Taylor v. Nationwide Mut. Ins. Co., 31154.

• Decision Date: 21 November 2003
• Docket Number: No. 31154.,31154.
• Citation: 214 W.Va. 324,589 S.E.2d 55
• Parties: Thomas W. TAYLOR, Plaintiff, v. NATIONWIDE MUTUAL INSURANCE COMPANY and Scarlett Tarley, Defendants.
• Court: West Virginia Supreme Court

589 S.E.2d 55

214 W.Va. 324

Thomas W. TAYLOR, Plaintiff, v. NATIONWIDE MUTUAL INSURANCE COMPANY and Scarlett Tarley, Defendants.

No. 31154.

Supreme Court of Appeals of West Virginia.

Submitted September 24, 2003.

Decided November 21, 2003.

Robert D. Aitcheson, Esq., Charles Town, David J. Romano, Clarksburg, West Virginia, Attorney for Plaintiffs.

Anita R. Casey, Esq., MacCorkle, Lavender, Casey & Sweeney, Charleston, West Virginia, Attorney for Defendants.

Paul T. Farrell, Jr., Esq., Wilson, Frame, Benninger & Metheney, Michael J. Romano, Esq., Romano Law Office, for Amicus Curiae, West Virginia Trial Lawyers Association.

James S. Crockett, Jr., Esq., Attorney for Amicus Curiae, West Virginia Insurance Federation. MAYNARD, Justice:

In this case, we answer a certified question from the United States District Court for the Northern District of West Virginia. The certified question is as follows:

Does a cause of action exist in West Virginia to hold an insurance company's employee claims adjuster personally liable for violations of the West Virginia Unfair Trade Practices Act, W.Va.Code § 33-11-1, et seq?¹

Upon review of the arguments of the parties and the applicable law, we hold that a cause of action exists in West Virginia to hold a claims adjuster employed by an insurance company personally liable for violations of the West Virginia Unfair Trade Practices Act, W.Va.Code §§ 33-11-1 to—10.

According to W.Va.Code § 51-1A-3 (1996):

The supreme court of appeals of West Virginia may answer a question of law certified to it by any court of the United States ... if the answer may be determinative of an issue in a pending cause in the certifying court and if there is no controlling appellate decision, constitutional provision or statute of this state."

The answer to the certified question herein is determinative of an issue in a pending cause of action in the federal district court, and there is no controlling precedent. Consequently, certification is a proper means to decide this issue.²

I. FACTS

The general facts as set forth in the pleadings and the record are as follows. In March 1998, the plaintiff, Thomas Taylor, a resident of Jefferson County, West Virginia, purchased from an agent in Maryland a Nationwide auto insurance policy. In December 2001, Mr. Taylor was involved in a two-car vehicle accident in which he was injured. The driver of the other vehicle was determined to be at fault. Mr. Taylor settled with the driver of the other vehicle for the $100,000 per person liability limit on the other driver's auto liability policy.

Mr. Taylor then filed a claim with defendant herein Nationwide Mutual Insurance Company to receive underinsured motorist coverage on his Nationwide policy.³ According to the declarations page of the policy, the limits of his coverage were $20,000 per person and $40,000 per occurrence. Mr. Taylor claimed, however, that these limits were incorrect because Nationwide did not offer him the opportunity to purchase optional levels of underinsured motorist coverage in the manner required by law.⁴ In an April 18, 2002, letter, Scarlett Tarley, a claims adjuster for Nationwide and a defendant in this case, informed Mr. Taylor that "it is our position that policy limits are $20,000.00[,]" and "[w]e have found the waivers to be valid in regards to this matter."⁵ The letter also informed Mr. Taylor that Nationwide was issuing him a check for the policy limits.

Mr. Taylor subsequently sued Nationwide and claims adjuster Scarlett Tarley in the Circuit Court of Jefferson County alleging breach of fiduciary duty, breach of contract, and bad faith against Nationwide, and unfair claims settlement practices against both Nationwide and Ms. Tarley.⁶

Thereafter, Nationwide and Ms. Tarley filed a Notice of Removal of the plaintiff's case in the United States District Court for the Northern District of West Virginia.⁷ As a basis for removal to federal court, the defendants asserted that Ms. Tarley, a resident of West Virginia, had been fraudulently joined as a party in order to defeat the district court's diversity jurisdiction because there is no actionable claim against Ms. Tarley recognized by West Virginia law.⁸

Mr. Taylor then filed a Motion to Remand the action to state court. Subsequently, the District Court requested that the parties submit memoranda of law regarding the propriety of naming an insurance company's employee claims adjuster for purposes of defeating a federal court's diversity jurisdiction.

By order of January 24, 2003, the District Court certified the question set forth above to this Court. The District Court also stated that if such a cause of action exists, it will remand the case to the Jefferson County Circuit Court. If such a cause of action does not exist, it will deny the remand motion and dismiss Ms. Tarley as a defendant.

II. STANDARD OF REVIEW

We recognized in Syllabus Point 1 of Light v. Allstate Ins. Co., 203 W.Va. 27, 506 S.E.2d 64 (1998) that "[a] de novo standard is applied by this Court in addressing the legal issues presented by a certified question from a federal district or appellate court."

III. DISCUSSION

This is a straightforward case of statutory interpretation in that we are called upon to construe the provisions of the Unfair Trade Practices Act, W.Va.Code § 33-11-1 to—10. "The primary object in construing a statute is to ascertain and give effect to the intent of the Legislature." Syllabus Point 1, Smith v. State Workmen's Compensation Com'r, 159 W.Va. 108, 219 S.E.2d 361 (1975). "Once the legislative intent underlying a particular statute has been ascertained, we proceed to consider the precise language thereof." State ex rel. McGraw v. Combs Services, 206 W.Va. 512, 518, 526 S.E.2d 34, 40 (1999). Moreover, when we interpret a statutory provision, this Court is bound to apply, and not construe, the enactment's plain language. We have held that "[a] statutory provision which is clear and unambiguous and plainly expresses the legislative intent will not be interpreted by the courts but will be given full force and effect." Syllabus Point 2, State v. Epperly, 135 W.Va. 877, 65 S.E.2d 488 (1951), see also Martin v. Randolph County Bd. of Educ., 195 W.Va. 297, 312, 465 S.E.2d 399, 414 (1995)

(quoting Connecticut Nat'l Bank v. Germain, 503 U.S. 249, 253-54, 112 S.Ct. 1146, 1149, 117 L.Ed.2d 391, 397 (1992) ("[C]ourts must presume that a legislature says in a statute what it means and means in a statute what it says there.").

The purpose of the Unfair Trade Practices Act "is to regulate trade practices in the business of insurance ... by defining, or providing for the determination of, all such practices in this State which constitute unfair methods of competition or unfair or deceptive acts or practices and by prohibiting the trade practices so defined or determined." W.Va. Code § 33-11-1 (1974). The Act achieves this purpose by expressly prohibiting any person from engaging "in any trade practice which is defined in this article as, or determined pursuant to section seven [§ 33-11-7] of this article to be, an unfair method of competition or an unfair or deceptive act or practice in the business of insurance." W.Va.Code § 33-11-3 (1974). Unfair methods of competition and unfair or deceptive acts or practices are defined in detail in W.Va.Code § 33-11-4 (2002). In order to enforce the Act, the State Insurance Commissioner is granted the power to issue cease and desist orders; require the payment of penalties to the State; and revoke or suspend the license of a violator of the Act. W.Va.Code § 33-11-6 (1974).

In addition, W.Va.Code § 33-11-6(c) provides that "[n]o order of the [Insurance Commissioner] pursuant to this article or order of court to enforce it, or holding of a hearing, shall in any manner relieve or absolve any person affected by such order or hearing from any other liability, penalty or forfeiture under law." Based in part on this subsection, this Court has held that "[a]n implied private cause of action may exist for a violation by an insurance company⁹ of the unfair settlement practice provisions of W.Va.Code, 33-11-4(9)[.]"¹⁰ Syllabus Point 2, in part, Jenkins v. J.C. Penney Cas. Ins. Co., 167 W.Va. 597, 280 S.E.2d 252 (1981),overruled on other grounds by State ex rel. State Farm Fire & Cas. Co. v. Madden, 192 W.Va. 155, 451 S.E.2d 721 (1994)

(footnote added). In Jenkins, this Court explained that its "past acceptance of an implied cause of action for a statutory violation is deeply ingrained. We are virtually the only jurisdiction that permits a private cause of action for violations of statutes requiring sidewalks to be in good repair." Jenkins, 167 W.Va. at 600,

280 S.E.2d at 255 (footnote and citations omitted). We also based our decision on the fact that "the administrative remedy provides no direct relief for an injured person, but only provides sanctions against the company or fines in favor of the State." Jenkins, 167 W.Va. at 605,

280 S.E.2d at 257(footnote omitted). Finally, this Court noted that "the strong policy declaration in our statute against unfair insurance practices initially suggests the appropriateness of a private cause of action." Id. See also Mutafis v. Erie Ins. Exchange, 174 W.Va. 660, 328 S.E.2d 675 (1985) (holding that a private cause of action exists for violations of W.Va. Code §§ 33-11-4(3) and (5) of the Unfair Trade Practices Act) and Morton v. Amos-Lee Securities, Inc., 195 W.Va. 691, 466 S.E.2d 542 (1995) (holding that a private cause of action exists for violations of W.Va. Code § 33-11-4(1)(a) of the Act).¹¹

Because this Court has already determined that a private cause of action exists for violations of the Unfair Trade Practices Act, we need only to look to the express terms of the Act to determine whether individual claims adjusters fall within its scope. If individual claims adjusters fall within the scope of the Act, Jenkins and its progeny compel the conclusion that a...