Blair v. Federal Insurance Company
433 P.3d 1048
Alaska2018Background
- Daniel (Danny) Blair, a seaman injured aboard a vessel owned by Charles Fogle, settled with the vessel’s insurer Federal Insurance Company under a P&I policy with $1,000,000 face limit; Federal paid $961,447.81 as the agreed “remaining policy limits.”
- The insurance policy contained a prominently headed notice stating the policy limits coverage for attorney’s fees under Alaska Civ. R. 82 (a “Rule 82 notice”).
- Blair later sued, claiming Federal breached the settlement by failing to include Rule 82 attorney’s fees in the policy limits calculation and by deducting $2,268.78 paid to Mahl’s Medical Review from the policy limits.
- The superior court granted summary judgment for Federal, finding the Rule 82 notice valid/conforming and construing the release as a full settlement for $961,447.81; the court also awarded Federal Rule 82 fees as the prevailing party.
- On appeal the Alaska Supreme Court affirmed on the Rule 82 notice and the settlement’s objective meaning, reversed as to whether the Mahl’s deduction was properly charged against policy limits (finding genuine fact issues), vacated the attorney’s fees award, and remanded for further proceedings.
Issues
| Issue | Plaintiff's Argument (Blair) | Defendant's Argument (Federal) | Held |
|---|---|---|---|
| Validity of the policy’s Rule 82 notice | Notice failed to conform to Division of Insurance model forms and thus was void | Notice substantially conformed to Division models (Combined form); no director approval required | Notice valid and enforceable; superior court correctly entered summary judgment for Federal on Rule 82 fee issue |
| Settlement interpretation re: attorney’s fees | Settlement should include Rule 82 fees separate from stated policy limits | Settlement paid the policy-defined limits; Rule 82 liability capped by policy notice | Objective contract construction: no extrinsic evidence Blair reasonably expected more than policy-defined limits; summary judgment for Federal on this issue affirmed |
| Deduction for Mahl’s Medical Review ($2,268.78) | Mahl’s charge was Federal’s cost-saving review and should not reduce policy limits | Mahl’s charge was properly part of amounts charged against policy limits | Genuine issue of material fact exists whether Mahl’s payment was resolved or left open; summary judgment was erroneous as to this issue; reversed and remanded |
| Discovery and entitlement to Rule 82 fees under maritime law | (Discovery) Superior court abused discretion; (Fees) Rule 82 cannot apply to admiralty claims and thus Federal not entitled | (Discovery) court did not abuse discretion; (Fees) Rule 82 applies in state courts for maritime claims | Discovery rulings: no demonstrated abuse of discretion on record; Fees: court reaffirmed that Rule 82 can apply to state-court maritime claims; however attorney’s-fee award vacated pending resolution of Mahl’s issue |
Key Cases Cited
- Therchik v. Grant Aviation, 74 P.3d 191 (Alaska 2003) (explains "conforming" vs. "substantially equivalent" Rule 82 notices and that conforming notices must be very close to the model)
- Alakayak v. B.C. Packers, Ltd., 48 P.3d 432 (Alaska 2002) (summary judgment standard cited)
- Williams v. Eckert, 643 P.2d 991 (Alaska 1982) (state courts may award Rule 82 attorney’s fees in actions arising from admiralty)
- Hughes v. Foster Wheeler Co., 932 P.2d 784 (Alaska 1997) (reaffirmed that Rule 82 is not displaced by federal maritime law and applies to mariners’ claims in state court)