Coverage - Central Analysis Bureau

ARGONAUT INS. CO. V. ATL. SPECIALTY INS. CO.

United States District Court for the Eastern District of Louisiana
May 9, 2022, Decided; May 9, 2022, Filed
CIVIL ACTION No. 21-1602 SECTION I

Reporter

2022 U.S. Dist. LEXIS 83078 *; 2022 WL 1460112

ARGONAUT INSURANCE COMPANY VERSUS ATLANTIC SPECIALTY INSURANCE COMPANY

Core Terms

truck, Non-Trucking, summary judgment, driver, stopping, route, collision, coverage, detour, load, material fact, Deviation, ambiguous, genuine, underlying lawsuit, personal use, Terminal, Carrier, insurer, Garage, argues

Counsel: [*1] For Argonaut Insurance Company, Plaintiff: Max Jeffrey Cohen, LEAD ATTORNEY, Melanie Lockett, Lowe, Stein, Hoffman, Allweiss & Hauver, LLP, New Orleans, LA; Kent J Lisenby, The Lisenby Law Firm, P.C., Coppell, TX.

For Atlantic Specialty Insurance Company, Defendant: Alex P Tilling, LEAD ATTORNEY, Leake & Andersson, LLP (New Orleans), Energy Centre, New Orleans, LA; Karen E Futch, Leake & Andersson, New Orleans, LA; Megan Ashley Haynes, Leake & Andersson, LLP, New Orleans, LA.

Judges: LANCE M. AFRICK, UNITED STATES DISTRICT JUDGE.

Opinion by: LANCE M. AFRICK

Opinion

ORDER & REASONS

Before the Court is a motion¹ for summary judgment filed by defendant Atlantic Specialty Insurance Company (“ASIC”). Plaintiff Argonaut Insurance Company (“Argonaut”) opposes² the motion. ASIC filed a reply.³ For the reasons that follow, the Court will grant the motion and enter judgment in favor of ASIC.

I. BACKGROUND
A. February 22, 2019 Collision

This action arises out of a 2019 vehicular collision in New Orleans, Louisiana, and an ensuing tort action (“the underlying lawsuit”) brought in Orleans Parish Civil District Court.⁴ The undisputed facts⁵ are as follows: On February 22, 2019, Darrell Esnault (“Esnault”), a commercial truck driver, was [*2] operating a 2005 Freightliner, unit number TG27 (the “truck”), which was leased by Double S Transportation, LLC (“Double S”) to Triple G Express, Inc. (“Triple G”).⁶ Esnault delivered his final load of the day to the Norfolk Southern Railroad Terminal, located at 2900 Florida Avenue, New Orleans, Louisiana.⁷ He departed the terminal at approximately 3:50 p.m., “bobtailing” the tractor of the truck—meaning that he was driving the tractor without a trailer attached to it.⁸

Esnault then traveled toward a Save-A-Lot grocery store located at the intersection of Paris Avenue and Mirabeau Avenue.⁹ On the way, Esnault saw a friend on Paris Avenue, stopped for approximately five minutes, exited his vehicle, and spoke with his friend.¹⁰ Thereafter, Esnault returned to his vehicle and continued traveling north on Paris Avenue towards the Save-A-Lot.¹¹As Esnault drew closer to Save-A-Lot, he realized that he did not have enough cash to make his contemplated purchases, so he turned around and headed south on Paris Avenue towards Gentilly Boulevard “to go to his residence,” where the truck is normally garaged.¹² Esnault reached the intersection of Paris Avenue and Gentilly Boulevard, which [*3] is approximately three to four blocks away from his residence.¹³“Then, Esnault turned right on Gentilly Boulevard to go to his residence, but before he got to his residence, he contemplated [purchasing cigarettes at] a Shell Station or a nearby convenience store located near the corner of Paris Avenue and Gentilly Boulevard, which would have required another U-turn in the opposite direction of his residence.”¹⁴

As Esnault started to turn left from the outer lane to the left lane at the intersection of Gentilly Boulevard and Republic Street, in order to make the U-turn, a Nissan Altima, driven by Christian Davis (“Davis”), collided with the left side of the truck.¹⁵ The accident occurred approximately 22 minutes after Esnault departed from the Norfolk Southern Railroad Terminal.¹⁶ “If the accident had not occurred, Esnault would have eventually returned to his residence located at 2346 Gentilly Boulevard, New Orleans, Louisiana, and garaged his truck.”¹⁷

B. Insurance Policies

At the time of the accident, Argonaut had issued Commercial Auto Policy Number AVT 100003600 to Triple G, which provided Motor Carrier Coverage in the amount of $1,000,000.¹⁸Additionally, ASIC had issued a [*4] policy to Triple G, which includes Non-Trucking Liability coverage (“the NTL policy”), the scope of which is specified in the policy’s Section One.¹⁹ The policy limit for Section One is $500,000.20

The NTL policy states that Section One “only applies to Losses that occur . . . when a Covered Truck is Non-Trucking.”²¹ The policy states that a truck is “Non-Trucking” when it “is subject to an active Permanent Lease with a government regulated Motor Carrier and is either Bobtail or Deadhead is operating solely for personal use unrelated to the business of the Motor Carrier.”²² The policy further provides that a truck is “not Non-Trucking” when it is “returning to the Truck’s Primary Garage Location subsequent to delivering a load[.]”²³ The “Primary Garage Location” is “the home parking base for a Truck or the terminal from which the Truck customarily obtains hauling assignments.”²⁴

C. Ensuing Litigation

In the underlying lawsuit, Davis named Argonaut, ASIC, Esnault, Double S, and Triple G as defendants.²⁵
Davis’s state court petition stated that “at all material times . . . [Esnault] was on a mission and/or errand for
[Triple G] and/or [Double S] on the date of this accident[.]”²⁶ Argonaut [*5] provided a defense to Esnault, Triple G, and Double S, and settled Davis’s claims as to those defendants for $750,000.²⁷ The order of dismissal, executed in January 2021 as a result of the settlement, stated that Davis “retains all claims and rights . . . against Atlantic Specialty Insurance Company.”²⁸ Davis assigned all of his remaining rights to Argonaut.²⁹An order of dismissal as to all remaining defendants was executed on February 22, 2022.³⁰

Argonaut filed the above-captioned action in this Court, seeking damages from ASIC.³¹ Argonaut argues that ASIC’s NTL policy covered the collision and, therefore, that ASIC should have been the primary insurer in settling Davis’s claims.³² Argonaut argues that ASIC had a duty to provide coverage and to defend Esnault and Triple G in the underlying lawsuit.³³ Argonaut argues that it has the right to recover $500,000 from ASIC—in other words, the maximum limit under ASIC’s policy.³⁴Additionally, Argonaut argues that it is entitled to recover special damages in the amount of $30,384.95 for the cost of defending the underlying lawsuit.³⁵

In the instant motion for summary judgment, ASIC argues that its NTL policy did not cover the collision at issue [*6] and that Argonaut is not entitled to recover any damages from ASIC in connection with the underlying settlement. ASIC also submits that, even if the NTL policy covered the collision, ASIC did not have a duty to defend in the underlying lawsuit, and that Argonaut has no basis to seek contribution from ASIC, whether directly or through subrogation of Davis’s claims.³⁶

II.STANDARD OF LAW

Summary judgment is proper when, after reviewing the pleadings, the discovery and disclosure materials on file, and any affidavits, the court determines that there is no genuine dispute of material fact and that the movant
is entitled to judgment as a matter of law. See Fed. R. Civ. P. 56. “[A] party seeking summary judgment always
bears the initial responsibility of informing the district court of the basis for its motion, and identifying those
portions of [the record] which it believes demonstrate the absence of a genuine issue of material fact.” Celotex
Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986). The party seeking summary
judgment need not produce evidence negating the existence of a material fact, but need only point out the absence of evidence supporting the other party’s case. Id.; Fontenot v. Upjohn Co., 780 F.2d 1190, 1195 (5th Cir. 1986).

Once the party seeking summary judgment carries its burden, the nonmoving party must [*7] come forward with specific facts showing that there is a genuine dispute of material fact for trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S. Ct. 1348, 89 L. Ed. 2d 538 (1986). The showing of a genuine issue is not satisfied by creating “‘some metaphysical doubt as to the material facts,’ by ‘conclusory allegations,’ by ‘unsubstantiated assertions,’ or by only a ‘scintilla’ of evidence.” Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (citations omitted). Instead, a genuine issue of material fact exists when the “evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). “Although the substance or content of the evidence submitted to support or dispute a fact on summary judgment must be admissible . . . .the material may be presented in a form that would not, in itself, be admissible at trial.” Lee v. Offshore Logistical & Transp., LLC, 859 F.3d 353, 355 (5th Cir. 2017) (quotation omitted).

The party responding to the motion for summary judgment may not rest upon the pleadings but must identify specific facts that establish a genuine issue. Anderson, 477 U.S. at 248. The nonmoving party’s evidence, however, “is to be believed, and all justifiable inferences are to be drawn in [the nonmoving party’s] favor.” Id. at 255; see also Hunt v. Cromartie, 526 U.S. 541, 552, 119 S. Ct. 1545, 143 L. Ed. 2d 731 (1999).

III. LAW AND ANALYSIS

“The interpretation of an insurance contract presents a question of law, rather than fact, and therefore is an appropriate matter [*8] for determination by summary judgment.” Martco Ltd. P’ship v. Wellons, Inc., 588 F.3d
864, 878 (5th Cir. 2009) (citations omitted). “Louisiana law provides that an insurance policy is a contract between the parties and should be construed using the general rules of contract interpretations set forth in the Louisiana Civil Code.” First Am. Bank v. First Am. Transp. Title Ins. Co., 585 F.3d 833, 837 (5th Cir. 2009). “The role of the judiciary in interpreting an insurance contract is to ascertain the common intent of the insured and insurer as reflected by the words of the policy.” Gorman v. City of Opelousas, 148 So. 3d 888, 892 (La. 2014) (quoting Peterson v. Schimek, 729 So. 2d 1024, 1028 (La. 1991)). “When the words of an insurance contract are clear, explicit and lead to no absurd consequences, courts must enforce the contract as written and make no further interpretation in search of the parties’ intent.” Id. (quoting Peterson, 729 So. 2d at 1028); see also La. Civ. Code. art 2046.

“Ambiguous policy provisions are generally construed against the insurer and in favor of coverage.” Cadwallader v. Allstate Ins. Co., 848 So. 2d 577, 580 (La. 2003). “Under this rule of strict construction, equivocal provisions seeking to narrow an insurer’s obligation are strictly construed against the insurer.” Id. However, this principle “applies only if the ambiguous policy provision is susceptible to two or more reasonable interpretations.” Id. (emphasis in original). “An insurance policy should not be interpreted in an unreasonable or strained manner so as to enlarge or [*9] to restrict its provision beyond what is reasonably contemplated by its terms or so as to achieve an absurd conclusion.” Lodwick, LLC v. Chevron U.S.A., Inc., 126 So. 3d 544, 549-50 (La. App. 2 Cir. 2013). “Likewise, a court should not strain to find ambiguity in a policy where none exists.” Id.

ASIC contends that, because “Esnault was returning from dropping off a load at the time of this accident, and would not have even been operating the Truck at all had it not been for the delivery he had been obligated to make, it is clear that he was not operating the subject Truck solely for personal use at the time the accident occurred, such that the underlying claim is properly excluded from coverage under this general definition alone.”³⁷

Argonaut states that it is “is not taking the position that any ‘route deviation’ . . . would have triggered ASIC’s Non-Trucking coverage” and suggests, for instance, that stopping to purchase gas or to use the restroom would not be considered “non-trucking.”³⁸ However, Argonaut submits that stopping to “purchase groceries or cigarettes” is “purely . . . personal” in nature, such that the driver would be considered to be “non-trucking.”³⁹
Argonaut also emphasizes the fact that Esnault needed to make a U-turn and travel away from his residence [*10] in order to complete his contemplated stop at a nearby Shell station or convenience store.

First, the Court looks to the term “Non-Trucking,” which is defined, in relevant part, as when a truck is “operating solely for personal use unrelated to the business of the Motor Carrier.”⁴⁰ The inclusion of the term “solely” in
this definition is significant, because it indicates that the policy contemplates that a truck may simultaneously be
put to both business and personal use. Additionally, the relevant coverage exception, which applies when the truck is “returning to the Truck’s Primary Garage subsequent to delivering a load,”⁴¹ does not state that the return trip must be the most direct route possible, nor does it explicitly preclude drivers from making brief stops or detours along the way.

The caselaw on this issue, although sparse, supports the interpretation that minor personal detours do not render a truck to be “non-trucking.” For instance, in Great West Casualty Insurance Co. v. Burns, 2020 U.S. Dist. LEXIS 92911, 2020 WL 2776495 (M.D. Ga. May 28, 2020), the court considered the same ASIC Non-Trucking policy in a context that bears some factual similarities to the instant case. The court concluded that if a truck driver made a “personal errand to grab food” while he was en route to pick up [*11] a load, this would “not change the essential nature of his trip.” 2020 U.S. Dist. LEXIS 92911, [WL] at *8. Such a stop would be a “minor personal detour,” which “would not have altered the reason he was operating his tractor that morning, which was to further [his carrier’s] commercial interests by picking up a load[.]” Id.⁴² See also, e.g., Forkwar v. Empire Fire & Marine Ins. Co., 487 F. App’x 775, 780 (4th Cir. 2012) (concluding that a “business use” exception applied, despite the fact that the truck driver stopped for a meal on his way to pick up a load that he had been tasked with retrieving). The parties have not
provided, nor is the Court aware of, any cases in which a court has concluded that a short personal detour effectively rendered the driver to be “non-trucking.”

Argonaut points to the fact that the General Policy Definitions section of the policy defines the term “Route Deviation” as meaning “a deviation from the customary business route to pursue personal interests,”⁴³ and
asserts that this term must be read in harmony with the relevant exception to the Non-Trucking coverage.⁴⁴
However, as ASIC notes, “none of the relevant policy provisions at issue in this case make use of the defined
term ‘Route Deviation’ or otherwise indicate that they are made subject to that term in any way.” [*12] ⁴⁵
Additionally, ASIC persuasively asserts that “[t]he fact that the return trip provision does not reference Route Deviations hurts rather than helps Argonaut’s argument” because “[t]he provision could have specifically excepted Route Deviations from its scope but plainly does not.”⁴⁶

“That ‘contractual language may, on occasion, pose difficult factual applications . . .’ and that the parties disagree as to coverage, does not create ambiguity.” Mahaffey v. Gen. Sec. Ins. Co., 543 F.3d 738, 741 (5th Cir. 2008) (quoting Empire Fire & Marine Ins. Co. v. Brantley Trucking, Inc., 220 F.3d 679, 681 (5th Cir. 2000)). The Court concludes that the language of the NTL policy is unambiguous, and that the NTL policy does not cover the collision at issue in this action. However, to the extent that the policy might be deemed ambiguous, the Court also concludes that Argonaut’s proffered interpretation is unreasonable.

Specifically, it would be unreasonable to interpret the policy as preventing drivers from making brief stops or detours to tend to basic personal needs. For instance, it would be difficult to believe that the NTL policy would
preclude a driver from stopping to use the restroom. Similarly, it would be difficult to believe that the policy would preclude a driver experiencing drowsiness from stopping for coffee or to stretch his legs. Argonaut, [*13] for its part, at least concedes that stopping for gas or to use the restroom would not render the driver “non-trucking,” but maintains that stopping for groceries or cigarettes is purely personal in nature, and would render the driver “non-trucking.”⁴⁷ However, the text of the policy provides no basis for drawing such distinctions. While stopping for gas is perhaps an example of a detour that could be described as solely for business purposes, any other kind of detour— including a stop to use the restroom, or to get coffee or food—could be characterized as at least partially personal in nature. The Court concludes that it would be unreasonable to read the NTL policy as precluding stops or detours of any kind whatsoever, and further concludes that it would be unreasonable to read Argonaut’s proposed distinctions into the policy.

Argonaut also cautions that, “[i]n essence, ASIC’s position is that until Esnault returned home, he was not Non-Trucking, no matter what he was doing or where he was going.”⁴⁸ The Court does not believe that such an extreme implication flows from its interpretation of the policy. Future cases may present factual scenarios that test the outer boundaries of the NTL [*14] policy, but the instant case does not. The collision occurred approximately 22 minutes from the time that Esnault left the Norfolk Southern Railroad Terminal.⁴⁹ While Esnault did not take the most direct route home after dropping off his last load of the day, he also did not stray far from the route. He briefly drove towards a grocery store, before realizing that he did not have sufficient cash and drove towards his residence.⁵⁰ He stopped for five minutes to talk with a friend whom he saw on the street.⁵¹ His subsequently-contemplated trip to a nearby gas station or convenience store, while requiring him to drive in the opposite direction of his residence, would have taken him approximately three to four blocks away from his residence, at most.⁵² The Court concludes, in light of the limited purpose, distance, and duration of Esnault’s attempted detour, that the truck was not being
operated solely for personal use at the time of the collision.

In sum, the Court concludes that the NTL policy is unambiguous. However, to the extent that the NTL policy could be deemed ambiguous, Argonaut’s proposed interpretation is unreasonable. Cadwallader, 848 So. 2d at 580. The Court therefore concludes that the NTL policy did [*15] not apply at the time of the collision. Having so concluded, the Court declines to reach the parties’ arguments as to ASIC’s duty to defend and contribution. Accordingly,

IT IS ORDERED that the motion for summary judgment is GRANTED and that plaintiff’s claims are DISMISSED WITH PREJUDICE.

New Orleans, Louisiana, May 9, 2022.

/s/ Lance M. Africk

LANCE M. AFRICK

UNITED STATES DISTRICT JUDGE

JUDGMENT

On this date, the Court issued an order and reasons granting defendant’s motion for summary judgment.
Accordingly,

IT IS ORDERED that the motion for summary judgment is GRANTED. Plaintiff’s claims in the above-captioned action are DISMISSED WITH PREJUDICE.

New Orleans, Louisiana, May 9, 2022.

/s/ Lance M. Africk

LANCE M. AFRICK

UNITED STATES DISTRICT JUDGE

End of Document

¹ R. Doc. No. 17.

² Doc. No. 19.

³ R. Doc. No. 22.

⁴ R. Doc. No. 17-4.

⁵ R. Doc. No. 17-2 (joint stipulation).

⁶ Id. at 1 ¶ 1.

⁷ Id. at 2 ¶ 7.

⁸ Id.; see also R. Doc. No. 17-9, at 6 (defining “bobtailing”).

⁹ R. Doc. No. 17-2, at 2 ¶ 8.

¹⁰Id. at 2 ¶ 9.

¹¹ Id. at 2 ¶ 10.

¹² Id. at 2 ¶¶ 11-13; R. Doc. No. 17-3, at 4 ¶ 19; R. Doc. No. 19-1, at 2 ¶ 19.

¹³ R. Doc. No. 17-2, at 2 ¶ 12.

¹⁴ R. Doc. No. 17-2, at 2 ¶ 13. Both parties have stipulated to the fact that Esnault intended to purchase cigarettes at the Shell station or convenience store. R. Doc. No. 33.

¹⁵ Id. at 3 ¶ 14.

¹⁶ Id. at 3 ¶ 15.

¹⁷ Id. at 3 ¶ 16.

¹⁸ R. Doc. No. 19, at 2.

¹⁹ R. Doc. No. 17, at 6.

²⁰Id.

²¹ R. Doc. No. 17-9, at 9 (emphasis in original).

²² Id. at 6 (emphasis in original). The parties do not dispute that the truck was subject to an active permanent lease with a government regulated motor carrier.

²³ Id. at 6-7.

²⁴ Id. at 7.²⁵ R. Doc. No. 17-3, at 1.

²⁶ R. Doc. No. 17-4, at 3 ¶ VI.

²⁷R. Doc. No. 19-1, at 1.

²⁸ R. Doc. No. 17-8.

²⁹ R. Doc. No. 17-7, at 5.

³⁰ R. Doc. No. 19-3.

³¹R. Doc. No. 1, at 6 ¶ 17.

³² Id. at 4 ¶ 11, 6 ¶ 17.

³³ Id. at 6 ¶ 17.

³⁴ Id. at 5 ¶ 15.

³⁵ Id. at 6 ¶ 17.

³⁶ R. Doc. No. 17-1, at 10-12, 19-21.

³⁷ R. Doc. No. 17-1, at 13 (emphasis in original).

³⁸ R. Doc. No. 19, at 6.

³⁹ Id.

⁴⁰ R. Doc. No. 17-9, at 6.

⁴¹Id. at 7.

⁴² Ultimately, evidence in the record conflicted with the driver’s testimony that he intended to make a brief detour for a meal. Burns, 2020 U.S. Dist. LEXIS 92911, 2020 WL 2776495, at *8-9. Because there were genuine disputes of material facts at to the driver’s intended destination, among other things the court denied the motion for summary judgement. 2020 U.S. Dist. LEXIS 92911, [WL] at *9. No such factual disputes exist in this action because the parties have jointly stipulated that Esnault intended to get cigarettes at a nearby gas station or convenience store prior to the collision. See supra n.14.

⁴³R. Doc. No. 17-9, at 7.

⁴⁴ R. Doc. No. 19, at 6.

⁴⁵ R. Doc. No. 22, at 6.

⁴⁶ Id. at 6-7.

⁴⁷ R. Doc. No. 19, at 6.

⁴⁸ Id. at 4.

⁴⁹ R. Doc. No. 17-2, at 2 ¶ 12.

⁵⁰ Id. at 2 ¶¶ 8, 10, 11.

⁵¹ Id. at 2 ¶ 9.

⁵² Id. at 2 ¶ 12. The Court does not deem the fact that Esnault’s contemplated detour required him to drive in the opposite direction of his primary garage to be dispositive. Detours, by definition, require the driver to depart from the most direct route to some degree. Whether the detour entails a U-turn or, for instance, exiting a highway to drive to a nearby gas station, is of little import. The purpose, distance, and duration of the detour bear more relevance to the inquiry.

Mabin v. Artisan & Truckers Cas. Co.

Court of Appeals of Wisconsin

March 24, 2022, Decided; March 24, 2022, Filed

Appeal No. 2021AP188

Reporter

2022 Wisc. App. LEXIS 244 *; 2022 WL 872204

JESSICA MABIN, PLAINTIFF-APPELLANT, v. ARTISAN AND TRUCKERS CASUALTY COMPANY, DEFENDANT-RESPONDENT, TALGAT KONKARGAEV, DUET INSURANCE GROUP AND NATIONAL LIABILITY & FIRE INSURANCE COMPANY, DEFENDANTS, C A S TRANSPORT, INC. AND NATIONAL CONTINENTAL INSURANCE COMPANY, DEFENDANTS-THIRD-PARTY PLAINTIFFS, v. NOVA LINES, INC. AND NATIONAL CONTINENTAL INSURANCE COMPANY, THIRD-PARTY DEFENDANTS.

Notice: THIS OPINION IS SUBJECT TO FURTHER EDITING. IF PUBLISHED, THE OFFICIAL VERSION WILL APPEAR IN THE BOUND VOLUME OF THE OFFICIAL REPORTS.

THIS OPINION WILL NOT BE PUBLISHED. SEE WIS. STAT. RULE 809.23(1)(B)(4).

Prior History: [*1] APPEAL from an order of the circuit court for Dane County: STEPHEN E. EHLKE, Judge. Cir. Ct. No. 2018CV2424.

Disposition: Affirmed.

Core Terms

coverage, subparagraph, semi-truck, circuit court, insurer, endorsement, amend, time of an accident, proof of financial responsibility, uninsured motor vehicle, summary judgment, insurance policy, driver, terms, equitable estoppel, parties, liability policy, motion for leave, motor carrier, motor vehicle, undisputed, bodily injury liability, uninsured vehicle, bad faith, interstate, ambiguity, Trucking, financial responsibility law, asserts, qualify

Case Summary

Overview

HOLDINGS: [1]-Where an insured was injured when a semi-trailer truck rear-ended her car, and where the insured filed a personal injury suit against the driver of the semi-truck and its owner as well as against her own insurer based on an uninsured motorist (UM) provision in her policy, the trial court properly dismissed the insured’s UM claim against her insurer because the policy did not provide UM coverage under these circumstances since the semi-truck was not an uninsured vehicle under the policy’s terms; [2]-In particular, the semi-trailer truck that rear-ended the insured’s car had an endorsement that was not a policy of insurance, but rather demonstrated financial responsibility for the vehicle in compliance with federal law, but there was no evidence that a bodily injury liability bond or policy applied to the semi-truck at the time of the accident.

Outcome

Decision affirmed.

LexisNexis® Headnotes

Civil Procedure > … > Summary Judgment > Entitlement as Matter of Law > Appropriateness

Civil Procedure > Appeals > Summary Judgment Review > Standards of Review

Civil Procedure > Judgments > Summary Judgment > Entitlement as Matter of Law

Civil Procedure > … > Summary Judgment > Entitlement as Matter of Law > Legal Entitlement

Civil Procedure > … > Summary Judgment > Entitlement as Matter of Law > Genuine Disputes

Entitlement as Matter of Law, Appropriateness

Appellate courts independently review a grant of summary judgment using the same methodology as the circuit court. Summary judgment is appropriate if there are no genuine issues of material fact, and the moving party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2) (2019-20).

Administrative Law > Judicial Review > Standards of Review > De Novo Standard of Review

Governments > Legislation > Interpretation

Civil Procedure > Appeals > Standards of Review > De Novo Review

Civil Procedure > Appeals > Standards of Review > Questions of Fact & Law

Standards of Review, De Novo Standard of Review

The interpretation and application of statutes and regulations present issues of law that are generally subject to de novo review.

Civil Procedure > Appeals > Standards of Review > De Novo Review

Insurance Law > Claim, Contract & Practice Issues > Policy Interpretation > Judicial Review

Insurance Law > Claim, Contract & Practice Issues > Policy Interpretation > Question of Law

Civil Procedure > Appeals > Standards of Review > Questions of Fact & Law

Standards of Review, De Novo Review

Interpretation of an insurance policy presents issues of law that appellate courts review independently from determinations of the circuit court.

Insurance Law > Claim, Contract & Practice Issues > Claims Made Policies > Coverage

Claims Made Policies, Coverage

Under Wisconsin’s coverage methodology, a court first examines the terms in the insurance policy addressing coverage to determine whether the alleged damages are covered.

Insurance Law > … > Policy Interpretation > Ambiguous Terms > Construction Against Insurers

Ambiguous Terms, Construction Against Insurers

Ambiguities in insurance policies are construed against the insurer. If there is no ambiguity in the language of an insurance policy, it is enforced as written, without resort to rules of construction or applicable principles of case law.

Insurance Law > Claim, Contract & Practice Issues > Policy Interpretation

Claim, Contract & Practice Issues, Policy Interpretation

Courts must avoid determining that there is coverage for risks that the insurer did not contemplate or underwrite and for which it did not receive a premium.

Insurance Law > … > Coverage > Compulsory Coverage > Motor Carriers

Transportation Law > Carrier Duties & Liabilities > Freight Brokers & Forwarders

Compulsory Coverage, Motor Carriers

Interstate motor carriers must comply with federal law governing their financial responsibilities, and one permissible way for them to do this is to maintain an endorsement attached to an insurance policy. 49 C.F.R. § 387.7(d). Federal law applies to the operation and effect of the specified endorsement.

Insurance Law > Claim, Contract & Practice Issues > Policy Interpretation > Entire Contract

Insurance Law > Claim, Contract & Practice Issues > Policy Interpretation > Ordinary & Usual Meanings

Policy Interpretation, Entire Contract

One rule of insurance policy interpretation is that courts attempt to construe a given term so that it aligns with the common and ordinary meaning it would have in the mind of a lay person. But another rule is that absent ambiguity, a an insurance policy is enforced as written, without resort to rules of construction or applicable principles of case law.

Insurance Law > … > Coverage > Compulsory Coverage > Proof of Financial Responsibility

Compulsory Coverage, Proof of Financial Responsibility

The purpose of Wisconsin’s financial responsibility law is to provide a method of compensating third parties for damages that may result from future accidents caused by the negligence of an operator with a poor driving record. Stated broadly, under this state law it is a condition of a license to operate a motor vehicle that the operator obtain a liability insurance policy for the protection of persons or property injured through operation of such vehicles.

Civil Procedure > Judicial Officers > Judges > Discretionary Powers

Civil Procedure > … > Pleadings > Amendment of Pleadings > Leave of Court

Judges, Discretionary Powers

Leave to amend in civil actions shall be freely given at any stage of the action when justice so requires. Wis. Stat. § 802.09(1) (2019-20). A circuit court’s decision whether to allow an amendment to a complaint when the party does not have a right to amend under § 802.09(1) is a matter left to the discretion of the court. Appellate courts affirm a circuit court’s discretionary decision if it applies a correct legal standard to the facts in a reasonable manner.

Insurance Law > Claim, Contract & Practice Issues > Estoppel & Waiver > Burdens of Proof

Insurance Law > Claim, Contract & Practice Issues > Estoppel & Waiver > Policy Coverage Issues

Insurance Law > Claim, Contract & Practice Issues > Estoppel & Waiver > Equitable Estoppel

Estoppel & Waiver, Burdens of Proof

A dispute over the existence of insurance coverage cannot be resolved based on application of the doctrine of equitable estoppel against the purported insurer. The general rule is well established that the doctrine of waiver or estoppel based upon the conduct or action of the insurer or its agent is not applicable to matters of coverage. Estoppel can neither create an insurance contract where none exists, nor enlarge existing coverage.

Insurance Law > Liability & Performance Standards > Bad Faith & Extracontractual Liability > Elements of Bad Faith

Bad Faith & Extracontractual Liability, Elements of Bad Faith

A bad faith claim in the insurance context is a tort separate and apart from a breach of contract per se, giving rise to a separate claim for damages. A plaintiff must show: (1) the absence of a reasonable basis for denying policy benefits, and (2) the insurer’s knowledge or reckless disregard of the lack of a reasonable basis for denying the claim. The first element is objective and the second is subjective.

Judges: Before Blanchard, P.J., Fitzpatrick, and Kloppenburg, JJ.

Opinion

P1 PER CURIAM. A semi-trailer truck rear-ended Jessica Mabin’s car. Mabin filed this personal injury action against the driver of the semi-truck and its owner. She also sued various insurance companies. This included a claim against her own insurer, Artisan and Truckers Casualty Company (Artisan), based on an uninsured motorist (UM) provision in her Artisan auto policy. The circuit court dismissed Mabin’s UM claim against Artisan, concluding that, under the circumstances, the policy does not provide UM coverage. On appeal, Mabin argues that she is entitled to UM coverage because the semi-truck was an “uninsured vehicle,” as defined in the policy. Based on our conclusions that there is no ambiguity in the pertinent language of the policy and that the semi-truck is not an “uninsured vehicle,” we agree with Artisan that Mabin is not entitled to UM coverage.

P2 Separately, Mabin appeals circuit court decisions to deny her motions for leave to amend her complaint to add new claims against Artisan based on theories of [*2] equitable estoppel and bad faith. We reject Mabin’s arguments on these topics.

P3 Accordingly, we affirm the challenged decisions of the circuit court and the dismissal of Mabin’s action against Artisan.

BACKGROUND

P4 The semi-truck rear-ended Mabin’s car in September 2015 in Dane County. Mabin filed this personal injury suit in the circuit court against the truck driver, who identified himself on the scene as Talgat Konkargaev, and CAS Transport, Inc. (CAS), the owner of the semi-truck. Mabin also named as defendants three insurance companies. She sued two of them—National Continental Insurance Company (National Continental) and National Liability & Fire Insurance Company (National Liability)—as alleged insurers of CAS or Konkargaev with potential exposure in this case. Mabin also sued Artisan, as pertinent here based on an Artisan policy held by Mabin that provided for UM coverage.¹

P5 We skip over, as irrelevant to this appeal, procedural history regarding: (1) a third-party complaint that CAS and National Continental filed against Nova Lines, Inc. (Nova) and; (2) decisions by the circuit court to grant motions for summary judgment in favor of CAS, National Continental, National Liability, [*3] and Nova, dismissing each from this action. As established in a July 16, 2021 order of this court, the scope of this appeal is limited to the decisions of the circuit court granting Artisan’s motion for summary judgment based on the absence of UM coverage, dismissing Artisan from the case, and denying Mabin’s motions for leave to amend her complaint against Artisan based on theories of equitable estoppel and bad faith.²

P6 Mabin moved for partial summary judgment and for leave to amend her complaint as to Artisan, and followed this up with a “revised memorandum” to the circuit court on these same issues. Mabin made three arguments, each matching the arguments she now makes on appeal. We now briefly summarize them.

P7 First, Mabin argued that she is entitled to summary judgment in her favor because the semi-truck qualifies as “an uninsured motor vehicle as defined under” Mabin’s Artisan policy. Second, she argued that the circuit court should permit her to amend the complaint to add a claim of equitable estoppel against Artisan. Her theory was that, due to Artisan’s actions and inactions, it “is estopped from now claiming that there is no UM coverage” on the grounds that Artisan was then [*4] asserting. Third, she argued that the court should permit her to amend the complaint to add a claim of bad faith against Artisan, “based upon its breach of its duty to [Mabin] to act in good faith.”

P8 Artisan moved for summary judgment seeking dismissal of all claims against it, advancing the same arguments it now makes on appeal. In pertinent part Artisan argued that the UM provisions in the policy do not apply here because Mabin “was not involved in an accident with an ‘uninsured motor vehicle.’” Regarding Mabin’s motions for leave to amend the complaint, Artisan contended that leave was not appropriate because any theories of estoppel or bad faith would fail on multiple grounds.

P9 After considering briefing and oral arguments of the parties, the circuit court denied Mabin’s motions for partial summary judgment and for leave to amend the complaint, and granted Artisan’s motion for summary judgment, dismissing it from the case. Mabin appeals.

DISCUSSION

P10 We first address the UM coverage issue and then turn to the circuit court’s denial of Mabin’s motions for leave to amend the complaint.

I. UM Coverage

A. Legal Standards

the same methodology as the circuit court. Pertzsch v. Upper Oconomowoc Lake Ass’n, 2001 WI App 232, ¶7, 248 Wis. 2d 219, 635 N.W.2d 829. Summary judgment is appropriate if there are no genuine issues of material fact, and the moving party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2) (2019-20).³

P12 The interpretation and application of statutes and regulations present issues of law that are generally subject to de novo review. Wisconsin Power & Light Co. v. PSC, 2009 WI App 164, ¶18, 322 Wis.2d 501, 777 N.W.2d 106.

P13 Interpretation of an insurance policy presents issues of law that we review independently from determinations of the circuit court. Folkman v. Quamme, 2003 WI 116, ¶12, 264 Wis. 2d 617, 665 N.W.2d 857.

P14 Under Wisconsin’s coverage methodology, a court first examines the terms in the policy addressing coverage to determine whether the alleged damages are covered. American Family Mut. Ins. Co. v. American Girl, Inc., 2004 WI 2, P24, 268 Wis. 2d 16, 673 N.W.2d 65. In this case, we end with that first step, because we determine that there is no grant of coverage and the parties do not discuss any exclusions or exceptions to exclusions in the Artisan policy. See id. (addressing the potential for second or third steps in the methodology).

Id., ¶13.

P16 Courts must avoid determining that there is coverage for risks that the insurer did not contemplate or underwrite and for which it did not receive a premium. American Family Mut. Ins. Co., 2004 WI 2, 268 Wis. 2d 16, ¶23, 673 N.W.2d 65.

B. Additional Background

P17 The following additional background is undisputed and pertinent to various arguments by the parties on the UM coverage issue. Some of it is also pertinent to the two other issues addressed below.

P18 At the time of the accident, the semi-truck had been leased by its owner, CAS, to Bright Trucking Company. Bright, in turn, had entered into a “Broker-Carrier Transportation Agreement” with Nova, under which Bright agreed to pick up and deliver a load of goods for a Nova customer using the semi-truck. Thus, the state of affairs when the semi-truck struck Mabin’s car was that Bright was the interstate motor carrier that operated the semi-truck, which was on lease from CAS and carrying a load for a customer of Nova.

P19 A state trooper responded to the accident scene, conducted an investigation that included taking photographs, and prepared a report that became available to the public. This evidence revealed that two signs were attached to the driver-side door of the semi-truck tractor: “LEASED TO NOVA [*7] LINES” and “BRIGHT TRUCKING US DOT #2783363 WOODRIDGE, IL.”⁴

P20 At the time of the accident, CAS and Nova each had liability insurance policies with National Continental and Bright had a policy with National Liability. In order to distinguish between the two separate policies that two different entities had with the same insurer, we refer to the CAS policy as National Continental-CAS policy and the Nova policy as the National Continental-Nova policy.

P21 Mabin filed a liability claim with National Continental-CAS, which was denied. National Continental-CAS took the position that the driver “did not qualify as an insured” under the policy and that he “was not working for” CAS at the time of the accident. In contrast, Mabin did not pursue claims based on the National Continental-Nova policy or Bright’s National Liability policy.⁵

P22 Also at the time of the accident, Mabin had an Artisan auto insurance policy that includes UM coverage with limits of $500,000 per accident. Part III, paragraph (a), of the policy provides in pertinent part:

If you pay the premium for this coverage, we will pay for damages that an insured person is legally entitled to recover from the owner or operator [*8] of an uninsured motor vehicle because of bodily injury:

1. sustained by an insured person;

2. caused by an accident; and

3. arising out of the ownership, maintenance, or use of an uninsured motor vehicle.

“Uninsured motor vehicle” is defined in paragraph (d) of Part III as follows:

“Uninsured motor vehicle” means a land motor vehicle or trailer of any type:

a. to which no bodily injury liability bond or policy applies at the time of the accident and the owner or operator has not furnished proof of financial responsibility for the future;

b. to which a bodily injury liability bond or policy applies at the time of the accident, but the bonding or insuring company:

(i) denies coverage; or

(ii) is or becomes insolvent.

c. that is an unidentified motor vehicle involved in a hit-and-run accident with an insured person; or

d. that is a phantom motor vehicle, if all of the following apply [listing three circumstances irrelevant to this appeal] ….

P23 We now explain briefly how one aspect of the UM provision in Mabin’s Artisan policy causes the parties to discuss federal financial responsibility statutes and regulations that govern interstate motor carriers. Central to some arguments is one phrase, emphasized [*9] in the following, from subparagraph a. of paragraph III(d) of the Artisan policy: “‘Uninsured motor vehicle’ means a land motor vehicle … to which no bodily injury liability bond or policy applies at the time of the accident and the owner or operator has not furnished proof of financial responsibility for the future.” for Motor Carrier Policies of Insurance for Public Liability Under Sections 29 and 30 of the Motor Carrier Act of 1980,” and is referred to as an MCS-90 endorsement. See 49 C.F.R. § 387.7(d).

P24 In introducing the concept of the federal proof of financial responsibility law and the MCS-90 endorsement we make the following basic points. As the parties here agree, an MCS-90 endorsement is not a policy of insurance that provides coverage for a particular vehicle or set of vehicles. Instead, it demonstrates the financial responsibility of the particular interstate [*10] motor carrier that is named in the insurance policy to which the endorsement is attached. See 49 C.F.R. §§ 387.5, 387.15; Canal Ins. Co. v. Distribution Servs., Inc., 320 F.3d 488, 490 (4th Cir. 2003) (“‘the primary purpose of the MCS-90 endorsement is to assure that injured members of the public are able to obtain judgment from negligent authorized interstate carriers,’” and it “creates a suretyship by the insurer to protect the public” (emphasis added; alteration and quoted source omitted)).

P25 It is undisputed that an MCS-90 endorsement was attached to the National Continental-CAS policy, to the National Continental-Nova policy, and to Bright’s National Liability policy.

P26 As discussed in more detail below, Mabin contends that she is entitled to coverage under the UM provision of the Artisan policy because National Continental-CAS’s denial of her claim caused the semi-truck to qualify as an “uninsured motor vehicle” under the Artisan policy.

C. Analysis

P27 We now explain why we reject Mabin’s arguments that the semi-truck fits a definition of an “uninsured motor vehicle” contained in the UM provision of the Artisan policy, based strictly on our construction of the pertinent policy terms.⁶ Based on that conclusion, we affirm the circuit court on the UM coverage issue.

P28 Subparagraphs a.-d. of paragraph (d) of Part III of the Artisan policy are stated in the disjunctive, and therefore Mabin would establish that the semi-truck was an “uninsured vehicle” if she could show that any subparagraph applies. The primary dispute between the parties involves subparagraph b. Mabin adds limited argument based on subparagraph a., but she makes no argument at all based on subparagraphs c. or d., as quoted more completely supra in ¶22. Given Mabin’s emphasis, we now address in turn subparagraphs b. and a., explaining why we conclude that neither provision applies here.

1. Subparagraph b.

P29 Subparagraph b. defines “[u]ninsured motor vehicle” using a two-part test. Each part must be met in order for a motor vehicle (here, the semi-truck) to be deemed “uninsured,” because the parts are separated by a conjunctive “but.” First, the vehicle must be one “to which a bodily injury liability bond or policy applies at the time of the accident.” Second, the bonding or insuring company must either deny coverage to the person claiming UM coverage, or else the company must be “insolvent” or become so. (Neither party suggests that company [*12] insolvency is an issue in this case.)

P30 We agree with Artisan that the following aspect of undisputed evidence is dispositive in its favor under a proper interpretation of the terms of subparagraph b., which are not ambiguous. It is undisputed that neither the semi-truck nor its driver at the time of the accident is listed on any insurance policy held by any of the three interstate motor carriers that have been identified as having potential liability in the accident. Mabin acknowledges this undisputed fact in her briefing on appeal: “CAS Transport, Inc., Nova Lines, Inc., and Bright Trucking Company, Inc. each had their own insurance polic[ies], but neither the driver nor the semi was listed on any of the policies.” For this reason, Mabin cannot meet the first part of the two-part test in subparagraph b., because she lacks evidence that the semi-truck was one “to which a bodily injury liability bond or policy applies at the time of the accident.”

P31 It is true that Mabin was denied coverage by National Continental-CAS. She contends that this denial alone was sufficient to satisfy the subparagraph b. test. This is incorrect because, as Mabin concedes, the National Continental-CAS [*13] policy did not apply to the semi-truck or to the driver. As Artisan argues, the mere fact of this denial did not transform the semi-truck into an “uninsured vehicle” under the terms of subparagraph b.

P32 Mabin argues that hers is a “basic,” “very typical” UM claim, because she was an “insured” “involved in a motor vehicle accident, the at-fault driver’s insurer denie[d] coverage for the accident, and the insured file[d] an uninsured motorist claim under its own policy.” But it is a false premise that in this case “the at-fault driver’s insurer denie[d] coverage.” Mabin is referring to denial of coverage by National Continental-CAS. We have just explained why National Continental-CAS is not “the at-fault driver’s insurer.” Further, as noted above, Mabin did not pursue claims based on either the National Continental-Nova policy or on Bright’s National Liability policy, and therefore there could have been no denial under either of those policies.

P33 Mabin argues that “a reasonable person in her position would understand,” based on the UM provision in the Artisan policy, “that the denial of liability coverage by [National Continental-CAS] triggered Ms. Mabin’s uninsured motorist coverage [*14] under her policy.” Mabin is correct that ” to the pertinent terms in subparagraph b. would reach a different conclusion. Cieslewicz, 84 Wis. 2d at 98.

P34 At least at points in her briefing, Mabin seems to suggest an alternative argument that, even if the unambiguous terms of subparagraph b. dictate that there could be no UM coverage on the undisputed facts, the steps that she took (through counsel) to investigate the facts and consider the potential pursuit of claims in the wake of the accident should have been sufficient to trigger UM coverage because those were the actions of a reasonable insured. At least this would seem to be the implication of her many assertions about what information [*15] was or was not readily available to her when she was making decisions about what claims to pursue. For example, she asserts (without providing a record citation) that, at some unidentified time, she “did not know about the MCS-90 endorsement[s]” attached to the liability policies of Bright and Nova “and did not know about Nova Lines, Inc. or the Bright Trucking Company.” However, we do not discern in any of these references to information that she claims to have lacked at various points a basis to conclude that UM coverage is available to her under subparagraph b., or under any other policy term referenced by the parties. Put differently, Mabin fails to identify evidence in the summary judgment materials related to the availability of information that could have any effect on the simple analysis we have just given explaining why, based on the undisputed facts and the unambiguous terms, subparagraph b. does not apply here to qualify the semi-truck as an “uninsured vehicle.”

P35 Mabin asserts that she should not have to “prove a negative” to qualify for UM coverage, but fails to explain this assertion in terms of policy language and we dismiss this as an undeveloped argument. See State [*16] v. Pettit, 171 Wis. 2d 627, 646, 492 N.W.2d 633 (Ct. App. 1992) (appellate courts may decline to address undeveloped and inadequately briefed issues).

2. Subparagraph a.

P36 For the most part, Mabin relies on subparagraph b. Indeed, she states in her opening brief that her “argument is focused on” subparagraph b. However, she may intend to add one or more arguments relying on subparagraph a., related to the federal financial responsibility law referenced above.⁷ We now explain why we fail to discern a developed argument by Mabin that could render the semi-truck an “uninsured vehicle” under subparagraph a.

P37 “Uninsured motor vehicle” is defined in subparagraph a. by a different two-part test. Each part of the subparagraph a. test must be met, because the parts are separated by the conjunctive “and.” First, the vehicle must be one “to which no bodily injury liability bond or policy applies at the time of the accident.” Second, the “owner or operator” of the vehicle “has not furnished proof of financial responsibility for the future.”

P38 Mabin makes references to the second part of the subparagraph a. test. She asserts that the meaning of the phrase “has not furnished proof of financial responsibility for the [*17] future” means that Artisan was required to provide Mabin “with proof of financial responsibility for the future.” To this assertion she adds that “only a lawyer would think that [the second part of the subparagraph a. refers to] the filing of a Form BMC 91X Certificate of Liability Insurance with the Federal Highway Administration,” meaning the filing of a form related to an MCS-90 endorsement. We assume without deciding that Mabin raises potential questions about how, precisely, proof of financial responsibility is to be “furnished” under the terms of the UM policy. However, until her reply brief, she does not develop a discernable argument based on the policy terms, as opposed to simply raising questions. In the reply brief she may intend to indicate that her point is that the reference in subparagraph a. to “proof of financial responsibility for the future,” is, in her words, “likely” a reference not to federal financial responsibility laws and the use of MCS-90 endorsements but instead to Wis. Stat. §§ 344.24 – 344.579. This is a generic citation to the many sections of Chapter 344 (“Vehicles — Financial Responsibility”), including subchapter III, which addresses aspects of “Proof Of Financial Responsibility [*18] For the Future.”

operator with a poor driving record.” Cardinal v. Leader Nat. Ins. Co., 166 Wis. 2d 375, 390, 480 N.W.2d 1 (1992). Stated broadly, under this state law it is a condition of a license to operate a motor vehicle that the operator obtain a liability insurance policy for the protection of persons or property injured through operation of such vehicles. See Hechimovich v. Acuity, 2014 WI App 14, ¶¶6-8, 352 Wis. 2d 513, 842 N.W.2d 493; Wis. Stat. § 344.33 (defining required “motor vehicle liability policy”).

P40 With that background, Mabin does not develop an argument that the second part of the subparagraph a. test has been satisfied here by proof that the “owner or operator” of the semi-truck “has not furnished proof of financial responsibility for the future” because the “owner or operator” did not comply with Wisconsin’s financial responsibility law, as opposed to complying with the federal financial responsibility law. As would minimally be required for an argument along these or similar lines, she does not address in this context (or explain why she need not address) the uncontested facts that: (1) CAS, Bright, and Nova [*19] all had liability policies (which was, after all, a necessary precondition to having MCS-90 endorsements, which are attached to liability policies); (2) Mabin made no claims against either of the potentially responsible motor carriers Bright or Nova. And stepping back, Mabin does not support her assertion that, contrary to the unambiguous terms of the policy that the furnishing of proof is to be made by the “owner-operator,” the furnishing of proof is to be made by Artisan to its insured.

II. Motions For Leave To Amend

P41 Mabin argues that the circuit court should have granted her motions for leave to amend her complaint to add claims against Artisan based on theories of equitable estoppel and bad faith.

P42 As pertinent here, not erroneously exercise its discretion in determining that justice did not require amendment on either proposed theory.

A. Equitable Estoppel

P43 We need not summarize the law governing the doctrine of equitable estoppel or Mabin’s particular theory of equitable estoppel. This is because we resolve this issue based on Mabin’s concession to one of Artisan’s arguments, applying settled Wisconsin case law, which is dispositive on this issue. This case law establishes that failure to respond in reply brief to argument made in response brief may be taken as concession). Based on this concession, the circuit court could not have erroneously exercised its discretion on this issue.

B. Bad Faith

er se,” giving rise to a separate claim for damages. Anderson v. Continental Ins. Co., 85 Wis. 2d 675, 686, 271 N.W.2d 368 (1978). A plaintiff must show: (1) the absence of a reasonable basis for denying policy benefits, and (2) the insurer’s knowledge or reckless disregard of the lack of a reasonable basis for denying the claim. Brethorst v. Allstate Prop. and Cas. Ins. Co., 2011 WI 41, ¶26, 334 Wis. 2d 23, 798 N.W.2d 467. The first element is objective and the second is subjective. Weiss v. United Fire and Cas. Co., 197 Wis. 2d 365, 377, 541 N.W.2d 753 (1995).

P45 We conclude that the circuit court did not erroneously exercise its discretion on this issue for the following reason. As Artisan notes, in denying the motion for leave to amend to add a bad faith claim, the circuit court made the basic point that “there is no basis for the UM coverage here,” and therefore a bad faith claim against Artisan would be “ill-founded in light of the fact [that] I have concluded there is no UM coverage.” That is, the circuit court concluded that, viewed in an objective manner, Mabin could not show the absence of a reasonable [*22] basis for denying policy benefits, given the fact that there is no basis for coverage. Mabin fails to develop an argument (and provides no argument at all on this issue in her reply brief) that could provide a sufficient basis for this court to reverse the circuit court’s exercise of discretion on this issue, given our conclusion that the circuit court properly determined that there is no UM coverage under the policy.⁸ Mabin fails to persuade us that the circuit court failed to apply correct legal standards to the facts in a reasonable manner.

CONCLUSION

P46 For all of these reasons, we affirm the circuit court rulings denying Mabin’s request for a determination of UM coverage and her motions for leave to amend her complaint, and dismissing her action against Artisan.

By the Court.—Order affirmed.

This opinion will not be published. See Wis. Stat. Rule 809.23(1)(b)(5).

End of Document

¹Mabin initially claimed that Artisan was an insurer of CAS, but she does not pursue that position in this appeal. She discusses Artisan exclusively in its role as her own insurer, and she seeks exclusively to establish a right to UM coverage under her Artisan policy.

²In this appeal, Mabin challenges aspects of the circuit court’s reasoning in dismissing National Continental on summary judgment, but this is improper argument under our prior order and accordingly we ignore those challenges.

³All references to the Wisconsin Statutes are to the 2019-20 version unless otherwise noted.

⁴Regarding the “DOT number” on one of these signs, federal regulations governing commercial motor vehicles establish the required contents and modes of display for “identification numbers issued by” the Federal Motor Carrier Safety Administration, to be “preceded by the letters ‘USDOT,’” including signage involving leased vehicles. See 49 C.F.R. § 390.21 (2020). All references to the Code of Federal Regulations are to the 2020 edition unless otherwise noted.

⁵To clarify, Mabin initially sued National Liability based on a lapsed policy that National Liability had issued to CAS (entirely separate from the policy issued to Bright), but Mabin did not mention Bright in the operative complaint and she does not now assert that there is evidence that she ever pursued a claim based on Bright’s National Liability policy.

⁶Given our dispositive interpretation of pertinent policy terms on the UM coverage issue, we need not and do not reach what Artisan may intend to present as a broader argument for affirming the circuit court. Artisan’s broader argument might be that, based on federal or state statutes and regulations, no one in Mabin’s position could possibly be entitled to UM coverage in any “trucking accident case that involves no less than three interstate motor carriers, each with a liability policy including an MCS-90 endorsement.” This includes the arguments made by each party about the significance and persuasive value of a California state court opinion. See Global Hawk [*11] Ins. Co. v. Century-National Ins. Co., 203 Cal. App. 4th 1458, 138 Cal.Rptr.3d 363 (Cal. Ct. App. 2012) (holding that the liability insurer of an interstate motor carrier that rear-ended a garbage truck was required to reimburse a UM insurer of the owner of the garbage truck for benefits paid by the UM insurer based on the carrier’s MCS-90 endorsement). The facts in Global Hawk differ in numerous ways from the facts here and, at least so far as the current arguments of Artisan and Mabin suggest, the reasoning of the California court could be persuasive authority only regarding what Artisan may intend as the broader argument, which we do not reach.

⁷Mabin’s subparagraph a. argument is arguably developed primarily in her reply brief, but we do not reject it on that basis. See Roy v. St. Lukes Med. Ctr., 2007 WI App 218, ¶30 n.6, 305 Wis. 2d 658, 741 N.W.2d 256 (appellants are not entitled as of right to raise arguments for the first time in reply briefs).

⁸Before concluding, we note one fundamental shortcoming in Mabin’s appellate briefing. In multiple spots, Mabin’s counsel provides as record authority for a proposition a citation to a set of pages in the appellant’s appendix, without providing either a specific page or a record citation. Both are required. See Roy, 305 Wis. 2d 658, ¶10 n.1. We remind counsel for Mabin that judges and staff of this high volume court, as well as opposing counsel, are entitled to expect briefing by an attorney that follows the basic rules of appellate procedure.