Opinion ID: 1206072
Heading Depth: 2
Heading Rank: 3

Heading: sufficiency of the evidence

Text: The jury found and the court of appeals agreed that Illinois Mutual breached its implied covenant of good faith and fair dealing by denying, without a reasonable basis, Gurule's claim. See Rawlings, 151 Ariz. at 156, 726 P.2d at 572. Thus, it has been established that Illinois Mutual's conduct was wrongful and that extracontractual damages were warranted. The only question before us is whether, in addition to breaching its covenant of good faith and fair dealing, there is sufficient evidence from which a jury could infer that Illinois Mutual acted with an evil mind. Relying primarily on Little v. Stuyvesant Life Insurance Co., 67 Cal. App.3d 451, 136 Cal. Rptr. 653, Gurule argues that the evidence in this case is sufficient to infer the required evil mind. We disagree. Despite superficial similarities, Little actually illustrates why punitive damages are inappropriate in this case. In Little, as here, the insurer terminated disability benefits on the basis of two independent medical examinations. Unlike this case, however, Little's claim was supported by overwhelming objective medical evidence of disability. 67 Cal. App.3d at 457, 136 Cal. Rptr. at 656. Prior to the onset of her disability, Little had two lumbar fusions and two myelograms, was only able to work in a brace, and was on pain medication. Little's final disability was attributed to nerve root irritation. After the claimed onset of disability, Little had four major surgical procedures, including three cervical anterior body fusions and a surgery to relieve nerve root pressure caused by scar tissue. The life insurer for the program waived premiums because of disability; Little also was found totally disabled by both the state and the Social Security Administration. She took daily medication for pain and was unable to perform even such simple tasks as grocery shopping. She was unable to sit or stand, hold a book, or perform any sustained activity. She spent hours each day in a jacuzzi to relieve her pain. Defendant had full knowledge of Little's condition, and of the medical evidence supporting her disability claim. Defendant nevertheless insisted on two independent medical examinations; it provided neither of the doctors performing these examinations with the voluminous information in its files from Little's doctors. [5] The second examining doctor determined that Little was not disabled because she could perform `a half day's work as a receptionist' and had the ability to `open ... a drawer and put a file in and close it.' 67 Cal. App.3d at 459, 136 Cal. Rptr. at 657. In addition, defendant was aware that Little had lost her home, had borrowed money, and had attempted suicide as a result of her disability. Still, defendant refused to reinstate benefits. 67 Cal. App.3d at 457-61, 136 Cal. Rptr. at 656-58. [6] The difference in medical evidence between Little and this case is critical. In Little, the denial of benefits was outrageous and punitive damages were appropriate because the jury reasonably could infer the requisite intent to harm from the insurer's denial of benefits in the face of overwhelming medical evidence. 67 Cal. App.3d at 462, 136 Cal. Rptr. at 659. Here, on the other hand, Illinois Mutual did not ignore overwhelming medical evidence when it denied Gurule's claim. Gurule's disability resulted from accidental injuries for which he did not immediately seek medical treatment. He first sought a dental examination nineteen days after the accident, and did not consult a physician until 38 days after the accident. Dr. Carlson diagnosed a soft tissue injury; although Gurule displayed some signs of nerve root irritation, very little objective evidence of disability was ever conveyed to Illinois Mutual. Gurule's EMG's were all normal, including those performed by his doctor. Even Dr. Carlson stated at several points that Gurule probably would be able to return to work within a few months. As it turned out, Drs. Carlson, Soscia, and Feingold were too optimistic. Nevertheless, there is no overwhelming medical evidence to support the conclusion that Illinois Mutual knew Gurule was disabled and denied benefits with conscious indifference to Gurule's rights and the significant harm caused by its conduct. There is no evidence to justify an inference that Illinois Mutual arranged for independent medical examinations with disreputable doctors, tried to influence the doctors' opinions, or purposefully withheld information from them. In this case, unlike Little, the facts regarding the nature of the accident, the ensuing medical treatment, and the handling of Gurule's file are insufficient to infer that Illinois Mutual consciously disregarded its obligations to Gurule. The facts strongly suggest, on the other hand, that Illinois Mutual tried to play fairly with Gurule. Here, unlike Little, the insurer applied a reasonable definition of disability, reinstated the claim when pressed to do so, and, at times, resolved conflicting medical opinions in favor of its insured. Illinois Mutual apparently was willing to continue paying disability benefits until the more strict policy definition of disability applied. In addition, Illinois Mutual paid Gurule benefits even when substantial evidence suggested that Gurule was not disabled. Its decisions to terminate benefits were based on apparently reputable medical evidence that arguably supported its position, and it explained its actions to Gurule, giving him a reasonable opportunity to respond. It responded, albeit grudgingly, to Gurule's requests for reconsideration. In sum, although the jury found that Illinois Mutual had insufficient grounds to deny Gurule benefits, we do not believe the evidence is sufficient to allow a reasonable juror to infer that Illinois Mutual acted with an intent to injure, or in conscious disregard of Gurule's rights under his policy. Compare Filasky, supra ; Linthicum, supra; Farr v. Transamerica Occidental Life Insurance Co., 145 Ariz. 1, 699 P.2d 376 (App. 1984); Maxwell v. Aetna Life Insurance Co., 143 Ariz. 205, 693 P.2d 348 (App. 1984). [7] Illinois Mutual did, no doubt, consider its own interests in denying Gurule's claim. Self interest is not, however, evidence of an evil mind.