Case Number: A-19-0366
Court Number: Lancaster
Call Date: January 14, 2020
Case Time: 1:00 PM
Case Location: Lincoln
Case Summary
A-19-0366, Michael F. Saif & Mary Sue Saif (Appellants) v. LeMars Insurance Company
District Court for Lancaster County, District Judge Lori A. Maret
Attorney for Appellant: Steven M. Lathrop & Joshua J. Yambor (Hauptman, O’Brien, Wolf & Lathrop, P.C.)
Attorney for Appellee: Michael L. Moran (Engles, Ketcham, Olson & Keith, P.C.)
Summary Judgment: Insurance Policy; Underinsured Motorist; Affirmative Defenses.
Facts:
On October 1, 2014, Michael was cycling on the shoulder of Highway 43 in Lancaster County when he was struck from behind by a pickup driven by Edward Vasa. At the time, Vasa was acting within the scope of his employment with Vasa Construction, which was insured by EMC Insurance Companies up to a $1,000,000 liability amount. Michael suffered extensive injuries as a result of the collision.
At the time of the accident, Michael and Mary held an insurance policy with LeMars, which included underinsured motorist (UIM) coverage up to $500,000. The policy included provisions outlining the duties an insured has after an accident or loss, including that the insured would cooperate with LeMars’ investigation of the claim, submit to examination under oath at the request of LeMars, and authorize LeMars to obtain medical and other relevant records.
In November 2014, Michael informed LeMars of the automobile-bicycle collision and asked that the letter serve as “notice of a potential [UIM] claim.” In April 2015, LeMars consented to Michael’s settlement with Vasa’s insurer for the policy’s limits. LeMars declined to substitute payment. Michael also provided a signed authorization to disclose health information, which had an expiration date 45 days later.
In September 2016, LeMars contacted Michael and asked whether it should expect a UIM claim. Michael responded the next month, informing LeMars that he was still in the process of obtaining medical records. In January 2017, LeMars again contacted Michael asking whether he intended to make a claim under the UIM coverage within his policy. Michael responded that LeMars could expect a demand soon, to which LeMars requested that any such demand also include Michael’s medical records and records reflecting lost wages and earning capacity.
On February 24, 2017, Michael made a demand for the full payment of his $500,000 UIM policy limit. He included various records with the demand. On March 2nd, LeMars acknowledged receipt of Michael’s demand and indicated that it was in the process of reviewing it, and requested additional records. Michael sent the requested records on March 7th. On March 16th, Michael contacted LeMars regarding the status of his demand, to which LeMars responded it was still in the process of review. On April 17th, LeMars requested another authorization for health information, claiming the materials Michael had provided did not include records after September 2016 or any indication of whether Michael required medical treatment prior to the accident. The authorization was not provided. On April 26th, Michael’s counsel contacted LeMars indicating that since they had not received a response to the demand made two months prior, they were going to file suit. On May 2nd, LeMars requested to schedule an examination under oath of Michael and inquired into the status of the second authorization for health information.
Appellants filed suit on May 10, 2017 alleging LeMars erroneously refused his demand for UIM benefits. Mary alleged she was entitled to payment under the UIM coverage on a theory of loss of consortium. LeMars moved for summary judgment claiming there were no genuine issues of material fact that Michael breached the cooperation provision of the policy by depriving LeMars of the opportunity to adjust the claim after he confirmed he was seeking UIM coverage, and that Mary failed to submit a claim to LeMars before filing suit.
Action Taken by Trial Court:
The district court granted LeMars’ motion for summary judgment, finding there were no genuine issues of material fact and that LeMars was entitled to judgment as a matter of law. The court specifically found (1) Michael failed to provide LeMars with requested information and cooperate with its investigation; (2) even if LeMars’ delay in responding to Michael’s demand was too long, such did not allege a prima facie case that LeMars waived the cooperation provision; and (3) Mary did not submit a claim to LeMars prior to filing suit.
Assignments of Error on Appeal:
Appellants claim the district court erred in granting summary judgment, specifically in concluding there were no genuine issues of material fact, and LeMars was entitled to judgment to judgment as a matter of law insomuch as the court found (1) Michael breached the cooperation provision in the insurance policy and that the breach was material and prejudicial to LeMars; (2) Mary was required, and failed, to make a demand for benefits prior to filing suit; and (3) LeMars did not forfeit its ability to assert the affirmative defenses as a result of unreasonable delay in investigating Michael’s claim and failure to respond to Appellants’ demand in a timely manner.