Youso et al v. Pharmacists Mutual Insurance Company

Filing 57

ORDER that Plaintiff's 53 Motion for New Trial is denied. Signed by Judge Neil V Wake on 4/8/2013.(LFIG)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Timothy Youso and Michelle Youso,
Plaintiffs,

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ORDER

vs.

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No. CV-11-8057-PCT-NVW

Pharmacists Mutual Insurance Company,
Defendant.

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Before the Court is Plaintiffs’ Motion for New Trial (Doc. 53) under Fed. R. Civ.

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P. 59.

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I.

LEGAL STANDARD

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“Although Rule 59(e) permits a district court to reconsider and amend a previous

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order, the rule offers an extraordinary remedy, to be used sparingly in the interests of

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finality and conservation of judicial resources.” Kona Enters., Inc. v. Estate of Bishop,

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229 F.3d 877, 890 (9th Cir. 2000) (internal quotation marks and citation omitted). “A

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Rule 59(e) motion may not be used to raise arguments or present evidence for the first

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time when they could reasonably have been raised earlier in the litigation.”

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“Reconsideration under Rule 59(e) is appropriate if (1) the district court is presented with

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newly discovered evidence, (2) the district court committed clear error or made an initial

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decision that was manifestly unjust, or (3) there is an intervening change in controlling

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law.” SEC v. Platforms Wireless Int’l Corp., 617 F.3d 1072, 1100 (9th Cir. 2010).

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“Unless justice requires otherwise, no error in admitting or excluding evidence—or any

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other error by the court or a party—is ground for granting a new trial, for setting aside a

Id.

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verdict, or for vacating, modifying, or otherwise disturbing a judgment or order. At every

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stage of the proceeding, the court must disregard all errors and defects that do not affect

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any party’s substantial rights.” Fed. R. Civ. P. 61.

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II.

ANALYSIS

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Plaintiffs contend that the Order (Doc. 46) granting Defendants summary

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judgment included three errors: (1) reliance on evidence held to be inadmissible hearsay

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and other evidence for which foundation objections were overruled; (2) determining that

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issues regarding Coverage C (personal property) could be decided as a matter of law

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despite disputed facts; and (3) misinterpreting the application of Coverage B (related

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structure). Plaintiffs do not contend that reconsideration is justified because of newly

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discovered evidence or an intervening change in controlling law.

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The Order sustained hearsay objections to specific paragraphs of Defendant’s

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separate statement of facts “to the extent that the paragraphs assert the truth of statements

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made within correspondence attached as Exhibits 11 and 12 to the Declaration of Kirk

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Benson (Doc. 38),” but found admissible “Mr. Benson’s declaration asserting that he

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received the attached correspondence, including specific bids for repairing Plaintiffs’

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residence.” Mr. Benson’s declaration stated that he had determined that the policy would

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provide coverage for loss to Plaintiffs’ residence, including debris removal, of

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$400,339.95. The declaration also stated that Exhibit 11 was a true and correct copy of

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correspondence from Bruce Thomson of Frontier Adjusters. Mr. Benson received Mr.

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Thomson’s correspondence and the enclosed letter from Bob Brown of R.M.B. Inc., dba

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Apple Construction Company, agreeing to do the repair work for $400,339.95. The

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relevancy of the bid is the fact it was made in the stated amount within policy limits. The

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substance of the bid was not hearsay.

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undisputed.

The fact and the good faith of the bid are

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Regarding Coverage C (personal property), the Court did not misunderstand that

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Defendant paid Plaintiffs $132,181.32 based on an incomplete personal property

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inventory they submitted to Defendant. The Complaint alleges that Defendant breached
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its contract and acted in bad faith by failing to timely and reasonably compensate

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Plaintiffs for their personal property losses, but Plaintiffs did not submit to Defendant a

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complete inventory of personal property for which they sought compensation until a year

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after initiating this lawsuit. Defendant could not have breached its contract and acted in

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bad faith by failing to timely and reasonably compensate Plaintiffs as alleged in the

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Complaint if Plaintiffs had not yet submitted to Defendant a complete inventory. Further,

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it is irrelevant that Defendant knew that Plaintiffs believed they were entitled to more

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than $132,181.32 if Plaintiffs did not provide Defendant with a personal property

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inventory showing a loss greater than $132,181.32. Therefore, the Court did not err by

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finding that Plaintiffs had submitted no evidence to the Court that they were entitled to

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more compensation than what they were paid for loss of personal property.

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Regarding Coverage B (related structures), Plaintiffs contend that Coverage B

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adds 10% to the Coverage A limit when the replacement cost of any damaged related

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private structures is less than $1,000, and because no related structures were damaged,

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the Coverage A limit should have been increased by 10%. Although the Coverage B

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limit is initially established as 10% of the Coverage A limit before periodic adjustments,

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the relevant policy endorsement, which is titled “Increased Coverage A Limit,” does not

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mention 10% or damage. Rather, it states that when the combined replacement cost of all

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detached related private structures is less than $1,000, the amount of the Coverage B limit

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will be added to the Coverage A limit. In other words, even though the insured was

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required to pay for coverage for related structures, if there were no related structures or

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the existing related structures could be replaced for less than $1,000, the coverage for

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related structures, which would be essentially useless, would be added to the coverage for

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the residence. But Defendant denied the “increased Coverage A limit” because Mr.

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Benson opined that the detached stone retaining wall had a replacement value exceeding

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$1,000. Plaintiffs did not offer evidence on summary judgment to dispute that opinion.

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Therefore, the Coverage A limit was not increased, and there was no basis for any

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compensation under Coverage B because the retaining wall was not in need of repair or

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replacement.

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IT IS THEREFORE ORDERED that Plaintiffs’ Motion for New Trial (Doc. 53) is
denied.
Dated this 8th day of April, 2013.

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