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Harrell v. Allstate Property & Casualty Insurance Co.

United States District Court, S.D. Mississippi, Southern Division

December 7, 2017




         BEFORE THE COURT are the [48] Motion for Partial Summary Judgment filed by Defendant Allstate Property and Casualty Insurance Company, and the [50] Motion for Summary Judgment filed by Plaintiff Kathy Harrell in this automobile insurance case. The motions have been fully briefed. After due consideration of the submissions, it is the Court's opinion that Allstate's affirmative defenses identified by Harrell should be dismissed. It is also clear that the tortfeasor was driving an underinsured motor vehicle under Mississippi law. Accordingly, Harrell's Motion for Summary Judgment will be granted. Additionally, the Court concludes that Allstate has shown that it is entitled to summary judgment regarding Harrell's claims of bad faith and other extra-contractual damages. Both Motions will be granted.

         I. Background

         Harrell complains about Allstate's handling of her claim for underinsured motorist benefits after she was struck from behind by Alice Arena while waiting at a stop sign. Both drivers are insured by Allstate. Harrell does not name Arena but alleges a negligence claim against her. As against Allstate, Harrell alleges she is entitled to $50, 000 in underinsured motorist benefits and Allstate is acting in bad faith by failing to pay that amount. (Id. at 4-7). Allstate concluded after its investigation of her claim that “Mrs. Harrell has been fully compensated for her injuries by the underlying carrier and her medical payments coverage.” (2d Am. Compl. Ex. 1, ECF No. 13-1).

         Harrell seeks summary judgment on two affirmative defenses asserted by Allstate, and a finding that Arena was driving an underinsured motor vehicle under Mississippi law. Allstate seeks summary judgment on the issue of its liability for bad faith, asserting that it has a reasonable basis for denying payment of benefits, and this is a pocketbook dispute not suitable for punitive or extra-contractual damages under Mississippi law.

         II. Legal Standard

         Summary judgment is granted when “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Kemp v. Holder, 610 F.3d 231, 234 (5th Cir. 2010) (citing Fed.R.Civ.P. 56(a)). The “burden of production at trial ultimately rests on the nonmovant” and the movant must merely show an “absence of evidentiary support in the record for the nonmovant's case.” Cuadra v. Houston Indep. Sch. Dist., 626 F.3d 808, 812 (5th Cir. 2010). The nonmoving party must then come forward with specific facts showing that there is a genuine issue for trial. Id. The Court must draw justifiable inferences in favor of the nonmovant, provided there is sufficient evidence to draw the inference. State Farm Life Ins. Co. v. Gutterman, 896 F.2d 116, 118 (5th Cir. 1990). There is “no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986).

         III. Discussion

         A. Harrell's Motion For Partial Summary Judgment

         Harrell seeks summary judgment and dismissal of the fourth and fifth affirmative defenses asserted by Allstate: “each and every applicable affirmative defense, ” and mitigation of damages. (Allstate Answer 9, ECF No. 17). Allstate does not oppose dismissal of these affirmative defenses. (See Allstate Resp. 1, ECF No. 54). They will be dismissed.

         Harrell also seeks summary judgment on the issue of “whether the vehicle driven by Arena was an ‘Uninsured Motor Vehicle' under Mississippi law.” (Harrell Mem. 8, ECF No. 51). She refers to the Mississippi statute defining an underinsured vehicle as an uninsured vehicle.[1] Harrell submits that because the uninsured coverage of her two vehicles can be stacked, she has $50, 000 in coverage, which is greater than Arena's $25, 000 in coverage. Harrell therefore claims she is entitled to UM/UIM benefits totaling $50, 000.

         Harrell contends that Allstate has denied that Arena was an uninsured motor vehicle in its 30(b)(6) deposition, and asks the Court to recognize that the “undisputed facts satisfy the definition of ‘Uninsured Motor Vehicle' under Mississippi law.” (Harrell Mem. 8, ECF No. 51). But in her reply she states that she “seeks summary judgment on whether Arena is an ‘uninsured motorist' under Mississippi law, not an ‘uninsured auto' under Allstate's policy.” (Harrell Reply 3, ECF No. 58). It is not clear to the Court what declaration Harrell seeks, or if there is any real difference in her formulations. The statute at issue here mandates uninsured motorist coverage in insurance policies, but does not define an “uninsured motorist.” Instead, it speaks in terms of uninsured vehicles. See Miss. Code Ann. § 83-11-101, et seq.

         However, after reviewing Allstate's response and the transcript of the 30(b)(6) deposition, it appears that the parties agree that Arena's vehicle was underinsured as defined by Mississippi statute. Disagreement arose when the deponent was pressed to agree that Arena was underinsured - her $25, 000 in coverage was inadequate to compensate Harrell. (See Harrell Mem. Ex. 1, at 25-27, ECF No. 51-1). The Allstate deponent was understandably reluctant to give the impression that Allstate agreed that Arena's liability and Harrell's injuries were such that Arena was actually underinsured. That is the ultimate issue in this case, and will be determined after Arena's liability for Harrell's damages, and the extent of those damages, are proven. Thus the Court grants summary judgment as to Harrell's original formulation of her issue, and concludes that Arena's vehicle meets the definition of an Uninsured Motor Vehicle under Mississippi law because Arena had less UM/UIM coverage than Harrell. See Byrd v. Hutchinson, 876 So.2d 1092, 1095 (Miss. Ct. App. 2004) (underinsured motorist coverage is determined solely by a comparison of the tortfeasor's liability coverage and the personal coverage carried by, or available to the injured party).

         B. Allstate's Motion for Partial Summary Judgment

         Allstate requests dismissal of the bad faith punitive damages claim and any extra-contractual damages claim, arguing that this case presents a pocketbook dispute that cannot support bad faith or punitive damages in Mississippi. Allstate argues that it has not denied Harrell's claim - it has evaluated the claim as having been fully satisfied, subject to consideration of “any additional documentation you have to review.” (2d Am. Compl. Ex. 1, ECF No. 13-1). Allstate states that Harrell has “already recovered $30, 000 between the tort carrier and her medical payments coverage.” (Allstate Mem. 17, ECF No. 49). Allstate argues that its reasons for having evaluated the claim as it did are supported by 1) Harrell's medical records, which indicate that she had suffered from back pain for five to six months prior to the accident and reached ...

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