Talbert v. Progressive Northwestern Insurance Company

Filing 9

ORDER granting 5 motion for summary judgment in favor of Progressive Northwestern Insurance Company. Signed on 1/29/14 by Magistrate Judge John T. Maughmer. (Alexander, Pam)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
SOUTHERN DIVISION
Patricia Talbert,

)
)
Plaintiff,
)
)
v.
)
)
Progressive Northwestern Insurance Company, )
)
Defendants.
)

Civil Action Number
13-03379-CV-S-JTM

ORDER
On November 7, 2009, plaintiff Patricia Talbert (“Talbert”) was injured when a 2005
Honda motorcycle on which she was a passenger (and that was being operated by husband) was
involved in an accident. At the time of the accident, Talbert’s husband had obtained an
insurance policy [No. 57240310-0] on the motorcycle from defendant Progressive Northwestern
Insurance Company (“Progressive”). The policy had a liability limit of $100,000 per person, but
with a limit of $25,000 per person if the “household exclusion clause” applied. Progressive
determined that the clause did apply to Talbert and paid Talbert $25,000.
A year after the motorcycle accident, Progressive filed a declaratory judgment action in
the Circuit Court of Henry County, Missouri, seeking a declaration that “Policy No. 57240310-0
provided only $25,000 of liability coverage to [Talbert’s husband] for injuries to Patricia Talbert
[for the motorcycle accident].” Progressive Northwestern Insurance Company v. Patricia
Talbert, Case No. 10TE-CC00491 (Mo. Cir. Ct. [Henry Cty.]), Petition for Declaratory
Judgment, at 3. Thereafter, Talbert answered and asserted that:
[Talbert] is entitled to a declaratory of law [sic] that she is entitled
to insurance coverage pursuant to the contract provided by
[Progressive] of $100,000 for the injuries she sustained in [the
motorcycle] accident.

Progressive Northwestern Insurance Company v. Patricia Talbert, Case No. 10TE-CC00491
(Mo. Cir. Ct. [Henry Cty.]), Answer of Defendant Patricia Talbert, at 3. After the parties filed
cross motions for summary judgment, the state court trial judge entered a Judgment in favor of
Talbert “on the unpaid policy limits of seventy five thousand dollars.” Progressive Northwestern
Insurance Company v. Patricia Talbert, Case No. 10TE-CC00491 (Mo. Cir. Ct. [Henry Cty]),
Judgment, at 1. 1
Progressive then appealed the case to the Missouri Court of Appeals, Southern District.
On March 26, 2013, the appellate court reversed the trial court judgment, finding that (1) the
“household exclusion clause” was partially enforceable under Missouri law, and (2) the
Progressive policy was not unenforceable due to ambiguity or unconscionableness. Progessive
Northwestern Insurance Co. v. Talbert, 407 S.W.3d 1, 8 (Mo. App. [S.D.] 2013). In addition,
the court of appeals noted that Talbert additionally argued that she was “entitled to Underinsured
Motorist Coverage” under the Progressive policy. Id. at 11 n.14. The court, however, noted that
Talbert had not raised this argument in her original motion for summary judgment before the
trial court and, as such, the appellate court would not consider the argument. Id. (citing MO. R.
CIV. P. 74.04(c)).
Following Talbert’s loss in the state appellate court, she filed the present action in the
Circuit Court of Wright County, Missouri, seeking damages from Progressive’s alleged
vexatious refusal to pay “underinsured motorist coverage” to Talbert. After Progressive
removed the case to this Court, it filed the presently pending motion for summary judgment.
Progressive argues that this lawsuit must be dismissed based on res judicata. The Court agrees.
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The trial court found that the aforementioned “household exclusion clause”
rendered the insurance policy “an unconscionable adhesion contract.” Progressive
Northwestern Insurance Company v. Patricia Talbert, Case No. 10TE-CC00491 (Mo. Cir. Ct.
[Henry Cty]), Judgment, at 1.
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It is well-settled that “[t]he law of the forum that rendered the first judgment controls the
res judicata analysis.” C.H. Robinson Worldwide, Inc. v. Lobrano, 695 F.3d 758, 764 (8th Cir.
2012) (quoting Laase v. County of Isanti, 638 F.3d 853, 856 (8th Cir. 2011). Here, the state
courts of Missouri rendered the first judgment. Under Missouri law:
The compulsory counterclaim rule is simply the codification of the
principles of res judicata and collateral estoppel. Claims and issues
which could have been litigated in a prior adjudicated action are
precluded in a later action between the same parties or those in
privity with them. The function of this rule is to serve as a means
of bringing all logically related claims into a single litigation,
through the penalty of precluding the later assertion of omitted
claims.
Adamson v. Innovative Real Estate, Inc., 284 S.W.3d 721, 728-29 (Mo.App. [S.D.] 2009). In
Missouri, to determine if a cause of action is single and cannot be split, a trial court must
consider:
(1)

whether the separate actions brought arise out of the same act or
transaction; and

(2)

whether the parties, subject matter, and evidence necessary to
sustain the claim are the same in both actions.

Hollida v. Hollida, 190 S.W.3d 550, 556 (Mo. App. [S.D.] 2006). Moreover, the term
“transaction” has been held to be a term of broad and flexible meaning which is intended to
include all the facts and circumstances constituting the foundation of a claim and should be
applied so as to bring all logically related claims into a single litigation. Scott v. Flynn, 946
S.W.2d 248, 252 (Mo. App. [E.D.] 1997).
Applying these tenets to the case at hand, the Court concludes that Talbert could have
(and, thus, should have) asserted a claim for coverage under the “underinsured motorist”
provisions of the Progressive policy when she asserted her claims in the original underlying state
court declaratory judgment action. Indeed, it is not clear that Talbert did not actually raise the
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claim with state trial court. As Talbert noted in her brief with the Missouri appellate court, she
believed that in answering the declaratory judgment action “she affirmatively pled that she was
entitled to a declaration of law that she was entitled to insurance coverage pursuant to the
contract provided by [Progressive] of $100,000 for the injuries she sustained.” Whether Talbert
specifically argued for coverage for an “underinsured motorist,” is somewhat ambiguous. What
is evident, however, is that Talbert was seeking coverage under the Progressive policy in the
state court and, consequently, was required to assert any and all of her claims for coverage under
such policy in the state court. Moreover, the fact that Talbert’s present claim is one for alleged
vexatious refusal to pay does not save her from the application of res judicata. Compare
Creative Walking, Inc. v. American States Insurance Co., 25 S.W.3d 682, 687 (Mo. App. [E.D.
2000) (res judicata barred insured’s vexatious-refusal-to-pay claim which could have been raised
in insurer’s original declaratory judgment).
For the foregoing reasons, it is
ORDERED that Defendant Progressive Northwestern Insurance Company’s Motion For
Summary Judgment, filed October 28, 2013 [Doc. 5] is GRANTED. Accordingly judgment in
this matter is entered in favor of Progressive Northwestern Insurance Company.

/s/ John T. Maughmer
John T. Maughmer
United States Magistrate Judge

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