DA 11
- 0208 IN THE SUPREME COURT OF THE STATE OF MONTANA

2011 MT 272
LEXIE LaMERE and VIRGIL HENDERSON, Plaintiffs and Appellants,
v. FARMERS INSURANCE EXCHANGE, Defendant and Appellee.

APPEAL FROM: District Court of the Eighth Judicial District,

In and For the County of Cascade, Cause No. ADV
- 06
- 466(b ) Honorable Julie Macek, Presiding Judge
COUNSEL OF RECORD:

For Appellant: Benjamin R. Graybill, Graybill Law Firm, P.C., Great Falls, Mont ana Lawrence A. Anderson , Attorney at Law, Great Falls, Montana For Appellee: David C. Dalthorp , Gough, Shanahan, Johnson & Waterman, PLLP, Helena, Montana

Submitted on Briefs: October 12, 2011 Decided: November 1, 2011 November 1 20112

Filed:

_______ ___________________________________

Clerk3

Justice Patricia O. Cotter delivered the Opinion of the Court. ¶1 Lexi 1 LaMere is Virgil Henderson’s daughter. In 2001, Lexiwas seriously injured in an automobile accident caused by an uninsured motorist. Hende rson and members of his household, including Lexi , were insured by two Farmers Insurance Exchange (Farmers or FIE) automobile insurance policies, each providing uninsured motorist protectiono f $25,000. In late 2001, in exchange for a full release signed by Lexi, F armers paid $25,000 inuninsured motoristcov erageunder Henderson’s polic y insuring the vehicle involved in the accident. In April 2006, Lexi and her father sued FIE seeking uninsured motorist benefits under Henderson’s second policy
. The Eigh th Judicial District Court entered summary judgment in fa vor of FIE. Lexiand Henderson appeal. We affirm. **ISSUE S**  ¶2 A restatement of the issue s is: ¶3 Did the District Court err in dismissing Lexiand Henderson ’sc laim for stacking of uninsured motorist cov erage s ? ¶4 Did the District Court err in ruling that neither Lexi n or Henderson had standing to bring a claim for medical pay coverage? ¶5 Did the District Court abuse its discretion when it declined to certify a putative class for claims of unjust enrichment and disgorgement of premiums?

**FACTUAL AND PROCEDURAL BACKGROUND**

1 T he parties use “Lexie” and “Lexi” interchangeably; because Lexi signed her Release of All Claims “Lexi LaMere,” we use that spelling throughout this Opinion.4

¶6 In 2001, Lexi Henderson was a passenger in a truck owned by her father, Virgil Henderson, but driven by her then
-boyfriend, now - husband, Aaron LaMere
. Aaron was uninsured
. Through Aaron’s neg l igence, the couple had an accident and Lexiwas seriously injured. Lexi was l iving at home at the time and was insured under her father’s FIE policies. Henderson had a policy on the truck in which Lexihad been riding (Policy #58) and on a second newer truck ( Policy #59)
. Both of Henderson’s liability polic ies with F armerscontained uninsured motorist (UM) a s well as underinsured motorist (UIM) coverage but neither containedmedical payment coverage. ¶7 Leximade a UM claim ag ainst the FIE policy insuring the wrecked truck and on November 27, 2001, in exchange for a release of all claims arising from the accident, FIE settled Lexi ’s claim by paying the UM policy limit of $25,000. At the time of thi s settlement, both the terms of the insurance policy and t he then
- current law prohibited the

“ stacking ” of insurance coverage. 2 Five years later

—inApril 2006

—Lexi sued F armers
se eking to stack the UM coverage contained in Policy #59 on top of the UM coverage she received under Policy #58
. Farmers issued a seco nd check to Lexiin December 2006 in the amount of $25,000, the UM policy limit under Policy #59
. ¶8 In the ir second amended complaintf iled in February 2007 , relying on Hardy v. Progressive Specialty Ins. Co ., 2003 MT 85, 315 Mont. 107, 67 P.3d 892, Lexiand Henderson requested declaratory judgment that they and si milarly situated policyholders

2 S tacking of ins urance policies refers to adding the policy limit of UM, UIM, or medical pay coverage from an insurance policy on one vehicle with the UM, UIM, or medical pay policy limits from a policy on another vehicle. In other words, adding the coverage limits provided in insurance policies of two or more vehicles.5

we re entitled to stack “uninsured, underinsured, and medical payment coverages.” Lexi asserted she was entitled to reopen her settled claim and pursue additional dama ge s. They also claimed that F armers : (1) was being unjustly enrichedby collecting premiums but refusing to provide full benefits under multiple policies; (2) had breached its contract with Hendersonand Lexiby refusing to pay benefits for which it rece ived consideration; (3) h ad breached the implied covenant of good faith and fair dealing ; and (4) had exercised bad faith . Additionally, they claimed that Lexi ’srelease constituted aunilateral mistake of law
. Lexi and Henderson sought to bring all of these claims as a class action on behalf of themselves and other similarly situated policyholders
. ¶9 In October 2008, FIE mo ved for partial summary judgment on Lexi and Henderson’s claim for declaratory relief. F armersa lso sought summary judgment on Lexiand Henderson’s claimsp ertaining to entitlementto medical payments on the grounds that Henderson’s policies did not have medical payment provisions and Lexiand Henderson had never asserted medical pay claims against Farmers. FIE arg uedthat neither Lexin or Henderson had standing to bring claims based upon medical payment coverage personally

or as class representatives. ¶10 In January 2009,f ollowing a hearing on Farmers’ motion for partial summary judgment, the District Court granted FIE’s motion as to al l claims pertaining to stacking and standing ; thus , the only remaining claim was for unjust enrichment
. The basis for the court’sruling on stacking issues was that Lexihad settled her claim prior to our decision in Hardy ; th erefore , Hardydid not apply retroactively to her claim. It also held that Lexi6

and Henderson had no standing to pursue any claims related to medical pay since they never paid premiums for

or obtainedmedical pay coverage. ¶11 In June 2009, Lexiand Henderson moved to certify a classto pursue a class action ag ainst Farmers for its alleged unjust enrichment derived from fa iling to pay stacking claimso n UM, UIM, and/or medical payment cov erages . I

n February 2011, after a hearing to address various outstanding motions, the District Court denied the motion to certify the class. The District C ourt determined neither Lexi nor Henderson were
me mbers of the class they sought to certify and represent. ¶12 Lexiand Henderson filed a timely appeal from the District Court’s order granting Farmers’ mot ion for partial summary judgment and the court’s order denying their motion to certify a class. **STANDARD OF REVIEW** ¶13 We review summary judgment rulings de nov o. Applying the same M. R. Civ. P. 56 criteria as the district court, we determine whether the mo ving party has established both the absence of any genuine issues of material fact and entitlement to judgment as a matter of law. We rev

iew a district court’ s conclusions of law for correctness. We
rev iew a district court’ s findings of fact to determinewhether they are clearly erroneous
. Weaver v. Advanced Refrigeration , 2011 MT 174, ¶ 8, 361 Mont. 233, 257 P.3d 378 (citation omitted)
. ¶14 We rev

iew a district court's decision on a motion for class certification for an abuse of discretion. Hop v. Safeco I ns. Co ., 2011 MT 215, ¶ 9, 361 Mont. 510 , ___ P.3d ___ (citation omitted).7 **DISCUSSION** ¶15 Did the District Court e rr in dismissing Lexia nd Henderson’s claim for stacking of uninsured motorist coverages ? ¶16 In 2001, at the time of Lexi ’s accident, § 33
- 23
- 203, M CA (2001) , the anti
- stacking statutewas in full force and effect. Itprovided: **Limitation of liability**  **under motor**  **vehicle liability policy.**  (1) Unless a motor veh icle liability policy specifically provides otherwise, the limits of insurance coverage a va ilable under each part of the policy must be determined as follows, reg ardless of the number of motor v ehicles insured under the policy, the number of policies issued by the same company covering the insured, or the number of separate premiums paid:

. . . (c) the limits of

the coverages specified under one policy or under more than one policy issued by the same company ma y not be added together to determine the limits of the insurance coverages av ailable under the policy or policies for any one accident. ¶17 As a result of this statute and the anti
- stacking lang uag e contained in Henderson’s policies , Lexid id not pursue the UM policy coverage av ailable under

H enderson’s second insurance policy following her accident. With the advice of counsel, in 2001 she signed a release in return for payment of the $25,000 maximum UM cov erage av ailable under the policy insuring the truck that Aaron LaMere wrecked. ¶18 In 200 2 , Ned Hardy c hallenged § 33
- 23
-203, MCA (2001)
. H ardy h ad been seriously injured in an automobile accident with an underinsured driver
. After receiving $50,000 from the other driver’s liability insurer, Hardy sought further recovery from his insurer, Progressive. It was undisputed that Hardy’s damages exceeded $50,000. He submittedthat he h ad three vehicles insured withP rog ressive and paid three separate8

premiumse ach of which paid for $50,000 in underinsured motorist protection
. A s a result, he opined, he was entitled to recover $150,000 from Progressive b y stacking his three coverages . Hardy , ¶ 1. Hardy argued that it was against public policy in Montana for an insurance company to charge separate premiums for UIMprotection for separate vehicles insured on the same policy but then refuse to stack the coveragesin order to provide the insured with the greatest compensation. Hardy , ¶ ¶ 30
- 31
. In an Opinion issued on April 18, 2003, we concluded that charging insurance premiums for “non
- existent” coverage
— second and third coverage sf or UIM that the insurer did not intendto pay

— was indeedag

ainst the public policy in Montana . We therefore ruled that the statuteprecluding stacking under these circumstances was unconstitutional. Hardy, ¶¶ 37
- 42
. ¶19 Subsequently, we were askedt o address whether our ruling in Hardya pplied retroactively to cl aims arising before the date Hardywas decided
. I n Dempsey v. Allstate Ins. Co ., 2004 MT 391, ¶ 31, 325 Mont. 207, 104 P.3d 483, Tyler Dempsey, on behalf of himself and a certified class, sued Allstate for additional payments from past insurance claims de nied based upon anti
- stacking provisions in the policiesand the pre -Hardy anti
- stacking statute . After briefly reviewing the history of retroactive application of our cases, we concluded Hardyc ould be applied retroactively except to those “cases that be came final or were settled prior to [the] decision’ s issuance. ” Dempsey , ¶¶ 31, 37. ¶20 Lexi and Henderson argue on appeal that the ir “ case is about whether [Lexi] settled a stacking claim when she signed FIE’s 2001 release.” They assert that the release she signed in 2001 released FIE for claims arising under Policy #58 alone. Relying on a9

contract analysis, they claim Lexi ne ither intended n or consented to release the stacking claim. They also profess that the release is invalid as to a stacking claim bec ause Farmers did not provide Lexi with consideration for giving up her stacking claim. They further allege that the release language was ambiguous and therefore should be construed ag ainst Farmers as the author of the release. B ased upon this analysis, they claim the release did not discharge their stacking claim. Lastly, they submit that F armer s ’ payment of $25,000 in December 2006 under Policy #59 is evidence of and an admission that FIE “considered the stacking claim to be an open, unsettled claim.” As such, Hardyshould be retroactively applied because Lexi’s claim was not final or settled before the Hardy decision was issued. ¶21 Addressing Lexi’s claim that her release is invalid under a contract analysis, we note th at Lexi and Henderson argued to the District Court that the release was ambiguous and lacked consideration. There is no record , however, that they asserted lack of intent and consent. Therefore, we will not address these arguments as they were not raised before the District Court and cannot be raised for the first time on appeal

. Estate of Donald v. Kalispell Reg ’ l

. Med. Ctr. , 2011 MT 166, ¶ 44, 361 Mont. 179, 258 P.3d 395
. ¶22 At the hearing onF armers’ motion for partial summary judgment , the District Court did not expressly address Lexi’s claim so f lack of cons iderationa nd ambiguous language in the release . However , in determining that the release was legal and valid , the court specifically concluded that there was no reason for a 2001 release to contain language addressing stacking polic ies or referencing coverage under a second and separate policy held by the policy holder because, as a matter of law at the time, a10

“stacking claim simply did not exist.” The court concluded that “ [Lexi’s] case was . . . settled for policy limits, and at the time the release was signed and the policy limits were paid the only claim

that [Lexi] had as a matter of law was no longer open and had in fact been settled with Farmers Insurance.” The District Court acknowledged Farmers’ payment under the second po licy but attributed no legal significance to the payment, finding that Lexi had settled her only existing claim with Farmers prior to our issuance of Hardy , and therefore

—

under the clear language of Hardy

—Farmers was entitled to summary judgment as a matte r of law. ¶23 We hav

e no evidence as to why Farmers’ paid Lexi an additional $25,000 in December 2006 purportedly under Policy #59. Without such evidence, we cannot conclude that the payment was in any way an admission that Lexi’s 2001 release and settlemen t was not full and final. We note, h owever, that payment of this second $25,000 achieved the same outcome as stacking Henderson’s policieswould have achieved

—Lexi received the ma ximum UM benefit from both policies. N otwithstanding the fact that Lexi ’s p ersonal anti
- stacking claim against Farmers is arg uably thereby rendered moot,
we conclude the District Court correctly determined on the merits that Lexi’s c laim ag ainst Farmers was barred under Dempsey
. ¶24 Lexi and Henderson attempt to avoid the consequen ces of Dempseyby asserting precepts of contract law and claiming the release Lexi signed in 2001 did not release their stacking claim. These arg uments are unavailing. We very clearly held in Dempseythat in the interests of finality, Hardywould not app ly retroactively unless the case in question was “pending on direct review or not yet final.” Dempsey , ¶ 37. Elsewhere in11

the opinion we stated: “ For reasons of finality we also conclude that the retroactive effect of a decision does not apply ab initio , that is, it does not apply to cases that became final or were settled prior to a decision’s issuance.” Dempsey , ¶ 31. There is no question that Lexi’s claim for benefits was settled prior to the issuance of Hardy ; therefore, under Dempsey , Hardy

will not permit the stacking claims she and Henderson now assert. Were we to re - open Lexi’s claim for additional benefits now under any of the various premises she offers, our pronouncements in Dempseywould be rendered completely meaningless. ¶25 We likewise rejec t the argument that a dispute must be litigated

—as opposed to settled

— before the retroactivity limitations of Dempseywill apply. Plaintiffs urg e us to apply language from an unpublished slip opinion authored by United States District Judge Donald Molloy in Hoffman v. GEICO , CV
- 06
- 83
- DWM, Slip Opinion, 2006 WL 2925265 (D. Mont.). I n that case, Judge Molloy stated: “ [T]he Dempseyh olding requires judicial finality to bar the retroactive application of Hardy , not some manner of settlement where one party was without legal representation and may not have received adequate consideration.” Here, Lexi was represented by counsel when she accepted the
ma ximum UM benefit then available and signed the release. More to the point, we have on more than one occasion since Dempseystated that the retroactive effect of a decision does not apply to claims that were settled prior to our ruling in the Hardy
. See Schmill v. Liberty Northwest Ins. Co rp ., 2005 MT 144, ¶ 1 7, 327 Mont. 293, 114 P.3d 204 ; Stavenjord v. Mont

. S

tate Fund , 2006 MT 257, ¶ 1, 33 4 Mont. 117, 146 P. 3d 724 . We are not bound to follow Hoffman and decline to do so.12

¶26 Becausen either Lexi nor Henderson ha sav alid personal anti
- stacking claim ag ainst Farmers, they are not proper representatives of a classc onsisting of other Farmers’ policyholders who may have valid anti
- stacking claims
. Mont. Trout Un limited v. Beaverhead Water Co ., 2011 MT 151, ¶ 27, 361 Mont. 77, 255 P.3d 179
. ¶27 Did the District Court err in ruling that neither Lexi n or Henderson had sta nding to bring a claim for medical pay coverage? ¶28 The question of standing addressesthe issue of whether the litigant is a proper party to seek adjudication of a particular issue, not whether the issue is justiciable. The test f or standing is that the co mplaining party must clearly allege past, present or threatened injury to a property or civil rig ht, and the alleged injury must be distinguishable from the injury to the public generally, but it need not be exclusive to the complaining party. Mont. Trout Un limited, ¶ 27. ¶29 Itis undisputed that neither Lexi nor Henderson paid premiums to obtain medical pay cov erage under the applicable Farmers’ policies. B ecause they hav e no personal claim ag ainst Farmers for fa iling to pay or stack such benefitsunder the two policies , they have no “past, present or threatened injury.” Without such injury, they have no standing to bring

a medical payment - related claim
. This same rationale applies to their standing to represent other Farmers’ policyholders in medical pay claims. I t is well
- established that “even named plaintiffs who represent a class ‘must allege and show that they personally have been injured, not that injury has been suffered by other, unidentified me mbers of the class to which they belong and which the y purport to represent.’ ” Lewis v. Casey , 518 U.S. 343, 357 , 116 S. Ct. 2174, 2183 (1996). Lexi and13

Henderson simply cannot establishstanding, personally or as representatives of a class action, because neither has a personal c ase or controversy against Farmers with respect to medical payment issues. ¶30 Did the District Court abuse its discretion when it declined to certify a putative class for claims of unjust enrichment and disgorgement of premiums? ¶31 As noted above, it is undisputed that Lexi did not p ay any premiums to FIE ; therefore , Farmers was never “unjustly enriched” at the expense of Lexi. As such, and in accordance with the standing analysis above, Lexi has no unjust enrichment claim against Farmers, either on her behalf or on the behalf of a p utative class. The District Court did not abuse its discretion in so ruling and Lexi does not appeal this ruling
. ¶32 Henderson argues on appeal, however, that hisp aid premiums unjustly enriched Farmers ; therefore , h e has standing to represent both himself andac lass in a disgorgement of premiums claim. ¶33 Lexi and Henderson predicated their class action claim on Rule 23 of the Montana Rules of Civil Procedure. Rule 23(a) sets out the prerequisites to a class action which are numerosity, commonality, typicality, and adequacy of representation. It also requires that the representative of the class be a member of the class. ¶34 In June 2009, Henderson moved the District Court to certify the following class: All Farmers Insurance Exchange Montana insureds who purchased more than one stackable medical payments cov erage, uninsured motorist coverage, or underinsured motorist coverage who were entitled to such stackable coverages but who did not receive the benefit of such stackable coverages. 3

3 W e note that the class description included in Lexi and Henderson’s Amended, Second Amended and Third Amended Complaints is somewhat differentf rom this class description.14

¶35 To determine whether Henderson was a member of the defined class, t he District Court broke down thec lass description in to the following three subsets : aF armers’ insured who (1) purchased more than one policy that included medical payment, UM and/or UIMcov

erage, (2) was ent itled to stackable coverages, and (3) did not receive the benefit of stackable cov erage s . The court concluded Henderson satisfied the first criterion but did not satisfy the second two criteri a . Reiterating its analysis of Lexi and Henderson’s anti
- stacking claim, the court again concluded th atH enderson was not entitled to stackable coverage sb ecause Lexi had settled her claim with Farmers before the Hardydecision was issued. Asnoted herein, Hardy was not retroactively applicable. Because Hendersonwas not entitled to receive stackable coverage s at the time Lexi’s claim was settled, he was likewise not entitled to receive the benefits of stackable coverage s . The District Court therefore held that Henderson did not have standing to assert an unjust enrichment claim for disgorgement of pr emiumso n behalf of thecla ss “entitled to such stackable coverages” because he was not a member of thatclass. ¶36 The court’ s legal analysis was correct. As neither Lexi nor Henderson had standing to represent the define d class under Rule 23(a) , it was not an abuse of discretion for the District Court to deny class certification. **CONCLUSION**

However, because this is the d escription the District Court used to render judgment, and Lexi and Henderson do not challenge the court’s use of this description, we analyze this issue under this class description.15

¶37 For the foregoing reasons, we affirm the District Court ’s orders on summary judgment and class certification
. /S/ PATRICIA COTTER

We concur:
/S/ MIKE McGRATH /S/ BETH BAKER /S/ BRIAN MORRIS /S/ JIM RICE