Opinion ID: 1568305
Heading Depth: 3
Heading Rank: 2

Heading: Whether the Defendant Has a Colorable Defense to the Merits of the Claim.

Text: ¶ 16. The second prong of the balancing test asks whether the defendant has a colorable defense to the merits of the plaintiff's claim. See, e.g., Pittman, 501 So.2d at 388. With regard to the second prong, this Court has held that [i]f any one of the three factors in the balancing test outweighs the other in importance, this is the one. Bailey, 543 So.2d at 182; see also Stanford, 822 So.2d at 888 (quoting Allstate Ins. Co. v. Green, 794 So.2d 170, 174 (Miss.2001)) (stating that this Court has encouraged trial courts to vacate a default judgment where `the defendant has shown that he has a meritorious defense'). ¶ 17. American States argues that Rogillio is not covered under the J & N Timber policy. The policy states that six vehicles  a 2004 Ford F-150, a 2001 Ford Expedition, a 1998 Ford Ranger, a 2000 Ford pickup, a 2003 Ford Crown Victoria sedan, and a 2003 Lincoln Towncar sedan  are covered under it. The policy also includes Drive Other Car coverage for certain individuals when they are driving cars other than the six cars specifically listed. The only individuals listed under Drive Other Car coverage are William B. Netterville and Vicki Netterville. Rogillio is not listed under the Drive Other Car coverage and was not driving any of the vehicles specified in the J & N Timber policy at the time of the accident. Thus, it is arguable that, based on the excerpts of the J & N Timber policy included in the record, American States has a colorable defense to the merits of Rogillio's claim. ¶ 18. However, we note that it is unclear whether American States would prevail on the merits by asserting this defense. The record includes a short and long version of the J & N Timber policy. The short version of the insurance policy, which is what American States provided to Rogillio when he requested a copy of the policy prior to filing his complaint, includes a document with a Safeco Insurance [1] logo at the upper left corner of the page. This document states: Dear Valued Policyholder, We appreciate the opportunity to write your commercial auto coverage. Please take a minute to review your policy. Your policy has been issued based on the drivers listing below. In order to insure that your policy is issued with the most current information, please review this list and update as necessary. Include employees who drive their own vehicles on company business or anyone who will drive an insured vehicle. Contact your independent agent to advise of any changes. The document then includes a list of six drivers, including Ellis Rogillio. American States argues that the attachment of this document was accidental. American States asserted in its motion to set aside the default judgment that [w]hen printing the policy to provide to Plaintiff and his counsel, in an effort to conserve paper, American States inadvertently attached [the] document. American States did not explain how attaching additional documents to an insurance policy conserves paper. American States contends on appeal that this document is clearly not part of a policy or policy application, but a separate and subsequent letter written to the named insured, J & N Timber, Inc., simply to confirm those persons who would potentially be using a scheduled insured vehicle so that American States could evaluate and assess its risk and the premium to be charged for insuring that risk. American States provides an affidavit by a Safeco Insurance underwriter that states that the document listing Rogillio as a driver has nothing to do with the Drive Other Car coverage under the J & N Timber policy, and that Rogillio is not insured under the policy. American States claims on appeal that the underwriter's testimony is undisputed.  However, Rogillio certainly disputed this fact in the pleadings and at the hearing and continues to dispute it on appeal. Rogillio maintains that the attachment of the document listing him as a driver creates an ambiguity in the insurance policy, which should be interpreted against the insurer. ¶ 19. The document in question clearly states that [y]our policy has been issued based on the drivers listing below. In addition, although American States argues that the document was mistakenly attached to the short version of the policy when Rogillio requested a copy of the policy prior to filing suit, Rogillio rightly points out on appeal that the document also appears in the middle of the long version of the insurance policy that is included in the record. ¶ 20. It is well-established that any ambiguity in an insurance policy is interpreted in favor of the insured as the nondrafting party. See, e.g., Crum v. Johnson, 809 So.2d 663, 666 (Miss.2002); J & W Foods Corp. v. State Farm Mut. Auto. Ins. Co., 723 So.2d 550, 552 (Miss. 1998). This Court is persuaded by Rogillio's argument regarding the ambiguity in the insurance policy and finds that the strength of American States' defense is questionable. Nevertheless, we are of the opinion that American States' defense does present a colorable defense to the merits of the Rogillio's claim for the purposes of the balancing test. Therefore, the second prong of the balancing test weighs in favor of American States.