Court Opinion

ID: 9855200
Source: CourtListenerOpinion
Date Created: 2023-09-24 06:20:53.626583+00
Date Added: 2024-06-11T09:23:43.397771
License: Public Domain

ROONEY, Justice (Retired),
dissenting in part and concurring in part.
I dissent in Case No. 93-27, and I concur in Case No. 93-26, concurring in the result only as to one issue therein.
Donna R. Shrader and Terry Shrader (hereinafter “Insureds”) brought an action against their insurance carrier, State Farm Mutual Automobile Insurance Company (hereinafter “Insurer”), for damages occasioned to them in a collision between their automobile, in which they were riding, and an automobile owned and operated by Seth T. Barbour, who was not insured. The insurance policy issued to Insureds by Insurer required payment to Insureds by Insurer for “damages for bodily injury an insured is legally entitled to collect from the owner or driver of an uninsured motor vehicle” up to the coverage limit of $25,000 per person or $50,000 per accident.
The matter was tried to a jury in district court. The jury answered the issues presented to it by the district court in a special verdict form as follows:
1. What are the amount of damages the Shraders are legally entitled to collect from the owner or driver of the uninsured vehicle? (Exclude medical expenses)
*840Donna R. Shrader $ 70,000
Terry Shrader $ 9,500
2. Did the defendant^] State Farm[J breach its duty of good faith and fair dealing owed to the plaintiffs?
Yes X No
3. If your answer to question 2 was “yes[,”] what total amount of damages do you find [was] sustained by the plaintiffs from the breach for:
Donna R. Shrader $ 25,000
Terry Shrader $ 25,000
4. Did the defendant, State Farm, breach its statutory duty by unreasonably and without cause refusing to pay the full amount of a loss covered by the policy?
Yes X No _
5. Did the defendant, State Farm, through its officers, and/or employees, engage in willful and wanton misconduct so that punitive damages should be awarded later?
Yes X No _
Thereafter, the court granted Insurer’s motion, which had been previously taken under advisement, for a directed verdict on the issue of willful and wanton misconduct — the basis for the award of punitive damages.
The matter is before us on an appeal by each party. Farmers Insurance Exchange filed an amicus curiae brief in support of Insurer’s position in Insureds’ appeal.
Case No. 93-27: Insureds’ Appeal
Insureds word the issue in this appeal:
When a jury verdict of first party bad faith is supported by substantial evidence and that bad faith was intentional, dishonest, and institutionalized, should the trial court be allowed to disregard that same jury’s verdict of willful and wanton misconduct[?]
Insurer words it:
Was the jury’s finding that the Shraders were entitled to punitive damages unsupported by substantial evidence, such that the District Court correctly granted Appel-lee State Farm’s motion for directed verdict on the issue of punitive damages?
Dissenting from the majority of the Court, I would affirm the granting of a directed verdict by the trial court against Insureds on the issue of punitive damages.
The impropriety of the recognition of a bad faith tort and of an award of punitive damages under the circumstances of this case was adequately addressed in the well reasoned dissents of Justice Thomas and Justice Golden in McCullough v. Golden Rule Insurance Co., 789 P.2d 855 (Wyo.1990), a case relied upon herein by the majority of the Court. That said in those dissents does not need to be repeated here. This ease exemplifies the difficulty, if not the impossibility, of establishing a clear line between right and wrong under the holding of the majority in McCullough. The potential for inconsistencies and uncertainties under the majority holding in McCullough should be removed.
Accordingly, I would overrule McCullough and affirm the grant of a directed verdict by the trial court in this case.
Case No. 93-26: Insurer’s Appeal
Insurer presents seventeen issues in this appeal. Among them are:
2. Does the insured have the burden of proving that the other motorist was uninsured, legally liable for damage to the insured, and the amount of this liability?
3. Does a claim for uninsured motorist benefits become ex contractu and thus payable only after the extent of damages recoverable from the uninsured motorist has been determined?
4. Under Wyoming law can an insured bring a direct action against the insurer to adjudicate the amount of damages an insured is legally entitled to collect from the driver of an uninsured vehicle?
The other issues concern “bad faith” or “good faith and fair dealing.”
Insureds present five issues, including:
1.) Given the public policy of Wyoming Statute § 31-10-101, must the insureds under uninsured motorist coverage reduce their claim to judgment before they can *841proceed against their insurance company for its breach of contract and bad faith?
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4.) Did the jury instructions as given prejudice the rights of State Farm under the law?
5.) Did the trial court abuse its discretion in assessing costs and attorney’s fees against State Farm?
The other two issues concern the tort of bad faith.
As stated in the majority opinion, the question is whether or not the fault of the uninsured motorist and the amount of damages suffered by Insureds may be determined in a direct action against Insurer. The majority of the Court holds that they can, referring to similar holdings in other states. It notes that the language of the policy provides for payment of that amount which Insureds are “legally entitled to collect from the owner or driver of an uninsured motor vehicle ” and that such requires the ability to establish fault on the part of the uninsured motorist which gives rise to damages and to prove the extent of those damages. As long as the factual issues as to liability and damages can be properly placed by the fact finder, I agree with the majority of the Court that a direct action would be permissible. However, I believe that it would be difficult to properly place such issues. The danger of over emphasis on the contractual situation to the detriment consideration of the tort liability is great. A just result would seem to be more certain if the tort issues were first established in an action between Insureds and the uninsured motorist. I believe that such would not only be proper but be preferred. Something seems to be wrong in allowing the uninsured motorist to depart without penalty if he was the cause of the damages. In the event he is worth millions of dollars, why should an insurance company, a stranger to him, be required to pay for the damages caused by him? A more just outcome would seem to result in mandating the establishment of liability and amount of damages in a separate action, with the amount “legally entitled to collect” being that subject to collection but not collectible from the uninsured motorist as a practical matter.
In any event, the amount “legally entitled to collect” was not properly determined in this case. The extent of fault, and therefor the amount of damage award, was not properly determined. Wyoming is a comparative negligence state. The jury was not properly instructed to determine the degree of the negligence of each party and thus the amount of damages Insureds were “legally entitled to collect.” Such may more exactly be inquired into in a direct action against Insurer, and the damages adjusted accordingly. Consequently, I specially concur with the result reached by the majority of this Court for the return of this case to the district court, but I would return it only because of the failure to have the comparative negligence of the parties properly determined and not for the reason recited in the majority opinion. However, I emphasize, as stated supra, my belief that a more just result would be obtained if the issues were first determined through an action between the parties to the incident.
With reference to the failure to properly consider the comparative negligence of the parties in this case, as noted supra, the special verdict form made no reference or provision for allocating fault. The verdict form offered by Insureds contained a question requiring a determination of the percentage of fault “attributable to each of’ the drivers of the vehicles, but it was refused.
The court gave thirty-four separate instructions. Instruction No. 20 provided in part pertinent to comparable fault:
The plaintiffs’ damages caused by bodily injury in this case must be determined on the basis of comparable fault of the parties involved in the accident....
The Wyoming law applicable to this ease would require a reduction in the amount of damages awarded to any party by the percentage of faulty if any, that is attributable to that party. The percentage of fault, if any, of the parties seeking to recover damages is compared to each of the persons involved in an accident. The damages of an injured party are reduced by *842the percentage of fault found attributable to that recovering party.
There was nothing in the instruction directing the jury to apportion fault, and there was no other instruction given with reference to it.
Several other instructions emphasize only the necessity to determine causation of the accident by Insureds without any reference to the percentages thereof attributable to each driver, e.g.:
2. ... In order to determine what is owed on the cont[r]act of insurance, you will need to determine all of the plaintiffs’ damages caused by the bodily injury to Donna Shrader.
Instruction No. 4.
Damages must be reasonable. If you should find that the Plaintiffs are entitled to a verdict, you may award them only such damages as will reasonably compensate them for such damages as you find, from a preponderance of the evidence in the case, that they have sustained.
Instruction No. 13.
In this action, the Plaintiffs have the burden of proving by a preponderance of the evidence the following:
1. That the negligence of the uninsured motorist was a proximate cause of injury and damage to the Plaintiffs; and
2. The nature and extent of the injuries claimed to have been so suffered, the elements of Plaintiffs’ damage and the amount thereof.
Instruction No. 15.
If you find that Donna R. Shrader is entitled to damages from the accident by the evidence and instructions, then you may award her spouse[,] Terry Shrader[,] a sum which will constitute fair and reasonable compensation to him for the loss or impairment of his wife’s ability to perform services as a wife due to her injuries.
Instruction No. 19.
Accordingly, I specially concur only in the result reached by the majority of the Court on the issue concerning the propriety of a direct action against Insurer.
Addendum
I concur with the majority of the Court with reference to the other issues in this case.