Crosby v. Life Insurance Company of The Southwest et al, No. 2:2010cv00064 - Document 33 (D. Ariz. 2011)
Court Description: ORDER denying 30 Plaintiff's Motion for Reconsideration. Signed by Judge G Murray Snow on 1/19/11.(DMT)
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Crosby v. Life Insurance Company of The Southwest et al 1 Doc. 33 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 10 11 12 13 14 15 16 ) ) ) Plaintiff, ) ) vs. ) ) Life Insurance Company of the Southwest,) a foreign corporation; Cunningham) Financial Group, an Arizona business) ) entity, ) ) Defendants. ) ) Glenna Crosby, No. CV-10-0064-PHX-GMS ORDER 17 18 Pending before this Court is Plaintiff Glenna Crosby’s Motion for Reconsideration 19 pursuant to Local Rule 7.2(g), requesting that the Court reconsider its December 21, 2010 20 Order denying Plaintiff’s Motion for Partial Summary Judgment and granting Defendant’s 21 Motion for Summary Judgment. (Doc. 30). For the reasons stated below, the Court denies 22 Plaintiff’s motion. 23 BACKGROUND 24 On June 11, 2010, Plaintiff filed a Motion for Partial Summary Judgment, asking the 25 Court to interpret A.R.S. § 20-1109(3). (Doc. 21). On July 9, 2010, Defendant Life Insurance 26 Company of the Southwest (“LSW”) filed a response to Plaintiff’s motion and a Motion for 27 Summary Judgment “on all of the plaintiff’s claims.” (Doc. 25). Plaintiff failed to file any 28 response to Defendant’s motion. The Court issued its Order addressing both motions on Dockets.Justia.com 1 December 21, 2010. (Doc. 28). In that Order, the Court denied Plaintiff’s motion, concluding 2 that Plaintiff’s interpretation of A.R.S. § 20-1109(3) was both inconsistent with the plain 3 language of the statute and contrary to Arizona case law. In addition, the Court granted 4 Defendant’s motion, finding summary judgment appropriate. 5 On January 3, 2011, Plaintiff filed this Motion for Reconsideration on the Court’s 6 Order, arguing in particular that the Court should not have reached the issue of whether a 7 question in Dr. Crosby’s life insurance policy application was unambiguous and elicited a 8 factual response. (Doc. 30). Plaintiff argues that it “deliberately and specifically left the 9 resolution of this factual dispute as a ‘topic for another day.’” Plaintiff contends that for 10 purposes of her motion, “a ruling as to A.R.S. § 20-1109 would have been unnecessary.” 11 The Court agrees that for purposes of resolving Plaintiff's Motion for Partial Summary 12 Judgment, it was not necessary or even appropriate for the Court to decide whether the 13 question on Defendant LSW’s life insurance application was unambiguous and called for a 14 factual response. Nevertheless, Defendant independently moved for summary judgment on 15 Plaintiff's claims in their entirety. Thus, to resolve Defendant's motion, the Court was 16 required to make such a determination about the question on LSW’s application. Plaintiff 17 completely failed to provide any response to Defendant's motion. After having so failed and 18 then after having had summary judgment entered against her on the entirety of her claims, 19 Plaintiff now seeks to present legal arguments and withdraw her previous factual admissions 20 in a motion for reconsideration. Such an attempt is improper. 21 22 DISCUSSION A. Legal Standard 23 A motion for reconsideration is meant to correct “manifest error” or to present “new 24 facts or legal authority that could not have been brought to [the Court’s] attention earlier with 25 reasonable diligence.” Local R. Civ. P. 7.2(g). The granting of a motion for reconsideration 26 “is an extraordinary remedy which should be used sparingly.” 11 C. WRIGHT & A. MILLER, 27 FEDERAL PRACTICE AND PROCEDURE § 2810.1 (2d ed. 1995). Such a motion “‘may not be 28 used to relitigate old matters, or to raise argument or present evidence that could have been -2- 1 raised prior to the entry of judgment.’” Exxon Shipping Co. v. Baker, 554 U.S. 471, 485 n.5 2 (2008) (quoting WRIGHT & MILLER, FEDERAL PRACTICE AND PROCEDURE § 2810.1). “A 3 motion for reconsideration should not be used to ask a court ‘to rethink what the court had 4 already thought through – rightly or wrongly.’” Defenders of Wildlife v. Browner, 909 5 F. Supp. 1342, 1351 (D. Ariz. 1995) (quoting Above the Belt, Inc. v. Mel Bohannan Roofing, 6 Inc., 99 F.R.D. 99, 101 (E.D. Va. 1983)). “Arguments that a court was in error on the issues 7 it considered should be directed to the court of appeals.” Id. (citing Refrigeration Sales Co. 8 v. Mitchell-Jackson, Inc., 605 F. Supp. 6, 7 (N.D. Ill. 1983)). 9 B. Analysis 10 Even were the Court to consider Plaintiff’s argument, raised for the first time on a 11 motion for reconsideration, it does not establish that the Court erred in granting Defendant’s 12 Motion for Summary Judgment, let alone committed “manifest legal error” in doing so. 13 Local R. Civ. P. 7.2(g). The question at issue in LSW’s life insurance application instructs 14 the applicant to “List any life or disability insurance you currently have (include face & ADB 15 amounts, company name & year of 16 straightforward on its face and requires no judgment calls, analysis or interpretation of facts 17 or terms. It merely requires the applicant to list any life or disability insurance that he or she 18 currently has. issue).” (Doc 24, Ex. 1). Such a question is 19 In her Motion for Reconsideration, Plaintiff argues that the “you” in the question 20 necessarily creates ambiguity because the term must refer to Dr. Jim Crosby personally as 21 an owner of a life insurance policy. Plaintiff then argues, from this unestablished premise, 22 that the question is at least ambiguous as applied to the facts in this case because Dr. Jim 23 Crosby did not “own” the additional Lafayette life insurance policy. Rather, Plaintiff argues 24 Dr. Crosby was merely the beneficiary of a $1.4 million life insurance policy that was an 25 “ancillary benefit” of the “Jim Crosby, DDS, P.C. Defined Benefit Pension Plan” that Dr. 26 Crosby established for his dental practice through Lafayette Life. Thus, Plaintiff argues in 27 her Motion for Reconsideration that, regardless of the fact that the beneficiary of the 28 Lafayette life insurance policy was Dr. Jim Crosby, the true owner of the policy was the -3- 1 Defined Benefit Pension Plan Trust or some other third party, but not Dr. Crosby himself. 2 As a result, Plaintiff asserts, the question in the life insurance application is an ambiguous 3 one and the Court should not have granted summary judgment in Defendant’s favor on the 4 question concerning “legal fraud.” 5 Unfortunately for Plaintiff, however, even assuming that the ownership distinction she 6 now raises would have affected the Court’s analysis, she has already admitted in responses 7 to Defendant’s requests for admissions, that it was Dr. Crosby who had in force a life 8 insurance policy with Lafayette Life and that he did not disclose that policy in his LSW 9 application. (Doc. 24, Ex. 2 at ¶ 3–4, 6–9 (admitting that “Crosby had in force a policy of 10 life insurance with Lafayette Life Insurance Company” as of certain dates (emphasis 11 added))). Defendant relied on these admissions in bringing its own motion for summary 12 judgment to which the Plaintiff did not respond. The Court granted summary judgment to 13 Defendant after considering those admissions. Given Plaintiff’s admissions and failure to 14 respond to Defendant’s Motion for Summary Judgment, the Plaintiff cannot now take the 15 position in a motion for reconsideration that a factual ambiguity exists because Dr. Crosby 16 did not actually own the Lafayette life insurance policy, but rather the trust or another third 17 party did. 18 At any rate, there is a considerable distinction between the question in the application 19 here and the types of questions that the Ninth Circuit has indicated are so ambiguous or 20 opinion-oriented as to prevent the grant of summary judgment. For example, in James River 21 Insurance Co. v. Schenk, a recent case not cited by the Plaintiff in her Motion for 22 Reconsideration, the Ninth Circuit reversed the district court’s grant of summary judgment 23 to an insurance company seeking a declaration of no coverage. 523 F.3d 915 (9th Cir. 2008). 24 At issue in that case was the following question: 25 27 After inquiry, are any [lawyers within the firm] aware of any circumstances, allegations, Tolling [sic] agreements or contentions as to any incident which may result in a claim being made against the Applicant or any if [sic] its past or present Owners, Partners, Shareholders, Corporate Officers, Associates, Employed Lawyers, Contract Lawyers or Employees or its predecessor in business? 28 Id. at 918. The defendant responded in the affirmative and listed several actual and potential 26 -4- 1 claims, but did not disclose any information about a potential legal malpractice claim that 2 was later filed against defendant. Id. The issue raised on appeal was whether in his response, 3 the defendant made a factual misrepresentation. Id. at 921. The Ninth Circuit agreed with the 4 defendant that the question, which asked the applicant to list any incidents which “may 5 result” in a claim, is “fairly viewed as a matter of opinion.” Id. The Court noted that the 6 answer required “a judgment call reflecting an analysis of those circumstances,” and thus was 7 ambiguous. Id. at 922. In answering the question at issue here on LSW’s life insurance 8 application, no such judgment call or expressions of opinion were required. 9 Rather than rely on applicable precedent such as James River, Plaintiff in her motion 10 relies on two out-of-state cases, Mutual Benefit Health & Accident Ass’n of Omaha v. Reid, 11 182 So.2d 869 (Ala. 1966), and Purcell v. Washington Fidelity National Insurance Co., 16 12 P.2d 639 (Or. 1932). Neither of these cases has facts analogous to those presented here. In 13 Mutual Benefit, the insurer tried to rescind an accidental death rider it had issued to the 14 insured as part of an accident and health policy based on the insured’s failure to disclose a 15 life insurance policy. 182 So.2d at 874. In the accident and health policy application, a 16 question asked: “Are you or your listed dependents, if any, now covered by other personal 17 insurance, or are applications now pending for such insurance? (monthly indemnity, hospital 18 benefits, etc.).” Id. The decedent had no other accident and health policies, but he did hold 19 a separate life insurance policy that he did not disclose in response to the question. Id. The 20 Court demurred, noting that “[t]he requirement that the defendant be notified of the existence 21 of additional insurance, or of pending application therefor, had reference to the kind of 22 insurance covered by the policy in suit, i.e., accident or health insurance.” Id. at 875. Thus 23 an accidental death rider on the accident or health policy could not be rescinded based on the 24 failure to disclose a separate life insurance policy because the “policy in suit” was not a life 25 insurance policy. Id. Purcell is to the same effect. See 16 P.2d at 642 (holding that a failure 26 to disclose a life insurance policy that had incidental disability benefits was an insufficient 27 basis on which to rescind a disability policy). 28 The facts of those cases are distinguishable from the facts before the Court in the -5- 1 present case. The question in the LSW life insurance policy application asked about other 2 life and disability insurance that the insured had. A life insurance policy is the “policy in 3 suit.” Dr. Crosby admittedly had such coverage and did not disclose it. Thus, Plaintiff is in 4 no way aided by Mutual Benefit or Purcell, each of which involved an attempt to rescind a 5 policy based on a failure to disclose policies that were primarily designed to cover different 6 risks. 7 8 9 IT IS THEREFORE ORDERED that Plaintiff’s Motion for Reconsideration (Doc. 30) is DENIED. DATED this 19th day of January, 2011. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -6-
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