Court Opinion

ID: 1035995
Source: CourtListenerOpinion
Date Created: 2013-08-01 00:01:37.913634+00
Date Added: 2024-06-11T12:45:42.092347
License: Public Domain

FILED
                            NOT FOR PUBLICATION                                     JUL 30 2013

                                                                            MOLLY C. DWYER, CLERK
                     UNITED STATES COURT OF APPEALS                           U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

CECILIA V. GREGORIO,                              No. 11-17490

              Plaintiff - Appellant,              D.C. No. 2:10-cv-00407-JRG

  v.
                                                  MEMORANDUM*
GEICO GENERAL INSURANCE
COMPANY, et al.

              Defendant - Appellee.

                    Appeal from the United States District Court
                             for the District of Arizona
                 Joseph R. Goodwin, Chief District Judge, Presiding

                        Argued and Submitted June 13, 2013
                             San Francisco, California

Before: SCHROEDER and CALLAHAN, Circuit Judges, and VANCE, Chief
District Judge.**

       Plaintiff-Appellant Cecilia Gregorio appeals the district court's grant of

summary judgment to defendant GEICO Insurance Company on her claims of

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
       **
             The Honorable Sarah S. Vance, Chief District Judge for the U.S.
District Court for the Eastern District of Louisiana, sitting by designation.

                                           1
breach of contract and breach of good faith and fair dealing. These claims are

based on GEICO's refusal to pay Gregorio uninsured/underinsured ("UM/UIM")

benefits under her umbrella insurance policy. We have jurisdiction over this appeal

pursuant to 28 U.S.C. § 1291, and we affirm.1

                                           I

      This court reviews de novo the district court's grant of summary judgment.

Buono v. Norton, 371 F.3d 543, 545 (9th Cir. 2004). "Summary judgment is

appropriate when there is no genuine issue of material fact and the moving party is

      1
              As a preliminary matter, we address GEICO's motion to strike several
portions of Gregorio's Excerpts of Record (EOR). GEICO contends that these
documents were not filed with the district court, as is required by Federal Rule of
Appellate Procedure 10(a). That motion is GRANTED IN PART.
       Gregorio has waived any arguments based on facts not before the district
court when it rendered summary judgment. See Peterson v. Highland Music, Inc.,
140 F.3d 1313, 1321 (9th Cir. 1998). We therefore will not admit into the record
documents filed in the district court after its consideration of the summary
judgment motion. Accordingly, we strike those portions of Gregorio's EOR that
were not before the district court before it denied Gregorio's motion to reconsider
the grant of summary judgment, to wit:
       (1) All pages of plaintiff's Exhibit 1 except 1-8, 14-21, 25-26, 29-30, 37,
              41-53, 58-59, 62-63, 65-68, 85-105, 110-125, 129-152, 162-173, 182-
              185, 194-201, 206-212, 214-221, 226-233, 235, and 238-241.
       (2) ER Vol. 2, page 82 (the first page of plaintiff's Exhibit 2).
       (3) Plaintiff's Exhibit 5.
       GEICO's motion to strike is denied insofar as it relates to Exhibit 1, pages 1-
8, 66-68, 85, 129, 151-52, 210-12; and Exhibit 2, page 2, because these documents
were presented to the district court with plaintiff's motion for reconsideration.

                                          2
entitled to judgment as a matter of law." Karuk Tribe of Cal. v. U.S. Forest Serv.,

681 F.3d 1006, 1017 (9th Cir. 2012).

                                           II

      The district court was correct in holding that Gregorio's umbrella policy

unambiguously lacks UM/UIM coverage. The policy expressly excludes

"[p]ersonal injury or property damage resulting from an uninsured or underinsured

motorist claim unless a premium is shown for the uninsured or underinsured

motorist coverage in the declarations." The declarations page, in turn, does not list

a premium for UM/UIM coverage. Moreover, the umbrella policy provides only

third-party liability coverage, as it covers only "damages an insured must pay (1)

legally; or (2) by agreement with [GEICO's] written consent; because of personal

injury or property damage covered by this policy." These provisions

unambiguously demonstrate that the umbrella policy does not provide UM/UIM

coverage.

                                           III

      Gregorio argues that even if the plain language of the policy does not

include UM/UIM coverage, the district court erred by failing to take into account

her reasonable expectations of coverage.

                                           3
      In Arizona, courts apply the reasonable expectations doctrine to claims

based on standardized insurance contracts. See First Am. Title Ins. Co. v. Action

Acquisitions, LLC, 187 P.3d 1107, 1113 (Ariz. 2008) (en banc); Darner Motor

Sales, Inc. v. Universal Underwriters Ins. Co., 682 P.2d 388, 396-99 (Ariz. 1984).

Arizona courts generally limit the application of the doctrine to four contexts:

      1. Where the contract terms, although not ambiguous to the court, cannot
      be understood by the reasonably intelligent consumer who might check
      on his or her rights, the court will interpret them in light of the objective,
      reasonable expectations of the average insured;
      2. Where the insured did not receive full and adequate notice of the term
      in question, and the provision is either unusual or unexpected, or one that
      emasculates apparent coverage;
      3. Where some activity which can be reasonably attributed to the insurer
      would create an objective impression of coverage in the mind of a
      reasonable insured;
      4. Where some activity reasonably attributable to the insurer has induced
      a particular insured reasonably to believe that he has coverage, although
      such coverage is expressly and unambiguously denied by the policy.

Gordinier v. Aetna Cas. & Sur. Co., 742 P.2d 277, 283-84 (Ariz. 1987) (internal

citations omitted). Gregorio's claim falls into none of these categories.

      The first Gordinier category is not applicable because a reasonably

intelligent consumer could easily understand that there is no suggestion of

UM/UIM coverage in the GEICO policy. The exclusion of UM/UIM coverage is

itself plain, and the coverage provision clearly states that the policy covers only

                                            4
damages the insured must pay. Further, the policy excludes "personal injury to any

insured," and provides that it pays damages "on behalf of," not "to," an insured.

      The second category is inapplicable because Gregorio received a copy of the

policy, which set forth the UM/UIM exclusion in plain language on the third page

of a six-page document. The exclusion was not buried in an unexpected section of

a voluminous policy. Further, the provision hardly "emasculates apparent

coverage," as the coverage provision of the policy states that it applies to the

insured's liability to pay damages, the policy is entitled "Personal Umbrella

Liability Insurance Agreement," and the policy includes no first-party coverage.

      Nor does Gregorio's case fall within either the third or the fourth Gordinier

category. Her threadbare recollection of a nine-year old conversation with a

GEICO representative, in which she does not recall whether UM/UIM coverage

was mentioned, does not provide more than a "mere . . . scintilla of evidence"

supporting her reasonable expectations claim. Anderson v. Liberty Lobby, Inc.,

477 U.S. 242, 252 (1986). Gregorio could not dispute that a different GEICO

representative called her back with a quote for an umbrella policy. That

representative denied having made any representation to Gregorio that UM/UIM

insurance was included in the policy and averred that she explained that the policy

                                           5
was a liability policy. Gregorio could not dispute this testimony because she could

not recall the details of the conversation.

      Thus, the record contains no probative evidence that GEICO engaged in any

activity that would create an objective impression of coverage in the mind of a

reasonable insured, or that induced this particular insured to believe that she had

coverage. See Gordinier, 742 P.2d at 284. Gregorio's recollection is too vague to

indicate that she clearly conveyed to GEICO her desire that UM/UIM coverage be

included in her umbrella policy, much less that GEICO assured her that the

coverage would be included. See First Am. Title Ins. Co., 187 P.3d at 1114 (noting

that a subjective expectation of coverage on the part of the insured, without more,

does not trigger the reasonable expectations doctrine). Deviation from the written

terms of an insurance policy must be based on something more than an insured's

"fervent hope usually engendered by loss," Darner, 682 P.2d at 395, and the

reasonable expectations doctrine "does not require insurers to read their insureds'

minds." Sec. Ins. Co. of Hartford v. Andersen, 763 P.2d 251, 258 (Ariz. Ct. App.

1986), vacated in part, 763 P.2d 246 (Ariz. 1988). Accordingly, the district court

did not err in granting summary judgment.

                                              6
                                            IV

      Given the unambiguous language of the policy, and that Gregorio has failed

to demonstrate that she had a reasonable expectation of UM/UIM coverage, her

bad faith claim against GEICO is also without merit. See Deese v. State Farm

Mut. Auto. Ins. Co., 838 P.2d 1265, 1267-68 (Ariz. 1992) (en banc) (bad faith

claim requires showing "the absence of a reasonable basis for denying benefits of

the policy and the defendant's knowledge or reckless disregard of the lack of a

reasonable basis for denying the claim").

                                            V

      Gregorio also contends that the district court erroneously relied on two

articles describing umbrella policies in its analysis of Gregorio's coverage. The

district court's citation of the articles was not an abuse of discretion since the court

referred to the articles only to confirm its legal conclusion that Gregorio's policy

provided only liability insurance. In any event, because the policy at issue

unambiguously excluded UM/UIM coverage and Gregorio's reasonable

expectations claim fails, any such error is harmless.

                                            VI

      Because we hold that Gregorio's reasonable expectations claim fails on the

merits, we need not address GEICO's argument that the claim is barred by the

                                            7
statute of limitations. See United States v. Gonzales, 669 F.3d 974, 979 (9th Cir.

2012) (court of appeals "may affirm on any ground supported by the record").

      AFFIRMED.

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