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Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 

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UNITED STATES COURT OF APPEALS F I L E D United States Court of Appeals 

TENTH CIRCUIT 

CONSULTING PSYCHOLOGICAL SERVICES, 

a proprietorship, D. EUGENE THORNE, 

Plaintiffs-Appellants, 

v. 

AMERICAN HOME ASSURANCE co., and 

AMERICAN PROFESSIONAL AGENCY, INC., 

Defendants-Appellees. 

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ORDER AND JUDGMENT* 

Tench Circuit 

SEP 1 7 1990 

&OBERT L. HOECKER 

Clerk 

No. 90-4047 

(D.C. No. 89-C-259-S) 

( D. Utah) 

Before MOORE, BARRETT, and BRORBY, Circuit Judges. 

After examining the briefs and the appellate record, this 

three-judge panel has determined unanimously that oral argument 

would not be of material assistance in the determination of this 

appeal. See Fed. R. App. P. 34(a); 10th Cir. R. 34.1.9. The 

cause is therefore ordered submitted without oral argument. 

Appellants appeal the order of the district court granting 

defendants' motions for summary judgment. 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth tircuit, 

except for purposes of establishing the doetrines of the law of 

the case, res judicata, or collateral estoppel. 10th Cir. R. 

36.3. 

Appellate Case: 90-4047 Document: 010110042165 Date Filed: 09/17/1990 Page: 1 
The following recitation of the facts is taken from the 

district court's memorandum decision dated January 31, 1990. 

Appellant Thorne is a licensed psychologist and attorney who, from 

1979 through 1985, served as the executive director of clinical 

programs and owned an interest in the Provo Canyon School. Thorne 

also maintained a private clinical psychology practice, treating 

patients who were not students at the school. Between February 

1976 and May 1988, defendant American Home (the exclusive carrier 

for members of the American Psychological Association to which 

Thorne belongs), through its general agent, defendant American 

Professional, issued a series of policies to Thorne d/b/a either 

Utah Psychological Services or Consulting Psychological Services. 

The last policy covered the period from May 1, 1987, through May 

1, 1988. 

On May 2, 1987, the parents of Jeff Rusak commenced a civil 

rights action against Thorne, in his capacity as director of the 

Provo Canyon School, alleging the school violated the boy's 

constitutional rights while he was a resident there in 1984. 

Thorne notified American Professional which notified American Home 

of the claim. By letter dated August 26, 1987, American Home 

denied coverage under policy provisions showing Thorne was covered 

only in his capacity as a psychologist and not as a director of 

Provo Canyon School. In 1986 Thorne let his policy lapse by 

failing to pay the premium when due. American Home reinstated the 

policy but informed Thorne it would not renew the policy when it 

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Appellate Case: 90-4047 Document: 010110042165 Date Filed: 09/17/1990 Page: 2 
expired in May 1988. The nonrenewal notices were sent on May 28, 

1987, July 29, 1987, February 25, 1988, and February 29, 1988. 

American Home also placed Thorne on an "undesirable" list. 

During 1984, Thorne and two other Rusak defendants were 

insured under a liability policy issued to Provo Canyon School by 

St. Paul Fire & Marine Insurance Company (St. Paul). St. Paul 

retained attorney David Epperson to defend Rusak and, although 

Thorne entered his appearance as counsel~ se, Epperson remained 

as defense counsel through final disposition of the Rusak case. 

The parties eventually settled for $75,000, and all claims were 

dismissed. St. Paul defended under a reservation of rights, then 

contested its coverage in a state court action that resulted in a 

ruling that St. Paul's policy covered all the Rusak claims against 

Thorne and the other defendants. Thorne neither personally 

contributed to the $75,000 settlement nor paid Epperson's fees. 

Thorne eventually brought the present suit seeking 

compensation for (1) his time invested and expenses allegedly 

incurred to defend himself in Rusak, (2) attorney's fees he 

allegedly incurred in the action and (3) Epperson's fees. He also 

claimed damages resulting from American Home's refusal to renew 

the policy, such as loss of past, present and future income, 

anxiety, stress and mental anguish, and loss of business and 

business opportunities. Thorne alleged American Home's refusal to 

defend or indemnify in Rusak and the nonrenewal of Thorne's policy 

not only caused loss of his reputation, but also effectively 

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Appellate Case: 90-4047 Document: 010110042165 Date Filed: 09/17/1990 Page: 3 
prevented him from obtaining coverage from another malpractice 

carrier. 

The district court determined that defendant American 

Professional was entitled to summary judgment as a matter of law 

on all claims because Thorne failed to meet his shifted burden of 

production under Fed. R. Civ. P. Sb(e). See also Celotex Corp. v. 

Catrett, 477 U.S. 317, 324 (1986). Thorne offered no clear and 

convincing evidence to support his assertions that American 

Professional was involved in the nonrenewal of plaintiffs' policy 

in any other capacity than as agent for American Home. 

The district court also granted summary judgment for 

defendant American Home. As to appellants' first claim for 

relief, based on defendants' alleged breach of express and implied 

covenants of the insurance agreement, the district court 

determined that "because Thorne was fully represented through 

settlement in Rusak and he neither contributed to the settlement 

nor paid attorney's fees or costs, there is no evidence to support 

his claim for compensatory and punitive damages under either a 

breach of contract or tort theory." 

As to appellants' second claim for relief, based on 

defendant's alleged breach of fiduciary duty and bad faith, the 

district court determined that there is no recognized duty on the 

part of an insurance carrier to renew an insured's policy once the 

policy has expired. Furthermore, the district court determined 

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Appellate Case: 90-4047 Document: 010110042165 Date Filed: 09/17/1990 Page: 4 
that American Home's notices to Thorne of its intent not to renew 

the policy after May 1, 1988, with the first notice being sent on 

May 28, 1987, satisfied the provisions of Utah Code Ann. § 31A-21-

303(4)(b) (Supp. 1990). The district court's memorandum decision 

did not specifically address appellants' third claim for relief, 

based on defendant's alleged violation of "the Utah Unfair Claims 

Settlement Practices Act, Title 31A, Chapter 26 of Utah Code 

Annotated, 1953," but the court "grant[ed] on all claims the 

motions for summary judgment of American Home and American 

Professional." 

On appeal, appellants contend that there were material facts 

in dispute which precluded the district court from granting 

summary judgment for the defendants, and that the district court's 

"granting of Defendants' Motion for Partial Summary Judgment is 

clearly erroneous[] and is not supported by the record." 

Specifically, appellants contend the following material factual 

disputes exist: (1) Whether "plaintiffs' insurance policy covered 

plaintiff 11 ; ( 2) whether "defendants' breached [a] duty to 

investigate and defend plaintiff"; ( 3) whether "defendants 

wrongfully cancelled and failed to renew plaintiffs' policy"; and 

(4) whether "plaintiffs [are] entitled to damages." 

Reviewing a summary judgment determination, this court 

applies the same standard employed by the district court under 

Rule 56(c) of the Federal Rules of Civil Procedure. Osgood v. 

State Farm Mutual Auto. Ins. Co., 848 F.2d 141, 143 (10th Cir. 

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Appellate Case: 90-4047 Document: 010110042165 Date Filed: 09/17/1990 Page: 5 
1988). "When a motion for summary judgment is granted, it is the 

appellate court's duty to examine the record to determine if any 

genuine issue of material fact was in dispute; if not, the court 

must decide if the substantive law was correctly applied." Id. 

Appellants' first and second claimed factual disputes 

completely ignore the substance of the district court opinion as 

to plaintiffs' claim based on defendant's refusal to defend or 

indemnify under the policy. Again, the district court concluded 

that "because Thorne was fully represented through settlement in 

Rusak and he neither contributed to the settlement nor paid 

attorney's fees or costs, there is no evidence to support his 

claim for compensatory and punitive damages under either a breach 

of contract or tort theory." The court's conclusion in this 

regard implicitly assumes that the American Home policy did 

provide coverage to Thorne for the Rusak action. Appellants have 

not directly challenged the district court's determination that 

Thorne did not incur any damages from defendant's refusal to 

defend or indemnify. In light of the district court opinion, it 

is immaterial whether the policy actually covered the Rusak 

litigation and whether defendant actually breached the insurance 

contract by refusing to indemnify and defend. 

Appellants' third claimed material fact dispute also fails to 

address the substance of the district court opinion. Appellants 

claim that a factual dispute exists whether defendants wrongfully 

cancelled and failed to renew plaintiffs' policy. However, the 

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district court concluded that there exists no fiduciary duty on 

the part of an insurer to renew an insured's policy once it has 

expired. In so doing, the court rejected plaintiffs' theory that 

American Home had an "enhanced duty" to Thorne because nonrenewal 

of his policy and classification of Thorne as an "undesirable" 

client would effectively deprive him of any malpractice coverage. 

On appeal, appellants merely reassert the existence of a duty 

on the part of American Home based on "[e]quitable principles and 

public policy." We find these arguments unpersuasive. 

Furthermore, appellants' reference to Utah statutory language in 

this regard fails to discuss the provisions of Utah Code Ann. 

§ 31A-21-303(4)(b) (Supp. 1990), which allows insurers to 

extinguish an insured's right to renewal if proper notice is sent 

to the insured at least thirty days prior to the policy expiration 

date. The district court found that proper notice had been sent 

well in advance of the prescribed limit and appellants do not 

challenge this finding. We therefore affirm the district court's 

conclusion that defendant had no duty to renew appellants' policy 

once it had expired and once proper notification had been given. 

Accordingly, appellants' fourth claimed ''factual dispute" 

regarding plaintiffs' alleged entitlement to damages based on this 

duty is nonexistent. 

Although the district court did not specifically address 

plaintiffs' broadly stated third claim for relief based on the 

"Utah Unfair Claims Settlement Practices Act, Title 31A, Chapter 

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. . 

26" of the Utah Code, we agree with appellees that the specific 

section addressing unfair claim settlement practices, Utah Code 

Ann. § 31A-26-303 (Supp. 1990), does not provide a private right 

of action. Utah Code Ann. § 31A-26-303(5) expressly states: 

"This section does not create any private cause of action.'' 

The district court's summary judgment order is AFFIRMED. 

The mandate shall issue forthwith . 

Entered for the Court: 

WADE BRORBY 

United States Circuit Judge 

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