Safeco Ins. Co. v. MONTANA EIGHTH JUDICIAL DIST. COURT, 00-173.

• Decision Date: 08 June 2000
• Docket Number: No. 00-173.,00-173.
• Citation: 2000 MT 153,300 Mont. 123,2 P.3d 834
• Parties: SAFECO INSURANCE COMPANY OF ILLINOIS, Petitioner, v. MONTANA EIGHTH JUDICIAL DISTRICT COURT, CASCADE COUNTY, Honorable Thomas M. McKittrick, presiding, Respondent.
• Court: Montana Supreme Court

2 P.3d 834

2000 MT 153

300 Mont. 123

SAFECO INSURANCE COMPANY OF ILLINOIS, Petitioner, v. MONTANA EIGHTH JUDICIAL DISTRICT COURT, CASCADE COUNTY, Honorable Thomas M. McKittrick, presiding, Respondent.

No. 00-173.

Supreme Court of Montana.

Submitted March 23, 2000.

Decided June 8, 2000.

Robert J. Phillips, Phillips & Bohyer, Missoula, Montana, For Petitioner.

Roland B. Durocher, Hartelius, Ferguson, Baker & Kazda, Great Falls, Montana (Pete Hill); Lot T. Holden, Jardine, Stephenson, Blewett & Weaver, Great Falls, Montana (Judith L. Bennett), For Respondent.

Justice JAMES C. NELSON delivered the Opinion of the Court.

¶ 1 This is an original proceeding in this Court involving an application for a writ of supervisory control. The Petitioner, Safeco Insurance Company of Illinois (Safeco), one of the defendants in the underlying action, seeks review of the District Court's February 2, 2000 order, which granted summary judgment in favor of the Plaintiff, Pete Hill (Hill) on his declaratory judgment claim against Safeco. Safeco contends that in doing so, the court incorrectly interpreted current law governing an insurer's obligation to pay medical expenses incurred by an injured third party claimant in advance of final settlement or judgment.

¶ 2 We assume supervisory control, and affirm the District Court's order granting summary judgment in favor of Hill.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 3 The parties agree that on April 6, 1998, a motor vehicle collision occurred between a vehicle driven by Safeco's insured, Judith Bennett (Bennett) and a vehicle in which Hill was a passenger. It is undisputed that Bennett admits that her negligence caused the accident, and that Safeco was her liability insurer at the time. Hill suffered injuries as a result of the accident, and initially incurred medical expenses of approximately $15,000, a figure which he asserted in a statement of claim filed with the court in April of 1999.

¶ 4 Although Safeco apparently paid some of Hill's initial medical claims—according to Hill's July 7, 1999 affidavit—it eventually disputed the causal relationship between the accident caused by its insured and Hill's claimed injuries. It refused to pay any medical bills submitted for payment by Hill that were incurred beyond December 1, 1998.

¶ 5 Hill filed suit on March 10, 1999, against Bennett for negligence damages, as well as against Safeco under three separate counts for its nonpayment of medical expenses. In part, Hill sought a declaratory judgment that he was legally entitled to advance payment of medical costs under Bennett's policy with Safeco prior to settlement or a final judgment, because Bennett's liability was reasonably clear. He asserted that such a declaratory judgment would be proper pursuant to Montana's Unfair Trade Practices Act (UTPA), as well as this Court's 1997 decision construing the Act, Ridley v. Guaranty Nat'l Ins. Co. Hill moved for summary judgment on this declaratory judgment claim on July 7, 1999.

¶ 6 Hill also brought an UTPA claim and a common law claim of bad faith against Safeco. The two counts were dismissed, however, by an order issued by the court on May 12, 1999, pursuant to a stipulation by the parties. On September 14, 1999, the court also granted Safeco's request to separate trials regarding Hill's negligence claim against Bennett and his declaratory judgment claim against Safeco.

¶ 7 In support of his motion for summary judgment, Hill asserted that all of his medical claims made to date were causally related to the accident. Hill relied primarily upon the affidavit of his primary treating physician, Dr. Ronald Peterson. Dr. Peterson's affidavit attested that "to a reasonable degree of medical certainty" he believed that Hill's claimed injuries were sustained in, and were related to, the April 6, 1998 accident.

¶ 8 Safeco, on the other hand, relied on the affidavit of its hired consultant, Dr. A. Craig Eddy, who stated that after his review of Hill's medical records he could not "to a reasonable degree of medical certainty, make a causal connection between the April 6, 1998 car accident and Mr. Hill's continuing medical complaints." According to Hill's affidavit, he was never asked to submit to a medical examination by a doctor chosen or approved by Safeco. Additionally, Safeco contended that summary judgment in favor of Hill was inappropriate because any action—including a declaratory judgment—arising from an UTPA claim is expressly precluded from adjudication prior to a settlement or a judgment in the underlying action between the third-party claimant and the insured, pursuant to § 33-18-242(6)(b), MCA.

¶ 9 The District Court, in issuing summary judgment in favor of Hill, noted that "nowhere in his affidavit does Dr. Eddy contradict the affidavits of Plaintiff or Dr. Peterson." Therefore, the court concluded that "the material facts as alleged by Plaintiff are not in dispute." The court further determined that "[b]ecause this action does not directly seek bad faith damages for a violation of the Unfair Trade Practices Act, there is no statutory bar under Mont.Code Ann. § 33-18-242(6)(b)."

¶ 10 The District Court ordered that Safeco "must advance the medical expenses Mr. Hill has incurred as a result of his injuries sustained in the wreck with Judith Bennett." The court specifically ordered that Safeco pay "the amount of Mr. Hill's medical expenses for treatment rendered from the date of the accident through November 1, 1999." The court further provided, however, that Safeco may nevertheless raise "reasonable defenses" as to the "validity for any expenses for treatment after that date."

¶ 11 From this order, Safeco seeks this Court's review pursuant to its petition for supervisory control.

STANDARD OF REVIEW

¶ 12 Generally, our standard of review of a district court's summary judgment order is de novo. See Auto Credit, Inc. v. Long, 1998 MT 327, ¶ 8, 292 Mont. 238, ¶ 8, 971 P.2d 1237, ¶ 8. In this instance, however, the District Court determined there were no significant factual issues and granted summary judgment to Hill based on its interpretation of the law. The parties concede that no genuine issues of fact remain. Accordingly, we will narrow our review to determine whether the moving party, Hill, was entitled to judgment as a matter of law. See Nimmick v. State Farm Mut. Auto. Ins. Co. (1995), 270 Mont. 315, 319, 891 P.2d 1154, 1156

. Our standard of review pertaining to a district court's conclusions of law, in rendering a declaratory judgment, is to determine if the court's interpretation of the law is correct. See Ash Grove Cement Co. v. Jefferson County (1997), 283 Mont. 486, 491, 943 P.2d 85, 89.

DISCUSSION

I. Propriety of Supervisory Control

¶ 13 Safeco contends that a writ of supervisory control is appropriate because a direct appeal of the District Court's February 2, 2000 order granting Hill summary judgment would be an inadequate remedy. Safeco sets forth a scenario whereby a jury may eventually find its insured, Bennett, not liable for some or all of Hill's medical expenses. In turn, Safeco may have already paid Hill some of these expenses pursuant to the court's order granting summary judgment. This "procedural paradox," as characterized by Safeco, is a direct result of the District Court's legal error in refusing to stay Hill's declaratory judgment until either a settlement had been reached or a judgment had been entered, which is required under § 33-18-242(6)(b), MCA.

¶ 14 Article VII, Section 2, of the Montana Constitution gives this Court "original jurisdiction to issue, hear, and determine writs...." The exercise of supervisory control by this Court is also authorized by Rule 17(a), M.R.App.P. Supervisory control is appropriate when a district court is proceeding under a mistake of law and in so doing is causing a gross injustice for which an appeal is not an adequate remedy. See State ex rel. Missoulian v. Montana 21st Judicial Dist. Court (1997), 281 Mont. 285, 290-91, 933 P.2d 829, 832-33

(citations omitted). Our determination of whether supervisory control is appropriate is a case-by-case decision. See Park v. Sixth Jud. Dist. Court, 1998 MT 164, ¶ 13, 289 Mont. 367, ¶ 13, 961 P.2d 1267, ¶ 13 (citations omitted). It remains an extraordinary remedy, however, exercised only in extraordinary circumstances. See State ex rel. Mazurek v. Fourth Jud. Dist. Court (1996), 277 Mont. 349, 352, 922 P.2d 474, 476 (citations omitted).

¶ 15 Here, we conclude that Safeco's application presents a legal issue which is appropriate for this Court to resolve through a writ of supervisory control. As explained by Safeco, should the ordered payment of medical expenses be incorrect, or a "mistake of law," the delay in awaiting the outcome of the corollary litigation that will determine damages could create an unfair prejudice for Safeco. Likewise, any further, unnecessary delay in the payment of Hill's medical costs—if the court's summary judgment was appropriate—would certainly prejudice Hill. Safeco contends that an appeal brought at some point in the future, as compared with a resolution of this matter now, would be inadequate. We agree.

¶ 16 We recognize, however, that due to the September 14, 1999 order for separate trials which followed Hill's July 7, 1999 motion for summary judgment, the granting of summary judgment on February 2, 2000, was not, technically speaking, "interlocutory." See generally Cechovic v. Hardin & Assoc., Inc. (1995), 273 Mont. 104, 118, 902 P.2d 520, 528

(stating general rule that summary judgment orders are interlocutory and therefore not appealable until final judgment is rendered) (citation omitted); Knight and Co. v. Fort Belknap Indian Agency (1980), 188 Mont. 218, 220-21, 612 P.2d 1290, 1291-92 (concluding that appeal must be dismissed without prejudice under Rule 1, M.R.App.P., where order of summary judgment is interlocutory). Although the trial court did not certify the summary judgment as...