Case Title: Doctors' Co. v. Insurance Corp. of America

Citation: 

Docket Number: 92-68

State: wyoming

Court: Wyoming Supreme Court

Date: 1992-09-15T00:00:00Z

Document:
Doctors' Co. v. Insurance Corp. of America1993 WY 151864 P.2d 1018Case Number: 92-68, 92-270Decided: 12/06/1993Supreme Court of Wyoming
The 
DOCTORS' COMPANY, a California corporation, 

Appellant 
(Plaintiff),

v. 

The 
INSURANCE CORPORATION OF AMERICA, a Texas corporation;

 and Stanley W. Peters, MD, 

Appellees 
(Defendants). (Two Cases).

Appeal 
from the District Court of Park County, Hunter Patrick, 
J.

Arthur 
H. Downey and Laurel E. Adams, Denver, CO, for Doctors' 
Co.

Judith 
A. Studer of Schwartz, Bon, McCrary & Walker, Casper, for Insurance Corp. 
of America.

Robert 
M. Shively of Murane & Bostwick, Casper, for Stanley W. Peters, 
M.D.

Before 
MACY, C.J., and THOMAS, CARDINE, GOLDEN and TAYLOR, 
JJ.

TAYLOR, 
Justice.

[¶1]      In these 
consolidated appeals, we are required to determine which "claims made" 
professional liability insurer provides coverage when a potential claim is 
reported to the former insurer but the actual claim is made during the coverage 
period of the present insurer. The present insurer of a Wyoming physician 
challenges the district court's grant of summary judgment in favor of the former 
insurer. The district court determined that no claim, as defined by the former 
insurer's policy, had been made during that company's applicable coverage 
period.

[¶2]      We affirm. 

I. 
ISSUES

[¶3]      In Appeal No. 
92-68, The Doctors' Company, appellant and the present insurer, identifies the 
following issues:

     1. Whether the trial 
court erred in holding, as a matter of law, that no "claim" had been made 
against Stanley W. Peters, M.D., prior to the expiration of his insurance policy 
with the Insurance Corporation of America.

     2. Whether the record 
shows, as a matter of law, that notice of the Wardell claim was given to the 
Insurance Corporation of America during its coverage 
period.

     3. Whether the trial 
court erred in finding that there were no material issues of fact existing 
between the parties to this action.

[¶4]      Appellee, Stanley 
W. Peters, M.D., presents a single issue for this appeal:

Whether 
the failure of the appellant to contest its policy's coverage for Dr. Peters in 
the underlying personal injury action either here or in the court below acts as 
a waiver or an estoppel of its previously made reservation of rights as to that 
coverage.

[¶5]      The Insurance 
Corporation of America, appellee and the former insurer, 
questions:

     Whether the court 
erred in holding, as a matter of law, that there was no coverage for Dr. Peters 
for the Wardell incident under the policy issued by the Insurance Corporation of 
America.

[¶6]      More 
specifically, this issue has two subparts. They are:

     A. Whether the trial 
court erred in holding as a matter of law that a "claim", as that term is 
defined in the policy, was not made during the policy 
period.

     B. Whether The 
Doctors['] Company can rely upon a self-serving, conclusory affidavit prepared 
by its counsel to raise a disputed issue of fact in order to defeat summary 
judgment.

[¶7]      In Appeal No. 
92-270, appellant, The Doctors' Company, questions whether the district court 
abused its discretion in denying relief from judgment under W.R.C.P. 
60(b).

[¶8]      Appellee, Stanley 
W. Peters, M.D., takes no position on the issue presented in this 
appeal.

[¶9]      Appellee, The 
Insurance Corporation of America, responds with the following 
issues:

1. 
Did the lower court's finding that the appellant failed to bring itself within 
Rule 60(b) constitute an abuse of discretion?

2. 
Did the lower court err, as a matter of law, in finding that "Plaintiff's 
Responses To Defendant West Park Hospital And Board of Trustees' First 
Interrogatories" would not [a]ffect the court's prior decision granting summary 
judgment to [The Insurance Corporation of America]?

II. 
FACTS

[¶10]   On May 13, 1987, Neal Wardell 
(Wardell) fell on the school playground in Burlington, Wyoming during recess. 
The seven-year-old child struck the back of his neck on a rock. Injured and 
complaining of pain and weakness in his arms and legs, Wardell was immobilized 
and brought, by ambulance, to West Park Hospital in Cody, 
Wyoming.

[¶11]   At the hospital, Stanley W. Peters, 
M.D. (Dr. Peters), an emergency room physician, examined Wardell along with an 
orthopedic surgeon. The diagnostic process included a range of motion test. At 
some point, Wardell was permitted to walk and use the bathroom. However, 
Wardell's neurological functions continued to diminish and the doctors ordered 
him transferred, by helicopter, to St. Vincent Hospital in Billings, Montana. 
The next day, as his condition deteriorated, the treating physician in Billings 
transferred Wardell to Children's Hospital in Denver, Colorado. Wardell left 
that hospital a quadriplegic with permanent injury to the seventh cervical 
vertebra.

[¶12]   On May 12, 1989, Wardell and his 
parents (collectively Wardell) simultaneously filed tort claims under the 
Wyoming Governmental Claims Act against the Big Horn County School District No. 
1 and West Park Hospital and filed a negligence action against the orthopedic 
surgeon and West Park Hospital. The negligence action alleged a breach in the 
standard of care by failing to keep Wardell immobilized. As discovery proceeded, 
it was determined that Dr. Peters was an independent contractor and not a 
hospital employee at the time he treated Wardell. Consequently, on November 13, 
1989, Wardell and his parents filed a separate action against Dr. Peters 
alleging negligence. Following a settlement of the claims against the Big Horn 
County School District No. 1 and West Park Hospital, the underlying negligence 
actions continued, on remand, following this court's decision in Wardell v. 
McMillan, 844 P.2d 1052 (Wyo. 1992).

[¶13]   When Dr. Peters treated Wardell, 
Insurance Corporation of America (ICA) insured Dr. Peters for professional 
liability on a "claims made" basis. ICA also insured Dr. Peters on a "claims 
made" basis at the time the May 12, 1989 Wardell complaint was filed against the 
orthopedic surgeon and West Park Hospital. On September 13, 1989, Dr. Peters 
completed an application for renewal of his ICA policy in which he stated: "I 
was involved 2 years ago in [a] case in which this hospital [West Park Hospital] 
and [a] consulting physician [were] sued recently. I am not sued but am 
named in the interrogatory. Note: thus far I have not been named in 
suit." (Emphasis in original.)

[¶14]   On October 16, 1989, Dr. Peters 
completed an application for professional liability insurance on a "claims made" 
basis with The Doctor's Company (TDC). In describing potential claims, Dr. 
Peters identified Wardell as a former patient and indicated: "I was involved in 
this case 2+ years ago; I was not named in suit (consultant, hospital and 
nurses were)[;] I felt it prudent to report it to ICA [and] did so. I was not 
sued." (Emphasis in original.) Dr. Peters identified the status of the claim 
as an open claim, but "[n]ot against me."

[¶15]   Coverage under Dr. Peters' 
professional liability insurance with ICA expired on November 1, 1989. On the 
same date, TDC issued a professional liability policy on a "claims made" basis 
insuring Dr. Peters. The TDC policy included retroactive coverage to November 1, 
1986.

[¶16]   Service of process for the November 
13, 1989 Wardell complaint against Dr. Peters occurred on December 1, 1989. Dr. 
Peters promptly notified his local insurance agent, ICA and TDC. Dr. Peters' 
handwritten letter to ICA reported:

     This letter is to 
inform you that I was finally named in a law suit of alleged malpractice. The 
incident occurred 5/13/87 - the patient's name was Neal W. Wardell. I notified 
Norm Cooper of Lander Valley Ins. verbally a long time ago and notified you on 
my application renewal form a couple months ago - at that time I was not sued - 
now I am. I'm waiting to hear from you.

Sincerely,

[Signature]

P.S. 
My papers were served 1 Dec. 89.

[Initials]

[¶17]   TDC notified Dr. Peters that under 
the terms of that company's professional liability policy, no coverage would be 
provided. On behalf of Dr. Peters, TDC tendered the defense of the November 13, 
1989 Wardell complaint to ICA. ICA refused determining that no coverage existed 
under its former policy with Dr. Peters because the claim, defined by ICA as a 
"demand for money, services or property made upon you," was not actually made 
during the coverage period.

[¶18]   TDC filed the declaratory judgment 
action that is the subject of Appeal No. 92-68 to determine the respective 
liabilities, if any, of ICA and TDC to Dr. Peters. ICA denied liability 
maintaining that because Dr. Peters had failed to purchase an Extended Reporting 
Endorsement on his ICA policy, "claims made" coverage had expired before the 
actual claim was made. ICA counterclaimed that sole liability for Dr. Peters' 
coverage belonged to TDC. Dr. Peters asserted that either ICA or TDC, under 
their respective policies, were required to tender a defense to the underlying 
negligence action and be liable for the payment of any judgment from that 
action.

[¶19]   The district court ruled, on cross 
motions for summary judgment, in favor of ICA. The district court found, despite 
Dr. Peters report to ICA of a potential claim following the filing of the May 
12, 1989 Wardell complaint against the hospital and the orthopedic surgeon, no 
actual claim was made against Dr. Peters until the November 13, 1989 Wardell 
complaint was filed and service of process was accomplished on December 1, 1989. 
The district court determined that the language of the ICA policy was 
unambiguous and ICA had no coverage obligation because that policy expired 
before a "demand for money, services or property" was made upon Dr. Peters. 
Since the actual claim was made after the effective date of the professional 
liability policy issued by TDC, the district court determined that coverage 
existed for Dr. Peters under the TDC policy. TDC appeals the district court's 
order.

[¶20]   After Appeal No. 92-68 was filed, 
TDC sought a limited remand to permit the district court to consider a motion 
for relief from judgment under W.R.C.P. 60(b). This court denied the motion, but 
established a procedure permitting district courts to consider W.R.C.P. 60(b) 
motions during the pendency of an appeal. The Doctors' Co. v. The Insurance 
Corp. of America, 837 P.2d 685 (Wyo. 1992). TDC filed a motion for relief from 
judgment under that procedure maintaining that due to mistake, inadvertence, or 
excusable neglect, an interrogatory response had been omitted from supporting 
exhibits on behalf of TDC's motion for summary judgment. The interrogatory, from 
West Park Hospital, requested from Wardell the names of agents and employees of 
the hospital that Wardell alleged were negligent. Wardell responded that Dr. 
Peters was one of those agents or employees. The district court denied the 
W.R.C.P. 60(b) motion. The district court ruled that the interrogatory response 
would not have changed its prior decision. TDC filed Appeal No. 92-270 to 
challenge that decision. This court ordered both appeals 
consolidated.

III. 
DISCUSSION

[¶21]   The fundamental issue of this 
declaratory judgment action questions whether ICA or TDC should defend Dr. 
Peters and possibly pay any judgment against him in the underlying negligence 
action. The answer requires this court to interpret the insurance policies 
governing the relationships between the respective parties. Insurance policies 
are contracts. St. Paul Fire and Marine Ins. Co. v. Albany County School Dist. 
No. 1, 763 P.2d 1255, 1258 (Wyo. 1988); Ricci v. New Hampshire Ins. Co., 721 P.2d 1081, 1085 (Wyo. 1986). As with any contract, interpretation of an 
unambiguous contract presents an issue of law which may be appropriately 
considered by summary judgment. Continental Ins. v. Page Engineering Co., 783 P.2d 641, 651 (Wyo. 1989); Ricci, 721 P.2d  at 1085. A summary judgment will be 
affirmed on appeal if there is no genuine issue of material fact and the 
prevailing party is entitled to judgment as a matter of law. W.R.C.P. 56(c). No 
special deference is accorded to the district court's decision on issues of law. 
Darlow v. Farmers Ins. Exchange, 822 P.2d 820, 823 (Wyo. 
1991).

[¶22]   Our established rules of contract 
interpretation apply to insurance policies. Albany County School Dist. No. 1, 
763 P.2d  at 1258; Hursh Agency, Inc. v. Wigwam Homes, Inc., 664 P.2d 27, 31 
(Wyo. 1983). Interpretation is the process of ascertaining the meaning of the 
words used to express the intent of the parties. Commercial Union Ins. Co. v. 
Stamper, 732 P.2d 534, 539 (Wyo. 1987); 4 Walter H.E. Jaeger, Williston on 
Contracts § 600A at 286 (3d. ed. 1961). The intent of the parties is determined 
by considering the instrument which memorializes the agreement of the parties as 
a whole. Klutznick v. Thulin, 814 P.2d 1267, 1270 (Wyo. 1991). This court 
utilizes a standard of interpretation for insurance policies which declares that 
the words used are given the plain meaning that a reasonable person, in the 
position of the insured, understands them to mean. Worthington v. State, 598 P.2d 796, 806 (Wyo. 1979); Wilson v. Hawkeye Casualty Co., 67 Wyo. 141, 215 P.2d 867, 873-74 (1950). See also Abifadel v. Cigna Ins. Co, 8 Cal. App. 4th 145, 9 Cal. Rptr. 2d 910, 919 (1992).

[¶23]   If the language is unambiguous, our 
examination is confined to the "four corners" of an integrated contract and 
extrinsic evidence is not admitted to contradict the plain meaning. Prudential 
Preferred Properties v. J and J Ventures, Inc., 859 P.2d 1267, 1271 (Wyo. 1993). 
The language of an insurance policy is ambiguous if it is capable of more than 
one reasonable interpretation. Helfand v. National Union Fire Ins. Co. of 
Pittsburgh, Pa., 10 Cal. App. 4th 869, 13 Cal. Rptr. 2d 295, 299 (1992). Because 
insurance policies represent contracts of adhesion where the insured has little 
or no bargaining power to vary the terms, if the language is ambiguous, the 
policy is strictly construed against the insurer. Albany County School Dist. No. 
1, 763 P.2d  at 1258; 7 Walter H.E. Jaeger, Williston on Contracts § 900 at 19, 
29 (3d ed. 1963). However, the language will not be "`tortured'" to create an 
ambiguity. Stamper, 732 P.2d  at 539 (quoting McKay v. Equitable Life Assur. Soc. 
of United States, 421 P.2d 166, 168 (Wyo. 1966)).

[¶24]   Traditionally, liability insurance 
has consisted of "occurrence" policies in which the insurer provides coverage if 
the covered event or injury occurs during the policy period, regardless of the 
time the actual claim is made. See St. Paul Fire and Marine Ins. Co. v. House, 
315 Md. 328, 554 A.2d 404, 406 (1989) (discussing differences between 
"occurrence" and "claims made" policies). A problem posed by such policies is 
that in product liability and in professional liability actions, the injury 
usually occurs during one policy period and the claim is made during subsequent 
policy periods. The series of product liability actions against asbestos 
manufacturers illustrate the time that some claims require to mature. See, e.g., 
Keene Corp. v. Insurance Co. of North America, 667 F.2d 1034 (D.C. Cir. 1981), 
cert. denied, 455 U.S. 1007, 102 S. Ct. 1644, 71 L. Ed. 2d 875 (1982). As a means 
of achieving a greater degree of underwriting certainty, many liability insurers 
utilize "claims made" policies. Under these policies, liability is indemnified 
when a claim is made or made and reported to the insurer during the policy term. 
See generally, 1 Rowland H. Long, The Law of Liability Insurance, § 1.08[4] 
(1991); Robert Knowles, The Reporting Of "Potential Claims" Under A Claims-Made 
Policy, 35 For The Defense 23 (July 1993).

[¶25]   If Dr. Peters' professional 
liability insurance policy with ICA had been an "occurrence" type, ICA would 
have had to provide coverage because the negligent treatment for which liability 
is alleged by Wardell occurred during the ICA policy period. However, the ICA 
policy conspicuously states it is a "claims made" policy. Under the policy, ICA 
agreed to pay "all sums," up to the coverage limit, which Dr. Peters became 
legally obligated to pay as damages for medical services he provided or should 
have provided if the "claim" was "first made" during the policy period. The 
terms "claim" and "first made" are defined in the ICA 
policy:

A 
claim is defined as a demand for money, services or property made upon you. A 
claim will be considered as being first made when you receive notice of such 
demand.

We 
agree with the district court that the language of the ICA policy is plain and 
unambiguous.

[¶26]   TDC argues that Dr. Peters' 
knowledge of the negligence action against the orthopedic surgeon and West Park 
Hospital, coupled with the knowledge that Dr. Peters treated Wardell should 
constitute a sufficient "claim" under the ICA policy. TDC suggests support for 
its position exists in the language of the May 12, 1989 Wardell complaint, which 
states:

     After the emergency 
room physicians made a diagnosis that there was spinal cord involvement, Neal 
Wardell was placed in a room and was negligently allowed to get up and move 
about including allowing him to use the bathroom when he had known neurological 
deficits and when the hospital, its agents and employees knew or should have 
known that any movement of the spinal cord when there is demonstrable 
neurological deficit is a deviation from the standard of 
care.

TDC 
maintains Dr. Peters knew he was one of the emergency room physicians against 
whom negligence was alleged.

[¶27]   The basic weakness in the TDC 
position is that Dr. Peters was not a named party in the May 12, 1989 Wardell 
complaint. The ICA definition of "claim" requires a "demand * * * made upon you 
[the insured]." Dr. Peters was never served in connection with the action filed 
against the orthopedic surgeon and West Park Hospital. Even if we assume Dr. 
Peters was one of the "emergency room physicians" generally described in the May 
12, 1989 Wardell complaint and assume Dr. Peters was aware of the specific 
allegations made in that action, the undisputed material fact remains that there 
was no "demand" made against Dr. Peters in the May 12, 1989 Wardell 
complaint.

[¶28]   A "demand" is a word for which a 
plain meaning, as used by a reasonable person in the position of the insured, 
may be determined. Wilson, 215 P.2d  at 873-74. A "demand" is the assertion of a 
legal right. Black's Law Dictionary 429 (6th ed. 1990). A "demand" is made by 
asking with authority or challenging as due. Smith v. Municipal Court of 
Glendale Judicial Dist., Los Angeles County, 167 Cal. App. 2d 534, 334 P.2d 931, 
934 (1959); Snipes v. Snipes, 55 N.C. App. 498, 286 S.E.2d 591, 595, aff'd, 306 
N.C. 373, 293 S.E.2d 187 (1982). The filing of a lawsuit against a named party 
certainly constitutes a "demand." Berry v. McLeod, 124 Ariz. 346, 604 P.2d 610, 
613 (1979). A letter directed to the party against whom a claim of right is 
asserted also constitutes a "demand." Southwestern Life Ins. Co. v. Green, 768 S.W.2d 445, 449 (Tex. App. 1989). However, it would torture the meaning of 
"demand" to find that the filing of a lawsuit in which Dr. Peters was not a 
named party, or the mere presence of Dr. Peters' name in an interrogatory 
response from a party to a lawsuit, constituted a demand against Dr. 
Peters.

[¶29]   Dr. Peters understood that no 
"demand" had been made against him when the May 12, 1989 Wardell complaint was 
filed or when he was named in the interrogatory responses of Wardell or of West 
Park Hospital. In his application for renewal, Dr. Peters informed ICA of the 
pending action and the fact that he was named in an interrogatory and 
emphatically stated: "Note: thus far I have not been named in suit." (Emphasis 
in original.) In his application for coverage to TDC, Dr. Peters also informed 
that company of the pending action, but declared: "I was not sued." (Emphasis in 
original.)

[¶30]   We hold that no "demand" was made 
by Wardell upon Dr. Peters sufficient to constitute a "claim" under the ICA 
policy prior to the expiration of that policy on November 1, 1989. We agree with 
the view stated in Abifadel, 9 Cal.Rptr.2d at 920:

     In defining "claims," 
the law focuses on the claimant's formal demands for service or payment and does 
not recognize a request for an explanation, the expression of dissatisfaction or 
disappointment, mere complaining, or the lodging of a grievance as a claim. In 
both its ordinary meaning and in the interpretation given to it by other courts 
in similar circumstances, a claim is a demand for something as a right or as 
due.

As 
a matter of law, the filing of a lawsuit which omits the insured as a named 
party and fails to accomplish service of process to the insured does not 
constitute a "claim" against the insured.

[¶31]   Alternatively, TDC argues that the 
language of the ICA policy permits the time of making the actual claim to relate 
back to the time that Dr. Peters had "notice" of a potential claim. TDC achieves 
this interpretation by a tortured reading of the sentence that defines "first 
made" in the ICA policy. We do not find ambiguity in this provision. 

[¶32]   Under the ICA policy, "[a] claim 
will be considered as being first made when you receive notice of such demand." 
Reading the ICA policy as a whole, this sentence makes the ICA policy a "claims 
made" policy as distinguished from a "claims made and reported" policy. The 
plain meaning that a reasonable insured would give to "notice" is the actual 
receipt of a demand for money, services or property in the form of service of 
process, a letter, or possibly an oral declaration. See Smith v. Southeastern 
Properties, Ltd., 776 S.W.2d 106, 109 (Tenn. App. 1989) (holding, under Rules of 
Civil Procedure, "notice" means notice that a lawsuit asserting a legal claim 
has been filed).

[¶33]   The practical application of 
"notice" as used in the ICA policy is easily demonstrated. The Wardell complaint 
against Dr. Peters was filed on November 13, 1989. Service of process to Dr. 
Peters was accomplished on December 1, 1989. Under the plain language of the ICA 
policy, the date the actual "claim" was made became December 1, 1989. Dr. Peters 
received "notice," in the form of service of process, of the "demand" made 
against him on that date. December 1, 1989 was one month after the ICA policy 
expired.

[¶34]   As used in the ICA policy, "notice" 
does not equate with "knowledge." Dr. Peters had knowledge of a potential claim 
against him because of the action filed against the orthopedic surgeon and West 
Park Hospital. He communicated this knowledge to both ICA and TDC in the 
insurance applications. Dr. Peters' knowledge of a potential claim and his 
communication to ICA, however, did not create an actual claim under the 
unambiguous language of that company's policy.

[¶35]   The definition of "claim" in the 
ICA policy and the customary use of the term in the insurance industry are 
distinguishable. The "claim" defined by the ICA policy is an assertion of legal 
rights made against the insured (hereinafter legal claim). The customary 
reference in the insurance industry to a claim is the shortened form of claim 
for benefits. A claim for benefits is a demand for indemnification under terms 
of a policy of insurance made by the insured and submitted to the insurer 
(hereinafter insurance claim). See Wyo. Stat. § 26-15-124(a) 
(1991).

[¶36]   The position TDC asserts relies 
upon Dr. Peters' knowledge of a potential legal claim and his application for 
renewal of the ICA policy as creating an insurance claim. We agree that in some 
circumstances a report of a potential claim could create liability. In St. Paul 
Fire & Marine Ins. Co. v. Edge Memorial Hosp., 584 So. 2d 1316, 1322-23 (Ala. 
1991), the court held that ambiguous language in a "claims made" policy failed 
to distinguish between an insurance claim and a legal claim. The insurer had 
failed to define the meaning of the term "claim." Id. at 1322. As a result, the 
court determined that the insured's report of a potential claim, in the manner 
required by the policy, constituted an actual claim. The insurer was required to 
defend and pay claims despite the fact that the actions against the insured were 
filed after the policy expired.

[¶37]   The language of the ICA policy, 
however, cannot be read to create a "claim," as defined by the policy, from a 
report of a potential claim. ICA required its insured to report a "claim 
incident" to the company by telephone:

In 
order to provide you with the best possible claim defense, we ask that the 
following matters be promptly reported to the Claim Division of 
ICA.

1. 
A serious complaint by a patient or client, especially those coupled with a 
threat of legal action.

2. 
An attorney's request for medical records if the reason for the request is 
unclear.

3. 
An attorney's letter advising the investigation of a possible 
claim.

4. 
Receipt of Suit Papers - If suit papers are received, a Phone Notification 
should be made to ICA the same day of receipt. Because there is a time limit for 
answering a lawsuit, these matters must be reported immediately. 

A 
claim is defined as a demand for money, services or property made upon you. 
While the abovementioned items may not qualify as a claim and are, therefore, 
not eligible for coverage under the policy, they should be reported to 
us.

It 
is undisputed that Dr. Peters never used this procedure to report a potential 
claim. Even if he had, until Dr. Peters received service of process of the 
November 13, 1989 Wardell complaint, no "claim" was made.

[¶38]   TDC assumes too much from 
expressions of subjective intent, as derived from the May 12, 1989 Wardell 
complaint and the interrogatories. TDC contends that all parties responsible for 
Wardell's treatment should have known they would be subject to liability. While 
Wardell may have been misinformed about Dr. Peters' status as an independent 
contractor of West Park Hospital, the assertion of a legal right, a demand, 
against Dr. Peters was not communicated until the November 13, 1989 Wardell 
complaint was filed and service of process was accomplished on December 1, 1989. 
The point at which Wardell's intent to make a demand upon Dr. Peters might be 
supposed cannot substitute for the actual presentation of a 
demand.

[¶39]   We hold as a matter of law that 
under the unambiguous language of the ICA policy, ICA had no coverage obligation 
for the claim made by Dr. Peters as a result of the Wardell action against him. 
The first point at which a "claim," as defined by the ICA policy, was asserted 
against Dr. Peters was December 1, 1989. Coverage under the ICA policy expired 
on November 1, 1989. Our holding that ICA had no coverage obligation foretells 
TDC's coverage obligation to Dr. Peters.

[¶40]   The TDC professional liability 
policy issued to Dr. Peters conspicuously states it is a "claims made" policy. 
More properly, it may be considered a "claims made and reported" policy since 
the coverage is limited to "claims made" against the insured during the policy 
period and first reported to TDC during the policy period. TDC agrees, in the 
policy, to pay "all sums," up to the coverage limit, which Dr. Peters becomes 
legally obligated to pay as damages if four requirements are 
met:

1. 
the claim is first reported to [TDC] during the policy 
period; and

2. 
the claim arises from [Dr. Peters] rendering or failing to render 
professional services in the territory during the 
policy period as stated on the Declarations Page; 
and

3. 
the claim and the professional services are within 
the coverage of your policy and not excluded by it; and

4. 
the amount paid does not exceed [TDC's] per-claim limit of 
liability and annual aggregate limit of liability 
applicable to [Dr. Peters].

(Emphasis 
in original.) A "claim" is defined, by the TDC policy:

[¶41]   Claim 
means

a. 
written notice, demand, crossclaim, or lawsuit (including an arbitration 
proceeding) first reported to [TDC] during the policy period which 
alleges disability, sickness, disease, or death to a patient arising from your 
rendering or failing to render professional services during the 
policy period.

b. 
your or your legal representative's written notice to [TDC], which is first 
reported during the policy period, that a demand, cross-claim, or 
lawsuit which alleges disability, sickness, disease, or death to a patient 
arising from your rendering or failing to render professional 
services during the policy period may be made against you 
by the patient or the patient's legal representative.

(Emphasis 
in original.) The TDC policy is unambiguous and we shall apply our rules of 
contract interpretation to its language.

[¶42]   Dr. Peters' report of his receipt 
of the service of process for the November 13, 1989 Wardell complaint 
constituted a "claim" under the plain meaning of the TDC policy. The TDC policy 
states that a "[c]laim means * * * [a] lawsuit * * * first 
reported to [TDC] during the policy period which 
alleges disability * * * to a patient arising from your rendering * * * 
professional services during the policy period." 
(Emphasis in original.) This "claim" was made and reported by Dr. Peters after 
the November 1, 1989 effective date of the TDC policy within the "policy period" 
defined by TDC. We affirm that TDC must defend and indemnify Dr. Peters against 
the Wardell negligence action under the terms of the TDC professional liability 
policy.

[¶43]   In support of its motion for 
summary judgment before the district court, TDC maintained that coverage for the 
November 13, 1989 Wardell complaint was excluded. Dr. Peters challenged on 
appeal that either TDC had failed to preserve this issue or that waiver or 
estoppel prevented TDC from asserting that coverage for a potential claim is 
excluded. In the Reply Brief of Appellant, TDC repeated its position that 
coverage was excluded under terms of an endorsement to the policy. ICA responded 
by filing a motion to strike portions of the TDC Reply Brief which argued 
coverage was excluded. We deny the motion to strike and hold that estoppel 
applies to prevent TDC from attempting to exclude 
coverage.

[¶44]   Initially, we must consider whether 
this issue is properly before this court. Generally, an issue not raised or 
supported with cogent argument in the brief of appellant is considered waived. 
Triton Coal Co., Inc. v. Mobil Coal Producing, Inc., 800 P.2d 505, 512 (Wyo. 
1990); W.R.A.P. 7.01(d) (formerly W.R.A.P. 5.01). However, only the timely 
filing of a notice of appeal is jurisdictional.

The 
failure to comply with any other rule of appellate procedure, or any order of 
court, does not affect the validity of the appeal, but is ground only for such 
action as the appellate court deems appropriate, including but not limited to: 
citation of counsel or a party for contempt; refusal to consider the 
offending party's contentions; assessment of costs; dismissal; or 
affirmance.

W.R.A.P. 
1.03 (formerly W.R.A.P. 1.02) (emphasis added). This court has previously 
considered issues not properly raised by appellants when review was permitted by 
the record and the facts. See, e.g., J & M Investments v. Davis, 726 P.2d 96, 97 n. 2 (Wyo. 1986). See also, Dale Bland Trucking, Inc. v. Kiger, 598 N.E.2d 1103, 1105 (Ind. App. 1992) (holding the court would consider issues 
raised for the first time on appeal in a reply brief if failure to comply with 
appellate rules did not impede review of the issue).

[¶45]   TDC did not raise any issue 
regarding exclusion of coverage under the TDC policy in its Brief of Appellant. 
Dr. Peters, in support of the district court's ruling, however, raised the issue 
of coverage under the TDC policy in the Brief of Appellee. Dr. Peters said 
waiver or estoppel should prevent TDC from denying coverage despite the tender 
of a defense under a reservation of rights. TDC then replied to Dr. Peters' 
argument.

[¶46]   A reply brief is "limited to those 
new issues and arguments raised by the brief of appellee." W.R.A.P. 7.03 
(formerly W.R.A.P. 5.03). TDC responded to the argument presented by Dr. Peters 
that coverage existed under the TDC policy. We will consider the issue. Rome v. 
Commonwealth Edison Co., 81 Ill. App.3d 776, 36 Ill.Dec. 894, 896-97, 401 N.E.2d 1032, 1034-35 (1980) (holding the court would consider an argument raised in the 
brief of appellee and in the reply brief of appellant).

[¶47]   TDC argues that because Dr. Peters 
possessed knowledge of a potential claim prior to the effective date of the TDC 
policy, coverage was excluded for that conduct. The TDC policy issued to Dr. 
Peters contains a conversion coverage endorsement providing retroactive 
coverage:

[TDC] 
by this Endorsement E310 agrees to provide coverage under your policy for 
claims arising out of your rending or failing to render 
professional services during the period from 11-1-86 to 11-1-89 
but only if all of the requirements below are 
met:

1. 
The claim is first reported to [TDC] during the policy period as 
stated on the Declaration Page; and 

2. 
The claim and the professional services are within 
the coverage of your policy and not excluded by it; and

3. 
The amount paid does not exceed [TDC's] per-claim limit of liability 
and annual aggregate limit of liability applicable to you; 
and

4. 
You were not aware of any conduct, circumstances or incidents during the period 
prior to the policy effective date of this policy which could 
reasonably be expected to result in a claim.

(Emphasis 
in original.)

[¶48]   TDC finds an exclusion under the 
language of paragraph four for coverage of any claims arising from Dr. Peters' 
treatment of Wardell. TDC summarized its position before the district 
court:

If 
the court finds that no claim was made in September of 1989 to ICA, it must find 
no coverage under any policy, as it is undisputed that Peters specifically 
identified this incident on his TDC policy application as an incident or event 
of which he had prior knowledge that could reasonably be expected to result in a 
claim, and which, therefore, is undisputedly excluded from 
coverage under the TDC policy.

(Emphasis 
in original.) We do not accept this position.

[¶49]   In contract law, promissory 
estoppel is recognized as both a cause of action and a defense. "`If an 
unambiguous promise is made in circumstances calculated to induce reliance, and 
it does so, the promisee if hurt as a result can recover damages.'" B & W 
Glass, Inc. v. Weather Shield Mfg., Inc., 829 P.2d 809, 813 (Wyo. 1992) (quoting 
Goldstick v. ICM Realty, 788 F.2d 456, 462 (7th Cir. 1986)). As applied to 
insurance contracts, promissory estoppel acts to prevent an insurer, under 
specific circumstances, from denying coverage when an insurance contract exists. 
3 Long, supra, at § 17.20.

[¶50]   Promissory estoppel prevents a 
denial of insurance coverage in situations where fraud or injustice would 
otherwise result. Crown Life Ins. Co. v. McBride, 517 So. 2d 660, 662 (Fla. 1987) 
(collecting cases applying promissory estoppel to insurance contracts). See 
also, W.C. Crais, Annotation, Comment Note: Doctrine of Estoppel or Waiver As 
Available To Bring Within Coverage Of Insurance Policy Risks Not Covered By Its 
Terms Or Expressly Excluded Therefrom, 1 A.L.R.3d 1139 (1965 & Supp. 1993). 
Injustice is found when the promisor reasonably should have expected that the 
affirmative representations he or she made would induce the promisee into action 
or forbearance of a substantial nature and where the promisee shows such 
detrimental reliance. Crown Life Ins. Co., 517 So. 2d  at 662. Promissory estoppel 
is distinguished from equitable estoppel and waiver which are generally not 
available to bring within the coverage of an insurance policy a risk which is 
not covered by the terms of the policy or expressly excluded. Sowers v. Iowa 
Home Mut. Cas. Ins. Co., 359 P.2d 488, 493 (Wyo. 1961). See generally, United 
Self Insured Services v. Faber, 561 So. 2d 1358 (Fla.App. 1990) (applying 
doctrine of promissory estoppel).

[¶51]   In Florida Physicians Ins. Co. v. 
Stern, 563 So. 2d 156, 160 (Fla.App. 1990), the court considered the application 
of promissory estoppel in the context of a "claims made" professional liability 
policy which contained an exclusion for known prior incidents that could be 
reasonably foreseen as becoming the basis of a claim or suit. A physician 
decided to change coverage from one insurer to another. As a part of the 
application process, the physician informed the insurer of a potential claim 
from a paralyzed former patient. Id. at 157. The former patient filed suit 
during the coverage period of the successor insurance company. Id. The successor 
insurer, after defending the action for over a year, determined that the former 
insurer should have provided coverage. Id. at 160. The court held promissory 
estoppel prevented the successor insurer from denying coverage. 
Id.

[¶52]   TDC created detrimental reliance on 
the part of Dr. Peters when it issued a professional liability insurance policy 
without language expressly excluding coverage for the potential claim of Wardell 
by name. Dr. Peters specifically informed TDC in the application for insurance 
coverage of circumstances surrounding the potential claim. TDC responded by 
issuing a policy with a retroactive date of November 1, 1986, prior to Dr. 
Peters' treatment of Wardell. The retroactive coverage created an affirmative 
representation that coverage for any potential claim by Wardell would be 
provided by TDC. Dr. Peters was induced by this representation to permit his ICA 
policy to expire without either purchasing an Extended Reporting Endorsement, so 
called "tail" coverage, or simply renewing professional liability coverage with 
that insurer. Under these circumstances, promissory estoppel operates to prevent 
an injustice which would result from enforcement of the general exclusion 
contained in the TDC policy for the insured's knowledge of prior conduct which 
could reasonably be expected to result in a claim.

[¶53]   Unlike Stern, 563 So. 2d 156, TDC 
conducted its defense of Dr. Peters under a reservation of rights which, if 
effective, preserves coverage defenses. Dr. Peters received two letters from TDC 
which are characterized as constituting the reservation of rights. The first 
letter, dated December 28, 1989, from TDC's Washington Office Claims Manager, 
stated: "Upon further review of the aforementioned case [the November 13, 1989 
Wardell complaint], we continue to believe that there would be no coverage for 
this claim under policy no. 41660-0001, provided by The Doctors' Company." The 
letter then stated that a formal tender of defense had been made to ICA. The 
second letter, dated January 15, 1990, also from TDC's Washington Office Claims 
Manager informed Dr. Peters that ICA had rejected the tender of defense. TDC 
said it planned to file a "declaratory relief action to acquire coverage for 
this claim under your ICA policy."

[¶54]   In Albany County School Dist. No. 
1, 763 P.2d  at 1262, this court held that a reservation of rights letter from a 
liability insurer preserved coverage defenses because the letter outlined 
several possible grounds for denial of coverage. The notice of a reservation of 
rights must make specific reference to the policy defense which the insurer may 
assert. Doe v. Illinois State Medical Inter Insurance Exchange, 234 Ill. App.3d 
129, 174 Ill.Dec. 899, 903, 599 N.E.2d 983, 987 (1992). A bare notice of a 
reservation of rights is insufficient. Royal Ins. Co. v. Process Design 
Associates, Inc., 221 Ill. App.3d 966, 164 Ill.Dec. 290, 295, 582 N.E.2d 1234, 
1239 (1991).

[¶55]   We hold the letters sent to Dr. 
Peters by TDC were ineffective, as a matter of law, in providing notice of a 
reservation of rights. We do not find in either of the letters even a bare 
notice of a reservation of rights. Royal Ins. Co., 164 Ill.Dec. at 295, 582 N.E.2d  at 1239. The letters do not specifically refer to TDC providing a defense 
under a reservation of rights. TDC did not inform Dr. Peters of any reason or 
reasons for a possible exclusion of coverage under the terms of his policy with 
TDC.

[¶56]   We hold, therefore, that TDC must 
provide a defense and indemnification to Dr. Peters for any claims arising from 
the November 13, 1989 Wardell complaint.

[¶57]   The final issue before this court 
is the denial by the district court of the motion for relief from judgment filed 
by TDC. W.R.C.P. 60(b). "Appellate review of a district court's decision on a 
Rule 60(b) motion is generally limited to the question of whether there has been 
an abuse of discretion." Forney v. Minard, 849 P.2d 724, 727-28 (Wyo. 1993). The 
district court is given wide discretion under our Rules of Civil Procedure and 
discretion is not disturbed "`unless appellant demonstrates that the trial court 
abused it and was clearly wrong.'" Vanasse v. Ramsay, 847 P.2d 993, 996 (Wyo. 
1993) (quoting Claassen v. Nord, 756 P.2d 189, 193 (Wyo. 
1988)).

[¶58]   The district court found that the 
interrogatory response which was omitted from the material filed by TDC in 
support of its motion for summary judgment had no affect on the district court's 
final order. There is no abuse of discretion in this finding. The July 20, 1989 
interrogatory response from Wardell, filed in connection with the action against 
the orthopedic surgeon and West Park Hospital, did not present a "claim" against 
Dr. Peters under the unambiguous terms of the ICA policy.

IV. 
CONCLUSION

[¶59]   The theme of much of the argument 
in these cases has been equitable in nature. It is not fair that the failure to 
name Dr. Peters as a party in the May 12, 1989 Wardell complaint resulted in a 
different insurance carrier having to assume the responsibility of defense and 
possible indemnification for any judgment. However, this is the position which 
"claims made" insurers advocated in issuing these policies which depend, not 
upon the date of the occurrence, but upon the date the claim was made or made 
and reported to establish coverage obligations.

[¶60]   The decisions of the district court 
in Appeal No. 92-68 and Appeal No. 92-270 are affirmed.