Opinion ID: 1924699
Heading Depth: 2
Heading Rank: 2

Heading: Mental-Anguish Damages

Text: Shelter also contends that the trial court erred in charging the jury on Alabama law regarding damages for breach-of-contract; it argues that the trial court should have instructed as to Missouri contract law. [9] The substantive rights of the parties under the contract are controlled by the law of the State ... where the contract was executed. New Hampshire Fire Ins. Co. v. Curtis, 264 Ala. 137, 142, 85 So.2d 441, 446 (1955). [10] Because we have held that the Shelter policy must be construed in accordance with Missouri law, we likewise hold that Missouri law must be applied when considering the damages that resulted from a breach of that contract. Under Missouri law, the damages recoverable in a breach-of-contract action are those naturally resulting from the breach and which were within the reasonable contemplation of the parties at the time the contract for insurance was executed. Brion v. Vigilant Ins. Co., 651 S.W.2d 183, 184-85 (Mo.Ct.App.1983). Our research reveals two limited circumstances under which the Missouri courts have allowed the recovery of mental-anguish damages arising from a breach of contract. In Golston v. Lincoln Cemetery, Inc., 573 S.W.2d 700 (Mo.Ct.App.1978), the court allowed surviving family members to recover damages for mental anguish following the negligent burial of their relative, reasoning that `in the case of interference with rights involving dead human bodies, ... mental anguish to the surviving relatives is not only the natural and probable consequence of the character of wrong committed, but indeed is frequently the only injurious consequence to follow from [the breach of the contract].' Golston, 573 S.W.2d at 704 (quoting Crenshaw v. O'Connell, 235 Mo. App. 1085, 150 S.W.2d 489, 493 (1941)). In Brion v. Vigilant Ins. Co., supra, a physician sued his medical-malpractice insurer and claimed damages for mental anguish after the insurer, without the physician's consent and contrary to the express provisions of the insurance contract, settled a professional negligence action that had been filed against the physician. 651 S.W.2d at 184-85. The Missouri court reasoned that the physician had stated a claim for mental-anguish damages because the contract gave the physician control over litigation that could jeopardize his professional reputation. Id. Such control, the court stated, is a valuable right, and the breach of a contract protecting that right may, therefore, give rise to damages not generally recoverable in a conventional breach of contract action. 651 S.W.2d at 185. Because mental anguish was not a natural and probable consequence of the alleged breach of the Shelter policy, because the policy did not concern interference with rights involving dead human bodies, and because the policy did not expressly concern a valuable intangible right such as a person's reputation, we interpret Missouri law to preclude the recovery by Barton of mental-anguish damages resulting from a breach of the Shelter policy. Moreover, Missouri courts have held that the mere failure to perform a contract cannot serve as the basis for tort liability unless the breach is also an independent tort. Haugland v. Parsons, 863 S.W.2d 609, 610 (Mo.Ct.App.1992). Although the breach of an insurance contract may lead to the independent tort of bad-faith refusal to pay an insurance claim, we have determined that Barton could not maintain her bad-faith claim against Shelter. Thus, she would not be entitled to mental-anguish damages for a breach of the Shelter policy. REVERSED AND REMANDED. SEE, BROWN, and STUART, JJ., concur. LYONS and HARWOOD, JJ., concur in part and concur in the result in part. HOUSTON, JOHNSTONE, and WOODALL, JJ., concur in the result. MOORE, C.J., recuses himself.