Stevenson v. Hamilton Mut. Ins. Co.

• Decision Date: 12 November 1996
• Docket Number: No. 07A01-9605-CV-158,07A01-9605-CV-158
• Citation: 672 N.E.2d 467
• Parties: Barbara Mitchell STEVENSON, Annalou Freeman, and Wyrtis Mitchell, by her next friend Annalou Freeman, Appellants-Plaintiffs and Lee Etta R. Mitchell, Individually and as Personal Representative of the Estate of George David Mitchell, deceased, d/b/a Serenity Chapel, Appellants-Defendants/Cross-Claim Plaintiffs v. HAMILTON MUTUAL INSURANCE CO., Appellee-Defendant.
• Court: Indiana Appellate Court

Page 467

672 N.E.2d 467

Barbara Mitchell STEVENSON, Annalou Freeman, and Wyrtis

Mitchell, by her next friend Annalou Freeman,

Appellants-Plaintiffs

and

Lee Etta R. Mitchell, Individually and as Personal

Representative of the Estate of George David

Mitchell, deceased, d/b/a Serenity

Chapel, Appellants-Defendants/Cross-Claim Plaintiffs v. HAMILTON MUTUAL INSURANCE CO., Appellee-Defendant.

No. 07A01-9605-CV-158.

Court of Appeals of Indiana.

Nov. 12, 1996.

Rehearing Denied Jan. 8, 1997.

Frank A. Barnhart, Barnhart Sturgeon & Spencer, Bloomington, William C. Lloyd, Ferguson Ferguson & Lloyd, Bloomington, for appellants-plaintiffs.

Karl L. Mulvaney, Nana Quay-Smith, Patrick A. Elward, Bingham Summers Welsh & Spilman, Indianapolis, for appellee-defendant.

OPINION

ROBERTSON, Judge.

George David Mitchell [Decedent] and his wife, Lee Etta R. Mitchell [Widow], both licensed funeral directors, had operated a mortuary business known as Serenity Chapel. Decedent had founded and developed the business. After Decedent's death, Widow continued to run the business as the sole owner and director. Decedent was buried in a cemetery under the direction of Serenity Chapel. Widow and Serenity Chapel were insured under a Business Owner's Policy with a Mortician's Malpractice Endorsement issued by the Hamilton Mutual Insurance Company [Insurance Company].

In 1991, Decedent's daughter, Barbara Mitchell Stevenson [Daughter], initiated a will contest in the Jackson Circuit Court against Widow (who was Decedent's second wife and not Daughter's mother) alleging that Widow had misappropriated Daughter's rightful inheritance by exerting undue influence and fraud over Decedent. At the courthouse on the day that trial was scheduled, Daughter and Widow entered into a settlement agreement, the terms of which were recited in open court and incorporated into a court order. Under the agreement, Widow was to pay Daughter certain sums of money and execute certain documents. The agreement also provided that Daughter could purchase and place a monument on her father's grave in the cemetery and, generally, bear responsibility for maintaining the grave. Daughter purchased and placed a monument on her father's grave.

Widow did not perform her part of the agreement, was held in contempt, and was sanctioned by the trial court. Eventually Widow paid Daughter the money owed under the agreement.

However, over the 1994 Memorial Day weekend, Decedent's mother, Wyrtis Mitchell (now deceased) [Mother] and sister (Daughter's aunt), Annalou Freeman [Sister], visited Decedent's grave and discovered that the body had been disinterred and was missing along with the monument which had marked the grave. It was later learned that Widow had caused the body to be disinterred and reburied elsewhere in the cemetery. The new grave had been marked with a used monument engraved with the name and dates of another person. This discovery caused Daughter, Mother, and Sister pain, anguish, and mental suffering.

Daughter, Mother, and Sister sought relief in the pending Jackson Circuit Court lawsuit requesting compensatory and punitive damages against Widow for 1) breach of the settlement agreement, 2) conversion of the monument, and 3) the intentional infliction of emotional distress for her deliberate, willful, outrageous, and bad faith conduct in desecrating Decedent's grave. The trial court held an evidentiary hearing on the matter at which all parties were represented by counsel and presented evidence. It was learned that Widow had applied to the State Board of Health to disinter Decedent before Daughter had placed the monument on the grave, thus establishing that Widow had never intended to honor the settlement agreement/court order with respect to Daughter's right to maintain her father's grave. The trial court entered specific findings to the effect that Widow had covertly, without any notice to the court, counsel, or family members, disinterred Decedent's body as part of a bad faith, malicious, and oppressive plan to vindictively retaliate against the Daughter and Decedent's family with the intention to cause them great anguish. The trial court found Widow, as well as Serenity Chapel, to be liable for the:

independent tortious conduct that is accurately described as bad faith, fraudulent, oppressive, malicious, and constitutes extreme and outrageous conduct designed to intentionally, recklessly, expectedly, and proximately cause severe emotional distress and harm to [Daughter, Mother, and Sister].

The trial court awarded compensatory damages in favor of Mother and Sister in the amount of $75,000.00 each for:

the severe emotional distress, depression, anxiety, and apprehension caused to her by [Widow's] tortious and calculated conduct in disinterring [Decedent] as above described, ...

The trial court awarded Daughter 1) $3,000.00 for the conversion of the monument pursuant to Ind.Code 34-4-30-1 (Civil remedy for crimes against property); and 2) $50,000.00 for the severe emotional distress, anxiety, depression, and apprehension caused by Widow's conduct in disinterring Decedent. The trial court imposed punitive damages in the amount of $150,000.00 to be shared by Daughter, Mother, and Sister. Widow/Serenity Chapel appealed the decision of the Jackson Circuit Court, and that appeal is presently pending before this court (but, not before the panel in the instant case).

The present declaratory judgment action was then initiated in the Brown Circuit Court against the Insurance Company which has refused to defend or indemnify Widow/Serenity Chapel for the judgment based upon a standard policy exclusion for "intentional or expected conduct." The Insurance Company obtained summary judgment on that basis, and this appeal ensued. Two appellant's briefs have been submitted--one by Daughter, Mother's estate, and Sister, and the other by Serenity Chapel. For simplicity, we will refer to all appellants collectively as Widow. The appellants have submitted an aggregate of eleven issues, which we restate and consolidate into two, neither of which constitutes reversible error. Additional facts are supplied as necessary.

DECISION

In reviewing a motion for summary judgment, this court applies the same standard as the trial court. American Family Mutual Insurance Co. v. Dye, 634 N.E.2d 844, 846 (Ind.Ct.App.1994), trans. denied. We must determine whether there is a genuine issue of material fact and whether the law has been correctly applied by the trial court. Cloverleaf Apartments, Inc. v. Town of Eaton, 641 N.E.2d 665, 667 (Ind.Ct.App.1994). Summary judgment is appropriate only if no genuine issues of material fact exist and the moving party is entitled to judgment as a matter of law. Ind.Trial Rule 56(C); Heck v. Robey, 659 N.E.2d 498, 500 (Ind.1995). Neither the trial court, nor the reviewing court, may look beyond the evidence specifically designated to the trial court. Seufert v. RWB Medical Income Properties I Ltd. Partnership, 649 N.E.2d 1070, 1072 (Ind.Ct.App.1995). Once the movant for summary judgment has established that no genuine issue of material fact exists by submission of materials contemplated by T.R. 56, the nonmovant may not rest on his pleadings but must set forth specific facts, using supporting materials contemplated under the rule, which show the existence of a genuine issue for trial. Liberty Mutual Insurance Company v. Metzler, 586 N.E.2d 897, 900 (Ind.Ct.App.1992), trans. denied. A trial court's grant of summary judgment is "clothed with a presumption of validity," and the appellant bears the burden of demonstrating that the trial court erred. Rosi v. Business Furniture Corp., 615 N.E.2d 431, 434 (Ind.1993).

The interpretation of a insurance policy is primarily a question of law for the court, and it is therefore a question which is particularly well-suited for disposition by summary judgment. Sutton v. Littlepage, 669 N.E.2d 1019, 1021 (Ind.Ct.App.1996). Where there is an ambiguity, policies are to be construed strictly against the insurance company. Id. Strict construction against the insurer is "driven by the fact that the insurer drafts the policy and foists its terms upon the customer." Id. The insurance companies write the policies; we buy their forms or we do not buy insurance. Id. Thus, the insurance company is bound by the plain and ordinary meaning of the words viewed from the standpoint of the insured. Id. However, there is no rule of construction that every term in an insurance contract must be defined, and the mere fact that a term is not defined does not render it ambiguous. Harden v. Monroe Guaranty Insurance Company, 626 N.E.2d 814, 817 (Ind.Ct.App.1993), trans. denied. Whether a contract is ambiguous is a question of law; and where the court determines there is no ambiguity, the terms of the contract are conclusive and the construction of those terms is also a matter of law to be determined by the court. Id. An insurance contract is ambiguous when it is susceptible to more than one interpretation and reasonably intelligent persons would honestly differ as to its meaning. Id. An ambiguity does not exist simply because a controversy exists between the parties, with each favoring a different interpretation. Id.

An unambiguous policy must be enforced according to its terms, even those which limit the insurer's liability. Trisler v. Indiana Insurance Company, 575 N.E.2d 1021, 1023 (Ind.Ct.App.1991). Courts may not extend coverage delineated by the policy nor may it rewrite the clear and unambiguous language of the policy. Id. However, an exclusionary clause will not be read so broadly as to effectively exclude all coverage. Id.

Widow makes an extraordinarily meticulous argument based upon isolated words, punctuation, and quotation marks (or the lack thereof), and the marketing brochures in an attempt to demonstrate certain ambiguities in the policy at issue. Widow's points are often taken out of context and do not materially affect the...