appears to be no dispute that the Complaint alleges the first two elements for breach of contract. In moving for dismissal, Esurance argues Plaintiff fails to adequately allege that it breached the Policy, or that she was damage by any such breach.

Under its basic terms, the Policy provides that if the insured pays the premium, Esurance agrees to pay for loss to the covered vehicle. More specifically, the Policy states:

Subject to the limits of liability, if “you” pay the premium for Collision Coverage, we will pay for a sudden, direct, and accidental “loss” to … [y]our” “covered auto” for which Collision Coverage has been purchased … .

(ECF No. 4, Ex. 1 at 16.) “Loss” is defined under the Policy to include “sudden, direct, and unintended physical damage” or “theft.” (Id. at 5). If there is a loss, under the Payment of Loss provision, Esurance may elect to “pay for the ‘loss' in money or repair or replace the damaged or stolen property.” (Id. at 24). Importantly, if Esurance “pay[s] for ‘loss' in money, [its] payment will include the applicable sales tax for the damaged or stolen property. (Id.) (emphasis added).

The Policy does have limits on the amount for which Esurance can be liable. Under its terms, the Policy limits Esurance's liability to the lesser of the following:

A. The limit of liability shown on [the] Declarations page;
B. Actual cash value of the stolen or damaged property; C. Amount necessary to repair the property to its pre-loss physical condition; or
D. Amount necessary to replace the property with other property of like kind and quality

(ECF No. 4, Ex. 1 at 23). In addition, [a]ny payment for damaged property will be reduced by the applicable deductible shown on [the] Declarations page and by the salvage value if [the insured or owner] retain[s] the salvaged property.” (Id.)

For purposes of the Motion to Dismiss, the parties do not dispute Plaintiff had a vehicle covered under the Policy that sustained a “loss, ” or that Plaintiff filed a claim for property damage under the Policy, and Esurance determined her vehicle...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT