Opinion ID: 1745503
Heading Depth: 2
Heading Rank: 5

Heading: Whether Summary Judgment Was Properly Granted as to the Plaintiff's Punitive Damages Claim.

Text: ¶ 46. Martin argues on cross-appeal that the trial court should have allowed the jury to decide her punitive damages claim for USF & G's denial of coverage. The issue of punitive damages was first raised in USF & G's motion for summary judgment. USF & G argued that a punitive damages claim should not be submitted to the jury because 1) USF & G did not deny Martin's claim in bad faith, 2) USF & G had an arguable basis for denying the claim, and 3) USF & G did not exercise malice, gross negligence, or reckless disregard. Martin argued in response that there was no arguable basis for USF & G's denial of her claim, and that USF & G committed a willful or malicious wrong, or acted with gross or reckless disregard. Sobley v. S. Natural Gas Co., 302 F.3d 325 (5th Cir.2002). ¶ 47. After a hearing, the trial court concluded that there were no genuine issues of material fact warranting the punitive damages claim to be decided by a jury. The trial court found that because the Policy was ambiguous, USF & G had an arguable basis for denying the claim. The trial court also found that there was no showing of malice, gross negligence, or wanton disregard by USF & G. The trial court stated that USF & G merely received a claim from the Plaintiff, investigated the cause of the loss, interpreted its policy and denied coverage. There is no evidence before the Court that the Defendant conducted itself in such a way as to call for the imposition of punitive damages. ¶ 48. As stated above, the standard of review for a grant of summary judgment is de novo review. See, e.g., Germany v. Denbury Onshore, LLC, 984 So.2d 270, 275 (Miss.2008) (citations omitted); see also, Jenkins v. Ohio Cas. Ins. Co., 794 So.2d 228, 232 (Miss.2001) (affirming trial court's denial of punitive damages claim on summary judgment). When deciding to grant or deny summary judgment, a court must review the record before it and take all the evidence in the light most favorable to the nonmoving party. Denbury Onshore, LLC, 984 So.2d at 275. The trial court's decision regarding summary judgment will be affirmed if the record before the trial court shows that there is no genuine issue of material fact and that the movant is entitled to a judgment as a matter of law. Id. A punitive damages claim should be decided by a jury if 1) there was no arguable or legitimate basis for denying coverage, and 2) the insurance company acted with malice or gross and reckless disregard for the rights of the insured. See, e.g., Jenkins, 794 So.2d at 232-33 (citing State Farm Mut. Auto. Ins. Co. v. Grimes, 722 So.2d 637, 641 (Miss.1998)). ¶ 49. This Court held in Jenkins that [p]unitive damages should be assessed with caution and within narrow limits as an example and warning. Jenkins, 794 So.2d at 232 (citation omitted). This Court has also stated that punitive damages should not be imposed simply because a mistake was made regarding coverage. Grimes, 722 So.2d at 641. The plaintiff bears a heavy burden when seeking punitive damages. Sentinel Indus. Contr. Corp. v. Kimmins Indus. Serv. Corp., 743 So.2d 954, 972 (Miss.1999). ¶ 50. Here, the insurance company had an arguable and legitimate basis to deny Martin's claim under its view that the Policy's water exclusion precluded recovery. See, e.g., Jenkins, 794 So.2d at 232-33 (citation omitted). The trial court found that the Policy was ambiguous as to coverage, and we agree with that conclusion. Accordingly, it follows that an insurance company could legitimately deny coverage under a policy that has ambiguous provisions for coverage. Also, taking the evidence in the light most favorable to Martin, there was no evidence before the trial court of malice, recklessness, or gross disregard of Martin's rights by USF & G. See, e.g., id. USF & G may have incorrectly denied Martin's claim, but Martin did not produce any evidence that USF & G's conduct constituted willful conduct in bad faith, thus failing to meet its heavy burden. Sentinel Indus. Contr. Corp., 743 So.2d at 972. Therefore, based on the record before the trial court, there was no genuine issue of material fact and USF & G was entitled to a judgment as a matter of law. After a de novo review of the evidence before the trial court, we find that summary judgment was properly granted as to the punitive damages claim.