Roark v. Farmers Group, Inc.
| Decision Date | 05 April 2007 |
| Docket Number | No. 24,287.,No. 26,400.,26,400.,24,287. |
| Citation | 2007 NMCA 074,162 P.3d 896 |
| Parties | Gary ROARK and First New Mexico Bank, a New Mexico Banking Corporation, Plaintiffs-Appellants, v. FARMERS GROUP, INC., Farmers Insurance Exchange, Farmers Insurance Company of Arizona, Richard Chaires, Jeffrey Fitzgerald, and Lee Tibbs, Defendants-Appellees. and First New Mexico Bank, a New Mexico Banking Corporation, Plaintiff-Appellant, v. Farmers Group, Inc., Farmers Insurance Exchange, Farmers Insurance Company of Arizona, Richard Chaires, Jeffrey Fitzgerald, and Lee Tibbs, Defendants-Appellees. |
| Court | Court of Appeals of New Mexico |
Frederick H. Sherman, Sherman & Sherman, Deming, NM, for Appellant First New Mexico Bank.
Steven C. Henry, Corrales, NM, for Appellant Gary Roark.
William R. Anderson, Sandenaw, Piazza & Anderson, P.C., Las Cruces, NM, for Appellees.
{1} This case is the consolidation of two appeals from two separate actions involving the same parties and the same dispute. At its most simple, the dispute is about insurance coverage. The first action was brought by First New Mexico Bank (Bank) against Gary Roark and Roark's insurer, Farmers Insurance Company of Arizona and related parties (collectively, Farmers). After a default judgment against Roark, a jury resolved that case in favor of Farmers. Bank appealed the first action, arguing that the trial court erred in certain evidentiary rulings and in denying Bank's motion to amend the complaint. While that appeal was pending, Bank and Roark filed another lawsuit against Farmers in a different county alleging the same claims that Bank had sought to add in the proposed amended complaint that was denied, and being appealed, in the first action. The trial court in the second action consolidated Bank's claims against Farmers with the first action. Bank then appealed the order of consolidation in the second action.
{2} We affirm the evidentiary rulings and the denial of Bank's motion to amend the complaint in the first action. We reverse the order of consolidation by the trial court in the second action and remand that part of the case for proceedings consistent with this opinion.
{3} In 1999, Roark obtained financing from Bank to purchase a pickup truck. Roark pledged the truck as collateral for the loan. As a condition of the loan, Roark agreed to obtain comprehensive insurance covering the truck. Roark obtained the insurance through Farmers, which in turn provided Bank with a lienholder's certificate of insurance that stated, "EFFECTIVE DATE: 09-22-1999" and "EXPIRATION DATE: CONTINUOUS UNTIL CANCELLED." At some point, Farmers cancelled Roark's insurance policy on the truck for non-payment of the premiums. Roark reinstated the policy, but for general liability coverage as opposed to comprehensive coverage. The truck was subsequently stolen, and Farmers denied Bank's claims for coverage based on its position that no policy was in force on the date of loss.
{4} In 2001, Bank first filed suit against Farmers and Roark in Hidalgo County District Court seeking money damages (the first lawsuit). Bank obtained a default judgment against Roark. Bank alleged that Farmers failed to provide Bank with notice of cancellation, and thus that Farmers was still liable for the loss as the insurer of the truck. Farmers denied that it had failed to provide proper notice of cancellation to Bank. Following the default judgment against Roark, the only issue remaining in the case was whether Farmers properly provided notice of cancellation to Bank. Approximately two months prior to trial, Bank filed a motion to amend its original complaint, and the proposed amended complaint included new causes of action. The trial court reserved ruling on the motion to amend the complaint pending the outcome of a jury trial on the issue in the original complaint. At trial, the jury returned a verdict for Farmers, finding that Farmers did not "fail to mail a notice of cancellation to [Bank] in compliance with the terms of the insurance policy or state law." The trial court denied Bank's motion to amend the complaint.
{5} Bank appealed from the judgment in the first lawsuit on the grounds that the trial court should have allowed Bank to amend its complaint to include additional claims, and that the trial court erred in excluding and admitting various testimony and evidence. The merits of that appeal are the subject of the first of the two appeals that we have consolidated in this opinion.
{6} While the first lawsuit was pending before this Court on appeal, Bank joined with Roark and filed a new action in Grant County (the second lawsuit) against Farmers. The second lawsuit was premised on the same transaction that gave rise to the first lawsuit. The complaint in the second lawsuit was based on the same causes of action raised in the proposed amended complaint that was denied in the first lawsuit. Bank claims that it filed the second lawsuit in contemplation of the statute of limitations expiring and because of newly discovered evidence. Farmers disputed the existence of such evidence.
{7} Farmers asserted the affirmative defenses of res judicata and collateral estoppel in its answer to the second lawsuit. However, instead of filing a motion to dismiss based on principles of preclusion, Farmers filed a motion to consolidate the second lawsuit with the first under Rule 1-042 NMRA. The trial court in the second lawsuit granted the motion to consolidate Bank's claims against Farmers with the first lawsuit that was already on appeal. In the order consolidating the second lawsuit with the first lawsuit the court cited "common factual issues."
{8} Bank opposed consolidation. After unsuccessful attempts to get the court in the second lawsuit to reconsider its order, Bank appealed the issue. Bank also petitioned this Court for a writ of error, but Bank admits in its briefs that it did so in an untimely fashion, and this Court denied the petition. The merits of the appeal from the order of consolidation are the subject of the second of the two consolidated appeals we address in this opinion.
{9} We provide additional facts as necessary throughout the opinion.
{10} We first address Bank's claims on appeal arising from the trial in the first action. Bank argues that the trial court erred by: (1) denying its motion to amend the complaint; (2) admitting Farmers' Exhibit 1 and testimony of Farmers' witness, Jeff Fitzgerald; and (3) striking the testimony of Bank's expert witness, Ted Knight. We affirm the trial court in the first case on all of these grounds raised in Bank's appeal.
{11} We then address Bank's appeal of the consolidation order by first examining whether the order of consolidation is final for appeal. We conclude that it is, and we therefore address the merits of the consolidation order issue. We reverse the trial court in the second case and hold that the order of consolidation was improper under the circumstances.
{12} Twenty months after the filing of the original complaint and after the close of discovery, Bank filed a motion to amend the complaint to include claims of estoppel, insurance bad faith, violations of the statutory schemes contained in NMSA 1978, §§ 59A-16-4 (1984), -20 (1997), commonly referred to as the Insurance Code, and NMSA 1978, §§ 57-12-2 (2003), -10 (2005), commonly referred to as the Unfair Practices Act. Farmers opposed Bank's motion to file the amended complaint as untimely and claimed that allowing Bank to amend the complaint would substantially prejudice Farmers' interests. In response, Bank suggested that the trial court could eliminate prejudice to Farmers "by bifurcating the issues and by trying the issues in the original [c]omplaint first." Rather than rule on the motion to amend immediately, the trial court postponed its ruling and thereby effectively bifurcated the issue of the notice of cancellation from the other issues raised by Bank in the proposed amended complaint. After the jury determined that Farmers mailed the notice of cancellation to Bank in compliance with the law, the trial court denied Bank's motion to file an amended complaint, stating that it "was not timely filed," and that it was "legally and factually inappropriate."
{13} Bank argues that the trial court erred in denying its proposed amended complaint, which included claims for violations of the Unfair Practices Act and the Insurance Code, a claim for insurance bad faith, and a claim that Farmers should be estopped to deny coverage.
{14} The rule governing the amendment of pleadings, Rule 1-015(A) NMRA, provides that after a responsive pleading is served, "a party may amend his pleading only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires." Normally, orders denying amendments are reviewed for abuse of discretion. Slide-A-Ride of Las Cruces, Inc. v. Citizens Bank of Las Cruces, 105 N.M. 433, 436, 733 P.2d 1316, 1319 (1987) ( .
{15} Bank contends that the standard of review is de novo because of the unusual procedural posture surrounding the motion to amend. The trial court reserved ruling on the motion to amend the complaint pending the outcome of the jury trial on the question of whether Farmers mailed notice of cancellation and, in doing so, the court effectively bifurcated the issues in the proposed amended complaint from the single issue in the original complaint. Thus, Bank argues that the trial court's denial of the motion to amend the complaint was equivalent to a directed verdict on the allegations contained in the...
To continue reading
Request your trial
-
Acosta v. Shell W. Exploration & Prod., Inc.
...our overarching goal is to determine the underlying intent of the drafters, Roark v. Farmers Grp., Inc., 2007–NMCA–074, ¶ 50, 142 N.M. 59, 162 P.3d 896, and we begin that task by parsing the plain language of the rule. See State v. Steven B., 2004–NMCA–086, ¶ 15, 136 N.M. 111, 94 P.3d 854 (......
-
Martinez v. Martinez
...a case and hear additional evidence is reviewed for abuse of discretion); Roark v. Farmers Grp., Inc. , 2007–NMCA–074, ¶ 20, 142 N.M. 59, 162 P.3d 896 (recognizing that the admission of evidence is reviewed for abuse of discretion); Garcia v. Jeantette , 2004–NMCA–004, ¶ 15, 134 N.M. 776, 8......
-
State v. Gallegos
...not reliable to generate the store's prices for the scanned merchandise. See Roark v. Farmer's Group, Inc. , 2007–NMCA–074, ¶ 32, 142 N.M. 59, 162 P.3d 896 (noting that "the burden of establishing lack of trustworthiness is on the party opposing admission"). The fact that the documents that......
-
Allen v. LeMaster
...We also seek guidance from the rule's language, history, and background. See Roark v. Farmers Group, Inc., 2007–NMCA–074, ¶ 50, 142 N.M. 59, 162 P.3d 896.B. Rule 5–503 Precludes Compelling a Statement from a Defendant in a Criminal Proceeding, Which Includes Habeas Corpus Review Under Rule ......
-
Depositions
...generates inconsistencies and potential problems, even where none had previously existed. See, for example, Roark v. Farmers Group, Inc ., 162 P.3d 896 (N.M. App. 2007), a lawsuit by a secured lender against a borrower and his automobile insurer to recover payment after the theft of a truck......
-
Depositions
...generates inconsistencies and potential problems, even where none had previously existed. See, for example, Roark v. Farmers Group, Inc., 162 P.3d 896 (N.M. App. 2007), a lawsuit by a secured lender against a borrower and his automobile insurer to recover payment after the theft of a truck.......
-
Depositions
...generates inconsistencies and potential problems, even where none had previously existed. See, for example, Roark v. Farmers Group, Inc., 162 P.3d 896 (N.M. App. 2007), a lawsuit by a secured lender against a borrower and his automobile insurer to recover payment after the theft of a truck.......