Court Opinion

ID: 9788846
Source: CourtListenerOpinion
Date Created: 2023-08-31 01:20:18.926484+00
Date Added: 2024-06-11T15:43:15.454766
License: Public Domain

BUSTAMANTE, Judge (specially concurring). {80} I concur fully with the Opinion in its resolution of the ambiguity issue and its handling of Discussion Sections B(3) and C. I also concur in Discussion Section D, with the exception of the last sentence of paragraph 74. I also agree that the result in Discussion Section B(2) of the Opinion should be affirmance of the trial court; but I cannot agree with the majority’s analysis.1  {81} My disagreement begins with the procedural posture of the case and the standard of review applied. The case was submitted to the trial court on cross motions for summary judgment supported by stipulated facts, affidavits and deposition testimony. As the Opinion makes clear, the affidavits and deposition materials were replete with factual disagreements concerning the actuarial reality of Allstate’s premium structure. The factual disagreements involved basic, material issues such as whether Allstate took into account “loss severity” as well as “loss frequency” in setting premiums, and whether the multi-ear premium was designed to eover-and thus charged for-expected losses for more than two vehicles. {82} Given these factual discrepancies, the matter was not proper for true summary judgment. Regardless, the parties apparently agreed to allow the trial court to decide the case on the material submitted without an actual trial. Montano explicitly left it to the trial court to “ascertain and determine the facts” based on the submitted material. In this posture, the trial court understood it was to decide the case on the merits, resolving questions of faets as it saw fit. And the trial court did so, deciding for example, that Montano did not pay uninsured motorist premiums on more than two vehicles. Thus, the trial court did not enter a summary judgment. It made a decision on the merits. As such, it is improper-even impossible-for this Court to apply the summary judgment de novo standard of review, even if the parties urge us to do so. Rather, the normal substantial evidence standard of review should be applied. Lightsey v. Marshall, 1999-NMCA-147, ¶ 15, 128 N.M. 353, 992 P.2d 904 (“[W]e review whether there is substantial evidence to support the district court’s conclusion, not whether the court could have reached another conclusion.”). {83} Applying the substantial evidence standard of review, I agree with affirmance. The material submitted by Allstate and referenced in the Opinion is not inherently incredible, and, as in any trial, the fact finder could rationally choose to believe it rather than Montano’s presentation. This is all the Opinion needs to do. {84} Instead, in keeping with its decision to apply a de novo standard, the majority launches into a full-blown discussion of the actuarial issue. Apart from being improper and unnecessary, the discussion is unfairly framed, misconstrues Rodriguez v. Windsor Ins. Co., and results in unfortunate and erroneous conclusions about the policy at issue here and the courts’ role in stacking litigation. {85} First, the issue is unfairly framed in that the Opinion both accepts the factual findings made by the trial court and also refuses to consider Montano’s factual arguments because they were not relied on by the trial court. See paragraphs 56 and 59 through 64. If the majority truly conducted a de novo review, it would consider Montano’s arguments and factual assertions on their full merits without regard to the trial court’s decision. Instead, the Opinion simply sweeps away Montano’s primary factual arguments: that the premium for property damage coverage should be included in the total uninsured motorist premium; that Allstate’s premium includes a value for loss severity; and that the premium includes Allstate’s risk for all cars it insures. {86} The approach is actually a hybrid. The Opinion deals with the facts as if it is conducting a substantial evidence review. But, because the majority believes it is conducting a de novo review, the Opinion uses the truncated facts it does consider to decide the issue as a matter of law. {87} This approach allows the majority to do more than simply affirm the trial court in this case. In paragraph 74, the majority all but declares-as a matter of law-that Allstate’s pricing structure meets Rodriguez’ requirement that insureds receive what they pay for. The Opinion thus forecloses future challenges to the actuarial basis of Allstate’s premium. In this procedural posture, that is simply improper. {88} Second, I disagree with the Opinion’s interpretation and use of Rodriguez to limit the role of the courts in assessing whether insureds are “getting what they pay for.” Having already brushed away Montano’s arguments about Allstate’s use of loss severity data as a factual matter, the Opinion in pure dicta proceeds to explain why under Rodriguez it is improper for the courts to review the actuarial issue at any rate. In paragraphs 58 and 59 the majority opines that the actuarial inquiry is improper because the “contention lies outside the realm of contractual expectation, since it is unlikely a hypothetical purchaser will delve into an insurer’s actuarial analysis.” {89} The majority’s interpretation of Rodriguez is diametrically opposed to the notion of the “hypothetical reasonable insured” described in the case. The defendant insurance company in Rodriguez argued that under our prior case law, “it was the particular expectations of the parties that mattered.” 118 N.M. at 130, 879 P.2d at 762 (internal quotation marks omitted). Thus, the defendant in Rodriguez attempted to isolate the expectation analysis to the specific insured’s understanding, knowledge and experience. Recognizing that few insureds will understand stacking, the Supreme Court rejected this approach making it clear that the correct inquiry was the expectations of the hypothetical reasonable insured; an abstract “Everyperson.” Id. “Reasonable expectations” are created and measured in large part by public policy preferences stated in our statutes and case law. {90} Using this approach it is irrelevant whether any insured would care or be able to delve into the actuarial details of Allstate’s premium structure. What is relevant is New Mexico’s strong policy favoring uninsured motorist coverage and stacking. Our uninsured motorist statute and case law require that insureds get what they paid for. If a premium is calculated taking into account the risks of loss severity and frequency associated with stacking in multi-vehicle policies, the insurance company must provide the benefit of that calculation through stacking. {91} The Opinion concludes in paragraphs 65 and 66 that the courts should leave the actuarial inquiry to the insurance commissioner. Its musing is prompted partly by its mistaken view of Rodriguez and partly by unwarranted misgivings about the courts’ ability to undertake the analysis. I reject the notion that the courts cannot or should not entertain the issue. Courts regularly delve into matters more grave and more complicated than this. I appreciate that the burden on the plaintiff to prove the case will be heavy. Montano did not merit summary judgment in his favor based on his showing; nor did Allstate. These circumstances are no reason to foreclose the inquiry. {92} The procedural posture of the case argues for caution and circumspection on our part. Instead, confusing the procedural posture, the majority refuses to consider crucial portions of Montano’s case; then chides him for failing to “prove” his case; and, finally, decides the issue as a matter of law. See paragraphs 58, 59, 63, 64, 65, and 66. {93} For these reasons I can only concur in the result of this portion of the Opinion.  . I do not dissent on the merits and urge a decision in favor of Montano because of the serious questions of fact presented by the parties' submissions. These questions of fact preclude a decision as a matter of law in favor of either side, at least as to the time frame specifically at issue. There is not enough in the record to be able to decide as a matter of law whether as of 1997 Allstate was actually charging for a greater risk than it was accepting. As a reviewing court we are properly bound by the trial court’s factual decision on the issue. It would be appropriate, however, to conclude — as a matter of law — that Allstate's structure was a subterfuge as of 1989 when it charged a higher premium than the prior year while at the same time precluding stacking entirely. The difficulty is that we do not know how conditions changed in the subsequent eight years.