2019 WL 2157579

Unpublished opinion. See KY ST RCP Rule 76.28(4) before citing.
NOT TO BE PUBLISHED
Court of Appeals of Kentucky.
ASHLEY CORIO APPELLANT
v.
NATIONAL SPECIALTY INSURANCE COMPANY APPELLEE
NO. 2017-CA-001870-MR
|
RENDERED: MAY 17, 2019
APPEAL FROM FAYETTE CIRCUIT COURT
HONORABLE KIMBERLY N. BUNNELL, JUDGE
ACTION NO. 13-CI-02761
Attorneys and Law Firms
BRIEFS FOR APPELLANT: M. Austin Mehr, Philip G. Fairbanks, Erik D. Peterson, Elizabeth A. Thornsbury, Lexington, Kentucky
BRIEF FOR APPELLEE: David W. Zahniser, Fort Mitchell, Kentucky
BEFORE: CLAYTON, CHIEF JUDGE; DIXON AND LAMBERT, JUDGES.

OPINION AFFIRMING
CLAYTON, CHIEF JUDGE:
*1 Ashley Corio appeals from a Fayette Circuit Court order granting summary judgment to National Specialty Insurance Company (NSIC) on Corio’s claims of bad faith against the insurer for its handling of her personal injury case. She also appeals from a subsequent order of the same court denying her motion to compel discovery. Corio argues that the grant of summary judgment was premature and that disputed issues of material fact exist regarding NSIC’s alleged undervaluation and delayed payment of the claim. Having reviewed the record and applicable law, we affirm the trial court’s rulings.

On July 9, 2012, Corio was injured when a tractor trailer ran a red light and struck her vehicle. Rosedale Transport Inc. owned the tractor trailer and employed the driver, Marty L. Rainey. NSIC was the primary liability insurer of Rosedale’s vehicle. Corio was airlifted to the hospital where she was diagnosed with rib fractures and a left hip contusion. CT scans of her head, neck, chest and spine were otherwise normal. She also experienced joint separation in her shoulder which required reconstructive surgery on July 19, 2012. Three days after the accident, Rosedale received notice that Corio had retained counsel who was investigating the claim and would provide a settlement evaluation and demand.

Corio complained of memory loss following the accident and consulted Dr. Maria Pavez, a neurologist. Corio also consulted several other medical providers for symptoms including persistent headaches, hip, back and shoulder pain, insomnia, and anxiety.

In early April 2013, Corio was involved in a rear-end automobile collision. She went to the hospital complaining of injury to her head, shoulder, low back and neck. She allegedly sustained a blow to the head in this accident. A CT scan of her head and X-rays of her shoulder and spine were normal. She returned to the hospital the following week, reporting that she had collapsed and hit her face on the floor. Dr. Pavez noted that Corio had started suffering from severe headaches following the second automobile accident. Corio stopped treating with Dr. Pavez after the doctor told her that her memory deficits, difficulty finding words and mental fogginess were caused by her migraine medication. Corio had a ten-year history of migraines predating the July 2012 accident.

On July 3, 2013, Corio filed suit, naming as defendants Rainey, Rosedale Transport, Glenn Buick-GMC Trucks, LLC, and Progressive Marathon Insurance Company. She asserted claims of negligent operation and respondeat superior as well as claims for negligent hiring, training and supervision against Rosedale. She alleged Glenn Buick-GMC was liable for failure to inspect because her vehicle’s airbag did not deploy in the accident. The record contains an email from Corio’s attorney to David Rosenthal, an attorney advising NSIC, stating the lawsuit was filed in large part due to the PIP carrier’s failure to pay medical bills within the one-year statute of limitations.

According to Corio, her injuries as a result of the accident included a traumatic brain injury, post-traumatic stress disorder, cognitive disorders and delays, migraines, glass in her left eye, a grade V separation of the AC joint of her left shoulder, a slap tear of the labrum in her left shoulder, a severed ulnar nerve in her left hand, blood clots in her right arm, joint dysfunction causing hip and low back pain, a left peroneal neuritis, three fractured ribs, anxiety and depression. She was hospitalized for thirty-one days and underwent surgery to repair her left shoulder and the ulnar nerve in her left hand. She received numerous other treatments including hundreds of injections, acupuncture, physical therapy, occupational therapy and psychological therapy. In August 2013, Corio consulted Dr. Christopher Allen who concluded she had a significant traumatic brain injury and post-traumatic stress.

*2 Although Corio had provided some medical records to NSIC in May 2013, she did not make a settlement demand prior to filing suit. NSIC did not dispute the liability of its insureds for the injuries caused by the July 9, 2012 accident, but it did seek to determine the extent and seriousness of those injuries, in particular Corio’s claim that she suffered a traumatic brain injury. It also sought to determine the extent to which her various injuries and symptoms were attributable to the accident and the extent to which they might be attributable to the subsequent April 2013 accident, to pre-existing conditions and to her alleged overuse of prescription medications. Another factor to be resolved was the potential liability of Glenn Buick-GMC for its alleged failure to inspect the airbag in Corio’s vehicle.

In a telephone conversation on October 28, 2013, NSIC informed Corio’s counsel that if her claims for traumatic brain and psychological injury were being pursued despite her apparently normal MRI and CT scans, NSIC would request to take Corio’s deposition and have a neuro-psychiatric independent medical examination performed before the claims could be properly evaluated. On November 12, 2013, Corio’s attorney emailed a demand to NSIC for the $1 million policy limits.

On December 26, 2013, Corio filed a motion to amend her complaint to assert claims of negligent infliction of emotional distress and to add bad faith claims under the Unfair Claims Settlement Practices Act, Kentucky Revised Statutes (KRS) 304.12-230, against NSIC, as Rosedale and Rainey’s insurer, for allegedly undervaluing and/or unnecessarily delaying the resolution of her claims.

Corio underwent a second shoulder surgery on April 1, 2014. At this time, NSIC was investigating Corio’s claims regarding the value of her lost wages and lost future earnings. NSIC took Corio’s deposition in May 2014; it had been delayed both for the surgery and for her wedding and honeymoon.

NSIC retained Dr. Robert Granacher, a neuropsychiatrist, to perform a neurological independent medical examination of Corio in June 2014. Dr. Granacher concluded that Corio had not sustained a permanent traumatic brain injury. He opined that, at worst, she had suffered an uncomplicated concussion. He attributed her current symptoms to physician- and nurse-induced over-medication.

The parties participated in mediation on August 11, 2014. Corio demanded $5 million for the claims against Rosedale and Rainey and $4 million for NSIC’s alleged bad faith. She also demanded $750,000 from Glenn Buick-GMC. NSIC offered $320,000. Corio countered with a demand of $2.999 million. Corio walked out of the mediation after NSIC raised its offer to $350,000, which Corio characterized as “lowball.”

On January 23, 2015, Corio renewed her motion to amend her complaint as the original motion had not yet been addressed by the trial court. At this time, Corio settled her claims against Glenn Buick-GMC for $75,000. She filed her amended complaint containing the bad faith claims against NSIC on February 2, 2015.

On March 13, 2015, the trial court entered an agreed order of bifurcation, pursuant to which discovery on the bad faith claims was stayed until the final resolution of the underlying bodily injury claim.

On July 15, 2015, the trial court granted NSIC’s insureds partial summary judgment on Corio’s punitive damages and negligent hiring claims. On July 22, 2015, NSIC increased its reserve to $600,000 when Corio’s medical expenses grew to $271,000.

In early August 2015, Corio started treatment at the Diamond Headache Clinic in Chicago, described by the appellee as the oldest headache clinic in the United States. Her treating physician at the clinic drew a causal connection between the July 2012 accident and Corio’s headaches. A second mediation was scheduled for November 2015, but due to a scheduling conflict with one of Corio’s attorneys, it was rescheduled for March 31, 2016. By that time, Corio’s medical expenses had escalated to approximately $600,000, due in part to her treatment at the Diamond Headache Clinic. In response to the opinion of the physician at that facility and the significant increase in Corio’s medical expenses, NSIC approved policy limits settlement authority. At the mediation, Corio presented a demand of $5 million. Ultimately, AIG, the excess insurer, settled Corio’s claim for $1.5 million on September 20, 2016.

*3 On April 24, 2017, the trial court lifted the discovery stay in the bad faith action. In anticipation of this, Corio had served NSIC with discovery requests on February 24, 2017. NSIC provided partial discovery responses on July 7, 2017.

On July 27, 2017, Corio sent NSIC a letter detailing purported deficiencies in the responses. The parties met in August 2017 to discuss the deficiencies and on August 28, 2017, Corio filed a motion to compel appropriate discovery responses. NSIC responded by requesting the court to deny the motion to compel in order to give NSIC time to move for summary judgment. The trial court directed NSIC to file the motion for summary judgment. Following full briefing and a hearing, the trial court granted the motion and thereafter signed an order tendered by NSIC. It also denied Corio’s motion to compel. This appeal by Corio followed.

In reviewing a grant of summary judgment, our inquiry focuses on “whether the trial court correctly found that there were no genuine issues as to any material fact and that the moving party was entitled to judgment as a matter of law.” Scifres v. Kraft, 916 S.W.2d 779, 781 (Ky. App. 1996) (citing Kentucky Rules of Civil Procedure (CR) 56.03). Summary judgment may be granted when “as a matter of law, it appears that it would be impossible for the respondent to produce evidence at the trial warranting a judgment in his [or her] favor and against the movant.” Steelvest, Inc. v. Scansteel Service Center, Inc., 807 S.W.2d 476, 483 (Ky. 1991) (internal quotation marks and citation omitted). “The record must be viewed in a light most favorable to the party opposing the motion for summary judgment and all doubts are to be resolved in his [or her] favor.” Id. at 480. “An appellate court need not defer to the trial court’s decision on summary judgment and will review the issue de novo because only legal questions and no factual findings are involved.” Hallahan v. The Courier-Journal, 138 S.W.3d 699, 705 (Ky. App. 2004).

Corio argues that the grant of summary judgment to NSIC was fatally premature because she was not provided with an adequate opportunity to complete pretrial discovery, and that in any event summary judgment was improper because there were numerous material facts from which jurors could infer that NSIC acted unreasonably in its handling of her claim. More broadly, Corio posits that the fact-specific nature of bad faith claims renders them virtually impervious to resolution by summary judgment.

In order to state a cause of action against an insurer for bad faith, a plaintiff must establish the following three elements: “(1) The insurer must be obligated to pay the claim under the terms of the policy; (2) the insurer must lack a reasonable basis in law or fact for denying the claim; and (3) it must be shown that the insurer either knew there was no reasonable basis for denying the claim or acted with reckless disregard for whether such a basis existed.” Kentucky Nat. Ins. Co. v. Shaffer, 155 S.W.3d 738, 742 (Ky. App. 2004) (quoting Wittmer v. Jones, 864 S.W.2d 885, 890 (Ky. 1993) (citations omitted)). In order to establish the third element, evidence is required that the insurer’s conduct was outrageous, or exhibited reckless indifference to the rights of others. Hollaway v. Direct General Ins. Co. of Mississippi, Inc., 497 S.W.3d 733, 738 (Ky. 2016). The plaintiff bears the burden of establishing all three elements; in order to defeat a motion for summary judgment she must offer proof for all three. Id.

*4 The first element of the bad faith claim required a showing that NSIC had a duty under the terms of the Rosedale Transport policy to compensate Corio. Under KRS 304.12-230, “an insurance company is required to deal in good faith with a claimant, … with respect to a claim which the insurance company is contractually obligated to pay.” Indiana Ins. Co. v. Demetre, 527 S.W.3d 12, 26 (Ky. 2017) (quoting Davidson v. American Freightways, Inc., 25 S.W.3d 94, 100 (Ky. 2000)). This element of contractual obligation comprises two distinct questions of law: first, liability for the accident itself, that is, whether the July 2012 accident was a result of NSIC’s insured’s fault and, second, the extent and severity of the alleged injuries resulting from the accident. Hollaway, 497 S.W.3d at 738. Although NSIC admitted its insured’s fault for causing the accident, it was not automatically compelled to accept responsibility for causing all Corio’s claimed damages as well. Id. The Kentucky Unfair Claims Settlement Practices Act “only requires insurers to negotiate reasonably with respect to claims; it does not require them to acquiesce to a third party’s demands.” Id. at 739.

As our foregoing recitation of the facts indicates, Corio’s injuries evolved over time and were the subject of considerable medical dispute, particularly the causal connection between the accident and a potential traumatic brain injury. Corio does not deny the record is replete with evidence that her injuries were by no means fixed and certain, with physicians such as Dr. Pavez and Dr. Granacher attributing her symptoms to over-medication. The impact of the rear-end collision in April 2013 and the potential liability of Glenn Buick-GMC were additional complicating factors. No genuine issue of material fact exists that NSIC was justified in contesting the extent of its liability. As the causation and extent of Corio’s injuries was reasonably and legitimately contested by NSIC, the contractual obligation of NSIC to pay the claim was not clearly established and consequently the first element of a bad faith claim was not satisfied. Id.

Corio nonetheless argues that under Farmland Mut. Ins. Co. v. Johnson, 36 S.W.3d 368 (Ky. 2000), as modified (Feb. 22, 2001), the threshold question of whether a claim is fairly debatable is always a question of fact for the jury and cannot be appropriately resolved by summary judgment. Farmland at 376. Farmland involved a first-party insurance claim following the destruction by fire of commercial building. The owners alleged that the insurance company misrepresented the policy provisions, failed to conduct a reasonable investigation, failed to attempt to bring about a fair settlement of the claim and compelled them to initiate litigation by offering a settlement amount substantially less than the amount ultimately recovered. Id. at 372. The insurance company argued that a reasonable debate existed regarding the value of the loss and whether the building could be rebuilt or had to be replaced. Id. at 374.

In addressing this question regarding the claim, the Kentucky Supreme Court cited with approval a decision of the Supreme Court of Arizona which held that “whether a claim or the amount of a claim is fairly debatable is a question of fact for the jury and that the fact of a disputed amount does not relieve the insurer of its duty to handle the claim fairly.” Id. at 376 (citing Zilisch v. State Farm Mutual Auto. Ins. Co., 196 Ariz. 234, 995 P.2d 276 (2000)).

Certainly, the fact that Corio’s claim was debatable did not relieve NSIC of its duty to deal in good faith. “[A]lthough elements of a claim may be ‘fairly debatable,’ an insurer must debate the matter fairly.” Id. at 375. Whether a claim is fairly debatable is certainly a question of fact for the jury but only when that issue is in dispute. No genuine issue of material fact exists that the extent of liability was legitimately contested by NSIC in this case. The fact that Corio’s claim was fairly debatable is simply not in dispute. As we have already discussed, the case history is replete with conflicting and changing medical reports and unsettled issues relating to the apportionment of liability. There was no need for a jury to determine this settled issue.

*5 We turn to the three aspects of the proceedings which Corio claims are evidence of bad faith on the part of NSIC and should have precluded the grant of summary judgment. First, she contends that the insurer improperly delayed payment of her claim, in direct contravention of KRS 304.12-230(6), which characterizes as an unfair claims settlement practice “[n]ot attempting in good faith to effectuate prompt, fair and equitable settlements of claims in which liability has become reasonably clear[.]” As we have already discussed, the extent of liability for Corio’s injuries did not become “reasonably clear” immediately following the accident. Corio nonetheless contends the four years which passed between the date of the accident and the payment of the claim raise a reasonable inference that NSIC acted in bad faith. But many of the delays were attributable to Corio herself and to the uncertainty surrounding her medical condition. For example, an email in the record dated seven months after the accident states Corio had not yet provided NSIC with any medical records or a settlement demand. Corio did not file suit until almost three months after her second automobile accident, and then sought to amend her complaint to assert bad faith claims against NSIC only two months after demanding the $1 million policy limits. The liability of Glenn Buick-GMC was not resolved until the settlement of February 2015. A delay of some four months preceding the final mediation was due to a normal rescheduling request by one of Corio’s attorneys. Delays are not presumptively evidence of bad faith, especially when the type of conclusive medical evidence necessary to establish the extent of liability lies in the hands of the claimant, not the insurer.

Second, Corio claims as further evidence of bad faith that NSIC ignored its own lawyers’ advice about the value of the claim. Initially, the lawyers recommended an offer in the range of $350,000 to $800,000. Corio rejected an offer of $350,000 at the first mediation conference. The attorneys continued to recommend a higher amount. Corio claims NSIC acted in bad faith when it entered the final mediation conference with an unchanged initial offering of only $350,000. But NSIC ultimately offered the $1 million policy limits at that conference in light of the new medical evidence from the Diamond Headache Clinic.

Third, Corio argues that NSIC ignored its own reserves in making settlement offers. At the time of the first mediation in August 2014, NSIC’s reserve was set at $450,000. On July 22, 2015, NSIC increased its reserve to $600,000. These increases were made in response to Corio’s mounting medical bills and the possibility that new medical evidence would support full liability. “We will not attribute changing positions as a result of new information or evidence to bad-faith failure to settle claims. Such a stance would stand contrary to our quest for truth and would likely lead to obfuscation in the early stages of accident investigations.” Hollaway, 497 S.W.3d at 738.

Corio argues that the grant of summary judgment by the trial court was fatally premature because she was not allowed to complete discovery. The action was bifurcated, and discovery stayed on the bad faith claims on March 13, 2015, about nineteen months after Corio filed suit. The stay was imposed after the first unsuccessful mediation and the settlement of Corio’s claims against Glenn Buick-GMC. The stay was lifted on April 24, 2017. NSIC provided partial discovery responses, including its entire case file, on July 7, 2017. Summary judgment was entered four months later, on November 8, 2017.

“[F]or summary judgment to be properly granted, the party opposing the motion must have been given adequate opportunity to discover the relevant facts. Only if that opportunity was given do we reach the issue of whether there were any material issues of fact precluding summary judgment.” Suter v. Mazyck, 226 S.W.3d 837, 842 (Ky. App. 2007), as modified (July 13, 2007). On the other hand, the party opposing summary judgment “cannot rely on the hope that the trier of fact will disbelieve the movant’s denial of a disputed fact, but must present affirmative evidence in order to defeat a properly supported motion for summary judgment.” Steelvest, Inc. v. Scansteel Service Center, Inc., 807 S.W.2d 476, 481 (Ky. 1991) (internal quotation marks and citations omitted). The circuit court’s decision that an ample amount of time has passed is reviewed on appeal for an abuse of discretion. Blankenship v. Collier, 302 S.W.3d 665, 668 (Ky. 2010).

Corio was provided with the entire case file before the trial court ruled on the summary judgment motion. The record before us contains numerous internal emails, memos outlining NSIC’s settlement strategies and other documents detailing how NSIC proceeded in dealing with her claims. Corio argues that the court’s action meant she was unable to take any depositions. It is unclear whose deposition she sought to take or how any information offered by a deponent from NSIC would cast light on her bad faith claims. She simply does not identify “specific examples of what discovery could have been undertaken that would have affected the outcome had it been conducted.” Benton v. Boyd & Boyd, PLLC, 387 S.W.3d 341, 343-44 (Ky. App. 2012). Indeed, as we have already observed, the kind of medical evidence that would have supported a direct causal link between her various injuries and symptoms and the July 2012 accident would have been in her control, not that of NSIC. Thus, the trial court did not abuse its discretion in ruling on the summary judgment motion without allowing further discovery.

*6 Corio also appealed the trial court’s denial of her motion to compel production. She does not raise any specific arguments in her brief regarding this issue. We review the denial of a motion to compel production “as an evidentiary matter within the trial court’s discretion. We will reverse only for an abuse of discretion. The trial court abuses its discretion when its decision is ‘arbitrary, unreasonable, unfair, or unsupported by sound legal principles.’ Commonwealth v. English, 993 S.W.2d 941, 945 (Ky. 1999) (citations omitted).” Curty v. Norton Healthcare, Inc., 561 S.W.3d 374, 378 (Ky. App. 2018). In light of the fact that the trial court determined NSIC was entitled to summary judgment on Corio’s claims of bad faith, it would have been futile to order NSIC to comply with Corio’s discovery demands.

Finally, Corio has also asked us to consider supplemental authority in the form of an opinion rendered after the filing of the briefs in this appeal. See Commonwealth ex rel. Landrum v. Dolt, Thompson, Shepherd & Conway, P.S.C., No. 2018-CA-000467-MR, 2019 WL 320510 (Ky. App. Jan. 25, 2019).1 In Landrum, parties in a contract dispute filed complaints against one another. Less than one month later, before any answer was filed, one party moved for summary judgment and a stay of discovery pending the resolution of the summary judgment motion. Summary judgment was entered resolving both consolidated cases and effectively denied the opposing party any opportunity whatsoever to conduct discovery. A panel of this Court deemed such a result “an improper use of summary judgment.” Id. at *4. By contrast, Corio was provided with discovery in the form of the entire case file. Her arguments that further unspecified discovery would lead to more probative evidence of bad faith is speculative at best. “If … pure speculation were sufficient grounds for discovery, the scope would be limitless and the process neverending.” Bennington v. Commonwealth, 348 S.W.3d 613, 625 (Ky. 2011).

For the foregoing reasons, the orders of the Fayette Circuit Court granting summary judgment and denying the motion to compel are affirmed.

ALL CONCUR.
All Citations
Not Reported in S.W. Rptr., 2019 WL 2157579

Footnotes

1
As of the date this opinion is rendered, motions for discretionary review of Landrum are pending in the Kentucky Supreme Court. Case Nos. 2019-SC-000197-D and 2019-CA-000199-D.

2019 WL 2184763

United States District Court, D. Arizona.
Zandra Manion, et al., Plaintiffs,
v.
Ameri-Can Freight Systems Incorporated, et al., Defendants.
No. CV-17-03262-PHX-DWL
|
05/21/2019

ORDER
*1 This case arises from a March 12, 2016 traffic accident that resulted in the instantaneous death of Johnathan Blyler (“the Decedent”). The vehicle that struck the Decedent’s vehicle was a tractor-trailer being driven by Steven Robertson, an employee of Ameri-Can Freight Systems, Inc. (collectively, “Defendants”). The plaintiffs in this lawsuit are (1) the Decedent’s mother, Zandra Manion (“Mother”), who asserts a wrongful death claim under A.R.S. § 12-611 as a statutory beneficiary of the Decedent, and (2) the Decedent’s wife, Lisa Blyler (“Wife”), who asserts both a wrongful death claim under A.R.S. § 12-611 in her capacity as a statutory beneficiary and a survival claim under A.R.S. § 13-1440 on behalf of the Decedent’s estate (“the Estate”) (together, “Plaintiffs”).

Now pending before the Court is a motion for partial summary judgment filed by Defendants. (Doc. 73.)1 In Section A of their motion, Defendants seek summary judgment on five causes of action (negligent supervision, negligent retention, negligent maintenance, negligent hiring, and negligent training). (Id. at 3-9.) In Section B of their motion, Defendants seek summary judgment on the following four damage claims: (1) any claim for the Decedent’s future wages asserted by the Estate as part of the survival action, (2) any claim related to the Decedent’s pain and suffering, (3) any claim for the Decedent’s future wages asserted by Mother or Wife as part of their respective wrongful death actions; and (4) any claim for punitive damages. (Id. at 9-16.)

In response, Plaintiffs clarified that “[m]ost of the Motion is not opposed.” (Doc. 84 at 1.) Specifically, Plaintiffs stipulated to the dismissal and/or non-existence of all five of the causes of action specified in Part A of Defendants’ motion. (Id. at 1-2.) Plaintiffs further stated that “Plaintiffs Manion and Blyler are not making claims for economic losses as part of their action for wrongful death” and that “Plaintiffs stipulate to the dismissal of their claim for punitive damages.” (Id. at 2.) Finally, in a separate response, the Estate stated that “no Plaintiff has made a claim for pain and suffering.” (Doc. 82 at 6.)

Given these concessions and clarifications, the only disputed issue for the Court to resolve is the challenge to the Estate’s ability to recover future wages as part of the survival action. In a nutshell, Defendants argue that such damages are unavailable for two reasons: (1) an estate cannot, as a matter of law, recover future economic losses in a survival action where the decedent died immediately, and (2) alternatively, the Estate’s claim for future loss of income is too speculative. (Doc. 73 at 9-12; Doc. 87 at 2-7.) For the following reasons, the Court disagrees and denies the motion.2

LEGAL STANDARD
*2 A party moving for summary judgment “bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of ‘the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,’ which it believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). “In order to carry its burden of production, the moving party must either produce evidence negating an essential element of the nonmoving party’s claim or defense or show that the nonmoving party does not have enough evidence of an essential element to carry its ultimate burden of persuasion at trial.” Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1102 (9th Cir. 2000). “If…[the] moving party carries its burden of production, the nonmoving party must produce evidence to support its claim or defense.” Id. at 1103.

“Summary judgment is appropriate when ‘there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.’ ” Rookaird v. BNSF Ry. Co., 908 F.3d 451, 459 (9th Cir. 2018) (quoting Fed. R. Civ. P. 56(a)). “A genuine dispute of material fact exists if ‘there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party.’ ” United States v. JP Morgan Chase Bank Account No. Ending 8215 in Name of Ladislao V. Samaniego, VL: $446,377.36, 835 F.3d 1159, 1162 (9th Cir. 2016) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50 (1986)). The court “must view the evidence in the light most favorable to the nonmoving party and draw all reasonable inference in the nonmoving party’s favor.” Rookaird, 908 F.3d at 459. Summary judgment is also appropriate against a party who “fails to make a showing sufficient to establish the existence of an element essential to that party’s case, and on which that party will bear the burden of proof at trial.” Celotex, 477 U.S. at 322.

ANALYSIS

I. Whether The Estate Can Recover Future Loss Of Income In The Survival Action
“A wrongful death claim and a survival claim are separate claims arising from the same incident.” Gandy v. United States, 437 F. Supp. 2d 1085, 1086 (D. Ariz. 2006). Both types of claims are being asserted in this case: Wife and Mother have each asserted a wrongful death claim under A.R.S. § 12-611 and the Estate (acting through Wife) has separately asserted a survival claim under A.R.S. § 14-3110. In their motion, Defendants don’t dispute the Estate’s ability to assert a survival claim but argue the Estate should be barred from seeking one particular category of damages as part of that claim—economic damages arising from the loss of Decedent’s future wages.

Before addressing Defendants’ argument, it is helpful to provide some background concerning the nature of survival and wrongful death actions under Arizona law. Both are creatures of statute. First, the Arizona survival statute provides:
Every cause of action, except a cause of action for damages for breach of promise to marry, seduction, libel, slander, separate maintenance, alimony, loss of consortium or invasion of the right of privacy, shall survive the death of the person entitled thereto or liable therefor, and may be asserted by or against the personal representative of such person, provided that upon the death of the person injured, damages for pain and suffering of such injured person shall not be allowed.
A.R.S. § 14-3110. “Under Arizona law, a claim under the survival statute may be brought only by a decedent’s estate.” Gotbaum v. City of Phoenix, 617 F. Supp. 2d 878, 883 (D. Ariz. 2008). The enactment of the survival statute “extended the right of a decedent’s personal representative to pursue the decedent’s personal injury claim against a tortfeasor.” Quintero v. Rogers, 212 P.3d 874, 877 (Ariz. Ct. App. 2009).

*3 Second, the Arizona wrongful death statute provides:
When death of a person is caused by wrongful act, neglect or default, and the act, neglect or default is such as would, if death had not ensued, have entitled the party injured to maintain an action to recover damages in respect thereof, then, and in every such case, the person who or the corporation which would have been liable if death had not ensued shall be liable to an action for damages, notwithstanding the death of the person injured, and although the death was caused under such circumstances as amount in law to murder in the first or second degree or manslaughter.
A.R.S. § 12-611. The Arizona courts have explained that “[a] wrongful death action is an original and distinct claim for damages sustained by the statutory beneficiaries and is not derivative of or a continuation of a claim existing in the decedent.” Barragan v. Superior Court of Pima Cty., 470 P.2d 722, 724 (Ariz. Ct. App. 1970). Such an action “is for the wrong to the beneficiaries, confined to their loss because of the death.” Id. at 725.

Defendants argue that, at least in cases (like this case) where a decedent dies upon impact, the wrongful death statute provides the only avenue for seeking damages based upon the decedent’s lost future wages. (Doc. 73 at 9-11; Doc. 87 at 2-4.) In support of this position, they cite cases from an array of other jurisdictions that “have concluded that the damages recoverable under the survival statute do not include an amount for the loss of the decedent’s future earnings.” (Doc. 73 at 10-11 & 11 n.1.)

This argument is unavailing. As an initial matter, Defendants’ reliance on cases from jurisdictions outside Arizona is misplaced. “[A] federal court interpreting state law is bound by the decisions of the highest state court….Where the state supreme court has not spoken on an issue presented to a federal court, the federal court must determine what result the state supreme court would reach based on state appellate court opinions, statutes, and treatises.” Vernon v. City of Los Angeles, 27 F.3d 1385, 1391 (9th Cir. 1994) (citations omitted). Here, Defendants haven’t identified any decision by the Arizona Supreme Court (or, indeed, by any Arizona state court) adopting their position that future wages are unavailable in a survival claim under A.R.S. § 14-3310. Moreover, the Arizona Court of Appeals has specifically noted that “because survival statutes and the interpretation of them vary greatly from state to state, [it does] not find a survey of the law in other jurisdictions particularly enlightening in interpreting § 14–3110.” Quintero, 212 P.3d at 877.

Given this backdrop, the proper place to begin the analysis is with the statutory text of A.R.S. § 14-3110. The plain language of the statute does not support Defendants’ position. Notably, the statute only identifies one category of damages that is unavailable in a survival action—“damages for pain and suffering.” Id. (emphasis added). This strongly suggests the Arizona Legislature didn’t intend to exclude other categories of damages, like future economic damages. Cf. TRW Inc. v. Andrews, 534 U.S. 19, 28 (2001) (“Where Congress explicitly enumerates certain exceptions to a general prohibition, additional exceptions are not to be implied, in the absence of evidence of a contrary legislative intent.”) (citation omitted); City of Surprise v. Ariz. Corp. Comm’n, 437 P.3d 865, 870 (Ariz. 2019) (Arizona courts follow “the interpretive canon[ ] expressio unius est exclusio alterius,” under which “the expression of one item implies the exclusion of others”). Thus, as in Quintero, where the Arizona Court of Appeals allowed a punitive damage claim to be pursued in a survival action because the “survival statute does not preclude punitive damages,” 212 P.3d at 878, the Court concludes that damages for future economic losses may be recovered in a survival action because the survival statute does not expressly exclude such damages.

*4 Defendants cite Gandy v. United States, 437 F. Supp. 2d 1085 (D. Ariz. 2006), for the proposition that “Arizona courts have held survival action loss of earnings must be limited to those incurred between the decedent’s injury and death because to allow post-death recovery would be double-recovery with a wrongful death action.” (Doc. 73 at 10.) Gandy did indeed come to this conclusion. But Defendants are mistaken in claiming that “Arizona courts” have so held—Defendants did not cite, and the Court is unaware of, any Arizona state court cases addressing this issue.

Moreover, the plaintiffs in Gandy were attempting to recover future-income damages both as part of the estate’s survival action and as part of the beneficiaries’ wrongful death action. Id. at 1089. These parallel claims created a risk of double recovery, and the Gandy opinion can be read as an attempt to avoid double recovery by funneling all of the future-income claims into a single cause of action. Id. at 1088 (“To prevent double recovery under the wrongful death and survival statutes, recovery for Decedent’s loss of future earnings in the survival claim is limited to the time between her injury, September 9, 1999, to her death, May 22, 2005.”) (emphasis added). In this case, however, there is no risk of double recovery—Wife and Mother have agreed not to “mak[e] claims for economic losses as part of their action for wrongful death.” (Doc. 84 at 2.)

Finally, in addition to lacking any support in the statutory text or relevant state-court case law, Defendants’ position also fails because it could lead to illogical results. Although double recovery is a legitimate concern where both survival and wrongful death claims are brought in the same case, it is unclear why the best way to address that concern is to arbitrarily decide that a claim for damages for future economic losses must be made under the wrongful death statute, rather than the survival statute. The consequences of this arbitrary rule are that defendants will often benefit when they kill, rather than injure, or when they kill those who were not supporting others at the time of their death.3 For these reasons, some courts have expressly declined to adopt the rule proposed here by Defendants. See, e.g., Criscuola v. Andrews, 507 P.2d 149, 150-51 (Wash. 1973) (en banc) (declining to “imply[ ] from the existence of a wrongful death act that all prospective losses were to be cut off in a survival action” and identifying other, less-arbitrary mechanisms for addressing “[t]he problem of prospective double compensation where actions are brought under both survival and wrongful death actions”); Wheeler v. Carlton, 2007 WL 9735706, *13-14 (E.D. Ark. 2007) (denying defendant’s motion in limine to preclude decedent’s estate from seeking future earnings and holding that any potential for double recovery could be addressed by “an appropriate instruction that the loss of future earning capacity (or earnings) of the decedent should be reduced by any overlapping awards of lost money contributions to the statutory beneficiaries”); Jones v. Flood, 716 A.2d 285, 290 (Md. Ct. App. 1998) (noting that, although Maryland follows a different approach, “there are a few states in which the damages in a survival action are measured by the post-death lost gross earnings less the amount that the decedent would have expended on the support of others and for the decedent’s personal maintenance, reduced to present value”). There may be policy reasons for such a rule, but the policy decision should be left to the Arizona Legislature and not made in the first instance by this Court.

II. Whether The Claim For Future Economic Losses Is Too Speculative
*5 In calculating economic damages, Plaintiffs’ economic damages expert, Vocational Economist J. Matthew Sims (“Sims”), assumed that if Decedent had not died in the collision, he would have become a sixth grade “Social Science” teacher beginning in summer 2016. (Doc. 83-1 at 24.) In support of this assumption, Plaintiffs cite Wife’s deposition testimony that (1) at the time of his death Decedent was teaching sixth grade social studies; (2) Decedent was awarded his Master’s Degree in Elementary Education posthumously; (3) Decedent would have been immediately certified to teach in Arizona after completing his student teaching and presenting his diploma to the Arizona Department of Education; and (4) the window for applying for teaching positions the following year had not yet opened. (Id. at 15-21.)

Defendants raise several objections to Sims’s analysis. First, Defendants contend that Wife lacked foundation regarding statements three and four, above. (Doc. 88 at 2.) Second, Defendants also highlight the undisputed facts that, at the time of his death, (1) Decedent had not yet completed his student teaching or the follow-up classwork for his degree; (2) Decedent had not yet applied for any jobs; and (3) Decedent was not employed. (Doc. 74 at 7.) Given these undisputed facts, Defendants more broadly argue that the “claims regarding the amount of decedent’s future estate and earnings are not supported by any evidence,” as Sims had no basis to “assume that if not for this incident, [Decedent’s] new new career would have begun in the summer of 2016.” (Doc. 73 at 11, citing Doc. 74-22 at 3.)

“[F]uture lost wages are an appropriate measure of damages under Arizona law.” Lewis v. N.J. Riebe Enterprises, Inc., 825 P.2d 5, 18 (Ariz. 1992). “Once the right to damages is established, uncertainty as to the amount of damages does not preclude recovery.” Id. Importantly, “[i]n loss of future income calculations, some assumptions about the future are required.” Rascon v. Brookins, 2018 WL 739696, *4 (D. Ariz. 2018). Where the “assumptions ha[ve] a basis in fact,” “[a]ssessing their accuracy and reliability [is] a question of fact for the jury.” Cty. of La Paz v. Yakima Compost Co., 233 P.3d 1169, 1187 (Ariz. Ct. App. 2010); see also Rascon, 2018 WL 739696 at *4 (“Here, Dr. Smith clearly identifies his assumptions that Sanchez would finish his CDL training and obtain employment in that area by 2014. The accuracy of these assumptions and whether Dr. Smith could project Sanchez’s future earnings from those assumptions is a question better left to the jury. ‘Vigorous cross-examination’ and ‘presentation of contrary evidence’ during trial is the appropriate method for such a determination.”) (citation omitted).

Here, the assumption that Decedent would be working as a full-time teacher had a basis in fact. At the time of his death, Decedent was student teaching and would have been close to graduating, evidenced by the fact that he was awarded his Master’s Degree in Elementary Education posthumously. (Doc. 83-1 at 15-18.) Rascon is instructive. There, the court declined to exclude an expert’s testimony on economic loss where that expert assumed the plaintiff would finish his Commercial Driver’s License training and obtain employment as a full-time truck driver. 2018 WL 739696105 at *4-5. Defendants have not presented any evidence disputing Wife’s statement that Decedent was planning to start a teaching job using the degree he was seeking. (Doc. 83-1 at 15-16.) Accordingly, the Court disagrees with Defendants that the Estate’s claim for future earnings is too speculative to survive summary judgment.4

III. Proper Plaintiff In The Wrongful Death Action Although Defendants do not raise this issue, the Court feels compelled to address it.

*6 In Arizona, there can only be one plaintiff in a wrongful death action. Wilmot v. Wilmot, 58 P.3d 507, 511 (Ariz. 2002) (“The text of the wrongful death statute contemplates that claims by all statutory beneficiaries be consolidated in a single action.”); Nunez v. Nunez, 545 P.2d 69, 73 (Ariz. Ct. App. 1976). “[T]he statutory plaintiff represents all other beneficiaries who have a ‘legal right…to be compensated for their loss resulting from the victim’s death.’ ” Wilmot, 58 P.3d at 511 (citation and emphasis omitted). In such a case, “there is ‘one judgment, the proceeds of which are held by the statutory plaintiff as trustee for the persons on whose behalf the suit was brought.’ ” Id. (quoting Nunez, 545 P.2d at 73) (emphasis omitted).
In this case, both Mother and Wife have asserted wrongful death claims. (Doc. 1-2.) Yet for the reasons discussed above, it appears that only one of them may assert such a claim. Rather than unilaterally select a solution, the Court will order the parties to meet and confer about this issue. One possible outcome of the meet-and-confer process would be for the parties to stipulate to Plaintiffs’ filing of an amended complaint so that only one Plaintiff is asserting a wrongful death claim on behalf of both statutory beneficiaries. Alternatively, if the parties disagree with the Court’s analysis concerning Wilmot and Nunez, they should file supplemental briefing explaining this disagreement. The Court will leave it to the parties to decide how they’d like to proceed.
Accordingly, IT IS ORDERED that:
1. Defendants’ motion for partial summary judgment (Doc. 73) is denied;
2. Plaintiffs’ claims for negligent supervision, negligent retention, negligent maintenance, and punitive damages are dismissed with prejudice pursuant to Plaintiffs’ stipulation;
3. Plaintiffs are precluded from asserting any claim at trial premised on a theory of negligent hiring or negligent training;
4. Plaintiffs are precluded from seeking the following two categories of damages at trial: (a) any claim for damages based upon Decedent’s pain and suffering, and (b) any claim for the Decedent’s future wages asserted by Mother or Wife as part of a wrongful death action; and
5. The parties must meet and confer regarding the proper Plaintiff (or Plaintiffs) in the wrongful death action and either stipulate to Plaintiffs’ filing of an amended complaint or file supplemental briefing on this issue by June 4, 2019. Dated this 20th day of May, 2019.

All Citations
Slip Copy, 2019 WL 2184763

Footnotes

1
The parties have also filed three Daubert motions that are fully briefed. (Docs. 70, 71, 72.) The Court intends to rule on those motions during the final pretrial conference, which will be set by separate order.

2
The parties have requested oral argument, but the Court will deny the requests because the issues have been fully briefed and oral argument will not aid the Court’s decision. See Fed. R. Civ. P. 78(b); LRCiv. 7.2(f).

3
See generally Calhoun v. Yamaha Motor Corp., U.S.A., 40 F.3d 622, 639 n.31 (3d Cir. 1994) (the prohibition against recovery of future earnings in a survival action “appears to be quite suspect when the decedent is someone who is not employed, especially a child. A child does not typically support her parents and so loss of support damages will be negligible. A child’s expected future earnings, however, may be considerable. Allowing for lost future earnings under such circumstances raises minimal risk of duplicative recovery. In our view, to deny loss of future earnings under such circumstances gives a windfall to potential defendants.”).

4
The Court notes that Defendants have not brought a separate Daubert motion to exclude the testimony of Sims.