Opinion ID: 2767550
Heading Depth: 3
Heading Rank: 2

Heading: Fundamental Principle of Justice

Text: Because New Mexico law equally enforces both inter- and intra-policy stacking prohibitions in choice-of-law analysis, Saveraid’s argument that this issue rises to the level of a fundamental principle of justice fails under Shope. See Shope, 925 P.2d at 517. The Shope court held that “[w]hile we interpret New Mexico insurance contracts to avoid repugnancy in clauses that prohibit stacking of coverages for which separate premiums have been paid, this rule is one of contract interpretation that does not rise to the level of a fundamental principle of justice.” Id. (emphasis added). And if Shope is not enough, the New Mexico Court of Appeals has recently reaffirmed Shope’s view in Wilkeson v. State Farm Mut. Auto. Ins. Co., 329 P.3d 749 (N.M. Ct. App.), cert. denied, 328 P.3d 1188 (N.M. 2014). The facts of 5 Saveraid admonishes the district court for relying on Rehders v. Allstate Ins. Co., 135 P.3d 237 (N.M. Ct. App. 2006), for the idea that New Mexico does not distinguish between inter- and intra-policy stacking. But just as she was wrong about the roles of Lopez and Konnick, she also misses the point with Rehders. In Rehders, the court drew from both inter- and intra-policy stacking cases to assess whether stacking was appropriate in the intra-policy stacking context. Rehders, 135 P.3d at 244–45. The district court pointed to Rehders for this exact reason. It shows that New Mexico does not distinguish between the two types of stacking. -10- Wilkeson are similar to Saveraid’s. Wilkeson was insured under two separate California policies, both of which contained inter-policy anti-stacking provisions for UIM coverage. Id. at 750. After a car accident, Wilkeson’s insurer paid her the UIM coverage under one policy, but it denied coverage under the second. Id. After reviewing the history of stacking jurisprudence in New Mexico, including the inter- and intra-policy stacking cases, the New Mexico Court of Appeals agreed with Wilkeson that New Mexico generally favors stacking. Id. at 751. However, it explained that choice-of-law issues require a different sort of analysis, as laid out in Shope. Id. at 752. To overcome New Mexico’s policy of applying the substantive law from where the contract was executed, a party must show “a countervailing interest that is fundamental and separate from general policies of contract interpretation.” Id. (quoting Shope, 925 P.2d at 517) (internal quotation marks omitted). Because Shope concluded that the stacking of insurance coverages is purely a question of contract interpretation that did not violate a fundamental interest of justice in New Mexico, the Wilkeson court declined to apply New Mexico law. See id. at 753 (“Although there is an important public policy favoring stacking that . . . may outweigh conflicting concerns within the same or related insurance policies, it does not alter the New Mexico policy to interpret insurance contracts according to the law of the place -11- where the contract is executed.”). It consequently upheld the anti-stacking provision in the California policies. Id at 754. Saveraid also depends heavily on Sloan to support her claim that New Mexico public policy should control the enforceability of the anti-stacking provision. In doing so, she misunderstands the fundamental question at stake. In Sloan, an inter-policy case, the New Mexico Supreme Court refused to apply an antistacking provision in a New Mexico insurance policy because it conflicted with New Mexico public policy. 519 P.2d at 303. These are two distinct questions. Under Sloan, the court was applying the standard for whether the contract— which was created in New Mexico—contained a provision that violated New Mexico public policy. Id. at 301–03. Conversely, in Shope, the court was tasked with determining whether a contract provision from Virginia violated a New Mexico fundamental principle of justice, a choice-of-law question. 925 P.2d at 515–16. What Saveraid fails to acknowledge is that Sloan had no choice-of-law question, and its holding is inapplicable to the issue she raises in her case. 6 Thus, 6 Saveraid argues that State Farm Mut. Auto. Ins. Co. v. Ballard, 54 P.3d 537 (N.M. 2002), provides an example of how the district court should have analyzed this case. In Ballard, a choice-of-law case, the court cited Estep v. State Farm Mut. Auto. Ins. Co., 703 P.2d 882 (N.M. 1985), which was not a choice-of-law case, to establish New Mexico law and public policy for the purpose of lex loci contractus analysis. 54 P.3d at 540. She argues we should apply Sloan instead of Shope for the same reasons. But New Mexico precedent disfavors this argument. In Wilkeson, the court rejected a request to apply Ballard instead of Shope in deciding whether to enforce an inter-policy anti-stacking provision. 329 P.3d at 754 (“Ballard . . . [is] not [a] stacking case[], and we consider the -12- we pivot away from whether New Mexico courts enforce stacking as part of New Mexico’s general public policy, and instead, we ask whether the anti-stacking provision rises to the level of a violation of a fundamental principle of justice in New Mexico. To this, Shope already has answered no. 925 P.2d at 517. Shope and Wilkeson are dispositive of this case. Inter- and intra-policy stacking cases are interchangeable when interpreting the validity of anti-stacking provisions in New Mexico. Both types of provisions are preferred for the same reason: “to ensure that the insured gets what he or she pays for, and to fulfill the reasonable expectations of the insured.” Rehders, 135 P.3d at 245 (citing Montano v. Allstate Indem. Co., 92 P.3d 1255 (N.M. 2004)). For the first time on appeal, Saveraid asserts that Jordan v. Allstate Ins. Co., 245 P.3d 1214 (N.M. 2010), and Progressive Nw. Ins. Co. v. Weed Warrior Servs., 245 P.3d 1209 (N.M. 2010), support her position that anti-stacking provisions are not enforceable in New Mexico. We see no reason to deviate from our general rule that we do not address arguments that are presented for the first time on appeal. 7 See United States v. Mora, 293 F.3d 1213, 1216 (10th Cir. 2002). Thus, we do not address it fully here. public policies involved in [that] case[] to carry greater weight when balanced against the policy to interpret insurance contracts according to the law of the contracting state.”). Therefore, this argument fails. 7 Moreover, Saveraid’s new argument lacks merit. This court stated that “it is important to recognize that . . . the Jordan court did not comment on the question of -13- In sum, Saveraid’s Iowa UIM policy contained an anti-stacking provision, and there is not a fundamental principle of justice under New Mexico law that precludes its application here. 8 Both parties agree that under Iowa law, antistacking provisions are enforceable. State Farm has already paid Saveraid the UIM benefits under her Towed Vehicle policy. Therefore, she has no basis to recover UIM benefits under her Motor Home policy.