Court Opinion

ID: 4092179
Source: CourtListenerOpinion
Date Created: 2016-10-24 21:01:27.05398+00
Date Added: 2024-06-11T14:36:10.653217
License: Public Domain

FILED
                           NOT FOR PUBLICATION
                                                                           OCT 24 2016
                    UNITED STATES COURT OF APPEALS                      MOLLY C. DWYER, CLERK
                                                                         U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

LEO GABRIELIAN,                                  No.   14-56523

              Plaintiff-Appellant,               D.C. No.
                                                 2:13-cv-04694-BRO-E
 v.

LAFAYETTE LIFE INSURANCE                         MEMORANDUM*
COMPANY,

              Defendant-Appellee.

                   Appeal from the United States District Court
                       for the Central District of California
                 Beverly Reid O’Connell, District Judge, Presiding

                      Argued and Submitted October 7, 2016
                              Pasadena, California

Before: PREGERSON, NOONAN, and PAEZ, Circuit Judges.

      Leo Gabrielian appeals the district court’s grant of summary judgment in

favor of Lafayette Life Insurance Company. We have jurisdiction pursuant to 28

U.S.C. § 1291, and we reverse and remand for further proceedings.

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      1. Reviewing for abuse of discretion, Yeager v. Bowlin, 693 F.3d 1076,

1079 (9th Cir. 2012), we conclude that the district court abused its discretion in

striking from Gabrielian’s declaration his statement that he requested to convert his

term life insurance policy prior to the five-year policy deadline. Under the “sham

affidavit” rule, “a party cannot create an issue of fact by an affidavit contradicting

his prior deposition testimony.” Id. at 1080.

      Here, Gabrielian’s deposition testimony that he “may have” contacted

Lafayette prior to November 11, 2010 is not in “clear and unambiguous” conflict

with his later declaration. Id. Nor does Gabrielian appear to have spontaneously

recalled when he first contacted Lafayette regarding conversion. Rather, he relied

on a letter he had written to Lafayette that he found after his deposition and

attached to his declaration.

      These facts distinguish Gabrielian’s case from Yeager, where the deponent

claimed to recall dozens of facts on the basis of several documents that he

nonetheless failed to attach to a later filed declaration. Id. at 1081. The district

struck the declaration because the inconsistencies were “so extreme” as to

constitute contradiction. Id. This is hardly the case here.

      When Gabrielian’s declaration is considered fully, whether he requested

conversion prior to the five-year deadline is a triable issue of fact. It is far from

                                            2
clear whether Gabrielian was required to submit a formal application for

conversion in order to exercise his right to convert. The policy does not address

what action is required and the parties’ course of conduct does not resolve the

issue.

         2. Gabrielian has also demonstrated that there are triable issues of material

fact regarding whether Lafayette properly permitted the policy to lapse for

nonpayment.1 Lafayette does not argue that a Preauthorized Withdrawal form

(“PAW”) is an invalid method of payment or that Gabrielian’s January 2011 PAW

was untimely. Rather, Lafayette argues that it rightfully rejected the January 2011

PAW because it 1) failed to specify a premium amount; 2) listed an additional

account with fluctuating premium payments; and 3) authorized payments to begin

only after the end of the grace period.

         Gabrielian points to several previous PAWs he submitted over the life of the

policy, however. Three out of the four past PAWs did not specify an amount, yet

were accepted and used to secure payment. Lafayette’s acceptance and use of the

PAWs is consistent with the authorization afforded by the PAW form itself, which

         1
       We review de novo a district court’s decision to grant summary judgment.
Millennium Labs., Inc. v. Ameritox, Ltd., 817 F.3d 1123, 1129 (9th Cir. 2016).
When deciding whether there are any genuine issues of material fact in dispute, we
view the evidence in the light most favorable to the nonmoving party and draw all
reasonable inferences in its favor. Id.
                                             3
permits Lafayette to withdraw “the necessary amount as provided in the policy.”

This broad language could easily extend authorization to an account with

fluctuating premiums as well.

        Further, nothing in the text of the policy or the form would preclude

Lafayette from using the January 2011 PAW to pay past-due premiums. In fact,

the language of the form authorizing Lafayette“to pay the premium, repay a loan or

carry out the other purposes stated herein” could be construed to authorize as

much.

        Viewed in the light most favorable to Gabrielian, the evidence relating to the

PAWs is sufficient to create genuine issues of material fact whether the January

2011 PAW constituted payment of all premiums due.

        3. Finally, we decline to consider the issues Gabrielian raises for the first

time on appeal. Generally, we do not consider new issues unless an exception

applies. Bolker v. Commissioner, 760 F.2d 1039, 1042 (9th Cir. 1985). Gabrielian

argues that the issues regarding the 61-day grace period and equitable estoppel for

lack of notice fall into the exception for purely legal issues. Id. For the “purely

legal” exception to apply, however, the factual record must either be irrelevant or

fully developed. Id. at 1042. Here, the record has not been fully developed on

either issue. Accordingly, the issues have been waived.

                                            4
      REVERSED and REMANDED for further proceedings consistent with

this disposition.

                                   5