Court Opinion

ID: 9633608
Source: CourtListenerOpinion
Date Created: 2023-08-22 11:54:05.453481+00
Date Added: 2024-06-11T14:55:17.568183
License: Public Domain

Scholfield, C.J.
(concurring in the result) — While I concur that the judgment should be reversed, I write separately because I disagree with the reasoning employed in the majority opinion to reach that result.
The opinion errs initially by concluding that the statutory requirement of stating the "actual reason" for refusing to renew is ambiguous. The ambiguity, the majority asserts, lies in interpreting "actual reason". There is nothing *264ambiguous about the words "actual reason", nor is any ambiguity created by the context in which the words are used. The word "actual" means "[e]xisting in act or reality; real; — opposed to potential, virtual, theoretical, hypothetical, etc." (Italics omitted.) Webster's New Collegiate Dictionary 10 (2d ed. 1956). The meanings of both "actual" and "reason" require no definition by the Legislature or referral to a dictionary. The meanings are commonly understood. The words of a statute, in the absence of some ambiguity or a special statutory definition, must be given their usual and ordinary meaning and cannot be rewritten by a court. Tauscher v. Puget Sound Power & Light Co., 96 Wn.2d 274, 286, 635 P.2d 426 (1981); Pope & Talbot, Inc. v. Department of Rev., 90 Wn.2d 191, 194, 580 P.2d 262 (1978); In re Estate of Baker, 49 Wn.2d 609, 610, 304 P.2d 1051 (1956).
It is worth noting that the Armstrongs' brief makes no suggestion that the legislative language is ambiguous. The Armstrongs forthrightly state the issue at page 12 of their brief:
The real issue presented in this lawsuit is whether Safeco acted in bad faith in refusing renewal of plaintiffs' policy in October 1984. It is clear that an insurance company must have a valid, good faith reason to justify non-renewal of an auto insurance policy. RCW 48.18.292; RCW 48.01.030.
Despite the absence of any basis for finding an ambiguity in the legislative language, the majority opinion proceeds to add to the statutory basis for nonrenewal of an automobile liability policy the requirement that the insurer's underwriting decisions must
be made solely on the basis of a reasonable application to relevant facts of underwriting principles, standards and rules that can be demonstrated objectively to measure the probability of a direct and substantial adverse effect upon losses or expenses of the insurer in light of the approved rating plan or plans of the insurer then in effect. . .
*265As the majority opinion acknowledges, the above quoted language comes from the insurance code of the state of Maryland as quoted in Lumbermen's Mut. Cas. Co. v. Insurance Comm'r, 302 Md. 248, 487 A.2d 271, 274 (1985). The opinion then states that "[a] similar requirement can be inferred in this state because of the burden of good faith imposed on insurers." Majority opinion, at 262.
This is clearly judicial legislation. It is well settled that courts cannot read into a statute matters which are not there nor modify a statute by construction. This is the rule even if the court's view is that the Legislature left something out unintentionally. Rhoad v. McLean Trucking Co., 102 Wn.2d 422, 426-27, 686 P.2d 483 (1984). A court cannot, under the guise of construction, substitute its judgment for that of the Legislature. Courtright v. Sahlberg Equip., Inc., 88 Wn.2d 541, 563 P.2d 1257 (1977).
The opinion in this case would do an end run around these well settled principles of constitutional law on the theory that the duty of good faith, which an insurance company owes to its customers, requires it. Although the duty to exercise good faith requires fair, honest, and objective dealings by both parties to an insurance policy, Safeco Ins. Co. of Am. v. JMG Restaurants, Inc., 37 Wn. App. 1, 10, 680 P.2d 409 (1984), the duty is limited in application to those functions and responsibilities which have been imposed by law upon the insurance industry. It cannot be used as a bridge to impose specific duties and restrictions upon the insurance industry which go far beyond the clear wording of the legislation involved.
The Maryland statute referred to in Lumbermen's was accompanied by a procedure whereby the question of whether or not the insurance company had complied with the standards for nonrenewal set forth in the statute could be reviewed in a quasi-judicial proceeding before the Maryland insurance commissioner and from there appealed to the judicial system. The wisdom of leaving legislative matters to the Legislature is demonstrated by the majority *266in this case, which would impose certain performance standards upon the insurance industry without providing any procedure for resolving whether a particular company was complying with those standards.
If the reasoning of the majority in this case were followed to its logical extreme, there would be no limitation upon the power of courts, under the guise of discovering legislative intent, to add to legislation substantive provisions believed by judges to be preferable to those enacted by the Legislature.
It is obvious that under the circumstances of this case, the Legislature intended only two limitations upon the right of an insurer to decline to renew. Those are giving 20 days' notice in writing and setting forth the actual reason for refusing to renew. Setting forth the actual reasons can serve several legitimate purposes. The Legislature restricted the right of nonrenewal by RCW 48.18.292(5). This demonstrates a legislative intent to limit the right only to that extent. The fact that a court feels that the statement of the actual reasons does not go far enough and that those reasons should be reasonably related to the insurer's economic and business purposes is immaterial. That is a decision only the Legislature can make. To incorporate wholesale provisions from the insurance code of a sister state in order to have the provision read as an appellate court might like to see it read is clearly unconstitutional. State ex rel. Gunning v. Odell, 58 Wn.2d 275, 278-79, 362 P.2d 254 (1961), modified, 60 Wn.2d 895, 371 P.2d 632 (1962).
Absent a violation of due process or other specific constitutional guaranty, the courts cannot substitute their social and economic beliefs for that of the legislature.
(Footnote omitted.) 16 Am. Jur. 2d Constitutional Law § 316, at 842-43 (1979).
Issue of Fact Is Present
This appeal does present an issue which I believe requires reversal. Whether Safeco stated its "actual reason" *267for refusing to renew is a factual issue requiring resolution by trial.
Very little is presented by Armstrong with respect to this issue. The affidavit of Paul J. Burns includes the attached letter of the Armstrongs to the Insurance Commissioner. In that letter, facts are presented relating to the underinsured motorist claim and the opinion of the Armstrongs that that is the real reason for the refusal to renew. The actual reason for the nonrenewal is understandably important to the Armstrongs and they are entitled to the benefit of the doubt on this issue. The Burns affidavit was unchallenged and is, therefore, sufficient to raise the issue of the accuracy of the reasons stated by Safeco and thus is sufficient to defeat a summary judgment. I would remand the case only for a resolution of the question of whether Safeco complied with the statutory requirement of stating the actual reasons for the nonrenewal. If Safeco is found to have stated accurately the actual reasons, then it is entitled to refuse to renew the Armstrong automobile coverage. The remand should be for this limited purpose only.
Review granted by Supreme Court May 3,1988.