Opinion ID: 888387
Heading Depth: 3
Heading Rank: 1

Heading: The Lorangs' Motion for Partial Summary Judgment

Text: ¶ 169 We again refer to the pertinent statutory language in order to establish the proper context for our discussion. Section 33-18-201(6), MCA, provides that an insurer may not neglect to attempt in good faith to effectuate prompt, fair, and equitable settlements of claims in which liability has become reasonably clear. Here, significant facts relevant under this statute are undisputed. First, it is undisputed that Fortis' liability was reasonably clear when Bonnie submitted her 2002 claim. Second, there is no dispute as to whether Fortis' eventual payment of this claim was fair or equitable in terms of the amount paid. Thus, the issue to be resolved here is whether Fortis violated its statutory duty to act in good faith to effectuate prompt settlement. This is a factual issue. See e.g. Precision Theatrical Effects, Inc. v. United Banks, N.A., 2006 MT 236, ¶ 23, 333 Mont. 505, ¶ 23, 143 P.3d 442, ¶ 23; Simmons v. Jenkins, 230 Mont. 429, 435, 750 P.2d 1067, 1071 (1988). However, the Lorangs argue that this issue should be determined as a matter of law on summary judgment. ¶ 170 Specifically, the Lorangs argue that Fortis violated § 33-18-201(6), MCA, as a matter of law because the denial of Bonnie's claim resulted from Fortis' institutionalized scheme of attempting to avoid its contractual obligations with respect to prosthetics coverage. As the Lorangs assert, even if an insured pursues Fortis' internal claims-appeal process, Fortis' practice is to automatically deny coverage for all replacement socket claims, but to then `correct' or `reverse' its denial once an insured files suit or an insurance commissioner's office intervenes on behalf of the insured. ¶ 171 In support of their argument that this is Fortis' general practice, the Lorangs cite testimony from Fortis' claims adjusters who state that the company regularly denies claims for replacement sockets and even trains its adjusters to do so. The Lorangs also cite the evidence that Fortis initially denied each of Bonnie's claims, in 1994, 1996, 1998, 2002, and 2003, but later admitted its contractual obligation and provided coverage after the Insurance Commissioner intervened on two instances, and after the Lorangs filed suit in another instance. Additionally, the Lorangs point to evidence that Fortis has engaged in this same conduct when dealing with other claimants. They state: This not only happened repeatedly to Bonnie Lorang, it also has happened to every other insured for which Fortis has produced discovery! ¶ 172 While this evidence provides strong support for the Lorangs' argument, we must consider the other admissible evidence as well. Additionally, because the Lorangs are the moving party here, we must view the evidence in a light most favorable to Fortis. LaTray, ¶ 15. That is, we must draw any reasonable inferences from the evidence in favor of Fortis, recognizing that a reasonable juror might do the same. LaTray, ¶ 15. ¶ 173 While the record contains little evidence favorable to Fortis, it does demonstrate that, as a result of the Lorangs' first lawsuit, Fortis placed a note in the Lorangs' file, ostensibly to ensure that Bonnie's claims would be handled appropriately. This note states that Bonnie's claims for replacement sockets are not to be denied on the basis that such coverage is not available under the policy. [26] This instruction was made readily available in Fortis' computer system, and Fortis' adjuster Jeanne Pehoski did in fact locate this instruction when considering Bonnie's 2002 claim. With respect to Fortis' statutory obligation to act promptly, we note that Fortis ultimately issued payment nearly four months after Bonnie's claim was submitted, and just over two months after it was wrongly denied. Fortis argues that while the claim would have been paid in October if handled properly, it was ultimately paid in December and the delay was not significant. ¶ 174 In light of all the aforementioned evidence, we cannot agree that the Lorangs are entitled to partial summary judgment on liability. We acknowledge the compelling nature of the evidence which indicates bad faith by Fortis, as well as the relative strength of the Lorangs' argument compared to that of Fortis. However, we have held that if there is any doubt as to the propriety of granting a summary judgment motion, that doubt must be resolved in favor of the party opposing the motion. Newbury, ¶ 14; Krusemark, 186 Mont. at 177, 606 P.2d at 1084; Mathews, 184 Mont. at 379, 603 P.2d at 238. This rule reflects the overriding principle that we must exercise extreme care to avoid resolving factual issues which are properly determined by a jury. Bowen v. McDonald, 276 Mont. 193, 199, 915 P.2d 201, 205 (1996) (citation omitted). ¶ 175 Accordingly, in determining the propriety of summary judgment for the Lorangs, we resolve all doubt in favor of Fortis. Considering Fortis' affirmative effort to ensure that Bonnie's claims would not be wrongly denied after the first lawsuit, as well as Fortis' remedial effort which culminated just over two months after the wrongful denial, and viewing this evidence in a light most favorable to Fortis, LaTray, ¶ 15, we cannot conclude as a matter of law that Fortis violated § 33-18-201(6), MCA. Thus, a jury must resolve the factual issue of whether Fortis acted in good faith to effectuate prompt settlement of Bonnie's claim. [27] ¶ 176 As noted above, the District Court denied the Lorangs' motion for partial summary judgment on liability. In doing so, the court did not discuss the application of summary-judgment rules or provide any analysis, but simply reasoned: The evidence shows that payment was prompt. We do not condone this cursory approach, nor do we agree with the court's reasoning. However, our practice is to affirm a correct ruling even if it was based on erroneous reasoning. Collier v. Kincheloe, 2008 MT 100, ¶ 8, 342 Mont. 314, ¶ 8, 180 P.3d 1157, ¶ 8. Thus, for the reasons noted above, we hold that the court correctly denied the Lorangs' motion for partial summary judgment on liability.