Court Opinion

ID: 4577526
Source: CourtListenerOpinion
Date Created: 2020-10-15 21:10:20.880514+00
Date Added: 2024-06-11T08:47:32.761760
License: Public Domain

10/06/2020

                                           DA 20-0112
                                                                                          Case Number: DA 20-0112

              IN THE SUPREME COURT OF THE STATE OF MONTANA
                                          2020 MT 251N

SHARON UHLIG,

               Plaintiff and Appellant,

         v.

ALLIED PROPERTY AND CASUALTY INSURANCE COMPANY,

               Defendant and Appellee.

APPEAL FROM:           District Court of the Fourth Judicial District,
                       In and For the County of Missoula, Cause No. DV-17-1292
                       Honorable Leslie Halligan, Presiding Judge

COUNSEL OF RECORD:

                For Appellant:

                       Paul Sharkey, Sharkey Law Firm, Missoula, Montana

                For Appellee:

                       Paul R. Haffeman, Stephanie A. Hollar, Davis, Haley, Haffeman & Tighe,
                       P.C., Great Falls, Montana

                                                   Submitted on Briefs: August 26, 2020

                                                              Decided: October 6, 2020

Filed:

                                 cir-641.—if
                       __________________________________________
                                         Clerk
Justice Ingrid Gustafson delivered the Opinion of the Court.

¶1     Pursuant to Section I, Paragraph 3(c), Montana Supreme Court Internal Operating

Rules, this case is decided by memorandum opinion and shall not be cited and does not

serve as precedent. Its case title, cause number, and disposition shall be included in this

Court’s quarterly list of noncitable cases published in the Pacific Reporter and Montana

Reports.

¶2     Plaintiff and Appellant Sharon Uhlig (Uhlig) appeals the November 5, 2019 Order

on Motions for Award of Attorney’s Fees and Interest on Judgment and the December 26,

2019 Order on Plaintiff’s Motion to Strike, Her Costs, and Other Monetary Awards issued

by the Fourth Judicial District Court, Missoula County. We affirm.

¶3     On February 1, 2017, Uhlig was driving in Missoula when she was involved in a

motor vehicle accident with Dennis Hildebrand (Hildebrand). Uhlig was transported by

ambulance to St. Patrick Hospital, where she was treated in the emergency room and

ultimately released from the hospital later that day. No further medical treatment was

required. As a result of the accident and medical treatment, Uhlig received an ambulance

bill of $1,360 and an emergency room bill of $3,470, for a total of $4,830 in medical bills.

Uhlig was insured by Farmers, who paid her $4,830 for those medical bills. Hildebrand

was insured by Allied Property and Casualty Insurance Company (Allied). Hildebrand’s

liability for the accident was reasonably clear and has never been contested by Allied. In

June 2017, Allied claims adjuster Marlee Miller (Miller) spoke to Uhlig by phone and made

a settlement offer. Miller mailed the settlement offer and release to Uhlig, who did not

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sign it but instead retained counsel. Uhlig thereafter made a demand that Allied advance-

pay her medical bills, which Allied refused.

¶4     On December 8, 2017, Uhlig sent Allied a letter offering to settle her claims and

arguing that Allied’s conduct in refusing to advance-pay her medical expenses constituted

violations of Montana’s Unfair Trade Practices Act (UTPA) and this Court’s decision in

Ridley v. Guaranty Nat’l Ins. Co., 286 Mont. 325, 951 P.2d 987 (1997). After Allied again

refused to advance-pay Uhlig’s medical bills, arguing they were not required to pay as

Farmers had already paid them, she filed her Complaint for Declaratory Relief on

December 21, 2017, pursuant to the Uniform Declaratory Judgments Act (UDJA). On

January 19, 2018, Allied offered to pay Uhlig’s $4,380 in medical expenses if she would

dismiss the pending lawsuit. Allied’s offer was not contingent on a global settlement of

any of Uhlig’s claims against Hildebrand arising from the accident, merely settlement of

the declaratory judgment claim against Allied. Uhlig did not dismiss the declaratory

judgment lawsuit and Allied did not pay the $4,380 at that time. Uhlig thereafter amended

her Complaint twice, before the parties each made cross-motions for summary judgment.

The District Court ultimately issued its Order on Cross-Motions for Summary Judgment

on December 31, 2018—denying Allied’s motion for summary judgment and granting

Uhlig’s to the extent that Allied was required to advance-pay Uhlig’s $4,380 in medical

expenses, but declining to rule on issues related to interest, attorney’s fees, and costs.

¶5     After the District Court issued its Order on Cross-Motions for Summary Judgment,

Uhlig filed a Motion and Brief for Award of Attorney’s Fees and a Motion and Brief for

Award of Statutory Interest. Later, Uhlig also filed the Plaintiff’s Motion to Strike
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Affidavit and Motion for Award of Expenses and Brief in Support, seeking to strike the

August 7, 2018 affidavit of Miller, Allied’s adjuster, which was presented by Allied with

its August 10, 2018 brief in opposition to Uhlig’s summary judgment motion. After

briefing, the District Court issued its Order on Motions for Award of Attorney’s Fees and

Interest on Judgment on November 5, 2019, granting in part and denying in part Uhlig’s

motion for attorney fees and granting the motion for an award of statutory interest.

Relevant here, the District Court’s Order granted Uhlig’s attorney fees for the work

performed by her counsel prior to January 19, 2018, when Allied offered to pay her medical

expenses in exchange for dismissal of the declaratory judgment lawsuit against Allied, but

denying her attorney fees for any work performed after that date. Uhlig’s counsel had

performed 12 hours of work prior to January 19, 2018, so the District Court awarded Uhlig

$2,400 in attorney’s fees based on Uhlig’s counsel’s rate of $200 per hour.              On

December 26, 2019, the District Court issued its Order on Plaintiff’s Motion to Strike, Her

Costs, and Other Monetary Awards, which denied Uhlig’s motion to strike Miller’s

affidavit and reaffirmed its award of $2,400 in attorney’s fees to Uhlig.

¶6     Uhlig appeals, raising two issues, which we restate as follows: (1) whether the

District Court erred by limiting its award of attorney fees to work performed by Uhlig’s

counsel prior to January 19, 2018, and (2) whether the District Court erred in denying

Uhlig’s motion to strike Miller’s affidavit. Uhlig correctly notes her second appealed issue

only need be addressed if the case is remanded for further proceedings in the district court.

As we affirm the District Court and do not remand for further proceedings, we address only

Uhlig’s first appealed issue.
                                             4
¶7     After Allied refused to advance-pay her medical expenses incurred in the accident

with Hildebrand, Uhlig filed a declaratory judgment action in the District Court, seeking a

declaration that Allied was required to advance-pay those medical expenses pursuant to

Ridley and the UTPA. “Pursuant to Ridley, insurers are obligated to pay an injured third

party’s medical expenses prior to final settlement when liability for such expenses is

reasonably clear.” Shilhanek v. D-2 Trucking, 2003 MT 122, ¶ 16, 315 Mont. 519, 70 P.3d

721. Under the UTPA, insurers are prohibited from engaging in unfair trade practices.

Section 33-18-201, MCA, provides, in relevant part:

       A person may not, with such frequency as to indicate a general business
       practice, do any of the following:

                                         .   .   .

       (6) neglect to attempt in good faith to effectuate prompt, fair, and equitable
       settlements of claims in which liability has become reasonably clear;

                                         .   .   .

       (13) fail to promptly settle claims, if liability has become reasonably clear,
       under one portion of the insurance policy coverage in order to influence
       settlements under other portions of the insurance policy coverage[.]

¶8     In the present case, Hildebrand’s liability for the accident was reasonably clear and

has never been in dispute. As an injured third party, Uhlig was entitled to have her medical

expenses advance-paid by Allied pursuant to Ridley and the UTPA. The District Court

correctly reached this determination in its Order on Cross-Motions for Summary Judgment.

After the court granted her motion for summary judgment, Uhlig sought to recover her

attorney’s fees.

                                             5
¶9     Montana generally follows the American Rule that a party in a civil action is not

entitled to attorney fees absent a specific contractual or statutory provision; however, we

have long recognized equitable exceptions to the American Rule. Trs. of Ind. Univ. v.

Buxbaum, 2003 MT 97, ¶ 19, 315 Mont. 210, 69 P.3d 663 (citations omitted). One such

exception is found in the UDJA, in that § 27-8-313, MCA, provides a district court

“discretionary authority for an award of attorney fees” in a declaratory judgment action.

Buxbaum, ¶ 46. We review a district court’s award of attorney fees pursuant to § 27-8-

313, MCA, for an abuse of discretion. Renville v. Farmers Ins. Exch., 2004 MT 366, ¶ 20,

324 Mont. 509, 105 P.3d 280. “A district court abuses its discretion when it acts arbitrarily,

without employment of conscientious judgment, or in excess of the bounds of reason

resulting in substantial injustice.” Kuhr v. City of Billings, 2007 MT 201, ¶ 14, 338 Mont.

402, 168 P.3d 615 (citation omitted).

¶10    Uhlig argues the District Court abused its discretion by limiting her recovery of

attorney’s fees to work performed prior to January 19, 2018, when Allied offered to pay

her medical expenses in exchange for dismissal of the instant lawsuit. Prior to that date,

Uhlig’s counsel had performed 12 hours of work on the case. After that date, Uhlig’s

counsel performed an additional 206 hours of work. As such, the District Court awarded

slightly less than six percent of the attorney’s fees Uhlig sought.

¶11    In Renville, we adopted the “tangible parameters” test to determine whether attorney

fees are “necessary and proper” under § 27-8-313, MCA. Martin v. SAIF Corp., 2007 MT

234, ¶ 23, 339 Mont. 167, 167 P.3d 916 (citing Renville, ¶ 27). The “tangible parameters”

test provides that attorney fees are “necessary and proper” when “(1) an insurance company
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possesses what the plaintiffs sought in the declaratory relief action; (2) it is necessary to

seek a declaration showing that the plaintiffs are entitled to the relief sought; and (3) the

declaratory relief sought was necessary in order to change the status quo.” United Nat’l

Ins. Co. v. St. Paul Fire & Marine Ins. Co., 2009 MT 269, ¶ 37, 352 Mont. 105, 214 P.3d

1260 (citing Martin, ¶ 23). In United Nat’l Ins. Co., we further clarified that a district court

may only apply the “tangible parameters” test after first determining “if equitable

considerations support the award.” United Nat’l Ins. Co., ¶ 38.

¶12    The District Court found equitable considerations only supported an award of

attorney’s fees for work performed prior to January 19, 2018, and we agree. Before

January 19, 2018, Allied was intractable in its incorrect assertion it was not required to

advance-pay Uhlig’s medical expenses.         After being served with Uhlig’s complaint,

however, Allied’s adjuster, Miller, determined Allied was required to advance-pay Uhlig’s

medical expenses. Miller communicated this to Uhlig on January 19, 2018, and offered to

pay the $4,380 in medical expenses in exchange for dismissal of the declaratory judgment

lawsuit. This matter could have, and should have, ended there. Because Uhlig refused

Allied’s offer, however, the matter dragged on for nearly another year before Uhlig won

summary judgment, and nearly another year after that before the District Court issued its

rulings on attorney’s fees, interest, costs, and the motion to strike Miller’s affidavit. The

District Court found Uhlig’s medical expenses had been paid by Farmers long before

Allied’s January 19, 2018 offer to pay those medical expenses and she was under no

financial duress at the time of that offer.

                                               7
¶13     The District Court correctly found equitable considerations supported an award of

attorney’s fees for work performed prior to January 19, 2018, and therefore applied the

“tangible parameters” test for that time period.       It also correctly found equitable

considerations did not support an award of attorney’s fees for the time period after

January 19, 2018, and did not apply the “tangible parameters” test to work performed after

January 19, 2018. See United Nat’l Ins. Co., ¶ 38. As the equities do not support an award

of attorney’s fees for the time period after January 19, 2018, the District Court did not

abuse its discretion by limiting its attorney’s fee award to work performed prior to that

date.

¶14     We have determined to decide this case pursuant to Section I, Paragraph 3(c) of our

Internal Operating Rules, which provides for memorandum opinions. In the opinion of the

Court, the case presents a question controlled by settled law or by the clear application of

applicable standards of review.

¶15     Affirmed.

                                                 /S/ INGRID GUSTAFSON

We concur:

/S/ MIKE McGRATH
/S/ JAMES JEREMIAH SHEA
/S/ BETH BAKER
/S/ JIM RICE

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