Rowe ex rel. Rowe v. Bankers Life and Cas. Co.
| Decision Date | 01 July 2008 |
| Docket Number | No. CV 07-1281-PHX-MHM.,CV 07-1281-PHX-MHM. |
| Citation | 572 F.Supp.2d 1138 |
| Parties | Gloria A. ROWE by her Guardian ad Litem Fred ROWE, and Fred Rowe, Plaintiffs, v. BANKERS LIFE AND CASUALTY COMPANY; Falicia M. Soller; and John Does 1 through 2, Defendants. |
| Court | U.S. District Court — District of Arizona |
Calvin C. Thur, Roger O'Sullivan Thur & O'Sullivan, PC, Phoenix, AZ, for Plaintiffs.
Nathanael J. Scheer, William M. Demlong, Kunz, Plitt, Hyland, Demlong & Kleifield, Phoenix, AZ, for Defendants.
This is an insurance bad faith cause of action. Plaintiffs originally filed this case in Maricopa County Superior Court. Defendant timely removed the case to this Court. Plaintiffs have included four causes of action in their complaint, including the following: (1) breach of the duty of good faith and fair dealing by Bankers Life and Casualty Company ("Bankers"); (2) negligence and malpractice against Defendant Soller; (3) common law fraud as to Defendants Bankers and Soller; and (4) constructive fraud as to Defendants Bankers and Soller. Plaintiffs also seek punitive damages.
Presently pending before the Court is Plaintiffs' Motion for Partial Summary Judgment (Doc. 17). In their Motion for Partial Summary Judgment, Plaintiffs seek requiring that Bankers pay benefits under the policy for at least 24 consecutive months as a matter of law. Plaintiffs also seek to have the Court find that the "restoration of benefits" provision is an unenforceable exclusion or limitation of coverage. The Motion is fully briefed. After recently granting Plaintiffs' Motion for Reconsideration and hearing oral argument on the Motion for Partial Summary Judgment, the Court hereby issues the following Order.
Plaintiffs Fred and Gloria Rowe bought an insurance policy from Bankers Life and Casualty Company ("Bankers") for Mrs. Rowe in 2003. Mrs. Rowe was 77 years of age at the time. Leading up to the purchase of the policy, Bankers' sales representative, Defendant Falicia Soller met with Plaintiffs Fred and Gloria Rowe on at least three occasions in 2003.
The policy the Rowes purchased provided the following:
• It is "GUARANTEED RENEWBLE," i.e., the policy "may be renewed for each Family Member on any renewal date as long as such Family Member lives."
• For a Maximum Daily Benefit amount of $150.00 for nursing home and assisted living facility care and a Maximum Weekly Benefit amount of $1,050 for Home Health Care and Adult Day Care, and promises to pay a "Maximum Benefit for Any One Period of Expense" of $27,000.
• For an Elimination Period of 20 Days of Service and defined "Elimination Period" to mean "the number of days a Family Member must receive services included under Part I or Part II Covered Expenses before benefits are payable."
• Benefits for care of "the following covered conditions: Alzheimer's Disease, Parkinson's Disease, Senile Dementia or other nervous or mental disorders of organic origin."
• "Any One Period of Expense" begins when a Family Member first incurs a charge for covered expenses and ends on the earlier of when (1) "after six consecutive months during which the Family Member has not required any treatment or services for those conditions which causes the prior One Period of Expense, or (2) the Maximum Benefit has been exhausted."
• A "RESTORATION OF POLICY BENEFITS" provision stated that "[t]his policy's Maximum Benefit for Any One Period of Expense will be fully restored when a Family Member has not required treatment or services covered under this policy for six consecutive months for the same cause or causes for which a previous period of expense began."
• A "CONFORMITY WITH STATE STATUTES" provision stated that "[a]ny provision of this policy which ... is in conflict with the laws of the state in which You live ... is amended to conform to the minimum requirements of such laws."
Shortly after the sale, Mrs. Rowe received a Bankers folder with Policy Form GR-N325. In December 2004, Mrs. Rowe suffered from confusion and inability to perform some basic tasks of daily living. Her doctor diagnosed her with Alzheimer's. Mrs. Rowe became totally unable to care for herself in December 2005. At that time, Visiting Angels, a home health care provider, began providing home health care to Mrs. Rowe. Since that time, Mrs. Rowe has become incapacitated. Mr. Rowe now acts as Mrs. Rowe's guardian, handling her personal affairs, and is named Guardian ad Litem for purposes of this lawsuit.
Mr. Rowe presented Mrs. Rowe's claim to Bankers using a four-page claim form he received from Bankers, along with a cover page referring to benefits under "long term care" coverage. The claim form gave instructions on how to "file a claim" and referred to "two different claim forms for LONG TERM CARE." On January 16, 2006, Mrs. Rowe's physician, R. Christian Allen, M.D., completed Bankers' Physician's Claim Form, confirming Mrs. Rowe's condition as Alzheimer's. Dr. Allen recommended home health care six hours per day, seven days per week indefinitely.
Mrs. Rowe has received numerous correspondences from Bankers referring to her "long term care policy." In late October 2006, the Rowes received a notice from Bankers that their benefits would soon terminate. Mr. Rowe wrote to Bankers to inquire as to how their coverage could be ending when the claim started less than a year before. Bankers' Vice President, K. Smith, responded by stating that Mrs. Rowe's policy was not for long term care. Two days later, Mrs. Rowe received a letter from Bankers referring to "your LONG TERM CARE insurance." Two weeks after that, Mrs. Rowe received a letter from Bankers again referring to "you LONG TERM CARE policy." This letter informed Mrs. Rowe that she had received $29,767.50 for her claims, which, the letter informed, was the maximum the policy would pay. Three weeks later, Mrs. Rowe received another letter form Bankers, dated December 27, 2006, that again told her that she had received the maximum benefit under "your LONG TERM CARE insurance." Additional bills were submitted to Bankers for Mrs. Rowe's home health care for the month of December 2006, but Bankers denied the claims with three additional letters in January 2007, referring to "your LONG TERM CARE insurance" having paid a maximum benefit of $29,767.50.
Bankers has conveyed to the Rowes in numerous correspondences that "lifetime maximum benefit amounts" were "unlimited" and the policy promises to pay for multiple "periods of expense," each period of expense ending when the maximum benefit amount of $27,0001 had been paid. Bankers has not paid benefits for a new period of expense, apparently in reliance on a "restoration of benefits" provision in the policy, which states that the "Maximum Benefit for Any One Period of Expense" will be fully restored when the insured "has not required treatment or services covered under this' Policy for six consecutive months for the same cause or causes for which a previous Period of Expense began."
Summary judgment is properly granted when no genuine and disputed issues of material fact remain, and when, viewing the evidence most favorably to the nonmoving party, the movant is clearly entitled to prevail as a matter of law. Fed. R.Civ.P. 56; Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Eisenberg v. Ins. Co of N. Am., 815 F.2d 1285, 1288-89 (9th Cir.1987).
Initially, the moving party bears the burden of showing that there is no material factual in dispute. Therefore, the court must regard as true the opposing party's evidence, if supported by affidavits or other evidentiary material. Celotex, 477 U.S. at 324, 106 S.Ct. 2548; Eisenberg, 815 F.2d at 1289. The court must draw all reasonable inferences in favor of the party against whom summary judgment is sought. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Intel Corp. v. Hartford Accident & Indem. Co., 952 F.2d 1551, 1558 (9th Cir.1991).
The burden then shifts to the non-movant to establish the existence of material fact. Celotex, 477 U.S. at 323, 106 S.Ct. 2548. The non-movant "must do more than simply show that there is some metaphysical doubt as to the material facts" by "com[ing] forward with `specific facts showing that there is a genuine issue for trial.'" Matsushita, 475 U.S. at 586-87, 106 S.Ct. 1348 (quoting Fed.R.Civ.P. 56(e)).
A dispute about a fact is "genuine" if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The non-movant's bare assertions, standing alone, are insufficient to create a material issue of fact and defeat a motion for summary judgment. Id. at 247-48, 106 S.Ct. 2505.
In their Motion for Partial Summary Judgment, Plaintiffs assert that Bankers marketed and sold them a long term care policy. Plaintiffs argue that the policy meets the statutory requirements for long term care and therefore, under the Arizona Revised Statute, Plaintiffs are entitled to at least twenty-four months of coverage. Plaintiff contends that insurance policies are defined under the Arizona statutory scheme not by their title, or any descriptive names on the policy itself, but instead, by the type of benefits promised.
In opposition, Defendants assert that the GR-N325 policy sold to Plaintiffs states that it is a "limited benefit, short term, convalescent care insurance policy," and therefore it does not fall within the definition of "long term care." Defendants also claim the policy is for "health coverage," excluding it from the statutory definition of long term care insurance because the statute expressly excludes "basic medicare supplement coverage, basic hospital expense coverage, basic medical and...
To continue reading
Request your trial
-
Ctr. for Biological Diversity v. Mayorkas
... ... what it has already thought through.” Rowe ... ex rel. Rowe v. Bankers Life & Cas ... ...
-
Konarski v. City of Tucson
...basis for reconsideration. See Leong v. Hilton Hotels Corp., 689 F. Supp. 1572, 1573 (D. Haw. 1988); Rowe ex rel. Rowe v. Bankers Life & Cas. Co., 572 F. Supp. 2d 1138, 1147 (D. Ariz. 2008), clarified on denial of reconsideration (Sept. 17, 2008). b. Engquist The defendants argue first that......
-
Brauer v. Bankers Life & Cas. Co.
...the Policy constituted a long-term care insurance policy because the District Court of Arizona held in Rowe v. Bankers Life and Casualty Company, 572 F.Supp.2d 1138 (D. Ariz. 2008), that nearly identical language constituted a long-term care policy. However, Rowe was decided under the Arizo......