Merrill v. Crown Life Insurance Company et al, No. 2:2013cv00110 - Document 68 (E.D. Wash. 2014)
Court Description: ORDER DENYING 65 DEFENDANT'S MOTION FOR RECONSIDERATION. Signed by Judge Thomas O. Rice. (BF, Judicial Assistant)
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1 2 3 4 5 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF WASHINGTON 6 7 ROBERT M. MERRILL, NO: 13-CV-0110-TOR 8 9 10 Plaintiff, ORDER DENYING DEFENDANT’S MOTION FOR RECONSIDERATION v. CROWN LIFE INSURANCE CO., 11 Defendant. 12 13 BEFORE THE COURT is Defendant’s Motion for Reconsideration (ECF 14 No. 65). This matter was submitted for consideration without oral argument. The 15 Court has reviewed the briefing and the record and files herein, and is fully 16 informed. 17 DISCUSSION 18 A motion for reconsideration may be reviewed under either Federal Rule of 19 Civil Procedure 59(e) (motion to alter or amend a judgment) or Rule 60(b) (relief 20 from judgment). Sch. Dist. No. 1J v. ACandS, Inc., 5 F.3d 1255, 1262 (9th Cir. ORDER DENYING MOTION FOR RECONSIDERATION ~ 1 1 1993). Reconsideration is appropriate under Rule 59(e) if the district court is 2 presented with newly discovered evidence, if it committed clear error or rendered a 3 manifestly unjust decision, or if there has been an intervening change in controlling 4 law. Id. at 1263. Reconsideration under Rule 60(b) may be granted if the moving 5 party can show 6 7 8 9 (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence that, with reasonable diligence, could not have been discovered in time to move for a new trial under Rule 59(b); (3) fraud ..., misrepresentation, or misconduct by an opposing party; (4) the judgment is void; (5) the judgment has been satisfied, released, or discharged; it is based on an earlier judgment that has been reversed or vacated; or applying it prospectively is no longer equitable; or (6) any other reason that justifies relief. 10 11 Fed. R. Civ. P. 60(b). Whether to grant a motion for reconsideration is within the 12 sound discretion of the court. Navajo Nation v. Confederated Tribes and Bands of 13 the Yakama Indian Nation, 331 F.3d 1041, 1046 (9th Cir. 2003). Reconsideration 14 is properly denied when a litigant “present[s] no arguments in his motion for 15 [reconsideration] that had not already been raised in opposition to summary 16 judgment.” Taylor v. Knapp, 871 F.2d 803, 805 (9th Cir. 1989). 17 Defendant has advanced two separate arguments in support of its motion for 18 reconsideration. First, Defendant asserts that the Court overlooked controlling 19 Washington authority which holds that insurance coverage cannot be created by 20 waiver or estoppel. ECF No. 65 at 5-8. Second, Defendant contends that allowing ORDER DENYING MOTION FOR RECONSIDERATION ~ 2 1 Plaintiff to recover total disability benefits for a period that he remained employed 2 and continued to earn an income is “contrary to sound public policy.” ECF No. 65 3 at 8-9. 4 The Court’s ruling does not run afoul of Defendant’s waiver and estoppel 5 authorities. Plaintiff’s theory of liability does not implicate coverage by waiver or 6 coverage by estoppel. Instead, Plaintiff’s theory of liability is that Defendant 7 breached the contracts of insurance by making a coverage decision based upon an 8 impermissible consideration: the fact that he continued working and earning an 9 income for nine months after his accident. As the Court previously explained, the 10 undisputed evidence supports this theory. ECF No. 63 at 14-16. First, it is 11 undisputed that Plaintiff’s vision impairments remained static from the moment he 12 returned to work to the moment he sold his practice on November 1, 2011. 13 Second, it is undisputed that nothing about Plaintiff’s physical ability to perform 14 the material and substantial duties of his profession changed on November 1, 2011. 15 Third, it is undisputed that Defendant awarded Plaintiff total disability benefits 16 effective November 1, 2011, and that Plaintiff continues to receive such benefits to 17 this day. 18 Plaintiff is presently “totally disabled.” See Summ. J. Hr’g Tr., ECF No. 64 at 30 Finally, Defendant has conceded (implicitly if not explicitly) that 19 20 ORDER DENYING MOTION FOR RECONSIDERATION ~ 3 1 (“We are not arguing that [Plaintiff is] not entitled to total disability now. . . . We 2 are not trying to say now he’s . . . not totally disabled.”).1 3 From this undisputed evidence, a rational finder of fact could only conclude 4 that Defendant denied total disability benefits from February to October 2011, not 5 on the basis of Plaintiff’s physical ability to continue performing the material and 6 substantial duties of his profession, but on the fact that Plaintiff continued to show 7 up for work and receive an income. Again, there is not one shred of evidence to 8 support a finding that Plaintiff’s ability to competently perform his duties as an 9 orthodontist changed on November 1, 2011. The only thing that changed on that 10 date is that Plaintiff sold his practice. As Plaintiff astutely noted in one of his 11 appeal letters, he did not become “totally disabled” because he sold his practice; 12 rather, he sold his practice because he was “totally disabled.” 13 14 1 15 Defendant argues that it has not “conceded” this issue. ECF No. 65 at 8 & n.7. 16 The Court respectfully disagrees. Defense counsel’s statements during the motion 17 hearing speak for themselves. Moreover, to whatever extent this issue is beyond 18 the scope of these proceedings, the fact that Defendant is presently paying Plaintiff 19 total disability benefits—and therefore considers Plaintiff “totally disabled” for its 20 own purposes—is relevant and admissible evidence. ORDER DENYING MOTION FOR RECONSIDERATION ~ 4 1 Contrary to Defendant’s protestations, this is simply not a coverage by 2 waiver or coverage by estoppel case. After all, Plaintiff is not seeking to “bring 3 into existence a contract not made . . . and create a liability contrary to the express 4 provisions of the contract the parties did make.” Saunders v. Lloyd’s of London, 5 113 Wash. 2d 330, 335 (1989). To the contrary, Plaintiff is attempting to enforce a 6 contract that the parties did make pursuant to the contract’s express terms. Thus, 7 the only relevant issue for purposes of the breach of contract claim is whether 8 Defendant partially denied coverage based upon something other than Plaintiff’s 9 physical ability to perform the material and substantial duties of his profession. 10 The undisputed facts establish, and a rational finder of fact could only conclude, 11 that it did. Plaintiff is therefore entitled to summary judgment. 12 Defendant’s attempt to create a genuine issue of material fact as to whether 13 or not Plaintiff could perform the material and substantial duties of his profession 14 from February to October 2011 falls far short. On the evidence before the Court, 15 no rational finder of fact could conclude Plaintiff possessed the ability to so 16 perform. 17 Finally, the Court is not persuaded that allowing Plaintiff to recover total 18 disability benefits is “contrary to sound public policy.” As the Court indicated in 19 its summary judgment order, Defendant’s argument that an insured should not be 20 entitled to recover total disability benefits while he or she remains employed and ORDER DENYING MOTION FOR RECONSIDERATION ~ 5 1 continues to earn an income has some intuitive appeal. But the prospect of an 2 insured “double dipping” in this scenario is not so offensive to public policy to 3 warrant a judicial re-write of the insurance policies. If Defendant wishes to avoid 4 paying total disability benefits to an insured in Plaintiff’s position, it can amend its 5 policy language accordingly. Given that the parties did not bargain for such a 6 result, however, the Court must decline Defendant’s invitation to reverse its prior 7 ruling. 8 IT IS HEREBY ORDERED: 9 10 11 12 Defendant’s Motion for Reconsideration (ECF No. 65) is DENIED. The District Court Executive is hereby directed to enter this Order and provide copies to counsel. DATED July 7, 2014. 13 14 THOMAS O. RICE United States District Judge 15 16 17 18 19 20 ORDER DENYING MOTION FOR RECONSIDERATION ~ 6
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