Safeco Insurance Company of America v. State ex rel. Hood, 082219 MSSC, 2017-IA-01554-SCT
| Opinion Judge | GRIFFIS, JUSTICE. |
| Party Name | SAFECO INSURANCE COMPANY OF AMERICA v. STATE OF MISSISSIPPI EX REL. JIM HOOD |
| Attorney | ATTORNEYS FOR APPELLANT: GREGG A. CARAWAY CLIFFORD K. (FORD) BAILEY, III JUDY Y. BARRASSO STEPHEN L. MILES CHLOÉ M. CHETTA STEPHEN R. KLAFFKY ATTORNEYS FOR APPELLEE: GEORGE W. NEVILLE DONALD L. KILGORE JACQUELINE H. RAY WILLIAM L. SMITH LUCIEN SMITH BENJAMIN BRYANT CRYMES G. PITTMAN WILLIAM E. CO... |
| Judge Panel | RANDOLPH, C.J., COLEMAN, MAXWELL, BEAM AND CHAMBERLIN, JJ., CONCUR. ISHEE, J., CONCURS IN PART AND IN RESULT WITHOUT SEPARATE WRITTEN OPINION. KITCHENS, P.J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY KING, P.J. KING, P.J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY KITCHENS, P.J. KI... |
| Case Date | August 22, 2019 |
| Court | Mississippi Supreme Court |
DATE OF JUDGMENT: 10/25/2017
HINDS COUNTY CIRCUIT COURT HON. TOMIE T. GREEN TRIAL JUDGE.
ATTORNEYS FOR APPELLANT: GREGG A. CARAWAY CLIFFORD K. (FORD) BAILEY, III JUDY Y. BARRASSO STEPHEN L. MILES CHLOÉ M. CHETTA STEPHEN R. KLAFFKY
ATTORNEYS FOR APPELLEE: GEORGE W. NEVILLE DONALD L. KILGORE JACQUELINE H. RAY WILLIAM L. SMITH LUCIEN SMITH BENJAMIN BRYANT CRYMES G. PITTMAN WILLIAM E. COPLEY MAISON HEIDELBERG
GRIFFIS, JUSTICE.
¶1. This case is before the Court on interlocutory appeal. Safeco Insurance Company (Safeco) challenges the circuit court's reassignment of this case and the appointment of a special master. We find an abuse of discretion and vacate the reassignment order and the special-master order. The case is remanded for further proceedings consistent with this opinion.
FACTS AND PROCEDURAL HISTORY
¶2. This case arises from Hurricane Katrina insurance litigation. After the hurricane had destroyed many homes, policyholders and insurance companies began litigating whether the hurricane losses were caused by flood damage or wind damage. The distinction determined whether the insurance companies would pay claims on those polices that did not cover flood damage.
¶3. For Mississippi residents who could not recover under an insurance policy at that time, Mississippi enacted the Homeowner Assistance Program (HAP), a federally funded program intended to assist uninsured or underinsured homeowners. According to the State, a portion of the HAP assistance would not have been paid by the State if insurers had not wrongly characterized flood-damage claims as wind-damage claims.
¶4. Since 2015, the State has initiated at least twelve HAP lawsuits against insurers, asserting different theories of liability related to HAP. Some of the cases have been settled, while others are pending in both state and federal courts.1 Four of such cases are relevant here.
¶5. On April 21, 2015, the State filed the first HAP complaint against State Farm Fire & Casualty Company (State Farm).2 The State alleged that State Farm misadjusted 8, 238 unidentified Katrina-related insurance claims. This case was initially randomly assigned to Senior Circuit Judge Tomie Green.
¶6. On November 20, 2015, the State filed another HAP case against Metropolitan Property and Casualty Insurance Company (Metropolitan).3 The State alleged that Metropolitan misadjusted 429 unidentified Katrina-related insurance claims. This case was initially randomly assigned to Circuit Judge William Gowan, who retired in March 2018.
¶7. Within several months of filing, Judge Gowan considered and ruled on two dispositive motions. Judge Gowan ruled against the State and held: first, that the State's subrogation claims were untimely; second, that the State violated Mississippi's pleading requirements by not appending each policyholder's subrogation agreement to the complaint; and third, that the State was to disclose these agreements, "rather than making the Defendant go on a fishing expedition." The case was settled following this ruling.
¶8. Shortly thereafter, on March 29, 2017, the State filed two more HAP cases. The first case was filed against Safeco.4 The complaint alleged that Safeco misadjusted 232 unidentified Katrina-related insurance claims. This case was initially randomly assigned to Judge Gowan.
¶9. The second case was filed against Liberty Mutual Insurance Company (Liberty Mutual).5 The complaint alleged that Liberty Mutual misadjusted 180 unidentified Katrina-related insurance claims. This case was initially randomly assigned to Judge Green.
¶10. On May 9, 2017, in State Farm, after the State filed a motion for entry of a proposed scheduling order and State Farm filed a motion to dismiss that was similar to that motion granted by Judge Gowan in Metropolitan, Judge Green entered the following text order, without conducting a hearing: ORDER OF NOTICE OF INTENT TO APPOINT SPECIAL MASTER. Please take notice OF THE COURT'S INTENT to appoint a SPECIAL MASTER on the grounds of its overcrowded civil and criminal dockets, and other administrative duties, in addition to the parties numerous filings and the complexity of case and the need for timely resolution of pretrial matters. The Special Master's fee and expenses will be borne by the parties, in equal proportion. Any party with a reasonable objection for cause to said appointment shall file said objection on or before May 19, 2017. NO FURTHER WRITTEN ORDER WILL BE ENTERED BY THE COURT.
On July 17, 2017, an order appointing a special master was entered in the State Farm case. State Farm objected to the entry of that order. The State Farm order is not before this Court.
¶11. On October 2, 2017, both Safeco and Liberty Mutual filed a motion to dismiss the State's claims for failure to join necessary parties and for failure to state a claim, similar to motions that Judge Gowan had granted in Metropolitan.
¶12. On October 13, 2017, the State, in the State Farm case, filed a motion to consolidate State Farm with Liberty Mutual and Safeco and a motion to appoint a special master. Neither the motion to consolidate nor the motion to appoint a special master was filed in the Safeco or Liberty Mutual cases.
¶13. Nevertheless, on October 24 and 25, 2017, Judge Green issued a sua sponte order in both the Safeco case (in which she was not the assigned judge) and the Liberty Mutual case (in which she was the assigned judge) appointing a special master.
¶14. Then, on October 26, 2017, Judge Green entered an order in the Safeco case that reassigned the Safeco case to her docket.
¶15. On November 8 and 9, 2017, Safeco and Liberty Mutual filed a petition for interlocutory appeal challenging both the reassignment order and the orders appointing a special master.6 In addition to the briefs of the parties and the amicus, on November 8, this Court requested responses from Judges Green and Gowan. Their joint response was filed on November 13, 2017, and Judge Gowan filed a separate supplemental response on December 7, 2017.
ISSUES
¶16. The parties stated the issues as follows: 1. Did the circuit court err by unilaterally and non-randomly reassigning the Safeco case to herself?
2. Did the circuit court err by appointing a special master without finding an exceptional condition to justify it and by granting the special master excessive authority not warranted by the facts of the cases, including permitting engagement in unlimited substantive ex parte communications?
3. If the Court finds overcrowding, should it appoint a special judge to hear the Safeco and Liberty Mutual cases instead of allowing a circuit judge to unilaterally delegate judicial authority to an unelected special master, at the parties' expense, including in a case not assigned to the circuit judge?
DISCUSSION
1.
Did the circuit court err by unilaterally and non-randomly reassigning the Safeco case to herself?
¶17. Safeco argues that the sua sponte reassignment of this case violated Rule 1.05A(A) of the Uniform Civil Rules of Circuit and County Court Practice. Safeco also argues that because Rule 1.05A requires assignments to be random, reassignments should be random as well.
¶18. The first question under this issue is whether circuit judges have the authority to reassign or transfer a case. This Court's appellate review of "questions of law are reviewed de novo." Miss. Dep't of Revenue v. Hotel & Rest. Supply, 192 So.3d 942, 945 (Miss. 2016) (citing Equifax, Inc. v. Miss. Dep't of Revenue, 125 So.3d 36, 41 (Miss. 2013)). The Court finds no Rule that prohibits reassignment or transfer of a case to a judge other than the judge to whom the case was initially randomly assigned. Further, the Court has found no Mississippi case that has interpreted this provision explicitly with respect to reassignments or transfers by one judge to another judge in the same district.[7]
¶19. Safeco's argument is that the reassignment order violates Rule 1.05A and this Court's precedent and should be vacated.
¶20. Mississippi does indeed follow a rule of random assignment of cases. In November 2000, this Court promulgated Mississippi Rule of Appellate Procedure 27(g): The setting of terms and assigning of causes in dockets in the chancery and circuit courts shall be done fairly considering the relative workloads of the judges and the right of litigants within the district to fair and reasonable access to all of the judicial officers, as well as reasonable accommodation of the requests and needs of all the judges within the district. Further, the assignment of cases and dockets shall be done through a systematic plan recognizing the criteria set out herein.
Then, to establish such a systematic plan, in May 2003, this Court adopted Rule 1.05A of the rules then known as the Uniform Circuit and County Court Rules: in multi-judge districts and courts, all civil cases shall be assigned immediately on the filing of the complaint by such method which shall insure that the assignment shall be random, that no discernible pattern of assignment exists, and that no person shall know to whom the case will be assigned until it has been assigned . . . .
¶21. Today, we recognize that the reassignment or transfer of cases is not prohibited by rule.8 Therefore, based on our de novo review, the Court concludes that cases may be reassigned or transferred by judges when necessary "to secure the just, speedy, and inexpensive determination of every action." M.R.C.P. 1.9 We now turn to the review of whether Judge Green abused her discretion in the decision to reassign this case.
¶22. On appeal, we...
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