Court Opinion

ID: 6479912
Source: CourtListenerOpinion
Date Created: 2022-06-26 22:56:20.247649+00
Date Added: 2024-06-11T14:59:37.089512
License: Public Domain

dissenting.
¶ 311 respectfully dissent from the majority’s decision. I would affirm the trial court’s decision granting summary judgment in favor of Hallmark on the grounds that the plain language of A.R.S. § 20-259.01 does not require Hallmark to include a premium in its UM/UIM selection form.
¶ 32 In reaching my conclusion, I am guided by two well-established principles of statutory construction. First, “[o]ur goal in interpreting statutes is to fulfill the intent and purpose of the legislature.” Garden Lakes Cmty. Ass’n, Inc. v. Madigan, 204 Ariz. 238, 241, ¶ 14, 62 P.3d 983, 986 (App.2003) (citing Zamora v. Reinstein, 185 Ariz. 272, 275, 915 P.2d 1227, 1230 (1996)). Second, “[wjhen determining the meaning of a statute, we first look to the plain language of the statute as the most reliable indicator of its meaning.” New Sun Bus. Park, LLC v. Yuma Cnty., 221 Ariz. 43, 46, ¶ 12, 209 P.3d 179, 182 (App.2009) (citing Nordstrom, Inc. v. Maricopa Cnty., 207 Ariz. 553, 556, ¶ 10, 88 P.3d 1165, 1168 (App.2004)).
¶ 33 When the legislature enacted the current version of A.R.S. § 20-259.01, it recognized that Arizona had “a very real problem” with uninsured and underinsured drivers. Ormsbee v. Allstate Ins. Co., 176 Ariz. 109, 112, 859 P.2d 732, 735 (1993). However, unlike previous versions of A.R.S. § 20-259.01 which mandated that insurance companies provide specified minimum amounts of UM/UIM coverage, the purpose of the current statute is to ensure that responsible drivers “have the opportunity to buy uninsured or underinsured motorist coverage” to protect themselves and their loved ones. Ormsbee, 176 Ariz. at 112, 859 P.2d at 735 (emphasis added); Ballesteros v. Am. Standard Ins. Co. of Wis., 226 Ariz. 345, 347, ¶ 8, 248 P.3d 193, 195 (2011).
¶34 To promote this legislative purpose, A.R.S. § 20-259.01 now places an affirmative duty on insurance companies to “make available” UM/UIM coverage to their insureds by offering to provide UM/UIM coverage. Bal-lesteros, 226 Ariz. at 348, ¶ 11, 248 P.3d at 196. The offer must be conveyed to the insured by a written notice that is “reasonably calculated to bring to the insured’s ab tention” that UM/UIM coverage is being offered. Giley v. Liberty Mut. Fire Ins. Co., 168 Ariz. 306, 812 P.2d 1124 (1991). In addition, the statute “requires that the insurer make an offer that, if accepted, would bind the insurer to provide the offered coverage.” Ballesteros, 226 Ariz. at 348-49, ¶ 14, 248 P.3d at 196-97.
¶ 35 A.R.S. § 20-259.01 is very specific as to what the insurance company’s written offer must contain. The insurance company must offer to provide: (1) UM and UIM coverage, (2) in limits up to, and including, the limits for death/bodily injury under the insured’s liability policy, and (3) the coverage must extend to all persons covered under the insured’s liability policy. A.R.S. §§ 20-259.01(A), (B). If the insured requests UM/ UIM coverage after receiving the offer, the insurance company must provide the requested coverage. Id.
*338¶ 36 Noticeably absent from AR.S. § 20-259.01 is any requirement that the insurance company include the cost of premiums in its offer. As a result, we have previously decided that A.R.S. § 20-259.01 does not require an insurance company to include the cost of premiums in its UM/UIM offer. Garcia v. Farmers Ins. Co. of Ariz., 191 Ariz. 410, 412, ¶ 19, 956 P.2d 537, 539 (App.1998).
¶37 The efforts of my colleagues in the majority to distinguish Garcia lack merit. First, they assert that unlike the present case, “there is at least a hint” the insurer sent the insured some premium information. Supra, p. 21 at n. 11.1 am neither willing nor able to speculate about this fact. There is nothing in the majority or dissenting opinions in Garcia to support that they inferred or considered the existence of such a “fact”; rather, their analysis was based on the fact the insurer’s offer form contained no information about the cost of UM/UIM coverage. Garcia, 191 Ariz. 410, 411-12, ¶¶ 9, 19, 956 P.2d at 538-39 (majority opinion); Id., at 413, ¶ 29, 956 P.2d at 540 (Fidel, J., dissent).
¶ 38 The majority also contends that Garcia is distinguishable because there is “no indication” that ADOI “affirmatively disapproved the form used by the insurer.” Supra, p. 20. I agree that Garcia makes no mention of the insurer receiving a non-compliance letter from ADOI. Even though the case is completely silent on this issue, I am willing to assume the insured received no such letter. However, assuming this fact does not mean ADOI approved of the form in Garcia, whereas it disapproved of Hallmark’s form.15 Such a conclusion seems suspect when the two forms are compared to each other. The Hallmark form, like the form in Garcia, contains no information about the cost of UM/UIM coverage. However, unlike Hallmark’s form, the offer form in Garcia contained no description of UM/UIM coverage, no statement the insured had a right under Arizona law to purchase UM/UIM coverage, and no clear indication the insured could purchase UM/UIM coverage in the same amounts as liability coverage under the policy. Garcia, 191 Ariz. at 414, app., 956 P.2d at 541.16
¶ 39 I see no reason to depart from our decision in Garcia, particularly when our supreme court has consistently refused to add requirements to AR.S. § 20-259.01 that are not specifically listed in the statute. In Tal-lent v. National General Insurance Co., 185 Ariz. 266, 915 P.2d 665 (1996), our supreme court held that A.R.S. § 20-259.01 does not require the insurance company’s offer “to contain an explanation of the nature of UIM insurance.” Id., 185 Ariz. at 267, 915 P.2d at 666. The court went on to state that, “[w]e find nothing in [AR.S. § 20-259.01] justifying the imposition of this additional requirement. If the legislature desires such an addition, it may create one.” Tallent, 185 Ariz. at 268, 915 P.2d at 667.
¶ 40 In Ballesteros, our supreme court addressed whether an offer of UM/UIM coverage to a Spanish-speaking insured must be in Spanish. The court held that AR.S. § 20-259.01, by its express terms, did not require a Spanish offer form. Ballesteros, 226 Ariz. at 349, ¶ 15, 248 P.3d at 197. The court concluded that “[i]f the legislature desires to add such a requirement, it may do so ... but it is not our place to rewrite the statute.” Id., 226 Ariz. at 349, ¶ 17, 248 P.3d at 197. See generally State v. Patchin, 125 Ariz. 501, 502, 610 P.2d 1062, 1063 (App.1980) (stating that courts are “not at liberty to rewrite the statute under the guise of judicial interpretation”); City of Phoenix v. Butler, 110 Ariz. 160, 162, 515 P.2d 1180, 1182 (1973) (citation omitted) (“The choice of appropriate wording *339rests with the Legislature, and the court may not substitute its judgment for that of the Legislature.”).
¶41 Hallmark’s UM/UIM selection form satisfied the offer requirements of AR.S. § 20-259.01 because it conveyed an offer that, if accepted by the insured, would have bound Hallmark to provide UM/UIM coverage. Ballesteros, 226 Ariz. at 348-49, ¶ 14, 248 P.3d at 196-97. Hallmark’s form is entitled, in capital letters, “ARIZONA UNINSURED MOTORISTS COVERAGE SE-LE CTION/REJE CTION FORM.” The form states that “Arizona law permits you [the insured] to make certain decisions regarding Underinsured/Uninsured Motorist Coverage,” and provides a short explanation as to the nature of UM and UIM coverage. The form also urges the insured to contact Hallmark “or your agent” if the insured has any questions about UM/UIM coverage and/or the amount of coverage available. Hallmark’s form clearly specifies that Hallmark “will provide Uninsured/Underinsured Motorist coverage in the same amount as the policy’s Bodily Injury Liability Limit” unless the insured rejects coverage or selects a lower amount of coverage. The form also states that the insured has “the right to purchase” UM/UIM coverage in an amount up to the policy’s liability limit. Finally, as to both UM and UIM coverage, Hallmark’s form includes a section where the insured may check a box selecting UM/UIM coverage for the full amount of coverage under the insured’s liability policy, a box selecting UM/ UIM coverage in an amount lower than the liability policy limits, or a box rejecting UM/ UIM coverage.
¶ 42 It is undisputed that when Melendez reviewed this form, she clearly and unambiguously rejected UM/UIM coverage. Melendez initialed the rejection boxes for both UM and UIM coverage, and signed the form at the bottom. Melendez has never alleged she did not understand the form, or that she did not have an opportunity to ask questions about the policy, including questions about the additional price of UM/UIM coverage.
¶ 43 The majority contends, however, that Hallmark’s UM/UIM selection form was too confusing and uncertain to constitute a valid offer because it did not include the cost for premiums. Supra, ¶¶ 16-17, 20, 27. Noting that both Tallent and Ballesteros applied general contract principles in interpreting the offer requirement of AR.S § 20-259.01, my colleagues argue that no reasonable person would expect to be bound by an offer that failed to include the cost of premiums. Supra, ¶ 17. My colleagues add that their position is “underscored” by the fact that Hallmark’s form expressly states “no coverage is provided by this document.” Id.
¶ 44 As a preliminary matter, while it is true both Tallent and Ballesteros applied general contract principles in interpreting AR.S § 20-259.01, the supreme court did not use these principles to re-write the statute or add requirements for an “offer” that were not specifically listed in A.R.S § 20-259.01. To the contrary, in both eases the supreme court refused to add any requirement that was not specifically included in the plain language of the statute. Ballesteros, 226 Ariz. at 348, ¶ 13, 248 P.3d at 196; Tallent, 185 Ariz. at 268, 915 P.2d at 667.
¶ 45 More importantly, the validity of Hallmark’s offer does not depend upon whether Melendez was confused or uncertain about the cost of premiums. As the supreme court noted in Ballesteros, “[T]he offeree need not understand the content of an offer to bind the offeror.” Ballesteros, 226 Ariz. at 349, ¶ 14, 248 P.3d at 197. Thus, the critical inquiry is not whether Melendez understood the terms of Hallmark’s offer, or whether she knew what the cost of premiums would be for such coverage; the sole issue is whether Hallmark would have been bound to provide UM/UIM coverage if Melendez had selected such coverage on Hallmark’s form. Balleste-ros, Id.
¶46 In my view, based on the language contained in Hallmark’s UM/UIM selection form, if Melendez had checked one of the boxes opting for UM and/or UIM coverage, there is no question Hallmark would have been bound to provide such coverage. See, supra, ¶41. This would be the ease even though Hallmark’s selection form did not contain premium costs. We have repeatedly held that “[a]n agreement can be implied and is enforceable where there is a valid offer *340and acceptance, and the only term missing is the final price.” Goodman v. Physical Res. Eng'g, Inc., 229 Ariz. 25, 28, 117, 270 P.3d 852, 855 (App.2011)(citing Schade v. Diethrich, 158 Ariz. 1, 5-11, 760 P.2d 1050, 1054-60 (1988)). See also Restatment (Second) of Contracts ch. 3, topic 3 § 33, cmt. a (West 2012) (“uncertainty as to incidental or collateral matters is seldom fatal to the existence of the contract[,]” provided that “the parties have intended to conclude a bargain.”). This premium cost would be easily ascertainable for both the maximum UM/UIM coverage and lesser amounts of coverage based on Hallmark’s premium schedule.
¶ 47 The majority expresses concern that an insured who accepts an insurer’s offer of UM/UIM coverage without knowing the price will be forced to buy a “pig in a poke,” e.g., will be at the mercy of whatever premium the insurer decides to charge.17 Of course, as noted above, the fact the insured is uncertain about the cost of UM/UIM coverage does not mean the offer is invalid, so long as the insurer is bound to provide the UM/UIM coverage. Ballesteros, 226 Ariz. at 349, ¶ 14, 248 P.3d at 197. Thus, in Balleste-ros, the insurance company’s offer of coverage was deemed valid under A.R.S. § 20-259.01 even though the insured was a Spanish speaker who could not understand any of the terms contained in the offer. Balleste-ros, Id. Likewise, in Tallent the insurer’s offer of UIM coverage was held to be valid even though the offer form did not contain an explanation of the nature of UIM insurance. Tallent, 185 Ariz. at 268, 915 P.2d at 667. It would be an incongruous result to declare that an offer lacking the cost of premiums would be invalid under A.R.S. § 20-259.01, while at the same time holding that offer forms are valid when a person cannot understand a single word of the form and/or has no idea what kind of insurance is being offered by the form.
¶ 48 When Melendez reviewed Hallmark’s UM/UIM selection form, the form provided Melendez with the opportunity to contact Hallmark about the premiums if she had any questions about the cost of premiums. It bears repeating that the purpose of A.R.S. § 20-259.01 is to bring to the insured’s attention the availability of UM/UIM coverage, and to provide the insured with an opportunity to purchase such coverage. A.R.S. § 20-259.01 does not mandate that an insurance company provide UM/UIM insurance unless the insured requests it. Ballesteros, 226 Ariz. at 347, ¶ 8, 248 P.3d at 195. Thus, although it is incumbent on an insurance company to offer UM/UIM coverage and to be bound to provide such coverage if the insured requests it, the offer does not change or become invalid simply because the insured makes an inquiry about the cost of premiums before accepting the insurance company’s offer.18 See Tallent, 185 Ariz. at 268, 915 P.2d at 667 (in determining whether insurer’s written offer form satisfied the “offer” requirement of A.R.S. § 20-259.01, the court stated the insurer’s form “certainly seems sufficient to cause any insured or potential insured who has questions about the meaning of UM or UIM coverages to ask for an explanation.”)
¶49 The majoi’ity also claims that Hallmark’s form fails to comply with A.R.S. § 20-259.01 because it expressly states, “no coverage is provided by this document.” Melendez never raised this argument — not in the trial court or on appeal — and for good reason: when read in context, the subject language simply provides that any UM/UIM coverage selected by Melendez is subject to *341the terms, conditions and exclusions of Melendez’ policy.
¶ 50 The language referenced by the majority is contained in one paragraph of the form. Apart from this paragraph, the entire form is dedicated to informing the insured of its right to select UM/UIM coverage. See supra, at ¶ 41. The sentence cited by the majority is contained in the paragraph immediately before the paragraph that describes the nature of UM/UIM coverage. The first sentence of the subject paragraph states, “[Tjhis document includes general descriptions of coverage.” The next sentence states, “[Hjowever, no coverage is provided by this document, nor is Underinsured coverage included with Uninsured Motorist coverage.” The paragraph concludes with the following, ‘You should read your policy and review your Declarations Page(s) and/or Sehedule(s) for complete information on the coverage you are provided.” (Emphasis added).
¶ 51 Clearly, the subject sentence, when read together with the sentences that precede and follow it, serves to refer the insured to its policy for a full description of the UM/UIM coverage provided by the policy.19 Ballesteros, 226 Ariz. at 348, ¶ 13, 248 P.3d at 196 (applying general contract principles when interpreting offer requirement under A.R.S. § 20-259.01); Tallent, 185 Ariz. at 268, 915 P.2d at 667 (same). Thus, an insured must refer to its policy to determine who is covered by the policy, what type of vehicles are covered, and what type of exclusions may apply to the UM/UIM coverage. The language in question is similar to the language contained in the ADOI form, which states, “[F]or a more detailed explanation of these [UM/UIM] coverages, refer to your policy.” This subject language also addresses the concern expressed by our supreme court in Tallent: imposing a requirement under A.R.S. § 20-259.01 “for an explanation of coverage is, we believe, both unwarranted under the statute and unwise ... [because] [s]uch shorthand explanations would inevitably lead to claims insurers had inadequately explained all the ramifications of UIM coverage or the lack thereof calling for yet further explanations.” Tallent, 185 Ariz. at 268, 915 P.2d at 667.
¶ 52 Finally, the majority asserts that ADOI has interpreted A.R.S. § 20-259.01 as requiring the inclusion of premiums, and therefore we should pay deference to ADOI’s interpretation. Supra, p. 14. The majority premises this argument on ADOI’s letter rejecting Hallmarks’ UM/UIM form, which states that Hallmark’s “forms do not comply with Arizona statutes” because the forms do not have “a place to show a premium.” Supra* Id. Accordingly, the majority states that because A.R.S. § 20-259.01 is an insurance statute that ADOI is charged with enforcing, we should afford great deference to ADOI’s interpretation of the statute. Supra, Id.
¶ 53 As a general matter, we should pay deference to ADOI’s interpretation of insurance regulatory statutes. However, ADOI’s letter does not interpret A.R.S. § 20-259.01. ADOI’s letter states, without any explanation, that Hallmark’s form does “not comply with Arizona statutes,” and that the form “fails to conform to the forms in our Regulatory Bulletin 2003-03.”
¶ 54 In truth, it is not even clear- what ADOI’s basis was for rejecting Hallmark’s form. In addition to a lack of space for a premium, ADOI’s letter notes that Hallmark’s form was rejected because the form, which was “to be used by more than one company,” did not list the names of all the companies that were offering coverage, nor did it provide “cheek boxes or lines ... to indicate which company has been selected to write the [UM/UIM] policy.”
¶ 55 I find it particularly confusing that ADOI rejected Hallmark’s form based on the recommended forms/guidelines set forth in Regulatory Bulletin 2003-03.20 As a preliminary matter, Regulatory Bulletin 2003-03 *342does not provide an “interpretation” of A.R.S. § 20-259.01, nor does it state that the cost of a premium must be included in a UM/UIM offer.21 Rather, the Bulletin provides suggested UM/UIM offer forms “that insurers could use to satisfy the requirements of A.R.S. § 20-259.01.” While these recommended forms include blanks for premium costs, they also provide (1) an explanation/definition of UM/UIM coverage and (2) a Spanish form. However, both of these “requirements” have been expressly rejected by the supreme court in Tallent and Ballesteros. As a result, if the Bulletin’s recommended forms do in fact constitute ADOI’s interpretation of A.R.S. § 20-259.01, this interpretation is clearly not in accordance with the statutory interpretations by our supreme court.
¶ 56 In conclusion, I would affirm the trial court’s judgment granting summary judgment in Hallmark’s favor based on the plain language of A.R.S. § 20-259.01. I therefore respectfully dissent from the majority’s decision to reverse the trial court’s judgment.
*343APPENDIX A
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. A.R.S. § 20-259.01 does not require insurers to use forms approved by ADOI, although use of an approved form is considered conclusive evidence the insurer complied with the statute. Ballesteros, 226 Ariz. at 350, ¶ 21, 248 P.3d at 198.

. Hallmark’s form also compares favorably with tire form approved by our supreme court in Tallent v. National General Insurance Co., 185 Ariz. 266, 915 P.2d 665 (1996). The form in Tallent stated "[Tjhis form is used for selecting (or changing) your Uninsured/Underinsured Motorist Coverage,” followed by a series of boxes to check with corresponding coverage amounts and premiums; the form contained no description of UM/UIM coverage and no statement the insured had a right under Arizona law to purchase UM/ UIM coverage. Tallent, 185 Ariz. at 268, 915 P.2d at 667, "Appendix A.”

. As a practical matter, I do not believe there is a realistic danger that insureds would be unwittingly subjected to exorbitant or unfair premiums. In fact, Melendez argues that one of the problems with Hallmark’s form is that it fails to disclose how relatively "affordable” UM/UIM coverage is, thereby depriving insureds of the opportunity to purchase this “relatively inexpensive” coverage. Moreover, insurance rates are regulated by the ADOI, and cannot be "excessive, inadequate or unfairly discriminatory.” See A.R.S. § 20-341, et seq.; A.R.S. § 20-381, et seq.

. Even if the insured fails to inquire about the premiums before accepting the insurance company’s offer, and later finds the cost of premiums to be too high, the insured can simply refuse to pay the premium, resulting in cancellation of the UM/UIM coverage. See, e.g., A.R.S. § 20-267(B) (discussing authority of insurance company to cancel policy for non-payment of premium); A.R.S. § 20-1631 (D)(l)(same).

. The majority states that "Hallmark’s form conflicts with ADOI’s requirements as to price of coverage as well as its statement that the forni will not provide coverage even if coverage is selected.” Supra, ¶ 28. However, the ADOI letter does not mention the subject coverage language, nor does it state this language violates Arizona law.

. As referenced in ADOI's letter. Regulatory Bulletin 2003-03 is available at the ADOI’s website: http://www.azinsurance.gov.

. In addition, the Bulletin clearly states it is "advisory only.” See Blevins v. Gov't Employees Ins. Co.. 227 Ariz. 456. 462, ¶ 24, 258 P.3d 274. 280 (App.2011) (ADOI bulletins/policy statements are advisory only).