A ft erexami ni ng t he br i efs and appe l l at e r ecor d, t hi s panel has det er m i ned * unani m ous l yt o gr antt he part i es ’ r eques tfora dec i s i on on t he br i efs w i t houtor al arg u m en t. S ee F ed . R . A p p . P . 3 4 (f); 10 th C ir . R . 3 4 . 1 (G ). T h e c ase is th ere fo re or der ed s ubm i t t ed w i t houtor al ar gum ent . T hi s or derand j udgm enti s notbi ndi ng pr ece dent , exce ptundert he doctr i nes of l aw of the ca s e, r es j udi cat a, and col l at er al es t oppel . I tm aybe ci t ed, how ever , fori t s per s uas i ve val ue cons i s t ent w ith F e d . R . A p p . P . 3 2 .1 a n d 1 0 th C ir . R . 3 2 .1 . 

## F I LED United States C ourt of Appeals Tenth Circuit 

### A p ril18,2007 Elisab eth A. Shumaker C l erk of C ourt UNI TED S TATES CO URT O F AP PEALS F O R T H E T E N T H C IR C U IT

GR AI N DE AL E RS M UT UAL I NS UR ANC E CO M P ANY, Pl ai nt i ff – A ppel l ee, v. CA RL HI L L , d o i n g b u s i n e s s a s J HC M a n a g e m e n t F in a n c ia l C o rp ., D e fe n d a n t – A p p e llan t. N o. 06- 7060 ( D . C. N o. 04 - CV - 01 9- J H P) (E .D . O k la .)

ORDE R AND J UDGM EN T * B efor e LU CE RO , C i r cui tJ udge, BROR BY , Seni orC i r cui tJ udge, and M c CO NNELL , C i r cui tJ udge.

C a rl H ill a p p e a ls th e d istric t co u rt’s o rd e r g ra n tin g su m m a ryju d g m e n t to h is fo rm e r in su re r, G ra in D e a ler s M u tu a l In su ra n c e C o . (“G ra in D e a ler s” ). H ill c o n ten d s th a t G ra in D e a ler s’ a ttem p t to c a n c e l h is in su ra n c e c o v e ra g e v io late d h is-2-

pol i cyand s t at e l aw . T her efor e, he ar gues , t he pol i cyr emai ned i n effectatt he t i m e hi s bus i nes s w as des t r oy ed byfi r e. W e conc l ude thatG r ai n D eal er s di d not compl yw i t h t he t erm s of the pol i cyw hen i tcanc el ed H i l l ’ s cover age. A ccor di ngl y , w e R EV ER SE t he di s t r i ctcourt ’ s j udgm entand RE M AND for f u rt h e r p ro c e e d in g s . I I n M ay2003, H i l l r enew ed hi s i ns ur ance pol i cyw i t h G r ai n D eal er s t o cover h is b u sin e ss f

ro m M a y2 8 , 2 0 0 3 to M a y2 8 , 2 0 0 4 . H e e lec ted to p a ym o n th ly i ns t al l m ent s of $145. 50, exce ptfort he fi r s tpaym entof $301 w hi ch he made on M ay12, 2003. H i l l cont ends t hatt hi s paym entcons i s t ed of a $20 pas tdue amount , and tw o m ont hl ypaym ent s . Fut ur e paym ent s w er e due on the 28th of eac h m ont h. I n J une, G r ai n D eal er s s entH i l l a bi l l r eques t i ng paym entof $145. 50 byJ une 28. H e s entt hi s paym entl at e, on J ul y9; G r ai n D eal er s r ece i ved i ton J ul y14. I n t he meant i m e, G r ai n D eal er s had i s s ued a c ance l l at i on not i ce on J ul y7, demandi ng paym entof $306 byJ ul y27. T he not i ce s t at ed that , i f paym ent w as notr ece i ved byt hatdat e, t he pol i cyw oul d be ca ncel ed effec t i ve J ul y27 at 1 2 :0 1 a .m . T h e $ 3 0 6 fig u re re p re s e n te d tw o m o n th ly p a ym e n ts , p lu s a la te fe e . H ill c la im s h e n e v e r r e c e iv e d th is n o tic e . G r ai n D eal er s cas hed H i l l ’ s J ul y9 chec k, butdi d notr ei ns t at e the pol i cy b e c a u se th e p a ym e n t w a s fo r le ss th a n th e f u ll am o u n t d e m a n d e d . It se n t H ill a r efund c heck on A ugus t20, aft erdeduct i ng a $20 l at e fe e. H i l l ’ s bus i nes s w as-3-

d e stro y e d b yfire o n A u g u st 2 9 . In a c ru e l tw ist o f fa te, h e re c e iv e d G ra in D eal er s ’ r efund c heck the nextday . G r ai n D eal er s r efus ed t o coverH i l l ’ s l os s es o n th e g ro u n d th a t th e p o lic yh a d b e e n c a n c e le d e ffe c tiv e J u ly 2 7 . I nvoki ng di ver s i t yj ur i s di ct i on under28 U . S. C . § 1332, G r ai n D eal er s fi l ed su it se e k in g a d e c lar a to ryju d g m e n t th a t ith a d n o c o n tra c tu a l o b lig a tio n to H ill a f ter th e p o licyw a s c a n c e led o n Ju ly2 7 , 2 0 0 3 . T h e d istric t co u rt g ra n ted G ra in D eal er s ’ m ot i on fors um m aryj udgm ent , concl udi ng t hati thad fol l ow ed the r equi r ed pr ocedur es t o canc el t he pol i cy . T he di s t r i ctcour t ’ s or derdi d not e x p lain , h o w e v e r, w h yG ra in D e a ler s c o u ld a c c e ler a te th e p a ym e n t sc h e d u le to d e m a n d p a ym e n t o f

th e Ju ly2 8 p re m iu m o n o r b e fo re Ju ly2 7 , o r w h yit co u ld reje c t th e $ 1 4 5 .5 0 p a ym e n t s e n t o n J u ly 9 fo r t h e J u ly p re m iu m . II W e r evi ew de novo the di s t r i ctcour t ’ s gr antof s um m aryj udgm ent , vi ew i ng th e re c o rd in th e lig h t m o s t fa v o ra b le to th e p a rt yo p p o s in g s u m m a ry ju d g m e n t. L an m an v . Jo h n so n C o u n ty , 3 9 3 F . 3 d 1 1 5 1 , 1 1 5 4 -55 (10 th C ir . 2 0 0 4 ). S u m m ary j udgm enti s appr opr i at e i f ther e i s no genui ne i s s ue of mat er i al fac tand the m o v ing p artyis en ti tl ed to jud g m en t as a m att er o f law . F ed . R . C iv. P. 56 (c); C e lo te x C o rp . v . C a tr e tt, 4 7 7 U .S . 3 1 7 , 3 2 2 -2 3 (1 9 8 6 ). T he part i es agr ee thatO kl ahoma st at e l aw contr ol s . I n t hi s di ver s i t ycas e, w e must“appl yO kl ahoma l aw w i t h t he obj ect i ve thatt he r es ul tobt ai ned i n t he-4-

fede r al cour ts houl d be the r es ul tt hatw oul d be r eac hed i n an O kl ahoma cour t . ” B lank e v . A lexa n d er, 15 2 F . 3 d 1 2 2 4 , 1 2 2 8 (10 th C ir . 1 9 9 8 ) (qu o tat ion o m itted). “To asc er t ai n t he natur e of [ an i ns ur er ’ s ] contr actual obl i gat i ons t o [the insu red ] . . . w e m u st ex am ine th e p rov isi o n s o f th e p o li cy . ” M ayv . M id-C en tury I ns . C o. , 151 P. 3d 132, 140 ( O kl a. 2006) . H i l l ’ s i ns ur ance contr acti ncl uded a sect i on enti t l ed, “C om m erci al D i rectB i l l P aym ent Pl an, ” w hich provides: C ance l l at i ons A n ym o n th lyb ill n o t p a id w ith in th e p a ym e n t g ra c e p e rio d w ill aut om at i cal l ypr om pta ca ncel l at i on not i ce fornonpaym entof pr emi um . T he effec t i ve dat e of c ance l l at i on w i l l be the l at erof ei t hert he pai d pr emi um earned dat e ordet er m i ned ac cor di ng t o t he n u m b er o f state leg al da y s, p lus m ail ing ti m e. T h is w il l vary b e tw e e n s ta te s .

. . . R e in sta tem e n ts W e w i l l aut om at i cal l yr ei ns t at e the pol i cyw hen atl eas tt he pas tdue pr emi um i s r ece i ved and the paym entenvel ope i s pos tm ar ked [s i c] pr i ort o t he ca ncel l at i on dat e. T her e i s no r ei ns t at ementfee ; how ever , t her e i s an N SF fee of $20. 00 foranynon- s uffi ci entfunds p a ym e n t. (e m p h a s is a d d e d ). G r ai n D eal er s , as t he i ns ur erand dr aft erof the i ns ur ance contr act , carr i es t he bur den of e s t abl i s hi ng i t s r i ghtt o demand t hatt he paym entdue J ul y28 be pai d on orbefor e J ul y27, as w el l as i t s r i ghtt o r ej ectH i l l ’ s l at e paym entfort he J ul ypr emi um . See Li verpool , L ondon & G l obe I ns . C o. v. T har el , 174 P. 773,-5-

774 ( O kl a. 1918) ( hol di ng bur den i s on i ns ur ance companyt o demonst r at e s t r i ct com pli ance w i t h insur ance c on t ract ’s cance l l at i on provis i on s) ; see al so M etr o. L i fe I ns . C o. v. R os i er , 117 P. 2d 793, 796 ( O kl a. 1941) ( s t at i ng “al l doubtar i s i ng fr om ambi gui t i es and conf l i ct i ng pr ovi s i ons i s r es ol ved aga i ns tt he one w ho p re p a re d th e [ in s u ra n c e ] c o n tr a c t” ). G ra in D e a ler s re c e iv e d H ill ’s p a st-d u e p a ym e n t, po stm a rk e d Ju ly9 , w e ll befor e the J ul y27 canc el l at i on dat e. U ndert he “Rei ns t at ement s ” pol i cypr ovi s i on q u o ted a b o v e , itw a s th e n re q u ire d to “ a u to m a tica llyre in sta te th e p o licy .” G ra in D eal er s m ai nt ai ns t hatt he J ul ypaym entcoul d notr ei ns t at e the pol i cybeca us e the pol i cyhad noty etbeen c ance l ed. T hi s ar gum enti s pl ai nl ym er i t l es s . T he

“ R e in sta tem e n ts” p ro v isio n e x p licitlysta tes th a t th e p o licyw ill b e re in sta ted if paym enti s m ai l ed “pr i ort o t he ca ncel l at i on dat e. ” The t er m “r ei ns t at ement , ” as us ed i n t he pol i cy , cl ear l yappl i es t o s i tuat i ons i n w hi ch a c ance l l at i on not i ce ha s been i s s ued, butt hatpol i cyhas y ett o be ca ncel l ed. T o the ext ent that the term “rei nst at em ent” could be co nsi dered am biguou s, i tm us tt hen be c ons t rued aga i ns tG r ai n D eal er s . See M cM i nn v. C i t yof O k laho m a C ity , 9 5 2 P . 2 d 5 1 7 , 5 2 2 (O k la. 1 9 9 7 ) (“If term s in the co n tr ac t are am biguou s, i tm ustbe co nstrued ag ai nstt he d raft er of t he co ntr act . ”); see al so M ax True Pl as t er i ng C o. v. U . S. Fi d. & G uar . C o. , 912 P. 2d 861, 869 ( O kl a. 1 9 9 6 ) (“ T h e in ter p re tatio n o f a n in su ra n c e c o n tra c t an d w h e th e r it is a m b ig u o u s is d e ter m in e d b yth e c o u rt a s a m a tter o f law .”). A c c o rd in g ly , w e rejec t G ra in-6-

D eal er s ’ ar gum entthati tcoul d notr ei ns t at e H i l l ’ s pol i cybeca us e i tw as noty et canc el l ed. W e a lso c o n stru e th e p h ra se “ a t lea st th e p a st d u e p re m iu m ” a g a in st G ra in D eal ers . O n July27 , t he d at e of c ancell at i on , on l yt he Jun e 28 prem i um w as past d u e . T h e se c o n d $ 1 4 5 .5 0 in c lu d e d in th e c a n c e llatio n n o tice w a s n o t d u e u n til Ju ly2 8 . G ra in D e a ler s a ss e rts, w ith o u t cita tio n to th e re c o rd , tha t it“ w a s f u lly w ith in p o licyter m s to a lso in c lu d e th e Ju lyp re m iu m p a ym e n t.” B u t itis i ncumbentupon G r ai n D eal er s , notH i l l , t o ci t e t o a pol i cypr ovi s i on orl egal author i t yperm i t t i ng i tt o acc el er at e the due da t e fort he J ul y28 paym ent . I thas n o t d o n e s o . T h e c a n c e lla tio n n o tic e a ls o d e m a n d e d p a ym e n t o f a la te fe e . H ow ever , cons t rui ng t he pol i cyi n favorof H i l l , w e conc l ude thata l at e fe e i s not a partof the “pa s tdue pr emi um . ” A ccor di ngl y , H i l l ’ s J ul ypaym entof $145. 50, no tt he $ 30 6 d em and ed b yG rai n D eal ers , sat i sfi ed h i s obli gati on t o p ayt he “p ast d u e p rem ium ” a n d G rain D ea lers ha s n o t est ab li sh ed it s ri g h t t o ca n ce l H il l’ s i ns ur ance cover age. W e r ecogni ze thatH i l l di d notm ake the paym ent s due on J ul y28 and A ugus t28. H e s t at es t hathe di d notr ece i ve a bi l l and di d notr eal i ze he ow ed a paym ent . G r ai n D eal er s di d nots end a bi l l beca us e i thad purpor t edl ycanc el ed th e p o licy . N e v e rth e les s, a n in su ra n c e p o licyre m a in s in e ffe c t u n til it i s p ro p e rly canc el ed. See C om m er ci al U ni on Fi r e I ns . C o. v. M i l l er , 248 P. 1112, 1112- 14 ( O kl a. 1926) ; s ee a l s o E m pi r e Fi r e & M ar i ne S. C o. v. Spur l ock, 593 P. 2d 768,-7-

7 7 0 (O k la. 1 9 7 9 ) (h o ld in g w o rk e rs’ c o m p e n sa tio n in su ra n c e p o licyre m a in e d in effect because i tw as not cancel ed p ursuantt o st atutoryrequi rem ents ). B ecause G r ai n D eal er s ’ at t empt t o canc el t he pol i cyw as i neffect i ve, t he pol i cyr emai ned vali d n otw i t hst and i ng H i l l ’s fai l ure t o p ayt he p rem i um s due July28 and A ug ust 28. See B anker s ’ R es erve Li fe Co. v. R i ce, 226 P. 324, 326 ( O kl a. 1924) ( “The m er e defaul ti n paym entbyt he i ns ur ed does notaffectt he val i di t yof the contr act of i ns ur ance . T he pr ovi s i on i n t he not e amount s onl yt o an opt i on i n favorof the co m p an yto fo rfe itthe in su ran ce , if i t sho u ld elec t t o d o so . ”). III F in a lly , H ill a ss e rts c laim s a g a in st G ra in D e a ler s fo r b re a c h o f c o n tra c t, bad fa i t h, and es t oppel . G r ai n D eal er s m ai nt ai ns t hatt hes e cl ai m s w er e not pr oper l ybefor e the di s t r i ctcour t . W e do notaddr es s t hi s i s s ue, l eavi ng i tfort he d istric t co u rt to d e ter m in e . G ra in D e a ler s’ m o tio n to file a su rre p lyb rie f to add res s this dis pu t e i s DENI ED . IV T he judgm ent of t he d i stri ctcou rti s RE VE RS ED a n d th e c a se is RE M ANDE D fo r f

u rth e r p ro c e e d in g s c o n sis ten t w ith th is o rd e r a n d ju d g m e n t. E n tered fo r th e C o u rt

C arlos F . L u ce ro C i r cui tJ udge