Court Opinion

ID: 64869
Source: CourtListenerOpinion
Date Created: 2010-04-26 05:23:54+00
Date Added: 2024-06-11T14:57:47.946475
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT  United States Court of Appeals
                                                    Fifth Circuit

                                                                            FILED
                                                                         February 13, 2009

                                     No. 08-30803                     Charles R. Fulbruge III
                                   Summary Calendar                           Clerk

ADAM J. MECHE

                                                  Plaintiff-Appellant
v.

NATIONAL INDEMNITY COMPANY

                                                  Defendant-Appellee

               Appeal from the United States District Court for the
                          Eastern District of Louisiana
                            USDC No. 2:07-cv-01491

Before JOLLY, BENAVIDES, and HAYNES, Circuit Judges.
PER CURIAM:*
       This appeal is from a summary judgment in favor of the insurer. The
issue is whether the insurer sent the notice of cancellation of the insurance
policy in compliance with the applicable Washington state law. In light of very
recent Washington Supreme Court precedent, we must conclude that the insurer
has not shown that the notice sent complied with the statutory notice
requirement. Therefore, we vacate the summary judgment and remand.

       *
         Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
                                  No. 08-30803

            I.     FACTUAL AND PROCEDURAL HISTORY
      National Indemnity Company (NIC), through its general agent, Cochrane
and Company, issued a public liability insurance policy to Selena Transport,
L.L.C. (Selena) that was to be effective from November 22, 2005, to November
22, 2006. On February 22, 2006, an employee of Cochrane mailed to Selena a
notice of cancellation of the insurance policy due to nonpayment of premiums.
The notice provided that the insurance policy would be cancelled effective March
30, 2006.
      On March 31, 2006, the plaintiff, Adam Meche, was injured in an accident
involving his motor vehicle and a truck driven by Vladimir I. Volkov, who was
an employee of Selena. Meche filed suit in Louisiana state court against Volkov,
Selena, and NIC, alleging that the accident was caused by Volkov’s negligence
and that Selena was vicariously liable as the employer. Meche further alleged
that the insurance policy issued by NIC was in “full force and effect” at the time
of the accident. NIC removed the suit to federal court and filed a motion for
summary judgment, arguing that the insurance policy had been cancelled prior
to the accident.
      The district court granted NIC’s motion for summary judgment and
dismissed with prejudice Meche’s claims against NIC. Subsequently, the district
court granted the parties’ joint motion for entry of final judgment as to NIC
pursuant to Rule 54(b) of the Federal Rules of Civil Procedure. The district court
also continued the proceedings against the remaining defendants pending this
Court’s resolution of the instant appeal.
      II.   ANALYSIS
            A.     Standard of Review
      This Court reviews a district court’s grant of summary judgment de novo,
applying the same standards as the district court. See e.g., Hirras v. Nat’l R.R.
Passenger Corp., 95 F.3d 396, 399 (5th Cir. 1996). Summary judgment is proper

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                                      No. 08-30803

if the record reflects “that there is no genuine issue as to any material fact and
that the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(c).
              B.     Notice of Cancellation
       Meche contends that the district court erred in granting summary
judgment in favor of NIC. He contends that NIC did not comply with the
applicable Washington statutory requirements when it sent the notice of
cancellation with respect to the insurance policy at issue. Meche contends that
there is a genuine issue of fact with respect to whether NIC mailed the notice.
Among other things, Meche argues that “NIC has come forth with no evidence
that its certified mailing of the notice of cancellation was received.”1
       In February of 2006, section 48.18.290(1) of the Revised Code of
Washington, provided that cancellation of insurance policies may be effected
only upon compliance with certain requirements. More specifically, “[w]ritten
notice of such cancellation, accompanied by the actual reason therefor, must be
actually delivered or mailed to the named insured.”                Wash. Rev. Code §
48.18.290(1)(a) (emphasis added).2 Additionally, the statute provided that:
       The mailing of any such notice shall be effected by depositing it in
       a sealed envelope, directed to the addressee at his or her last
       address as known to the insurer or as shown by the insurer’s
       records, with proper prepaid postage affixed, in a letter depository
       of the United States post office. The insurer shall retain in its
       records any such item so mailed, together with its envelope, which
       was returned by the post office upon failure to find, or deliver the
       mailing to, the addressee.

§ 48.18.290(2).

       1
          Meche also makes other challenges to the mailing but in view of our disposition of
this issue, we need not address them.
       2
         We note that on June 7, 2006, the statute was revised slightly. However, the former
version was in effect at the time the notice of cancellation was sent.

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                                       No. 08-30803

      Very recently, the Washington Supreme Court answered the following
question that had been certified to it by the Ninth Circuit: “Does sending notice
of cancellation by certified mail satisfy the ‘mailed’ requirement of RCW §
48.18.290 (1997) and give sufficient notice of cancellation to comply with RCW
§ 48.18.290, even if there is no proof that the cancellation letter was received by
the insured?” Cornhusker Casualty Ins. Co. v. Kachman, 198 P.3d 505, 2008
WL 5250268, *1 (Wash. Dec. 18, 2008). The Washington Supreme Court ruled
that the sending of a notice of cancellation by certified mail fails to satisfy the
“mailed” requirement of RCW 48.18.290. Id. at *4. Accordingly, certified mail
must be “actually delivered” to meet the statutory requirements. Id.
      In the instant case, NIC submitted evidence that the notice of cancellation
was sent by certified mail. NIC does not argue that the notice was actually
delivered to Selena. Instead, NIC relies on Washington cases issued prior to
Kachman holding that an insurer is not required to prove that a mailed notice
of cancellation was actually received for the cancellation to be effective.3
Additionally, NIC points to deposition testimony that the notice was never
returned by the post office as undeliverable. Because NIC did not prove that the
certified mail was actually delivered, the district court erred in granting
summary judgment in favor of NIC.4
      Accordingly, we VACATE the summary judgment and REMAND for
proceedings consistent with this opinion.

      3
          We note that Kachman was issued after the briefing in the instant case was
completed. Kachman makes clear that certified mail does not fall under the “mailed” prong
of the statute; instead, certified mail must be actually delivered. 198 P.3d 505, 2208 WL
5250268, at *4.
      4
          Of course, the district court did not have the benefit of Kachman.

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