Opinion ID: 891620
Heading Depth: 1
Heading Rank: 5

Heading: Whether Guest obstructed performance of the contract was for the jury to decide.

Text: {36} Allstate next argues that Guest's unreasonable behavior obstructed the performance of its contract. See Nat'l Old Line Ins. Co. v. Brown, 107 N.M. 482, 487, 760 P.2d 775, 780 (1988) (He who prevents a thing from being done may not avail himself of the nonperformance which he has himself occasioned;    the party thus prevented from discharging his part of the obligation is to be treated as though he had performed it. (quoting Gibbs v. Whelan, 56 N.M. 38, 42-43, 239 P.2d 727, 730 (1952))). {37} Responding, Guest quotes from the Court of Appeals' opinion in this case that she did not prevent Allstate from fulfilling its duty to defend. Guest, 2009-NMCA-037, ¶ 28, 145 N.M. 797, 205 P.3d 844. She argues that she was fully within her rights in choosing not to agree to a settlement that would have forced her to release her claims against the Durhams, Berardinelli, and Allstate. {38} Allstate relies upon this Court's Opinion in Gibbs. In that case, the plaintiff resigned from a steady job after the defendant contacted him and offered him a salaried position for at least five years doing field work on an as-needed basis. Gibbs, 56 N.M. at 40, 239 P.2d at 728-29. The plaintiff made himself available to work whenever necessary and performed all work that the defendant asked of him. Id. On many occasions, however, the plaintiff did not work at all because the defendant had not lined up any work for him. Id. Eventually, the plaintiff sued to recover unpaid wages, and the trial court ruled in his favor. Id. at 40-41, 239 P.2d at 728-29. On appeal, this Court affirmed, explaining, The defendant having voluntarily failed to line up work for the plaintiff to perform, he will not be permitted to deny liability under their agreement. Id. at 42, 239 P.2d at 730. When a partythe plaintiff in Gibbs is prevented from discharging his part of [the] obligation, [he] is to be treated as though he had performed it. Id. at 42-43, 239 P.2d at 730 (internal quotation marks and citation omitted). But Allstate cannot justify identifying itself with the plaintiff in Gibbs. {39} Unlike the defendant in Gibbs, Guest did not prevent Allstate from performing its obligations under the contract. Allstate promised to defend and indemnify Guest, and we agree with the Court of Appeals that Allstate could have satisfied its contract with Guest by representing her. Guest, 2009-NMCA-037, ¶ 28, 145 N.M. 797, 205 P.3d 844. Furthermore, as we explain later in this Opinion, the trial court ruled that a fact question existed as to the intended meaning of the terms defend and indemnify, which the jury answered in Guest's favor. Consequently, we cannot rule as a matter of law that Guest's refusal to settle prevented Allstate from continuing to provide a defense and indemnification. Had Allstate specified in the contract that it could satisfy its promise to Guest by negotiating a settlement, Gibbs might support its argument. Absent such contractual language, however, we disagree that, as a matter of law, Guest obstructed performance of the contract. {40} At oral argument, Allstate raised a slightly different, but related, contention, suggesting that this Court should bar Guest's recovery, not because she prevented Allstate's performance, but because her refusal to settle was in bad faith and unreasonable as a matter of law. As evidence, Allstate argued that Guest's outrageous demand for a signed $100 bill (1) could have resulted in disciplinary sanctions against her and (2) demonstrated that her refusal to settle was motivated solely by her desire to pursue a personal vendetta against the Durhams and Berardinelli. To affirm the verdict, Allstate argues, would condone Guest's behavior and encourage litigation for litigation's sake. {41} To the extent this issue was raised at trial or in the briefing for this appeal, we agree with the trial court that Guest's reasonableness in refusing to settle was ultimately for the jury to decide. In response to Allstate's motion for summary judgment, the trial court held that Guest had created a fact question as to the meaning of the terms defend and indemnify as set forth in the contract, which Allstate does not question on appeal. Specifically, at trial Allstate argued that its promise to defend and indemnify Guest was limited to protecting her from liability. Guest, on the other hand, claimed that she understood the contract to be a broader promise to defend her from harm. {42} We agree with the trial court. Because of a factual dispute concerning the definition of these critical terms, Guest's reasonableness under the contract could only be evaluated in light of the evidence of what the parties intended those terms to mean. See C.R. Anthony Co. v. Loretto Mall Partners, 112 N.M. 504, 509, 817 P.2d 238, 243 (1991) (The question of interpretation of language and conduct (the question of the meaning to be given the words of the contract) is a question of fact where that meaning depends on reasonable but conflicting inferences to be drawn from events occurring or circumstances existing before, during, or after negotiation of the contract.). After hearing the evidence and being properly instructed, the jury decided this issue in Guest's favor. Regardless of whether Guest's conduct may have been sanctionablea question far beyond the scope of this appealthe reasonableness of her conduct was properly submitted to the jury under the circumstances of this case.