Opinion ID: 1199778
Heading Depth: 1
Heading Rank: 4

Heading: The Action for Declaratory Judgment

Text: The insurance coverage of the defendants who went to trial is as follows: 1) Hamilton was insured by Mutual of Enumclaw. His policy included uninsured motorist coverage. 2) E.L. Murphy Trucking and Bongard were insured by Carrier's Insurance Company. This policy had a self-insured retention of $25,000. Carrier became insolvent in 1986, and the Minnesota Insurance Guaranty Association (MIGA) undertook Carrier's defense obligations. Additionally, Bantz had uninsured motorist insurance from North Pacific. After the trial, MIGA refused to pay the judgment. The Bantzes then filed a declaratory judgment action seeking a determination that they are entitled to payment of uninsured/underinsured motorist coverage under insurance policies issued by North Pacific and Mutual of Enumclaw, and that they are entitled to payment by MIGA of the judgment entered against Bongard. All four parties filed motions for summary judgment. The Bantzes argued that they were entitled to collect from both insurance companies and MIGA under the terms of the respective policies. Mutual of Enumclaw and North Pacific argued the Bantzes lost their right to coverage in settling several claims without the permission of the respective carriers. Mutual also argued that it was not timely notified of the claim. MIGA argued that it was not required under Minnesota law to pay anything until all uninsured motorist coverage had been exhausted and because certain administrative procedures mandated by Minnesota law had not yet been followed. The district court ruled as follows: 1) It granted North Pacific's motion holding that the Bantzes had waived policy coverage by entering into settlement agreements without North Pacific's permission. The court noted that although no Idaho appellate decision has ever addressed the issue of whether consent-to-settle clauses in insurance policies are enforceable or void for public policy, the majority of state courts have held them to be enforceable. The court adopted the majority view. This order has not been appealed. 2) Mutual of Enumclaw's motion was denied, the district court holding that its consent-to-settle clause was not enforceable against Bantz because: a) of the conflict of interest between Mutual who defended Hamilton against the Bantzes' complaint and the Bantzes, and b) the Bantzes were not signatories to Hamilton's policy and no reported case has extended the reach of a consent-to-settle provision to cover a third-party beneficiary. 3) MIGA's motion was also denied, the district court holding that the Bantzes were not barred from recovering from MIGA even though they had waived their North Pacific policy coverage. 4) It granted the Bantzes' motion as to MIGA and Mutual of Enumclaw for the reasons above. 5) It denied the Bantzes' motion as to North Pacific for the reasons above. Mutual of Enumclaw and MIGA both appealed from the court's order and those appeals have been consolidated by order of the Court.