308 P.3d 1138
Alaska2013Background
- Passenger Garold Charles was injured in a 2008 rollover while riding in a vehicle titled to Tara and Anthony Stout; Charles sued the Stouts and Credit Union 1 (lienholder) for negligence and negligent entrustment.
- Credit Union 1 moved for summary judgment, asserting its role as lender/lienholder alone does not create tort or contract liability.
- Tara (pro se) testified at deposition that she thought Credit Union 1 provided liability insurance when she financed the vehicle, but she left the deposition early and did not complete cross‑examination.
- Charles amended his complaint to add breach of contract and bad faith claims, asserting he was an intended third‑party beneficiary of an alleged promise by Credit Union 1 to provide liability (including UIM) coverage.
- The superior court struck Tara’s deposition testimony (as a sanction and under Civ. R. 32(b)) for lack of cross‑examination and hearsay, and granted summary judgment to Credit Union 1.
Issues
| Issue | Charles's Argument | Credit Union 1's Argument | Held |
|---|---|---|---|
| Was Charles an intended third‑party beneficiary of any contract to provide liability insurance? | Charles argued that a promise to provide liability/UIM coverage (or the loan documents) created third‑party beneficiary rights for injured passengers like him. | Credit Union 1 argued no written insurance contract existed and the loan agreement only allowed it to secure insurance to protect its collateral — not to confer rights on third parties. | Court held Charles failed to show he was an intended third‑party beneficiary; no genuine issue of material fact on that element. |
| Could Tara’s deposition testimony be admitted despite her leaving before cross‑examination finished? | Charles relied on Tara’s testimony to create disputed facts about Credit Union 1’s promise to provide insurance. | Credit Union 1 argued Ts deposition had to be struck because leaving thwarted cross‑examination and the testimony was hearsay not admissible under Civ. R. 32(b). | Court struck the testimony (as sanction and under Civ. R. 32(b)); the opinion affirms summary judgment without resolving whether striking was error. |
| Was Credit Union 1 liable as a matter of law once Tara’s testimony was excluded? | Charles contended other facts and theories raised in his amended complaint created triable issues. | Credit Union 1 argued that without Tara’s testimony there was no evidence of a promise or of beneficiary status, so summary judgment was proper. | Court affirmed summary judgment: even if Tara’s testimony were considered, Charles still had no evidence of intended beneficiary status and Credit Union 1 was entitled to judgment. |
Key Cases Cited
- Ennen v. Integon Indem. Corp., 268 P.3d 277 (Alaska 2012) (injured passenger can be an intended third‑party beneficiary where policy definition of insured includes permissive occupants; supports third‑party bad faith claims)
- Interior Cabaret, Hotel, Rest. & Retailers Ass’n v. Fairbanks N. Star Borough, 135 P.3d 1000 (Alaska 2006) (summary judgment standard)
- Rockstad v. Erikson, 113 P.3d 1215 (Alaska 2005) (summary judgment standard principles)
- Smith v. State, 282 P.3d 300 (Alaska 2012) (summary judgment standard)
- Cragle v. Gray, 206 P.3d 446 (Alaska 2009) (summary judgment review principles)