Court Opinion

ID: 2672842
Source: CourtListenerOpinion
Date Created: 2014-05-07 17:38:16.892533+00
Date Added: 2024-06-11T12:38:38.440803
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

PROGRESSIVE GULF INSURANCE                No. 09-16487
COMPANY, an Ohio corporation,
               Plaintiff-Appellant,          D.C. No.
                                          2:05-cv-01067-
                 v.                          BES-PAL

RANDALL K. FAEHNRICH,
individually and as natural parent          OPINION
and/or legal guardian of RANDY
FAEHNRICH and CHRISTIAN
FAEHNRICH, minors; TONI A.
FAEHNRICH, individually and as
natural parent and/or legal guardian
of RANDY FAEHNRICH and
CHRISTIAN FAEHNRICH, minors;
DOES I THROUGH X; ROE BUSINESS
ENTITIES I THROUGH X; inclusive,
               Defendants-Appellees.

      Appeal from the United States District Court
               for the District of Nevada
      Brian E. Sandoval, District Judge, Presiding

                Argued and Submitted
      October 6, 2010—San Francisco, California

                      Filed May 7, 2014
2         PROGRESSIVE GULF INS. CO. V. FAEHNRICH

        Before: Andrew J. Kleinfeld, Susan P. Graber,
          and Richard C. Tallman,* Circuit Judges.

                       Per Curiam Opinion

    *
    Judge Beezer was a member of the panel but passed away after oral
argument. Judge Tallman was drawn to replace him. He has read the
briefs, reviewed the record, and listened to the audio recording of oral
argument held on October 6, 2010.
          PROGRESSIVE GULF INS. CO. V. FAEHNRICH                       3

                           SUMMARY**

                     Nevada Insurance Law

    The panel reversed and remanded to the district court for
entry of summary judgment in favor of Progressive Gulf
Insurance Company after the Nevada Supreme Court
answered a certified question concerning choice-of-law in an
insurance contract.

    The panel certified a question to the Nevada Supreme
Court, and the Nevada Supreme Court rephrased the question.
The Nevada Supreme Court held that Nevada public policy
did not “preclude giving effect to a household exclusion
clause in an automobile liability insurance policy delivered in
Mississippi to Mississippi residents and choosing Mississippi
law as controlling, where Mississippi law permits household
exclusions but the effect of the exclusion is to deny Nevada
residents who were injured in Nevada recovery of the
minimum coverages specified in NRS 485.3091.”

    The panel held that because Mississippi law applied,
summary judgment should have been granted in favor of
Progressive Gulf Insurance Company where the parties
stipulated that if Mississippi law applied, there was no
coverage under the Progressive Gulf Insurance Company
policy.

  **
     This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
4       PROGRESSIVE GULF INS. CO. V. FAEHNRICH

                        COUNSEL

Dennis M. Prince, Prince & Keating LLP, Las Vegas,
Nevada, for Plaintiff-Appellant.

Brett A. Carter, Benson Bertoldo Baker & Carter, Chtd., Las
Vegas, Nevada, for Defendants-Appellees.

                         OPINION

PER CURIAM:

    Progressive Gulf Insurance Company seeks review of the
district court’s order denying its motion for summary
judgment and of a later order entering judgment in favor of
the defendants. The sole issue before us is whether Nevada
or Mississippi law applies to the parties’ insurance contract.
Because Mississippi law applies, we reverse the judgment of
the district court.

    Randall and Toni Faehnrich lived in Mississippi with their
two minor children. They contracted with Progressive Gulf
for automobile insurance. The policy was delivered in
Mississippi. It covered cars garaged in Mississippi, bearing
Mississippi license plates, driven by Mississippi-licensed
drivers. The policy specified that it was governed by
Mississippi law.

   The Faehnrichs divorced and, in 2003, Toni Faehnrich
moved to Nevada. On June 8, 2003, Toni Faehnrich was
involved in a rollover vehicle accident while the two children
were passengers in her car. Randall Faehnrich presented a
bodily injury claim to Progressive Gulf on behalf of the
            PROGRESSIVE GULF INS. CO. V. FAEHNRICH                       5

children, which Progressive Gulf denied, citing the policy’s
family-member exclusion.

     The parties stipulated that, “if Mississippi law is
applicable, there is no coverage under the terms and
conditions of the Progressive policy.” We certified the
following question to the Nevada Supreme Court:1

               Does Nevada’s public policy preclude
           giving effect to a choice-of-law provision in
           an insurance contract that was negotiated,
           executed, and delivered while the parties
           resided outside of Nevada, when that effect
           would deny any recovery under Nevada
           Revised Statutes section 485.3091 to Nevada
           residents who were injured in Nevada?

   The Nevada Supreme Court chose to rephrase the
question, as is its prerogative. Rephrased, the question the
Nevada Supreme Court answered was:2

           Does Nevada public policy preclude giving
           effect to a household exclusion clause in an
           automobile liability insurance policy
           delivered in Mississippi to Mississippi
           residents and choosing Mississippi law as
           controlling, where Mississippi law permits
           household exclusions but the effect of the
           exclusion is to deny Nevada residents who

 1
     Progressive Gulf Ins. Co. v. Faehnrich, 627 F.3d 1137 (9th Cir. 2010).
 2
   Progressive Gulf Ins. Co. v. Faehnrich, No. 57324, 2014 WL 1258808,
at *2 (Nev. March 27, 2014).
6             PROGRESSIVE GULF INS. CO. V. FAEHNRICH

             were injured in Nevada recovery of the
             minimum coverages specified in NRS
             485.3091?

    The Nevada Supreme Court answered this question in the
negative, holding that “giving effect to the choice-of-law
provision in the parties’ automobile insurance policy does not
violate Nevada’s public policy.”3 Because Mississippi law
applies, summary judgment should have been granted in
favor of Progressive Gulf. The facts and reasoning are fully
set out in the Nevada Supreme Court’s decision, Progressive
Gulf Ins. Co. v. Faehnrich, No. 57324, 2014 WL 1258808
(Nev. March 27, 2014), which we attach as an appendix.

   REVERSED AND REMANDED for entry of summary
judgment in favor of Progressive Gulf Insurance Company.

    3
        Progressive Gulf Ins. Co., 2014 WL 1258808, at *6.
PROGRESSIVE GULF INS. CO. V. FAEHNRICH   7

             APPENDIX
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