Court Opinion

ID: 4514233
Source: CourtListenerOpinion
Date Created: 2020-03-10 15:03:44.554631+00
Date Added: 2024-06-11T09:44:57.264494
License: Public Domain

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be                                       FILED
regarded as precedent or cited before any                               Mar 10 2020, 6:55 am

court except for the purpose of establishing                                CLERK
the defense of res judicata, collateral                                 Indiana Supreme Court
                                                                           Court of Appeals
                                                                             and Tax Court
estoppel, or the law of the case.

ATTORNEY FOR APPELLANT                                   ATTORNEY FOR APPELLEE
Alex Mendoza                                             Daniel W. Glavin
Hammond, Indiana                                         Schererville, Indiana

                                          IN THE
    COURT OF APPEALS OF INDIANA

Larry Mickow,                                            March 10, 2020
Appellant-Plaintiff,                                     Court of Appeals Case No.
                                                         19A-CT-1546
        v.                                               Appeal from the Lake Superior
                                                         Court
AAA Insurance MemberSelect                               The Honorable Stephen E.
Insurance Company,                                       Scheele, Judge
Appellee-Defendant                                       The Honorable Diane K.
                                                         Schneider, Judge Pro Tempore
                                                         Trial Court Cause No.
                                                         45D05-1808-CT-481

Altice, Judge.

                                         Case Summary

Court of Appeals of Indiana | Memorandum Decision 19A-CT-1546 | March 10, 2020                  Page 1 of 7
[1]   Larry Mickow filed a complaint against his insurer MemberSelect Insurance

      Company (MemberSelect) alleging breach of contract and bad faith in the

      handling of his underinsured motorist (UIM) claim arising from a motor vehicle

      collision. The trial court granted summary judgment in favor of MemberSelect,

      and Mickow now appeals.

[2]   We affirm.

                                       Facts & Procedural History

[3]   On August 12, 2016, Mickow and his passenger, Gregory Klen, were involved

      in a motor vehicle collision caused by Amanda Faye Ledger. Mickow and

      Klen sustained permanent injuries and incurred medical bills and lost wages.

      Ledger’s insurers eventually paid their policy limits to Mickow totaling $50,000.

[4]   At the time of the collision, Mickow had automobile insurance through

      MemberSelect under policy number AUTO28462267 (the Policy). On January

      5, 2018, MemberSelect paid Mickow $25,000, which represented the limits of

      the medical payments coverage under the Policy. Thereafter, on July 28, 2018,

      MemberSelect received a formal demand from Mickow’s attorney for $50,000

      under the Policy’s UIM coverage, which had a limit of $100,000.

[5]   On August 2, 2018, MemberSelect tendered $25,000, which it believed to be the

      remaining UIM coverage due after accounting for the $50,000 collected from

      the tortfeasor’s insurers and the $25,000 paid by MemberSelect under the

      medical payments coverage. Upon tendering payment, MemberSelect

      Court of Appeals of Indiana | Memorandum Decision 19A-CT-1546 | March 10, 2020   Page 2 of 7
      requested a policy release and advised that the release was necessary. Counsel

      for Mickow refused the release, apparently believing that MemberSelect owed

      Mickow $50,000, rather than $25,000, under the UIM coverage provision. 1

[6]   One week later, on August 9, 2018, Mickow filed suit against MemberSelect

      based on breach of contract and bad faith. 2 Service, however, was not issued

      until August 22, 2018. On September 5, 2018, counsel for MemberSelect filed

      an appearance and sought an extension of time to answer the complaint, and

      MemberSelect issued “a check in the amount of $25,000 to Alex Mendoza Law

      LLC and Larry D. Mickow.” Appendix at 84. This amount, according to

      MemberSelect, represented the remaining UIM coverage limit, which had been

      previously tendered. On October 26, 2018, MemberSelect answered the

      complaint, in part, stating affirmatively that it had paid all sums owed under the

      Policy and satisfied its legal obligations to Mickow.

[7]   Thereafter, on January 23, 2019, MemberSelect filed a motion for summary

      judgment. MemberSelect designated as evidence the complaint, its answer, the

      Policy, and the affidavit of Shalawn Frazier, a claim specialist with

      MemberSelect. In response to the summary judgment motion, Mickow argued,

      based on a different interpretation of the Policy, that MemberSelect had not

      1
       Mickow argued below – both implicitly in his complaint and directly on summary judgment – that the
      amount due for UIM coverage could not be reduced by the amount already paid to him for medical
      payments coverage. He does not make this argument on appeal.
      2
       In the same complaint, Klen asserted similar claims against his own insurer for UIM coverage. Those
      parties and claims are not at issue in this appeal.

      Court of Appeals of Indiana | Memorandum Decision 19A-CT-1546 | March 10, 2020                 Page 3 of 7
       paid the full amount due for UIM coverage. He also argued that MemberSelect

       acted in bad faith because along with its tender of the $25,000 in August 2018,

       it requested a release.

[8]    Following a short summary judgment hearing, the trial court issued a final

       order granting summary judgment in favor of MemberSelect in all respects.

       Mickow now appeals.

                                             Standard of Review

[9]    We review a summary judgment ruling de novo, applying the same standard as

       the trial court. Hughley v. State, 15 N.E.3d 1000, 1003 (Ind. 2014). That is,

       drawing all reasonable inferences in favor of the non-moving party, summary

       judgment is appropriate if the designated evidence shows that there is no

       genuine issue as to any material fact and that the moving party is entitled to

       judgment as a matter of law. Id.; Ind. Trial Rule 56(C).

                                           Discussion & Decision

                                          1. Breach of Contract Claim

[10]   With respect to the claim for breach of contract, Mickow argues that as a matter

       of law MemberSelect has not paid the full benefits due for UIM coverage. His

       argument is difficult to follow.

[11]   We begin by setting out what the parties agree on. First, the $100,000 limit for

       UIM coverage is reduced by the $50,000 paid by the tortfeasor’s insurers.

       Court of Appeals of Indiana | Memorandum Decision 19A-CT-1546 | March 10, 2020   Page 4 of 7
       Second, the Policy provides that any payment made by MemberSelect under

       the medical payments coverage, here $25,000, “shall be applied toward any

       settlement, judgment or award that [Mickow] receives under Part III –

       Uninsured or Underinsured Motorists Coverage.” Appendix at 58. Finally,

       “MemberSelect paid … $25,000 under the [UIM] policy to Mickow and Alex

       Mendoza Law LLC.” Appellant’s Brief at 6.

[12]   Despite the above, Mickow contends that according to the plain language of the

       Policy he is still owed $8332.50 from MemberSelect for UIM coverage. His

       argument in this regard follows:

               [A]nalysis of the [medical payments] coverage Part II(3) of the
               policy specifically refers to what the insured receives, meaning
               what he actually receives in his pocket. It specifies that [medical
               payments coverage] payments are applied toward any
               “settlement” that person “receives” under the UIM coverage.
               Here MemberSelect did not intend for Mickow to actually
               receive all of the funds, and, in fact, Mickow only received
               $16,667.50.[ 3] Thus, the [medical payments coverage] payment
               of $25,000 is added to $16,667.50 plus the $50,000 liability limit
               from the tortfeasor to equal only $91,766.50, which is $8,332.50
               short of the policy limit of $100,000.

       Appellant’s Brief at 9. The logic in this line of reasoning escapes us.

       3
        Attorney fees and expenses in the amount of $8332.50 were deducted from the UIM payment by Mickow’s
       counsel and then Mickow received the balance.

       Court of Appeals of Indiana | Memorandum Decision 19A-CT-1546 | March 10, 2020            Page 5 of 7
[13]   Under the plain language of the Policy, a credit for the $50,000 in payments

       from the tortfeasor’s insurers and the $25,000 medical payments coverage

       payment apply to reduce the amount of UIM coverage owed to Mickow to

       $25,000. This is precisely the amount Mickow received from MemberSelect on

       August 2, 2018, and then again on September 5, 2018. It is of no moment that

       Mickow satisfied his attorney’s fees and costs out of this UIM payment. The

       trial court properly granted summary judgment in favor of MemberSelect on the

       breach of contract claim.

                                              2. Bad Faith Claim

[14]   Our Supreme Court has made the following general observations regarding an

       insurer’s duty to deal with its insured in good faith.

               The obligation of good faith and fair dealing with respect to the
               discharge of the insurer’s contractual obligation includes the
               obligation to refrain from (1) making an unfounded refusal to pay
               policy proceeds; (2) causing an unfounded delay in making
               payment; (3) deceiving the insured; and (4) exercising any unfair
               advantage to pressure an insured into a settlement of his claim.

       Erie Ins. Co. v. Hickman by Smith, 622 N.E.2d 515, 519 (Ind. 1993).

[15]   Here, Mickow argues that the trial court improperly granted summary

       judgment because MemberSelect failed to establish as a matter of law that it

       acted in good faith. On the contrary, MemberSelect provided undisputed

       evidence, via Frazier’s affidavit, that it tendered a $25,000 UIM payment to

       Mickow within four days of his demand (a demand for twice what was actually

       Court of Appeals of Indiana | Memorandum Decision 19A-CT-1546 | March 10, 2020   Page 6 of 7
       owed). As discussed above, the amount tendered was the full amount

       remaining due under the Policy. About a month later, after Mickow filed suit,

       MemberSelect again sent a check for $25,000 to Mickow and his attorney.

[16]   Mickow asserts that MemberSelect made an unfounded refusal to pay policy

       proceeds, tried to exercise unfair settlement pressure, and compelled him to

       initiate litigation in order to recover the UIM benefits under the Policy. These

       assertions are apparently based on the fact that MemberSelect included a

       release agreement with the first tendered payment of the remaining UIM

       benefits.4 The inclusion of a release agreement along with the tender of full

       payment under the UIM provision did not, as a matter of law, constitute bad

       faith. Further, Mickow’s assertion that MemberSelect refused to pay the policy

       limits is without basis in fact. Because no factual dispute exists as to whether

       MemberSelect breached its duty of good faith and fair dealing, we conclude that

       the trial court properly granted summary judgment on this claim.

[17]   Judgment affirmed.

       Robb, J. and Bradford, C.J., concur.

       4
         On appeal, Mickow makes assertions of fact that are not based on the designated evidence. For example,
       he claims that his counsel requested payment of the undisputed amount without a release. Frazier’s affidavit,
       the only evidence before us, simply indicates that counsel refused the requested release. Moreover, there are
       no facts indicating, as suggested by Mickow, that MemberSelect misrepresented the applicable policy
       provisions relating to coverage issues in violation of Ind. Code § 27-4-1-4.5(1). Nor did MemberSelect offer
       Mickow “substantially less than the amounts ultimately recovered” in this action in order to compel him to
       institute litigation to recover amounts due under the Policy. I.C. § 27-4-1-4.5(7).

       Court of Appeals of Indiana | Memorandum Decision 19A-CT-1546 | March 10, 2020                    Page 7 of 7