Opinion ID: 2511821
Heading Depth: 1
Heading Rank: 9

Heading: Issue VReasonable Expectations Doctrine

Text: [¶ 36] Finally, Mrs. Harper argues that because the parties' contract was ambiguous, she should be allowed to recover under the reasonable expectations doctrine. In order to state a claim under the reasonable expectations doctrine, the plaintiff must show the subject contract is ambiguous as to the provision in dispute. Ahrenholtz v. Time Ins. Co., 968 P.2d 946, 950 (Wyo.1998). The doctrine will not be applied where the insurance contract is plain and unambiguous. W.N. McMurry Constr. Co. v. Community First Ins., Inc., 2007 WY 96, ¶ 21, 160 P.3d 71, 78 (Wyo.2007). [¶ 37] The doctrine of reasonable expectations is explained as follows in St. Paul Fire and Marine Ins. Co. v. Albany County Sch. Dist. No. 1, 763 P.2d 1255, 1262 (Wyo. 1988): The doctrine of reasonable expectations is essentially a rule of construction that acknowledges the usual disparity of bargaining power between an insurer and the fact that insurance contracts are generally contracts of adhesion. See Corgatelli v. Globe Life & Accident Insurance Company, 96 Idaho 616, 533 P.2d 737 (1975), wherein the Idaho Supreme Court described the doctrine and applied it in a split decision, and Casey v. Highlands Insurance Company, 100 Idaho 505, 600 P.2d 1387 (1979), in which that same court disavowed and refused to adopt the doctrine. Under the doctrine, the court will uphold the insured's reasonable expectations as to the scope of coverage, provided that the expectations are objectively reasonable. 2 G. Couch, Cyclopedia of Insurance Law 2d § 15:16 at 172 (Rev. ed.1984). Professor Keeton describes the operation of the doctrine in this fashion: The objectively reasonable expectations of applicants and intended beneficiaries regarding the terms of insurance contracts will be honored even though painstaking study of the policy provisions would have negated those expectations. [¶ 38] In regard to this issue, the district court was correct when it stated as follows: Mr. Harper was advised in the application that the information would be relied upon in issuing the insurance. The policy contained a contestability clause allowing challenge within the first two years of issuance. By his signature, Mr. Harper verified the answers contained in the application were true and correct. This [reasonable expectations] claim presumes that Mr. Harper can assume [Fidelity] will not rely upon his answers, which is contrary to the unambiguous language in the application. As did the district court, this Court fails to see how any claim would exist under the doctrine of reasonable expectations.