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Montoya v. Loya Insurance Co.

United States District Court, D. New Mexico

March 11, 2019

LOYA INSURANCE COMPANY, a foreign corporation doing business in New Mexico,, Defendants.




         THIS MATTER comes before the Court on Plaintiff's Motion For Partial Summary Judgment Regarding Bad Faith And Violations Of The Unfair Claims Practices Act, filed July 11, 2018. Doc. 8. Defendant Loya Insurance Company filed a response in opposition on August 8, 2018. Doc. 17. Plaintiff filed a reply on September 11, 2018. Doc. 28. The Court orders that the Motion be denied for the reasons explained below.


         A. Procedural History

         Plaintiff filed this suit on May 17, 2018 in state court. Doc. 1-1 (“Compl.”). On June 25, 2018, Defendant removed the case to federal court. Doc. 1. In its Notice of Removal, Defendant alleged the existence of subject-matter jurisdiction under 28 U.S.C. § 1332. Id. at 2. Plaintiff did not move to remand, and the Court finds that the allegations in the Notice of Removal are sufficient to establish this Court's subject-matter jurisdiction.

         In her Complaint, Plaintiff contends that she was in a motor vehicle accident on October 3, 2016. Compl. ¶ 8. The accident was the fault of the other driver, who fled the scene. Compl. ¶¶ 9-10. Plaintiff made a claim for Uninsured Insurance Benefits with her auto insurance company, Defendant Loya. Compl. ¶ 11. Defendant informed Plaintiff on November 1, 2016 that there was no coverage for the accident because it was outside of the policy period. Compl. ¶ 16. Defendant took a recorded statement from Plaintiff but lost it. Compl. ¶¶ 18-19. Plaintiff was forced to file suit against Defendant in state court in February 22, 2017. Compl. ¶ 20. On January 25, 2018, the jury rendered a verdict in favor of Plaintiff against Defendant in the amount of $23, 742.82. Compl. ¶¶ 45-46. Defendant continued to delay paying the claim even after the verdict. Compl. ¶ 51. The failure to pay caused Plaintiff financial hardship. Compl. ¶ 32. The Complaint brings claims for Breach of Contract, Insurance Bad Faith, Unfair Insurance Claim Practices, and Unfair Trade Practices. Doc. 1-1 at 5-9.

         On July 11, 2018, Plaintiff filed the present Motion for Partial Summary Judgment. Doc. 8. Defendant opposed it, arguing in part that it needed further discovery in order to fully respond to the motion. Docs. 17 & 17-5. Meanwhile, the Court set scheduling deadlines and the parties have been conducting discovery. On November 16, 2018, Defendant filed a motion for a protective order, seeking to prohibit discovery of Defendant's employees' conduct and communications during the underlying lawsuit, and to shield the production of materials related to a presentation on bad faith by current defense counsel to Defendant's adjusters. Doc. 37. The Court granted the motion in part. It found that “litigation conduct by Loya adjusters and employees during the underlying litigation is not relevant to whether Loya acted in bad faith by failing to pay Plaintiff's claim” and such evidence is therefore excluded from the scope of discovery. Doc. 53 at 5. It also found the requested material to be protected by attorney-client privilege and, after in camera review, ordered that the presentation on bad faith need not be disclosed. Doc. 53 at 6-9 & Doc. 56.

         B. Motion for Partial Summary Judgment

         At issue in Plaintiffs Motion are two auto insurance policies Plaintiff purchased from Defendant:

. Policy No. 62-604581180, effective from August 11, 2016 to February 11, 2016. See Doc. 8 at 2 ¶¶ 1-2 and Doc. 17 at 2 ¶¶ 1-2 (more or less agreeing on the existence of this policy). This policy will be referred to as “the 2016 Policy.”
. Policy No. 62-385323290, effective from April 2, 2015 to October 2, 2015 but canceled on June 2, 2015. See Doc. 17-2. This policy will be referred to as “the 2015 Policy.”

         The parties agree that, on October 3, 2016, Plaintiff was in a motor vehicle collision involving an unknown driver who fled the scene, and Plaintiffs property was damaged as a result. Doc. 8 at 2 ¶¶ 4-5; Doc. 17 at 2 ¶¶ 4-5. Plaintiff made an Uninsured Motorist Insurance (“UMI”) claim under her auto insurance and reported the claim to her insurer. Doc. 8 at 3 ¶ 6; Doc. 17 at 3 ¶ 6.

         From here, the parties' stories differ slightly. Plaintiff asserts that Defendant denied the claim on the basis that “the damages claimed did not happen within the policy period.” Doc. 8 at 3 ¶ 7. Plaintiff hired an attorney and filed suit, but Defendant continued to deny the claim as being outside the coverage period. Id. at 3 ¶¶ 8-9. Defendant attended a mediation and made settlement offers. Id. at 3 ¶ 9. The case went to trial and the jury found Plaintiff 0% at fault and awarded $23, 742.82 in damages on January 25, 2018. Id. at 3 ¶¶ 11-13. Defendant did not pay the claim until June 29, 2018, despite multiple requests for payment from Plaintiff. Id. at 4 ¶¶ 16-19.

         On the other hand, Defendant maintains that Plaintiff first opened a claim under the 2016 Policy (the “2016 Policy Claim”). Doc. 17 at 5 ¶ 1. Defendant informed Plaintiff she had UMI coverage on her policy. Id. at 6 ¶ 5. Defendant never denied the 2016 Policy Claim. Id. at 6 ¶ 4. Defendant was in communication with Plaintiff about the 2016 Policy Claim throughout mediation and trial. Id. at 7-8 ¶¶ 14, 17. Defendant asserts that on November 1, 2016, for reasons unknown, Plaintiff opened a second claim for the car accident under the 2015 Policy (the “2015 Policy Claim”). Id. at 6 ¶ 6. Because the 2015 Policy did not cover the 2016 accident, Defendant denied the 2015 Policy Claim. Id. at 7 ¶¶ 9-10. After the verdict in Plaintiff's favor was rendered, Defendant delayed payment due to advice of counsel pending the resolution of disputed issues regarding costs, pre- and post-judgment interest and a lien from First Recovery Group. Id. at 8 ¶ 18. Defendant disputes that Plaintiff made multiple requests for payment between the date of the verdict and the date of payment. Id. at 4 ¶ 16.

         Based on Plaintiff's version of events, she filed the present Motion for Partial Summary Judgment on liability.

         STANDARD ...

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