Stapley v. Minnesota Life Insurance Co.
Filing
50
MEMORANDUM DECISION AND ORDER-granting in part and denying in part 33 Motion for Summary Judgment. Defendant is GRANTED summary judgment on Plaintiff's claim that it breached the implied covenant of good faith and fair dealing by initially denying Plaintiff's claim under the Policy. Defendant's motion for summary judgment is DENIED as to Plaintiff's claim for breach of contract and her claim that Defendant breached the implied covenant of good faith and fair dealing by delaying, and failingto conduct, its investigation into and evaluation of her claim under the Policy. Signed by Judge Clark Waddoups on 5/8/19. (jmr)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF UTAH
KELLY STAPLEY,
MEMORANDUM DECISION AND
ORDER DENYING IN PART AND
GRANTING IN PART MOTION FOR
SUMMARY JUDGMENT
Plaintiff,
vs.
MINNESOTA LIFE INSURANCE CO.,
Defendant.
Case No. 2:17-cv-653
Judge Clark Waddoups
Before the court is Defendant Minnesota Life Insurance Co.’s Motion for Summary
Judgment (ECF No. 33). The motion has been fully briefed, and the court heard argument on the
same on April 17, 2019. Having reviewed the pleadings and materials submitted and considered
the arguments of counsel, the court now enters this order DENYING IN PART AND
GRANTING IN PART Defendant’s motion.
BACKGROUND
Plaintiff is the daughter of the late Conrad Jahries. (ECF No. 2, at ¶ 1, Compl.) Mr.
Jahries died in his home on October 17, 2015, at the age of 84. Id. at ¶ 5. His body was found
by his hospice nurse, Penny Johnson, who is now deceased. Nurse Johnson reported that she
found Mr. Jahries “in the doorway to his bathroom . . . with his head against the door jam [sic]”
and with “copious amounts of dried blood coming from his mouth and nose.” (ECF No. 32-3.)
No one witnessed Mr. Jahries’s death, and an autopsy was not performed on his body. On Mr.
Jahries’s death certificate, his cause of death was attributed to a stroke. (ECF No. 33-7.)
Mr. Jahries was the owner of an accidental death and dismemberment insurance policy
(the “Policy), which Defendant sold to him. (ECF No. 2, at ¶ 6, Compl.) Plaintiff is the
beneficiary of the Policy. The Policy states that Defendant will only provide benefits “when the
insured’s loss results directly—and independently—from all other causes, from an accidental
bodily injury which was unintended, unexpected and unforeseen.” (ECF No. 33-2, at p. 4.) The
Policy further states that “[t]he bodily injury must be evidenced by a visible contusion or wound”
and that it “must be the sole cause of the insured’s loss.” Id. The Policy excludes payment
“where the insured’s loss or injury is caused directly or indirectly by, results from, or there is
contribution from . . . bodily or mental infirmity, illness or disease . . . .” Id. at p. 5.
Plaintiff made a claim under the Policy. By letter dated May 25, 2016, Defendant denied
Plaintiff’s claim because Mr. Jahries’s death was “caused directly or indirectly by, resulted from
or there was contribution from bodily or mental infirmity, illness or disease.” (ECF No. 33-10,
at p. 2.) Defendant’s denial letter further stated that it had not been provided any information to
support the conclusion that Mr. Jahries’s death resulted from an accidental bodily injury. Id. On
March 17, 2017, Plaintiff, through her counsel, sent Defendant a letter appealing its denial and
offering evidence to support her assertion that Mr. Jahries’s death was the result of an accidental
bodily injury. (ECF No. 33-12.) Enclosed with this letter were: 1) a statement prepared by
Nurse Johnson, stating that she found Mr. Jahries “in the doorway to his bathroom . . . with his
head against the door jam [sic]” and with “copious amounts of dried blood coming from his
mouth and nose” and a letter written by Dr. Rothfeder, stating that it was his “medical opinion in
this matter is that Mr. Jahries suffered a slip and fall ambulating to the bathroom, blunt cranial
trauma, and a fatal traumatic brain injury” and that he “found no evidence that any of Mr.
Jahries’ [sic] chronic medical conditions contributed in any way to his sudden death.” Id.
Defendant received and reviewed Mr. Jahries’s medical records and referred the file to its
own doctor, Dr. Dennis Lee. Dr. Lee opined that the available records were both “consistent and
2
supportive” of the cause of death listed on the death certificate (a stroke) and “supportive of a
medical event that cause[d] Mr. Jahries to collapse and be later found deceased.” (ECF No. 3316, at p. 2–3.) Defendant therefore upheld its denial of Plaintiff’s claim.
Plaintiff thereafter initiated this action, seeking payment of benefits and asserting that
Defendant breached the Policy and acted in bad faith in handling and denying its claim. The
parties have conducted discovery, including the depositions of Dr. Rothfeder, Dr. Lee, and Dr.
Joseph, who was the hospice physician who signed Mr. Jahries’s death certificate. Plaintiff also
disclosed a report prepared by Dr. Rothfeder stating that his “medical opinion in this matter is
that Mr. Jahries suffered a slip and fall ambulating to the bathroom, blunt cranial trauma, and a
fatal traumatic brain injury” and that he “found no evidence that any of Mr. Jahries’ [sic] chronic
medical conditions contributed in any way to his sudden death.” (ECF No. 32-1, at p. 3.)
ANALYSIS
Summary judgment is proper when the moving party demonstrates that there is no
genuine issue of material fact and that it is entitled to judgment as a matter of law. FED. R. CIV.
P. 56(A). A material fact is one that may affect the outcome of the litigation. See Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The moving party bears the initial burden of
showing an absence of evidence to support the nonmoving party’s case. Celotex Corp. v.
Catrett, 477 U.S. 317, 325 (1986). “Once the moving party meets this burden, the burden shifts
to the nonmoving party to demonstrate a genuine issue for trial on a material matter.” Id. The
court must “view the evidence and draw reasonable inferences therefrom in a light most
favorable to the nonmoving party.” Commercial Union Ins. Co. v. Sea Harvest Seafood Co., 251
F.3d 1294, 1298 (10th Cir. 2001).
3
Defendant argues that it is entitled to summary judgment on Plaintiff’s claims for breach
of contract and breach of the implied covenant of good faith and fair dealing. Much of
Defendant’s motion relies on its contemporaneously-filed motion to exclude testimony of Dr.
Rothfeder (ECF No. 32) being granted, but the court recently denied that motion in part,
allowing Dr. Rothfeder to offer testimony that Mr. Jahries fell and died as the exclusive result of
that fall. (ECF No. 49.) Such testimony, if believed by the jury, “may affect the outcome of the
litigation” and therefore creates genuine issues of material fact that preclude Defendant from
being granted summary judgment. See Anderson, 477 U.S. at 248.
A. Defendant is not entitled to summary judgment on Plaintiff’s claim for breach of contract.
Defendant argues that it is entitled to summary judgment on Plaintiff’s claim for breach
of contract because, as a matter of law, Plaintiff cannot establish the elements of a covered loss
under the Policy and because Mr. Jahries’s death is explicitly excluded under the Policy.
Defendant asserts, and for purposes of this motion Plaintiff does not contest, that Plaintiff
must prove four elements in order to prevail on her breach of contract claim and recover under
the Policy: 1) Mr. Jahries died directly from a blunt cranial trauma suffered in a slip-and-fall; 2)
Mr. Jahries died from a blunt cranial trauma independently from all other causes; 3) the blunt
cranial trauma was evidenced by a visible contusion or wound; and 4) the blunt cranial trauma
was the sole cause of death. Defendant argues that there is no evidence in the record to support
any of these findings, but Dr. Rothfeder’s opinions cover each.
Dr. Rothfeder’s opinion that Mr. Jahries fell, struck his head, and suffered blunt cranial
trauma and a fatal traumatic brain injury satisfies the first element. (ECF No. 32-1, at p. 4–5.)
Although Dr. Rothfeder is precluded from offering expert testimony as to the cause of Mr.
Jahries’s fall (ECF No. 49), the evidence is clear that Mr. Jahries did in fact fall. Nurse Johnson
found him on the ground “with his head against the door jam [sic].” (ECF No. 32-3.) The cause
4
of his fall is an open, and material, question of fact that must be decided by the jury. The second
and fourth elements are satisfied by Dr. Rothfeder’s testimony and opinion that Mr. Jahries’s
death was sudden and not contributed to by any of medical conditions. Those opinions are
supported by his medical experience, his opinion that Mr. Jahries “wasn’t in bad shape for his
age,” and his reliance on Nurse Johnson’s representations that Mr. Jahries’s “vital signs were
excellent the day prior to his death.” (ECF No. 32-1, at p. 5; ECF No. 39-2, at p. 68:19–82:6.)
Finally, the third element requiring a visible contusion or wound is met by Dr. Rothfeder’s report
which shows that Mr. Jahries was found with “copious amounts of dried blood coming from his
mouth and nose.” (ECF No. 32-3.) Dr. Rothfeder’s reports, opinions, and testimony address
each of these necessary elements, and when accepted as true, establish that Plaintiff can prove
her case for breach of contract.
Defendant next argues that Mr. Jahries’s death is explicitly excluded by the Policy, which
does not cover losses caused or contributed to by bodily infirmity, illness, or disease. Defendant
argues that Mr. Jahries had a number of medical conditions that caused him to become weak and
fall leading up to his death and that Plaintiff cannot show that these conditions did not contribute
to Mr. Jahries’s fall here. This argument is similar to Defendant’s assertions that Plaintiff cannot
satisfy the second and fourth elements above, and it fails for the same reasons—Dr. Rothfeder’s
opinion offers a basis for the jury to find that Mr. Jahries’s fall was the sole cause of his death.
Defendant’s motion for summary judgment on Plaintiff’s claim for breach of contract is denied.
B. Defendant is not entitled to summary judgment on Plaintiff’s claim that its investigation
of her claim breached the implied covenant of good faith and fair dealing.
Plaintiff alleges that Defendant breached the implied covenant of good faith and fair
dealing and acted in bad faith in denying her claim under the Policy. Under Utah law, an insurer
is entitled to challenge claims that are “fairly debatable” and “cannot be held to have breached
5
the implied covenant if it chooses to do so.” Billings v. Union Bankers Ins. Co., 918 P.2d
461,465 (Utah 1996). Here, the varied opinions as to Mr. Jahries’s cause of death and the open
question as to what caused him to fall make this claim “fairly debatable” and therefore preclude
Plaintiff from establishing its claim of bad faith for denial. Callioux v. Progressive Ins. Co., 745
P.2d 838, 842 (Utah Ct. App. 1987) (“If the evidence presented creates a factual issue as to the
claim’s validity, there exists a debatable reason for denial, thereby legitimizing the denial of the
claim, and eliminating the bad faith claim.”) Defendant is therefore entitled to summary
judgment on Plaintiff’s claim that its initial denial of her claim breached the implied covenant of
good faith and fair dealing.
However, Plaintiff also alleges that Defendant acted in bad faith by delaying its
investigations into her claim for months, by failing to collect evidence for months, and by failing
to interview important witnesses. Plaintiff asserts that it was not until she was forced to hire Dr.
Rothfeder that Defendant requested Mr. Jahries’s medical records and completed a thorough
review of her claim. Defendant argues that the reliable information it initially received, mainly
Mr. Jahries’s death certificate stating that he died from a stroke and his fall questionnaire
showing he had a history of medically-caused falls, was conclusive and established that no
further inquiry or investigation was required to evaluate Plaintiff’s claim.
Under Utah law, “‘when confronted with a claim for benefits by a first-party insured, the
insurer must “‘diligently investigate the facts . . . fairly evaluate the claim, and . . . act promptly
and reasonably in rejecting or settling the claim.’” Billings, 918 P.2d at 465 (emphasis and
omissions in original) (quoting Beck v. Farmers Ins. Exch., 701 P.2d 795, 801 (Utah 1985)).
Thus, Plaintiff’s bad faith claim asks whether Defendant fairly evaluated Plaintiff’s claim by
relying on the initial documents it received and whether Defendant’s investigations and
6
evaluations into her claim were prompt and reasonable. Based on the evidence before it, the
court cannot answer these questions as a matter of law—they are for the jury to decide.
Defendant is not therefore entitled to summary judgment on Plaintiff’s claim that the manner by
which Defendant investigated, or failed to investigate, her claim, and the time that Defendant
took to complete its investigation, breached the implied covenant of good faith and fair dealing.
CONCLUSION
For the reasons stated above, the court HERBY DENIES IN PART AND GRANTS IN
PART Defendants’ Motion for Summary Judgment (ECF No. 33). Defendant is GRANTED
summary judgment on Plaintiff’s claim that it breached the implied covenant of good faith and
fair dealing by initially denying Plaintiff’s claim under the Policy. Defendant’s motion for
summary judgment is DENIED as to Plaintiff’s claim for breach of contract and her claim that
Defendant breached the implied covenant of good faith and fair dealing by delaying, and failing
to conduct, its investigation into and evaluation of her claim under the Policy.
DATED this 8th day of May, 2019.
BY THE COURT:
_______________________________
Clark Waddoups
United States District Judge
7
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?