Title: CARLY MESA CATHCART V. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY

State: wyoming

Issuer: Wyoming Supreme Court

Document:

CARLY MESA CATHCART V. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY2005 WY 154123 P.3d 579Case Number: 05-43Decided: 12/01/2005
OCTOBER 
TERM, A.D. 2005

 
 
CARLY 
MESA 
CATHCART,

 
 
Appellant

(Plaintiff),

 
 
v.

 
 
STATE 
FARM MUTUAL AUTOMOBILE

INSURANCE 
COMPANY,

 
 
Appellee

(Defendant).

 
 

Appeal 
from the DistrictCourtofConverseCounty

The 
Honorable John C. Brooks, Judge

 
 

Representing 
Appellant:

            
Terry W. Mackey of Moriarity, Gooch, Badaruddin & Booke, LLC, 
Cheyenne, Wyoming; Todd H. Hambrick and Stephanie A. Hambrick of Krampner, 
Fuller & Hambrick, Casper, Wyoming; Shawna M. Geiger of Shawna 
Mackey-Geiger, P.C., Greenwood Village, Colorado.  Argument by Mr. 
Mackey.

 
 

Representing 
Appellee:

            
Julie Nye Tiedeken of Tiedeken & Scoggin, Cheyenne, Wyoming.  

 
 
Before 
HILL, C.J., and GOLDEN, KITE, VOIGT, and BURKE, JJ.

 
 
            
KITE, 
Justice.

 
 
[¶1]      Carly Mesa Cathcart1 was the driver of an automobile 
involved in a one car rollover.  The 
automobile belonged to her grandparents and was insured by State Farm Mutual 
Automobile Insurance Company (State Farm).  Following the accident, State Farm paid 
Ms. Cathcart $75,000 under the uninsured motorist coverage provision of the 
policy to settle her claims. 

 
 
[¶2]      Nearly four years 
later, Ms. Cathcart filed breach of contract and first party bad faith claims 
against State Farm for its actions and inactions in negotiating the settlement 
with her following the accident.  The district court granted summary 
judgment in favor of State Farm on the breach of contract claim.  The bad faith claim proceeded to trial 
and the jury returned a verdict in favor of State Farm.  Ms. Cathcart appealed claiming the 
district court erred in:  1) 
granting summary judgment on her breach of contract claim; 2) allowing evidence 
at trial of the underlying accident, including the discovery of a marijuana pipe 
at the accident scene and alleged marijuana use by Ms. Cathcart prior to the 
accident; 3) allowing juror questions during the trial; and 4) giving certain 
jury instructions and refusing others.  We affirm.

         

ISSUES

 
 
[¶3]      Ms. Cathcart 
presents the following issues:

 
 
            
1.         
The trial court committed error when it failed to rule on the appellee's 
obligations under the insurance contract and granted summary judgment in favor 
of appellee on appellant's breach of contract claim.

 
 
            
2.         
The trial court committed error when it allowed evidence of the 
underlying incident giving rise to appellant's claim for breach of the duty of 
appellee to act in good faith with fair dealing.

 
 
            
3.         
The trial court committed error when it allowed evidence of a marijuana 
pipe and marijuana use to be presented to the jury.

 
 
            
4.         
The trial court's decision to ask questions submitted by the jury in this 
case was an abuse of discretion/error, and resulted in unfair prejudice to the 
appellant because the jury was allowed; and did, in fact, start 
advocating/deliberating before all of the evidence had been 
presented.

 
 
            
5.         
The trial court committed error in the giving of certain jury 
instructions and not giving others.

 
 
State 
Farm restates the issues as follows:

 
 
1.         
Did the trial court correctly grant State Farm summary judgment on 
appellant's breach of contract claim for the reason that there was no material 
issue of fact to be decided by the trier of fact?

 
 
2.         
Did the trial court properly allow evidence of the motor vehicle accident 
which gave rise to appellant's claim for breach of the duty of good faith and 
fair dealing to be admitted into evidence during trial?

 
 
3.         
Did the trial court properly allow the jury to hear about the factors 
considered by State Farm in its evaluation, including witness statements of 
marijuana use by Carly Mesa?

 
 
4.         
Did the trial court properly allow the jurors to submit questions to be 
asked of witnesses pursuant to Rule 39.4 of the Wyoming Rules of Civil 
Procedure?

 
 
5.         
Did the court correctly [instruct] the jury on the 
law?

 
 
FACTS

 
 
[¶4]      On July 17, 1997, 
17-year-old Carly Cathcart was driving a vehicle belonging to her grandparents, 
Al and Angie Mesa, on Interstate 25 near Casper, Wyoming when it left the roadway at a high 
rate of speed, rolled and came to a stop on its top in the median. Ms. Cathcart 
suffered serious injuries, including a closed head injury, broken neck and 
fracture of the pubic rami bones. 

 
 
[¶5]      At the time of 
the accident, the vehicle was insured by State Farm.  In the course of investigating the 
accident, State Farm's claims representative, Rick Trujillo, interviewed several 
eyewitnesses, two of whom stated that another vehicle swerved into the passing 
lane in front of Ms. Cathcart's vehicle, cutting her off and causing her to 
swerve, lose control of her vehicle and go off the road.  Although other eyewitnesses did not 
observe another vehicle, Mr. Trujillo notified the attorney representing the 
passengers in the Cathcart vehicle and Ms. Cathcart's mother that they might be 
entitled to pursue uninsured motorist claims. 

 
 
[¶6]      The State Farm 
policy provided $100,000 in coverage for uninsured motorist claims.  Based upon its investigation of the 
accident and potential claims, State Farm's claims committee gave Mr. Trujillo 
authority to settle Ms. Cathcart's claim for $100,000. After talking with his 
supervisor, Mr. Trujillo extended an offer to Ms. Cathcart and her father to 
settle the claim for $75,000.  On 
the day of Ms. Cathcart's 18th birthday, Mr. Trujillo met with Mr. Mesa and Ms. 
Cathcart, and Ms. Cathcart accepted the check for $75,000 and signed a release 
of her claims against State Farm. 

 
 
[¶7]      Four years later, 
Ms. Cathcart filed a complaint alleging that State Farm breached the insurance 
contract by failing to comply with the uninsured motorist provision of the 
policy and breached the covenant of good faith and fair dealing by (1) settling 
the claim with a brain damaged minor without court approval; (2) failing to 
adequately investigate the claim; and (3) failing to pay policy limits.2  State Farm filed an answer denying the 
claims and a notice of removal to federal district court.  The case was removed to federal court, 
however, upon Ms. Cathcart's motion, it was remanded to state court.3   

 
 
[¶8]      Back in state 
district court, State Farm moved for summary judgment on all of Ms. Cathcart's 
claims.  After a hearing, the 
district court entered an order granting summary judgment on the claims for 
intentional and negligent infliction of emotional distress; postponing a ruling 
on the fraud claim until completion of discovery; allowing additional briefing 
on the breach of contract and breach of statutory duty claims; and denying the 
motion on the bad faith claim.  When 
Ms. Cathcart and State Farm submitted no additional briefing on the breach of 
contract and breach of statutory duty claims, the district court entered a 
subsequent order granting summary judgment on the breach of contract claim and 
denying summary judgment on the breach of statutory duty claim. With these 
rulings, the claims left for trial by jury were breach of statutory duty, breach 
of the implied covenant of good faith and fair dealing, and 
fraud.

 
 
[¶9]      Prior to trial, 
Ms. Cathcart filed motions in limine requesting an order prohibiting the 
introduction of evidence at trial of her alleged marijuana use and her liability 
for the accident.  The district 
court denied the motions.  Ms. 
Cathcart also filed a motion for partial summary judgment in which she sought 
rulings that as a matter of law, the amount of damages due to her under the 
policy was not fairly debatable and State Farm's failure to pay the full amount 
of coverage was a breach of its duty of good faith and fair dealing. State Farm 
also filed a second motion for summary judgment on the claims for bad faith, 
breach of statutory duty, fraud and punitive damages.  No order appears in the record on these 
motions. 

 
 
[¶10]   On August 16, 2004, the case 
proceeded to trial.  Eleven days 
later, the jury returned a verdict finding that State Farm did not breach the 
duty of good faith and fair dealing or commit fraud in the manner in which it 
dealt with Ms. Cathcart's claim.  The district court entered judgment on 
the jury verdict. Ms. Cathcart filed a motion for new trial which the district 
court denied following a hearing.  Ms. Cathcart appealed.      

    

STANDARD 
OF REVIEW

 
 
[¶11]   We review orders granting summary 
judgment according to the following standards: 

 
 
"Wyo. R. 
Civ. P. 56 governs summary 
judgments.  A summary 
judgment is appropriate when there are no genuine issues of 
material fact and the moving party is entitled to judgment as a matter of law. 
 W.R.C.P. 56(c).  When reviewing a summary 
judgment, we consider the record in the perspective most favorable 
to the party opposing the motion and give that party the benefit of all 
favorable inferences which may be fairly drawn from the record.  We review questions of law de novo 
without giving any deference to the district court's 
determinations."

 
 

Baker v. 
Ayres and Baker Pole and Post, Inc., 2005 
WY 97, ¶ 14, 117 P.3d 1234 (Wyo. 2005) (citation omitted).

 
 
 
 
[¶12]   We review the district court's 
decisions concerning the admissibility of evidence for abuse of discretion. 
 Smyth v. Kaufman, 2003 WY 52, ¶ 13, 67 P.3d 1161, 1165-66 (Wyo. 2003).  We 
adopt the same abuse of discretion standard for reviewing alleged error in the 
district court's decision to allow juror questions.4

 
 
[¶13]   Our review of claimed error with 
respect to jury instructions is controlled by W.R.C.P. 51(b), which provides as 
follows:

 
 
(b) Further 
instructions; objections.  At the close of the evidence or at such earlier 
time during the trial as the court reasonably directs, any party may file 
written requests that the court instruct the jury on the law as set forth in the 
requests.  The court shall inform 
counsel of its proposed action upon the requests prior to their arguments to the 
jury. Before the argument of the case to the jury has begun, the court shall 
give to the jury such instructions on the law as may be necessary . . . .  No party may assign as error the giving or 
the failure to give an instruction unless that party objects thereto before the 
jury retires to consider its verdict, stating distinctly the matter objected to 
and the grounds of the objection.

 
 

Landsiedel 
v. Buffalo 
Properties, LLC, 2005 WY 61, ¶ 5, 112 P.3d 610, 612 
(Wyo. 2005).  If an objection 
properly is lodged, the appellate court reviews the instruction for error and 
prejudicial effect.  Daley v. Wenzel, 2001 WY 80, ¶ 29, 30 P.3d 547, 554 (Wyo. 2001).

 
 
DISCUSSION

 
 

1.                              
Summary 
Judgment on Breach of Contract Claim

 
 
[¶14]   Ms. Cathcart's breach of contract 
argument is somewhat difficult to follow.  She asserts the district court improperly 
based its summary judgment ruling solely on the fact that she accepted the 
$75,000 settlement offer and she released any other claims.  She argues the insurance contract 
unambiguously required State Farm to decide if she was legally entitled to 
collect damages and, if so, to determine the amount.  She argues the district court failed to 
make the fundamental determination required in all breach of contract claims, 
that is, whether or not the insurance contract was ambiguous.  Regardless of its conclusion in that 
regard, however, she asserts the district court should have concluded State Farm 
breached the contract, either by failing to follow its unambiguous terms or by 
failing to comply with its ambiguous terms when construed in favor of the 
insured.  She further argues the 
district court's error in this regard prejudiced her ability to present her bad 
faith claim to the jury.  Unable to 
show that State Farm failed to comply with the insurance contract, she claims, 
she likewise was unable to show that it breached the covenant of good faith and 
fair dealing.  Additionally, she 
asserts the district court erred in granting summary judgment prior to the 
discovery cutoff date, hampering her ability to present evidence demonstrating 
the existence of genuine issues of material fact. 

 
 
[¶15]   State Farm contends the insurance 
contract clearly and unambiguously provided that the amount payable under the 
uninsured motorist provision could be decided by agreement of the parties.  The parties agreed on the sum of $75,000. 
 In exchange for payment of that 
amount, Ms. Cathcart signed a contract in full settlement of her claim, 
releasing any further claims under the uninsured motorist provision and barring 
her from seeking further payments.  Given this undisputed evidence, State 
Farm argues, there were no genuine issues of material fact and the district 
court properly granted summary judgment on the breach of contract claim. 

 
 
[¶16]   Responding to Ms. Cathcart's claim 
that the district court prematurely granted summary judgment, State Farm asserts 
there were no discovery disputes at the time of the summary judgment hearing, it 
was undisputed that she had signed a full and final release, and by the time of 
the hearing, discovery had been ongoing for a year and the depositions of all 
the main witnesses had been taken.  Moreover, State Farms argues, Ms. 
Cathcart points to no evidence discovered after the summary judgment order to 
change the fact that she accepted the $75,000 and released her claims under the 
policy.

 
 
[¶17]   The record before this Court 
contains no transcript of the summary judgment hearing and no decision letter 
setting forth the district court's ruling.  The only documentation contained in the 
record is the district court's initial summary judgment order, in which it did 
not decide the issue and gave the parties time to file additional briefs on the 
breach of contract claim, and the subsequent order summarily granting the motion 
after Ms. Cathcart failed to file a supplemental brief.  Thus, we have no way of knowing the basis 
for the district court's decision to grant summary judgment on the breach of 
contract claim.5 

 
 
[¶18]   Irrespective of the district 
court's reasoning, however, the standards governing our review of summary 
judgments on breach of contract claims are firmly established.  As we said in Principal Life Ins. Co. v. Summit Well 
Service, Inc., 2002 WY 172, ¶¶ 17-19, 57 P.3d 1257, 1262 (Wyo. 2002) 
(citations omitted):   

 
 
An 
insurance policy constitutes a contract between the insurer and the insured. As 
with other types of contracts, our basic purpose in construing or interpreting 
an insurance contract is to determine the parties' true intent. We must 
determine intent, if possible, from the language used in the policy, viewing it 
in light of what the parties must reasonably have intended. The nature of our 
inquiry depends upon how clearly the parties have memorialized their intent. 
Where the contract is clear and unambiguous, our inquiry is limited to the 
four corners of the document. 

     We interpret an 
unambiguous contract in accordance with the ordinary and usual meaning of its 
terms. The parties to an insurance contract are free to incorporate within the 
policy whatever lawful terms they desire, and the courts are not at liberty, 
under the guise of judicial construction, to rewrite the policy. It is only 
when a contract is ambiguous that we construe the document by resorting to rules 
of construction. Whether a contract is ambiguous is a question for the court to 
decide as a matter of law. 

     A contract is 
ambiguous if indefiniteness of expression or double meaning obscure the parties' 
intent. Ambiguity cannot be created by the subsequent disagreement between the 
parties regarding the meaning of a contract. If the meaning of a provision in a 
contract is not readily apparent, the court may resort to competent evidence of 
extraneous circumstances to determine the parties' intent. Reviewing courts are 
free to make a determination as to the existence of ambiguity whether or not the 
parties agree one way or the other and whether or not the trial court has 
reached a conclusion one way or the other. 

 
 
[¶19]   In claiming summary judgment was 
improper on her breach of contract claim, Ms. Cathcart points to the following 
language of the insurance policy:

 
 
In order 
to determine the amount payable under uninsured motor vehicle coverage, two 
questions must be decided:

 
 
1.  Is the insured legally entitled to collect 
damages from the owner or driver of the uninsured motor vehicle; 
and

 
 
2.  If so, in what 
amount?

 

She 
contends this language unambiguously required State Farm to answer these two 
questions.  Given that State Farm 
made a payment to her, she contends the answer to the first question was 
undisputedly "yes".  The remainder 
of her argument is difficult to discern, but seems to be that the district court 
erred in granting summary judgment because genuine issues of material fact 
existed as to whether State Farm breached the provision by failing to make a 
good faith decision as to the amount she was entitled to collect from the 
uninsured motorist. 

 
 
[¶20]   In response, State Farm points to 
the provision cited by Ms. Cathcart and the provision following 
it:

 
 
In order 
to determine the amount payable under uninsured motorist vehicle coverage, two 
questions must be decided:

 
 
1.  Is the insured legally entitled to collect 
damages from the owner or driver of the uninsured motor vehicle; 
and

 
 
2.  If so, in what 
amount?

 
 
The 
questions can be decided by agreement between the insured and us.  

 
 
[¶21]   State Farm contends summary 
judgment was proper because the policy language is unambiguous and the evidence 
was undisputed that, in accordance with that language, the questions were 
decided by agreement between the parties when Ms. Cathcart and her parents 
agreed to accept the $75,000 State Farm offered in full payment of the uninsured 
motorist claim.

 
 
[¶22]   We agree that the policy language 
is clear and unambiguous.  Therefore, we limit our inquiry to the 
four corners of the document and interpret it in accordance with the ordinary 
and usual meaning of its terms.  Pursuant to the clear language of the 
policy, in determining the amount payable to Ms. Cathcart under the uninsured 
motorist provision, State Farm was required to decide if Ms. Cathcart was 
legally entitled to collect damages from the uninsured motorist and, if so, the 
amount.  Pursuant to the clear 
language of the policy, these determinations could be made by agreement between 
the parties.  

 
 
[¶23]   Considering the record in the light 
most favorable to Ms. Cathcart, and giving to her all favorable inferences that 
may be drawn from the evidence presented in support of State Farm's summary 
judgment motion on the breach of contract claim, the undisputed evidence was 
that State Farm concluded that if the witness testimony concerning the phantom 
vehicle was believed, there was a chance that Ms. Cathcart would be adjudged 
legally entitled to collect damages from the uninsured motorist.  Thus, it is undisputed that State Farm 
complied with the first requirement of the policy provision.  Thereafter, the evidence was undisputed 
that State Farm estimated that although Ms. Cathcart's actual damages exceeded 
the policy limits of $100,000, her damages would be reduced by some percentage 
for her comparative fault in causing the accident.  Using a 40 to 50 percent comparative 
fault figure, State Farm estimated the amount Ms. Cathcart was legally entitled 
to collect from the uninsured motorist was between $59,500 and $69,000. Thus, 
the evidence was undisputed that State Farm made the second determination it was 
required to make under the provision.  Thereafter, State Farm made an offer of 
$75,000. Ms. Cathcart and her father accepted the offer, signed a full and final 
release in settlement of her claims and accepted the $75,000 check from State 
Farm.6  There simply was no evidence that State 
Farm breached the uninsured motorist provision of the policy. Therefore, the 
district court properly granted summary judgment on Ms. Cathcart's breach of 
contract claim.

 
 
[¶24]   We are not persuaded by Ms. 
Cathcart's further contention that the district court's ruling on the breach of 
contract claim prejudiced her ability to present her claim for breach of the 
implied covenant of good faith and fair dealing. 

 
 

Wyoming has 
recognized that a breach of the implied covenant of good faith and fair dealing 
may be actionable in contract for compensatory damages. Wyoming has also 
acknowledged that a breach of the implied covenant of good faith and fair 
dealing which rises to the level of an independent tort is actionable for 
compensatory and punitive damages under proper circumstances. A recovery in tort 
for the breach of the duty of good faith and fair dealing is premised upon the 
existence of a special relationship created by the unequal bargaining power that 
an insurer has over an insured.

 
 

State 
Farm Mutual Auto Ins. Co. v Shrader, 882 P.2d 813, 825 (Wyo. 1994) (citations omitted).  The independent tort theory adopted by 
this Court imposes an obligation that neither party will do anything to injure 
the right of the other to receive the benefits of the agreement. Id.

 
 
Liability, 
in tort, is imposed not for a bad faith breach of contract, but for the failure 
to comply with the duty of good faith and fair dealing. The duty of good faith 
and fair dealing is not a requirement mandated by the terms of the 
policy.

 
 
It is 
the obligation, deemed to be imposed by the law, under which the insurer must 
act fairly and in good faith in discharging its contractual responsibilities. 
Where in so doing, it fails to deal fairly and in good faith with its 
insured by refusing, without proper cause, to compensate its insured for a loss 
covered by the policy, such conduct may give rise to a cause of action in tort 
for breach of an implied covenant of good faith and fair 
dealing.

 
 

Id.   

 
 
[¶25]   To establish a breach of an 
insurance contract, the insured must show the existence of a contract, a breach 
and damages.  To establish a breach 
of the implied covenant of good faith and fair dealing, the insured must show: 
 1) the absence of any reasonable 
basis for denying a claim for benefits; and 2) the insurer's knowledge or 
reckless disregard of the lack of a reasonable basis for denying the claim for 
benefits.  Shrader, 882 P.2d  at 825.  Thus, the two claims require proof of 
independent elements and are not mutually dependent, meaning one can be 
maintained without the other.  While 
an insured may state causes of action for breach of contract and breach of the 
duty of good faith and fair dealing, the insured does not need to prevail on the 
breach of contract claim to prevail on the claim for breach of the duty of good 
faith and fair dealing.  Id. The district court's ruling that no 
genuine issue of material fact existed on the question of whether State Farm 
made the determinations required by the uninsured motorist provision had no 
legal effect upon Ms. Cathcart's ability to present her claim that State Farm 
knew there was no reasonable basis for denying her uninsured motorist claim. 
 Despite the district court's 
ruling, Ms. Cathcart still had a full opportunity to present the latter 
claim.

 
 
[¶26]   Addressing Ms. Cathcart's 
contention that the district court prematurely granted summary judgment prior to 
the discovery cut-off, we note the following rather unusual course of events. 
 Ms. Cathcart filed her complaint 
against State Farm in state district court in May 2002.  The case was removed to federal court 
five months later.  On February 13, 
2003, an initial pretrial conference was held in accordance with federal 
practice and procedure.  Following 
the conference, the court entered an order requiring the parties to complete 
discovery and file dispositive motions by July 7, 2003.  Pursuant to the order, State Farm filed a 
summary judgment motion on February 28, 2003.  Ms. Cathcart requested additional time to 
respond and the federal court granted an extension until March 21, 2003.  Before that date, however, on March 11, 
2003, the federal court entered an order remanding the case to state district 
court. 

 
 
[¶27]   Back in state district court, State 
Farm simply re-filed the summary judgment that had been pending in federal 
court.  Subsequently, the state 
district court held a scheduling conference and set new deadlines for completing 
discovery and filing dispositive motions.  The scheduling order entered in state 
district court on April 22, 2003, set pending motions for hearing on May 28, 
2003, and required the parties to complete discovery by October 31, 2003, and 
file dispositive motions by November 17, 2003.  

 
 
[¶28]   On April 24, 2003, Ms. Cathcart 
filed a response to State Farm's summary judgment motion.  In a supplemental response filed the day 
before the hearing, Ms. Cathcart asked the district court to deny the motion or 
refrain from ruling until further discovery was completed.  In an affidavit attached to the 
supplemental response, counsel for Ms. Cathcart stated his experts were still in 
the process of formulating their final opinions for the June 27, 2003, expert 
designation deadline and other discovery likewise remained to be 
completed.

 
 
[¶29]   In accordance with the scheduling 
order, the district court heard argument for and against the pending summary 
judgment motion on May 28, 2003.  In 
its July 3, 2003, order, the district court reserved ruling on the summary 
judgment motion on the breach of contract claim and gave the parties additional 
time to file supplemental briefs.  As of August 27, 2003, three months after 
the summary judgment hearing, Ms. Cathcart had filed no supplemental materials 
opposing the motion.  Only then did 
the district court grant summary judgment for State Farm on the breach of 
contract claim.  By that time, the 
case had been pending for fifteen months, State Farm's summary judgment motion 
had been pending for six months, one deadline for completion of discovery had 
been avoided as a result of the remand and Ms. Cathcart had been given an 
additional three months to file supplemental materials opposing summary judgment 
on the breach of contract claim. Under these circumstances, we are hard pressed 
to find error, particularly where the summary judgment at issue involves 
interpretation of clear contract language and little in the way of factual 
dispute.    

 
 
[¶30]   We have said that, ordinarily, 
discovery on issues which are the subject of a summary judgment motion should be 
allowed to be completed before the motion is scheduled, heard and decided.  Abraham v. Great Western Energy, LLC, 
2004 WY 145, ¶ 19-22, 101 P.3d 446, 454-55 (Wyo. 2004).  On that basis we held in Abraham that the district court abused 
its discretion when it denied a motion for continuance of a summary judgment 
hearing until discovery was completed.  We said, "by scheduling the hearing on 
the motions for summary judgment before the deadline for discovery had passed 
and, thus, not allowing the Abrahams adequate time to prepare and file any other 
pertinent materials prior to that hearing, they were deprived of the protections 
to due process afforded by the applicable rules of civil procedure."  Id. 
at 455.

 
 
[¶31]   In contrast to the situation in Abraham, we conclude under the 
particular circumstances presented here that the district court's action in 
hearing the summary judgment motion before discovery was completed did not 
deprive Ms. Cathcart of adequate time to prepare or the opportunity to file 
additional materials.  Additionally, 
Ms. Cathcart offers no evidence discovered after the summary judgment ruling to 
show the result might have been different if the district court had waited to 
rule. Under these facts, we can find no error.    

 
 

2.                              
Evidence 
of the Underlying Motor Vehicle Accident

 
 
[¶32]   Given that her complaint against 
State Farm alleged bad faith, Ms. Cathcart contends the focus of the trial 
should have been the conduct of the insurance company and whether it fulfilled 
its duty to the insured.  She 
asserts the district court erred in allowing evidence concerning the accident 
and her conduct in relation to it.  She states:

 
 
[O]nce 
[State Farm] determined that [she] was entitled to recover damages (as it did) 
and once the amount of damages [she] was entitled to recover (an amount in 
excess of the policy limit), the only remaining question was to determine if the 
conduct of [State Farm] conformed to the legal standard already established in 
Wyoming. Since [Ms. Cathcart] was entitled to recover damages in excess of the 
policy limit ($100,000.00) all that remained for the jury was to determine if 
the payment by [State Farm] to [her] of less than that amount ($75,000.00) met 
the duty of good faith and fair dealing. 

 
 
By 
permitting State Farm to present evidence of her conduct and the accident, Ms. 
Cathcart contends, the district court improperly allowed those matters to become 
the focus of the trial, rather than State Farm's conduct. 

 
 
[¶33]   State Farm responds that the 
district court properly allowed evidence of the underlying accident to refute 
Ms. Cathcart's allegations of bad faith and unfair dealing. State Farm contends 
evidence of what it did to investigate, what it learned from the investigation 
and how that knowledge affected its evaluation of the claim was essential to 
refute Ms. Cathcart's claims that it acted unreasonably and that her claim was 
not fairly debatable.  Without the 
ability to present that evidence, State Farm contends, it would have been unable 
to present a defense.

 
 
[¶34]   We address Ms. Cathcart's argument 
summarily.  As State Farm asserts, 
without the opportunity to present evidence concerning the underlying accident  
what happened, who did what, what the witnesses saw, and what the accident 
investigation people concluded  State Farm would have had no defense to the 
claim that a reasonable insurer under the facts and circumstances would have 
handled the claim differently.  In 
order to show that it acted reasonably and in good faith and dealt with Ms. 
Cathcart fairly, State Farm had to be allowed to present evidence concerning its 
investigation of the accident, its evaluation of the claim, and its actions in 
dealing with Ms. Cathcart and her parents. Whether a claim is "fairly debatable" 
necessarily implicates the question whether the facts necessary to evaluate the 
claim are properly investigated and developed or recklessly ignored and 
disregarded.  McCullough v. Golden Rule Ins. Co., 789 P.2d 855, 860 (Wyo. 1990).  Moreover, "[t]he logical premise of the 
debatable . . . standard is that if a realistic question of liability does 
exist, the insurance carrier is entitled to reasonably pursue that debate 
without exposure to a claim of violation of its duty of good faith and fair 
dealing."  Gainsco Ins. Co. v. Amoco Production 
Co., 2002 WY 122, ¶ 33, 53 P.3d 1051, 1062 (Wyo. 2002) (citations omitted). 
 In order to show that Ms. 
Cathcart's claim was fairly debatable, State Farm was entitled to show that a 
realistic question concerning liability existed.  That showing required evidence of the 
circumstances surrounding the underlying accident.  The district court did not abuse its 
discretion in allowing evidence of the accident.

 
 

3.                              
Evidence 
of Marijuana Use

 
 
[¶35]   Ms. Cathcart also claims the 
district court abused its discretion in allowing evidence to be introduced at 
trial concerning a marijuana pipe found at the accident scene and statements 
that she used marijuana prior to the accident.  She contends the evidence was 
inflammatory and irrelevant given the toxicology reports indicating she had not 
used marijuana on the day of the accident.  State Farm responds that evidence 
concerning the pipe and alleged marijuana use was relevant because it was a 
factor considered in evaluating Ms. Cathcart's claim.  The district court agreed that the 
evidence was relevant to show what informationState Farm gathered and considered in 
evaluating the claim and ruled that it was admissible.

 
 
[¶36]   All relevant evidence is admissible 
at trial; irrelevant evidence is not admissible. W.R.E. 402.  Evidence is relevant if it has any 
tendency to make more or less probable the existence of any fact of consequence 
to determining the action.  W.R.E. 
401.  State Farm's theory of defense 
was that its actions were reasonable given the factors weighing in favor of a 
determination that Ms. Cathcart's comparative fault was sufficient to preclude 
her from recovering uninsured motorist benefits or that her damages would have 
been reduced by her percentage of fault.  One of those factors was the evidence of 
marijuana use in the car she was driving on the day of the accident.  There is no question that evidence was 
relevant as that term is defined by our rules. 

 
 
[¶37]   However, the fact that the evidence 
was relevant is not always determinative of its admissibility.  Even relevant evidence must satisfy 
W.R.E. 403, which states:

 
 
Although 
relevant, evidence may be excluded if its probative value is substantially 
outweighed by the danger of unfair prejudice, confusion of the issues, or 
misleading the jury, or by considerations of undue delay, waste of time, or 
needless presentation of cumulative evidence. 

 
 
[¶38]   As with other rulings on the 
admissibility of evidence, the district court's authority to exclude relevant 
evidence is discretionary in nature, as it is in a better position both to 
detect and to assess the dangers and considerations enumerated in the rule, and 
to balance these against the probative value of proffered evidence.  Banks v. Crowner, 694 P.2d 101, 104 
(Wyo. 1985). 
 We find no abuse of discretion in 
the district court's determination that the probative value of the evidence at 
issue outweighed the danger of unfair prejudice. Our conclusion in this regard 
is bolstered by the fact that evidence was also presented showing the toxicology 
report results, which evidence further reduced the danger of unfair 
prejudice.

 
 

4.                              
Juror 
Questions                 

 
 
[¶39]   Ms. Cathcart claims the district 
court abused its discretion in allowing the jurors to submit proposed questions 
to be asked of witnesses because the questions were irrelevant, caused confusion 
and allowed the focus of the trial to be shifted away from her bad faith claim. 
 This is the first time we have been 
asked to interpret W.R.C.P. 39.4, the rule that addresses juror questions.  The rule provides as 
follows:

 
 
            
At the beginning of civil trials, the court shall instruct jurors that they will be permitted to submit written 
questions for witnesses if they have questions about the witnesses' testimony 
that have not been answered after counsel for all parties have finished 
examining the witnesses. The court shall also instruct the jurors that some 
questions they submit may not be asked, as some jurors' questions may be legally 
improper or otherwise inappropriate. The court shall provide jurors with paper 
and a pen or pencil with which they may write down questions for submission to 
the court. 

 
 
            
Before each witness is excused, the court shall determine whether any 
jurors have questions for that witness. The court shall review jurors' written 
questions with counsel, out of the hearing of the jury, making the question part 
of the record. The court shall permit counsel to impose objections, including 
objections based on litigation strategy or stipulation of the parties. The court 
shall rule on any objections, noting the basis of the ruling on the record. If the court determines that the question is 
not improper or unfairly prejudicial, the court shall read the question to the 
witness or permit counsel to read the question to the witness. The question 
may be modified as deemed appropriate by the court in consultation with counsel. 
After the witness responds to the question, the court shall permit counsel for 
both sides to ask follow-up questions if such follow-up questions appear to be 
necessary or appropriate.

 
 
The 
court shall permit counsel to present additional rebuttal evidence at trial if 
necessary to prevent unfair prejudice attributable to testimony that results 
from questions that jurors submit.

 
 

Id.  (emphasis added).

 
 
[¶40]   Pursuant to the mandatory language 
of this rule, the district court instructed the jurors before trial that they 
would be permitted to submit written questions to be asked of the 
witnesses.  The court also informed 
the jurors that some of their questions might not be asked.  The court informed the jurors of the 
procedure it would follow concerning their written questions.  There is no indication from the record 
before this Court that Ms. Cathcart objected to the instruction or the procedure 
the district court imposed for complying with Rule 39.4. 

 
 
[¶41]   During the trial, the parties 
presented the testimony of 20 witnesses, four of whom testified by deposition. 
 The jurors submitted written 
questions to the sixteen witnesses who appeared and testified live at trial. 
 For those sixteen witnesses, the 
jurors submitted over 200 questions to the district court.  In accordance with the mandatory language 
of the rule, the district court reviewed the jurors' questions with counsel 
outside the hearing of the jury. These conferences were not reported and 
therefore do not appear in the record.  However, it appears from the record we do 
have that counsel and the district court decided outside the hearing of the jury 
that nine of the juror questions submitted would not be asked.7  The district court then permitted counsel 
to impose objections to the questions on the record. 

 
 
[¶42]   Of the 200-plus questions 
submitted, counsel for Ms. Cathcart objected on the record to fifteen juror 
questions asked of State Farm witness Newell Knight, an accident investigator 
and reconstructionist hired by State Farm during the claims process to assist it 
in evaluating the claim by assessing the cause of the accident.  Mr. Knight concluded that the accident 
was caused by Ms. Cathcart's high speed, inattention, inexperience and fatigue 
from driving an excessive number of hours, and testified to that effect at 
trial.   The basis for Ms. Cathcart's objection to 
the jurors' questions of Mr. Knight was that they were irrelevant and 
immaterial.  The district court 
overruled the objection and the following exchange 
occurred:

 
 
THE 
COURT:  * * * Your report states 
that initial marks do not indicate that braking was occurring in response to a 
driver's suddenly changing lanes in front of the driver. Based on the evidence, 
do you have an opinion about the existence of a phantom 
driver?

 
 
THE 
WITNESS:  Only to say that the marks 
that are there are not skid marks. That is a mark made by a driver coming back 
on. It does not indicate the skid mark; that is the best I can tell 
you.

 
 
THE 
COURT:  Would your opinion be 
different about Ms. [Cathcart]'s experience if she had been driving  actually 
driving before she was of an age to be legally driving?

 
 
THE 
WITNESS:  No.

 
 
THE 
COURT:  Would this accident occur  
have occurred if Ms. [Cathcart] was cut off by a phantom driver, even if she was 
going the speed limit?

 
 
THE 
WITNESS:  The answer is yes. If 
you're driving the speed limit, you could still make a yaw mark8. You wouldn't make yaw marks of 
this magnitude.

 
 
THE 
COURT:  What is the maximum number 
for drag factor?

 
 
THE 
WITNESS:  The maximum number would 
be probably 1,000, which is a meshing gear. But we see drag factors on roads 
that exceed 1.5, which is a very slippery  rough road going up a grade of about 
6 to 8 percent.

 
 
Q. Will 
the tire condition affect drag or yaw?9

 
 
            
THE WITNESS:  No, no, once a 
tire starts to skid, it makes no difference even if it's a bald tire. It just 
wears out faster. In a yaw, the tire is folding down under. If the tire failed 
you would see distinctive marks, but it doesn't make any 
difference.

 
 
            
THE COURT:  Will weight of a 
vehicle affect yaw?

 
 
            
THE WITNESS:  No, it will 
affect tip over, but not yaws.

 
 
            
THE COURT: Do you ever construct an accident when someone knows all the 
factors of an accident?

 
 
            
THE WITNESS:  
No.

 
 
            
THE COURT:  How close is a 
reconstruction to the actual facts in a percentage?

 
 
            
THE WITNESS:  In some cases 
you could be  you could be nearly 100 percent sure of everything that is there, 
speed, time, and distance, if everything is there and measured under the right 
conditions.

 
 
            
THE COURT:  How far did the 
car slide or yaw before flipping?

 
 
            
THE WITNESS:  The first mark 
recorded  and I'll just call it letter A. From the letter A to final position 
of the right rear is 653 feet, 9 inches, it looks like. 

 
 
            
THE COURT:  Okay, if you can, 
how many times have you worked for State Farm? 

 
 
            
THE WITNESS:  I bet I've 
worked for State Farm 500 times in 40 years, just off the top of my head. I bet 
it's 500 times out of many thousands.

 
 
            
THE COURT:  How are 
reconstructionists selected?

 
 
            
THE WITNESS: Selected?

 
 
            
THE COURT:  
Yeah.

 
 
            
THE WITNESS:  Well, they're 
selected by the people who decide to hire you. That is the first criteria, but 
how do you get the expertise, if that is the question. You get it through 
education, training, and experience. The way you're selected would be somebody 
calls and hires you, I guess is the best way to say it. But you get your 
background through education, experience, training, court testimony, veracity, 
truthfulness, all of those things.

 
 
            
THE COURT:  If you don't work 
in Wyoming, 
typically, do you know why you were contacted?

 
 
            
THE WITNESS:  I don't. 

 
 
            
[Plaintiff's counsel]:  
Excuse me, Your Honor, I think he answered the question. I will object to 
any volunteering.

 
 
            
THE COURT:  If you don't, 
that is 

 
 
            
THE WITNESS:  I don't, Your 
Honor.

 
 
            
THE COURT:  That is a 
sufficient answer.  What was 
determined in the friction coefficient of the car, and is that indicative in 
figuring the speed?

 
 
            
THE WITNESS:  It is, the 
friction coefficient is what you must have to determine how fast you can take a 
curve. On a slick road, if you have got an [ice] skating rink it's a .10. You 
can spin off very quickly. So the drag factor has to be considered of how you're 
sitting, squeezing the road is what it amounts to. If the drag factor goes low, 
you run off the road on a very long radius. But drag factor is part of the 
formula you have to have to find the  you take the middle ordinate to find 
radius, and once you find that's correct that has to be plugged in to how slick 
the road is. The greater the radius, the higher the speed, so drag factor is 
part of the equation. Part of the algebraic equation.

 
 
THE 
COURT:  Do you have some formula 
that determines the drag factor?

 
 
THE 
WITNESS: I do. The drag factor 

 
 
THE 
COURT: Excuse me, I guess it's the coefficient of 
friction.

 
 
THE 
WITNESS:  Drag factor coefficient of 
friction we use interchangeably. There is a little difference, but the formula 
is you take the weight of an object versus the amount of pull that it takes. So 
if I put a 100 pound block down on the road and it takes me 70 pounds to pull 
it, my drag is .7 to do it with a car. If I go 40 miles an hour, and I skid for 
76 feet, my drag factor, is .7. But there is a specific mathematical formula 
that says the drag factor equals the speed squared, divided by 30, times the 
distance. But all you're doing in reality is taking a chart and you say, if I go 
this fast, if I skid this far, that is how slick the road has to be. That is all 
based on a simple math formula. But we do it with a drag sled, and we can do it 
with an actual test of vehicles.

 
 
            
THE COURT:  Was your formula 
any different than the highway patrol's?

 
 
            
THE WITNESS:  
No.

 
 
            
THE COURT:  Does the highway 
patrol or the department of transportation enforce the ten-hour limit for truck 
drivers?

 
 
            
THE WITNESS: You know, I  they better; that is all I can say. But I 
don't know. I haven't worked with port of entry since I retired from the highway 
patrol, but I assume that is an enforcement thing.

 
 
[¶43]   Applying the abuse of discretion 
standard we have adopted for claims of error under W.R.C.P. 39.4, we find 
nothing in the record before us to indicate that the district court failed to 
exercise sound judgment with respect to the juror questions or acted arbitrarily 
and capriciously.  Ms. Cathcart 
points to no specific error or prejudice but challenges the rule itself by 
asserting that it is fundamentally unfair and prejudicial. 

 
 
[¶44]   Wyoming is among the majority of states that 
allow juror questioning.  As one 
court has stated in a thorough review of the practice:

 
 
Juror 
questioning is neither radical nor a recent innovation. The practice was 
historically part of the trial process and considered a useful tool in 
ascertaining the truth. . . . Although a few courts have prohibited questioning 
of witnesses by juries, none have held it unconstitutional. 

 
 
The vast 
majority of states that have ruled on the issue allow juror questioning in some 
form.

 
 
In 
addition to the state court decisions, of the ten federal circuits that have 
considered the juror questioning issue, all allow the practice in some form in 
the trial court's discretion.

 

[R]ecent 
decisions allow the trial courts greater freedom in utilizing juror questioning. 
Many decisions conclude that juror questioning of witnesses aids in the 
ascertainment of truth and the overall achievement of justice in trials. Other 
courts have found that juror questioning may also increase juror understanding 
and participation.

 

* * 
*

 
 
In 
addition, scholarly and professional commentary is near unanimous in its support 
for allowing jurors to question witnesses. 

 
 

State v. 
Doleszny, 2004 
VT 9, ¶¶ 12-15, 18, 844 A.2d 773, 778 (Vt. 2004) (citations omitted).  Absent a showing of how the juror 
questions specifically prejudiced Ms. Cathcart's ability to present her claim, 
we find no abuse of discretion and affirm the district court's rulings.   

 
 

5.                              
Jury 
Instructions

 
 
[¶45]   Ms. Cathcart's final contention is 
that the district court erred in giving certain jury instructions and not giving 
others.  We consider first her 
claims of error in instructions given by the district 
court.

 
 
a.         
Instructions Given

 
 
[¶46]   First, Ms. Cathcart claims the 
district court erred in giving instruction 13A, which read as 
follows:

 
 
If you 
find that the Defendant did no more than simply delay payment, then in order to 
find a breach of the duty of good faith in the handling and investigation of the 
claim, you must find that State Farm acted intentionally and without 
justification and used deceit, non-disclosure, violation of industry custom, 
and/or made deliberate attempts to conceal the truth.

 
 
Ms. 
Cathcart asserts the instruction was improper because this was not a delayed 
payment case.  State Farm responds 
that it was not error to give the instruction because testimony was presented 
that Ms. Cathcart's parents were pushing for a settlement and were frustrated at 
the amount of time it was taking.  State Farm also cites to the following 
statement by Ms. Cathcart's counsel during closing 
argument:

 
 
What in 
God's creation had State Farm been doing from November 13th, until it 
actually did the assessment in February, February 25th, in the injury 
evaluation report? Not much.

 
 
Because 
Ms. Cathcart objected to the instruction, we consider first whether the district 
court erred in giving it.  If we 
find error, we then review the error for prejudicial effect.  Daley, ¶29, 30 P.3d  at 
554.

 
 
[¶47]   Given defense counsel's statement 
in closing argument and the evidence that Mr. and Mrs. Mesa wanted a settlement 
and were frustrated by the delay in getting one, we find no error in the 
district court's decision to instruct the jury on the law concerning delayed 
payment.  Although the complaint did 
not specifically allege delayed payment as a basis for the bad faith claim, 
evidence and argument were presented suggesting that one of the ways in which 
State Farm acted in bad faith was by delaying payment.  The instruction may have been unnecessary 
in this case, but we are not willing to say the district court erred in giving 
it.     

 
 
[¶48]   Ms. Cathcart also asserts the 
district court erred in instructing the jury that she and her parents had a duty 
to read the insurance policy.  The 
instruction at issue stated as follows:

 
 
Instruction 
No. 16

 
 
            
Typically, an insured has a duty to read the insurance policy under which 
he or she is making a claim to determine the coverages available under the 
policy. If you find that the Plaintiff or her parents should have read the 
insurance policy in question and failed to do so, then you may consider such 
failure as evidence of their fault.

 
 
Ms. 
Cathcart claims this instruction misstated Wyoming law and prejudiced her case because it has never 
been held in Wyoming that an insured who is not a 
policyholder and not a party to the contract has a duty to read the policy. 
 State Farm responds that whether or 
not the instruction accurately states Wyoming law, there was no prejudice from the 
instruction because the jury found State Farm did not breach the implied 
covenant of good faith and fair dealing or commit fraud.  Therefore, State Farm asserts, the jury 
never reached the question of whether Ms. Cathcart was at fault for not reading 
the policy.  Ms. Cathcart objected 
to instruction 16 during the instruction conference; therefore, we consider 
whether it was error to give the instruction and, if so, whether the error was 
prejudicial.

 
 
[¶49]   The law in Wyoming is that a policy 
holder has a duty to read his or her insurance policy. Small v. King, 915 P.2d 1192, 1194 
(Wyo. 1996); Feather v. State Farm Fire & 
Casualty, 872 P.2d 1177, 1181 (Wyo. 1994); 
Darlow v. Farmers Insurance Exchange, 
822 P.2d 820, 828-29 (Wyo. 1991).  We have also recognized that third-party 
beneficiary claims are subject to the same defenses as would be available in an 
action between the actual parties to the contract.  Cordero Mining Co. v. U.S. Fidelity 
and Guar. Ins. Co., 2003 WY 48, ¶ 28, 67 P.3d 616, 626 (Wyo. 2003).  Applying this rule in Cordero, we held that the insured's 
failure to read the policy could be used by the insurer to defend a claim 
against a third party beneficiary of the policy.  We have not previously decided whether 
the duty to read defense available in an action brought by the policyholders 
also is available in an action brought by a non-policyholder insured.  We find it unnecessary to reach an 
express holding on the issue because we conclude any error in giving the 
instruction under these facts was not prejudicial.  We have said: 

 
 
In 
reviewing alleged errors in jury instructions, a finding of error alone is 
insufficient to reverse; prejudicial error must be found.  Such error is never presumed and must, 
instead, be demonstrated by the party asserting error.  To satisfy this burden, there must be a 
reasonable possibility that, in the absence of error, the verdict might have 
been more favorable to a party, and the burden is on the appellant to show 
whether the error is prejudicial.   

 
 

Daley, ¶ 29, 
30 P.3d  at 554 (citations omitted).  The jury in this case decided State Farm 
did not act in bad faith or commit fraud in investigating and handling Ms. 
Cathcart's claim, and never got to the question of whether Ms. Cathcart's 
failure to read the policy contributed to her alleged loss.  Under these circumstances, it seems 
unlikely the verdict might have been more favorable to Ms. Cathcart in the 
absence of the duty to read instruction. 

 
 
[¶50]   We have also 
said:

 
 
When 
generally examining the propriety of jury instructions, this Court reviews all 
instructions as a whole.  "On 
review, this Court considers whether the instructions, taken as a whole, 
adequately and clearly advise the jury of the applicable law."  

 
 
We have 
said the function of jury instructions is to give the jury guidance regarding 
the law of the case. The trial court is not obligated to give an instruction 
offered by a party as long as the jury is adequately instructed on the law as it 
pertains to that case.  The trial 
court's ruling on an instruction will not constitute reversible error absent a 
showing of prejudice, and prejudice will not be said to result unless it is 
demonstrated that the instruction confused or misled the jury with respect to 
the proper principles of law.  

 
 
In past 
decisions, this Court has applied a five-factor test in measuring the degree of 
error that may be considered prejudicial.  
Those factors are:

 
 
(1) 
[t]he extent to which there is conflict in the evidence on critical 
issues;

(2) 
whether or not the . . . argument to the jury may have contributed to the 
instruction's misleading effect;

(3) 
whether or not the jury requested a re-reading of the erroneous instruction or 
of related evidence;

(4) the 
closeness of the jury's verdict;  
and

(5) the 
effect of other instructions in curing the error. 

 
 

Daley, ¶ 30, 
30 P.3d 555 (citations omitted)

 
 
 [¶51]  The evidence presented in this case 
showed that State Farm investigated the accident, learned that Ms. Cathcart was 
driving at a high rate of speed, learned also that the actions of another driver 
may have contributed to the accident, informed Ms. Cathcart's parents that 
uninsured motorist coverage might come into play, determined that Ms. Cathcart's 
own actions may have had a significant role in the accident and, based upon an 
assessment of her likely percentage of fault, offered her $75,000 of the 
$100,000 available under the uninsured motorist provision.  The evidence presented further showed 
that, accompanied by her father, Ms. Cathcart accepted payment of the $75,000 
and signed a release relinquishing any further claims against State Farm as a 
result of the accident.  Applying 
the first factor in the five part test for prejudicial error, there was no 
material conflict in the evidence on these critical issues.10 

 
 
[¶52]   In her closing argument to the 
jury, counsel for State Farm stated:

 
 
            
And then I think you have to look in light of that Instruction Number 16 
that talks about what their duty is with regard to reading the policy to 
determine the coverage. And under the law an insured has a duty to read the 
insurance policy and determine the coverages. Mr. and Mrs. Mesa of course were 
not making the claim, but they were representing their daughter in making that 
claim. If there is any question in their mind as to what the policy limits were, 
what the coverage was, all they had to do was look at the policy. And they say, 
well, it wasn't our policy. It was my mother-in law's policy. Or, you know, all 
they had to do was ask the mother-in-law, could I have a copy of the policy. If 
she didn't have one, ask Rick Trujillo. I would have been happy to give her a 
copy of the policy. Go to ValeriePeak. She could have printed it out and 
would have been happy to do that. 

 
 
Whether 
or not a non-policy holder insured has a duty under Wyoming law to read the 
policy, defense counsel's argument simply told the jury in essence that an 
insured, or the parents of a minor insured, have a duty to exercise reasonable 
care to examine the coverage obtained and act to avoid loss.  Feather, 872 P.2d  at 1181; Moore, 813 P.2d  at 1301.  This is an accurate statement of 
Wyoming law. 
 Therefore, applying the second of 
the five factors for determining prejudicial error, the argument to the jury did 
not contribute to any misleading effect instruction 16 may have had.  Applying the third and fourth factors of 
the test, the jury did not request to have instruction 16 re-read and the jury 
verdict was unanimous.  Considering 
the duty to read an instruction in light of the other instructions given, we 
conclude the instructions as a whole adequately and clearly advised the jury of 
the applicable law. 

 
 
[¶53]   Ms. Cathcart also argues the 
district court erred in giving instruction 17, which 
stated:

 
 
            
An insurer, as part of its duty of good faith, may have an obligation to 
inform the insureds of the extent of the coverage afforded them under their 
policy before negotiating a settlement. Whether this duty exists depends on the 
particular circumstances of the case. In determining whether State Farm had a 
duty to inform, you should consider the following factors, together with all 
other evidence in the case:

 
 
a)  The type of insurance policy in 
question;

b)     
Whether 
it was apparent to the insurance company that the insured knew the extent of 
coverage;

(c) 
Whether there is a likelihood that the insured can only be compensated fully 
under her own policy; and

(d) 
Whether the insured has no basis to believe she must rely upon her policy for 
coverage.

 
 
These 
factors are not all inclusive nor must all be present or absent for the duty to 
inform to exist. If you find from your consideration of all the evidence that 
State Farm should have informed the Plaintiff of the coverage available under 
the policy but knowingly and recklessly failed to do so without any reasonable 
basis, then you may consider such failure as evidence of a breach of the duty of 
good faith.

 
 
Ms. 
Cathcart argues this instruction misstated Wyoming law because although it accurately 
states the law applicable in double-insurance situations (where both parties 
involved in an accident have liability coverage issued by the same insurer), it 
is not the applicable law in first party uninsured motorist cases like hers. 
 She contends an insurer handling a 
first party uninsured motorist claim has an unconditional duty to inform the 
insured of the amount of the policy limits.

 
 
[¶54]   In Darlow, 822 P.2d  at 828, we adopted the 
Tennessee Rule for determining the obligations owed by an 
insurer:

 
 
Under 
this formulation, the duty of good faith and fair dealing includes informing an 
insured as to coverage and policy requirements when it is apparent to the 
insurer that (1) there is a strong likelihood that its insured only can be 
compensated fully under her own policy and (2) the insured has no basis to 
believe that they must rely upon their policy for 
coverage.

 
 
As Ms. 
Cathcart asserts, Darlow involved a 
double-insured situation, i.e., the Darlows and the owners of the other vehicle 
involved in the accident had automobile insurance coverage issued by the same 
insurance company.  Since Darlow, we have considered an insurer's 
duty to inform in the context of uninsured motorist coverage and adopted a 
somewhat different standard. 

 
 
[¶55]   Shrader, 882 P.2d 813, was a first party 
uninsured motorist case.  In Shrader, State Farm argued that it owed 
no duty of good faith and fair dealing to its insured under the policy's 
uninsured motorist provision.  State 
Farm argued that a claim for uninsured motorist benefits should be treated as a 
third party claim until the liability of the uninsured motorist was determined. 
 We disagreed, holding that an 
insurer providing uninsured motorist coverage owes a duty of good faith and fair 
dealing to its insured at all times.  As we did in Darlow, we relied in Shrader on the Tennessee Supreme Court's 
decision in MFA Mutual Ins. Co. v. 
Flint, 574 S.W.2d 718 (Tenn. 1978), which was also a first party uninsured 
motorist case.  We cited with 
approval the Flint court's 
holding that as part of the duty of good faith and fair dealing, "an insurer . . 
. is required to inform the insureds of the extent of the coverage afforded them 
under their policy before negotiating a settlement, especially when it is 
apparent that the insured does not know the extent of available coverage."  Shrader, 882 P.2d  at 827.  This is the standard applicable under 
Wyoming law 
that defines an insurer's duty to inform in first party uninsured motorist 
cases. 

 
 
[¶56]   The difficulty with the instruction 
the district court gave in Ms. Cathcart's case is that it suggested the duty to 
inform was conditioned upon factors, identified in Darlow, that are not applicable in the 
uninsured motorist coverage context.  It also suggested the duty arises only 
when it is apparent to the insurer that the insured does not know the extent of 
coverage, instead of correctly stating that the duty always exists, especially 
when it is apparent the insured does not know the extent of coverage.  Because instruction 17 was not a correct 
statement of Wyoming law, the district court erred in 
giving it to the jury. 

 
 
[¶57]   We turn to the question of whether 
the error was prejudicial.  In 
making that determination, we apply the five factor test identified in Daley:  (1) the extent to which the evidence was 
in conflict on critical issues; (2) whether or not the argument to the jury may 
have contributed to the instruction's misleading effect; (3) whether or not the 
jury requested a re-reading of the erroneous instruction or related evidence; 
(4) the closeness of the jury's verdict; and (5) the effect of other 
instructions in curing the error.

 
 
[¶58]   Examining the first factor, the 
evidence was undisputed that State Farm had the responsibility to inform Ms. 
Cathcart and her parents of the extent of coverage.  State Farm's training manual, which 
provided that "State Farm claims representatives must understand the need to 
advise the insured of all coverages available under the insurance contract," was 
admitted into evidence.  Mr. 
Trujillo testified that it was his responsibility on all claims to explain 
"everything about" the coverage available under the policy.  Other more senior State Farm 
representatives testified as well that insurance adjustors were required to 
inform the insured concerning the extent of coverage.  This factor weighs in favor of a finding 
that the instruction was not prejudicial. 

 
 
[¶59]   Looking at the second factor, 
counsel for Ms. Cathcart appropriately argued to the jury that State Farm had a 
responsibility to inform Ms. Cathcart of the extent of coverage prior to 
entering into a settlement with her, including that the policy limits were 
$100,000.  State Farm did not 
dispute that it was required to advise Ms. Cathcart concerning coverage.  Neither party mentioned instruction 17 in 
closing argument.  If anything, the 
evidence and argument presented to the jury countered any misleading effect of 
instruction 17.

 
 
[¶60]   The third factor of the test for 
prejudicial error concerns whether the jury asked to have the erroneous 
instruction re-read.  Reading of the jury 
instructions apparently was not recorded, so there is no transcript for this 
Court to review in that regard; however, there is no indication anywhere else in 
the record or in the parties' arguments to this court that the jury requested 
the district court to re-read instruction 17.

 
 
[¶61]   Factor number four, the closeness 
of the jury verdict, similarly suggests a lack of prejudice.  Although the record before us does not 
reflect how long the jury deliberated, the record does indicate the jury asked 
no questions during deliberations.  The jury rendered a unanimous verdict in 
favor of State Farm.

 
 
[¶62]   The fifth factor concerns the 
effect of other instructions in curing the error.  In addition to instruction 17, which in a 
backhanded way instructed the jury that State Farm had a duty to advise Ms. 
Cathcart and her parents about coverage if it was apparent they did not know the 
extent of coverage, the jury was also instructed concerning an insurer's duties 
under the Unfair Claims Practices Act.  Instruction 13, which the district court 
gave to the jury, stated:

 
 
You are 
instructed that Wyoming law provides as 
follows:

 
 
Unfair 
claims settlement practices:

 
 
(a)       A person is 
considered to be engaging in an unfair method of competition and unfair and 
deceptive act or practice in the business of insurance if that person commits or 
performs with such frequency as to indicate a general business practice any of 
the following unfair claims settlement practices:

(i)         
Misrepresenting pertinent facts or insurance policy provision relating to 
coverages at issue; ***

(vi)       Not 
attempting in good faith to effectuate *** fair and equitable settlements of 
claims in which liability has become reasonably clear;***

(x)        
Making claims payments to insured *** not accompanied by a statement 
setting forth coverage under which the payments are being made; 
***

(xiv)     Failing to promptly 
provide a reasonable explanation of the basis in the insurance policy in 
relation to the facts or applicable law *** for the offer of a compromise 
settlement.

 
 
If you 
find that the Defendant violated one or more of the above provisions either 
knowingly or in reckless disregard of the above law, then you should consider 
such violation as evidence of bad faith.

 
 
This 
instruction informed the jury that State Farm had a duty to accurately represent 
pertinent facts and provisions relating to coverage, to set forth the coverage 
under which payments were made, and to reasonably explain the settlement in 
light of the policy provisions. 

 
 
[¶63]   Instruction 17 was not a correct 
statement of Wyoming law.  However, in light of instruction 13 and 
the evidence and argument presented to show State Farm had a duty to inform Ms. 
Cathcart and her parents concerning the extent of coverage, we hold the error in 
giving the instruction was not prejudicial.            

 
 
[¶64]   Ms. Cathcart also contends the 
district court erred in instructing the jury on comparative fault.  Instruction 27 stated as 
follows:

 
 
            
Your verdict in this case must be determined on the basis of the 
comparative fault of the parties. It will be necessary for you to determine the 
comparative fault, if any, of each of the parties involved in the occurrence. It 
also will be necessary for you to determine the total amount of damages, if any, 
sustained by the Plaintiff. Fault is defined as the breach of any of the duties 
as defined in these instructions which caused damage to the 
Plaintiff.

 
 
            
Your findings as to fault will affect the Plaintiff's recovery. It is my 
duty to explain how that may occur.

 
 
            
The Defendant's liability for damages is limited to the percentage of 
fault, if any, that you find is attributable to the 
Defendant.

 
 
            
The Plaintiff's recovery is reduced by the percentage, of any, of fault 
that you find is attributable to the Plaintiff. If you find that the Plaintiff's 
fault exceeds fifty percent (50%), the Plaintiff will not be entitled to recover 
any damages.

 
 
            
The verdict form provided to you includes spaces for you to record your 
determination of the parties' comparative fault on a percentage 
basis.

 
 
            
If you find that the Plaintiff was at fault in some percentage, do not 
make an adjustment to account for the percentage of fault you attribute to the 
Plaintiff when you record the total amount of the Plaintiff's damages on the 
verdict form. The judge  not the jury  is responsible for reducing the 
Plaintiff's recovery to account for the percentage of fault, if any, that the 
jury attributes to the Plaintiff.

 
 
            
In explaining the consequences of your verdict, I have not meant to imply 
that either the Plaintiff or the Defendant is at fault. That is for you to 
decide in conformity with these instructions.

 
 
Ms. 
Cathcart also claims error in the section of the verdict form allowing the jury 
to determine comparative fault. 

 
 
[¶65]   During the instruction conference, 
Ms. Cathcart objected to instruction 27 on the following 
grounds:

 
 
We 
believe it's inappropriate to apply a comparative fault standard in the 
circumstance of this case. It is confusing to the jury and does not comply with 
Wyoming law. 
It implies the jury may assign the fault percentages in the underlying accident. 
It also implies that the jury may consider comparative fault on the fraud claim, 
which is also inappropriate under Wyoming law.

 
 
Ms. 
Cathcart also objected to the portion of the verdict form referencing 
comparative fault:

 
 
            
We also object to numbers three and four of the verdict form regarding 
the fault of Carly Mesa and/or her parents. In this case  this is not a case of 
comparative fault for the breach of the covenants of good faith and fair dealing 
or fraud or the violation of statute. The fault of the plaintiff and/or her 
parents [does] not belong on this verdict form. It's an incorrect instruction to 
the jury to make them answer these questions, based upon the law of Wyoming.   

 
 
State 
Farm argues that any error in giving the instruction was harmless since the jury 
never reached the comparative fault issue.  Perfunctorily, State Farm also argues 
comparative fault is a proper matter for jury instruction in bad faith cases 
because this Court held in Board of 
County Commissioners of Teton County v. Bassett, 8 P.3d 1079, 1083-84 (Wyo. 
2000), that all species of culpable conduct are to be compared under Wyo. Stat. 
Ann. § 1-1-109 (LexisNexis 2005).

 
 
[¶66]   We decline to address the latter 
argument.  The issue of whether 
comparative fault is a proper matter for jury instruction in a bad faith case 
has not been placed squarely before us except in the most perfunctory manner and 
neither party adequately briefed or argued the issue.   We leave the issue for a case in 
which the parties squarely raise it and adequately address it.  We review the instruction complained of 
here for prejudicial error and hold that Ms. Cathcart has failed to meet her 
burden of proving prejudice from any error in the 
instruction.

 
 
[¶67]   The jury was asked to decide first 
whether State Farm breached the implied covenant of good faith and fair dealing 
in investigating and handling Ms. Cathcart's claim.  The jury answered "No."  The jury was then asked to decide whether 
State Farm committed fraud in investigating and handling Ms. Cathcart's claim. 
 Again, it answered "No."  Upon answering "No" to these questions, 
the jury was instructed to sign the verdict form and notify the bailiff.  Under these circumstances, where the jury 
concluded State Farm did not breach the covenant of good faith and fair dealing 
and never considered the comparative fault of Ms. Cathcart, we find no 
prejudicial error. 

 
 
b.         
Instructions Not Given

 
 
[¶68]   Ms. Cathcart also contends the 
district court erred in not giving several of the jury instructions she offered. 
 Ms. Cathcart's proposed instruction 
26, which the district court declined to give, stated as 
follows:

 
 
            
Even if State Farm had a fairly debatable reason for not paying the claim 
in the first place, i.e., its belief that the loss was the result of the 
negligence of Carly Mesa, it cannot proper[l]y go beyond a reasonable denial of 
the claim and engage in unreasonable or unfair behavior to gain an unfair 
advantage. A fairly debatable reason to deny a claim is not a defense against 
conduct that may flow from engaging in oppressive and intimidating claims 
practices. 

 
 
In Hatch v. State Farm Fire and Casualty 
Co., 842 P.2d 1089, 1099 (Wyo. 1992), the homeowners' insurance case from 
which this language is taken, the insured presented evidence of a variety of 
oppressive and intimidating claims practices.11  Ms. Cathcart alleged no comparable 
practices by State Farm.  Moreover, 
the jury deciding Ms. Cathcart's case was instructed in instruction 11 that even 
if a claim is fairly debatable, an insurer may breach the implied covenant of 
good faith and fair dealing "by the manner in which it investigates, handles or 
denies the claim."  This instruction 
adequately and accurately informed the jury concerning the applicable law.  We find no error in the district court's 
refusal to give proposed instruction 26.

 
 
[¶69]   Ms. Cathcart's proposed instruction 
30 stated as follows:

 
 
            
An insurance company may not ignore evidence that supports coverage, or 
just focus on those facts which justify denial of the claim. If it does so, it 
acts unreasonably toward its insured and breaks the covenant of good faith and 
fair dealing. 

 
 
Ms. 
Cathcart cited case authority from other states in support of this instruction. 
Wyoming has 
not adopted a similar rule.  The 
district court did not err in refusing the proposed 
instruction.

 
 
[¶70]   Ms. Cathcart's proposed instruction 
34 read as follows:

 
 
            
An insurer, as a part of its duty of good faith, is required to inform 
the insureds of the extent of the coverage afforded them under their policy 
before negotiating a settlement, especially when it is apparent that the insured 
does not know the extent of available coverage. 

 
 
This 
language was taken directly from Shrader and, as we said previously in 
this opinion in discussing instruction 17, correctly states Wyoming law on an 
insurer's duty to inform in an uninsured motorist situation.  We hold it was error for the district 
court not to give the instruction, but not prejudicial error.  State Farm did not dispute that it had 
the duty to inform Ms. Cathcart and her parents of the extent of coverage and 
instruction 13 correctly informed the jury that State Farm had a duty to 
accurately represent pertinent facts and provisions relating to coverage, to set 
forth the coverage under which payments were made, and to reasonably explain the 
settlement in light of the policy provisions. 

 
 
[¶71]   Proposed instructions 35 to 37 read 
as follows:

    

Instruction 
No. 35

 
 
            
If an insurer fails to inform the insureds of their right to compensation 
for past or future pain and suffering, future loss of earning capacity, or past 
or future loss of enjoyment as a result of the permanent injuries the insureds 
suffered, the insurer breaches the duty of good faith and fair 
dealing.

 
 
Instruction 
No. 36

 
 
            
The duty of an insurer to act in good faith and fairly should be of the 
highest order in regard to claims arising under uninsured motorist coverage. The 
public interest in this coverage means that insurers should be obligated to 
exercise the greatest care and highest level of good faith and fair 
dealing.

 
 
Instruction 
No. 37

 
 
            
The duty of good faith and fair dealing is the obligation that the 
insurer must act fairly and in good faith in discharging its contractual 
responsibilities. Where in so doing, it fails to deal fairly and in good faith 
with its insured by refusing, without proper cause, to compensate its insured 
for a loss covered by the policy, such conduct may be a breach of the covenant 
of good faith and fair dealing. 

            
 

[¶72]   The language in proposed 
instructions 35-37 is taken almost verbatim from cases and other legal 
authorities cited by this Court in 
Shrader.  Proposed instruction 
35 paraphrases statements made by the Tennessee Supreme Court in Flint, 574 S.W.2d  
at 721.  Proposed instruction 36 is 
taken from 2 Widiss, Uninsured and Underinsured Motorist Insurance § 20.4 at 
161-62 (2nd ed. 1992) as quoted in Shrader.  Proposed instruction 37 is from Gruenberg v. Aetna Ins. Co., 9 Cal. 3d 566, 108 Cal. Rptr. 480, 485 (1973), which was also quoted in Shrader.  While the statements from these 
authorities were cited with approval in Shrader, they do not represent holdings 
of this Court and it was not error for the district court to decline the 
proposed instructions.  Moreover, 
taken as a whole, the instructions the district court gave to the jury 
adequately and clearly advised the jury of the law applicable to Ms. Cathcart's 
claim.  Taken as a whole, the 
instructions given cannot be said to have confused or misled the jury with 
respect to the proper principles of law.  
We find no error in the district court's refusal to give proposed 
instructions 35-37.

 
 
[¶73    
Affirmed.

 
 
FOOTNOTES

 
 

1At the time 
of the accident, Ms. Carly Mesa was unmarried.  She subsequently married and took her 
husband's name of Cathcart.

 
 

2In her 
complaint, Ms. Cathcart also alleged claims for breach of the duty imposed by 
Wyo. Stat. Ann. § 26-15-124(c) (LexisNexis 2005), failure to investigate and 
evaluate the insurance claim, intentional infliction of emotional distress, 
negligent infliction of emotional distress, fraud and punitive damages.  

 

3Pursuant to 
28 U.S.C. §§ 1441 and 1446, cases are removable to federal court when the 
parties are citizens of different states and the amount in controversy exceeds 
$75,000.  28 U.S.C. § 1446(d) 
requires a notice of removal to be filed within 30 days after receipt by the 
defendant of the complaint or first pleading from which it can be ascertained 
that the case meets the criteria for removal.  Ms. Cathcart filed her complaint on May 
21, 2002.  State Farm filed its 
answer on June 20, 2002.  State Farm 
filed its notice of removal on October 17, 2002, claiming Ms. Cathcart alleged 
unspecified damages in her complaint and that it became clear she was claiming 
damages exceeding $75,000 only when she responded to requests for admissions in 
October, 2002.  Ms. Cathcart filed a 
motion for remand on October 28, 2002, asserting the removal notice was 
untimely.  Without considering the 
remand motion, the federal district court entered an order of removal on 
December 9, 2002.  Upon 
consideration of the remand motion, the federal district court concluded State 
Farm's removal notice was untimely because it was not filed within 30 days after 
receipt of the complaint, from which it could be ascertained that the amount in 
controversy exceeded $75,000. 

 
 

4Most courts conclude that the submission 
of jurors' questions to witnesses is left to the discretion of the district 
court and will not give rise to reversal absent an abuse of discretion.  State v. LeMaster, 669 P.2d 592, 595 
(Ariz. 1983); 
DeBenedetto v. Goodyear Tire & 
Rubber, Co., 754 F.2d 512, 519 (4th Cir. 1985). 

 
 

5The only 
indication in the record concerning the trial court's reasoning is found in the 
transcript of the hearing conducted on Ms. Cathcart's new trial motion after the 
verdict and judgment were rendered.  At that time, in discussing the breach of 
contract claim the trial court indicated that without moving to set aside the 
release, Ms. Cathcart had no breach of contract claim other than the claim that 
State Farm did not treat her fairly, which was the essence of her bad faith 
claim.  Absent a rescission of the 
release and return of the amount paid, the trial court concluded, there was no 
pure breach of contract claim and all that remained was the bad faith 
claim.  

 
 

6Although 
neither party adequately briefed the issue, the law is clear in Wyoming that a settlement 
agreement constitutes a contract subject to the legal principles applicable to 
all contracts.  Wyoming Sawmills, Inc. v. Morris, 756 P.2d 774, 
779 (Wyo. 
1988).  Thus, the release Ms. 
Cathcart signed constituted a contract.  Although a release can be set aside in 
Wyoming upon 
grounds of mutual mistake, duress or unconscionable bargain, Ms. Cathcart did 
not seek to set it aside nor did she claim that she signed the release based 
upon any of these grounds.

 
 

7Roughly 185 
of the written juror questions are marked "o.k.," nine are marked "no" and 
roughly 30 have no notation.

 
 

8In his 
direct testimony, Mr. Knight testified that a yaw mark is "caused when hard 
steering is put into a car.  And 
that car starts to turn. . . .  It 
is not a skid by definition. . . .  A car yaws when you see these long, 
looping marks. . . .  It's an input 
that causes the car to eventually go into a clock spring. . . ." 

 
 

9It is not 
clear from the transcript whether the court or someone else asked this 
question.

 
 

10The only 
disputed issue among these critical elements was whether State Farm informed Ms. 
Cathcart's parents the uninsured motorist provision applied.  They initially testified they did not 
remember what they discussed with Mr. Trujillo.  They later testified the applicability of 
the provision was not discussed.  The attorney representing them at the 
time testified he was informed that it applied.  Mr. Trujillo's notes reflect the issue 
was discussed.  In any event, Ms. 
Cathcart ultimately accepted payment under the uninsured motorist provision. 

 
 

11In Hatch, the insured presented evidence 
that, among other things, the insurer required them to file a 275 page inventory 
of items in the house at the time it burned (including the number of cornflakes 
in the cereal box and the amount of salt in the salt shaker), ousted them from 
their home and searched it several times without permission, and made them 
submit to repeated and lengthy interviews by rude and threatening 
representatives and other oppressive and intimidating conduct.