Cumis Insurance Society, Inc. v. Massey
318 P.3d 932
Idaho2014Background
- Massey prepared a 2007 Summary Appraisal Report for Clearwater Mortgage; the appraisal valued the property at $1,150,000 but contained errors acknowledged by both Massey and Clearwater.
- Clearwater decided not to fund the loan and not to pay Massey for the appraisal; Massey later had no contemporaneous payment arrangement with Clearwater.
- Icon Federal Credit Union later loaned $250,000 to the Hruzas and paid Capitol West Appraisals $800 for the appraisal; Icon obtained possession of the appraisal by an unclear channel.
- CUMIS Insurance, as Icon’s subrogee, sued Massey and Capitol for professional negligence, negligent misrepresentation, and breach of contract, and sought a jury trial; the district court granted summary judgment for Massey.
- The Idaho Supreme Court vacated the district court’s grant of summary judgment, holding that there are genuine issues of material fact about whether Massey owed Icon a duty of care based on the appraisal certifications and how Icon obtained the appraisal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Duty of care arising from certifications | Certification 23 creates duty to rely; Icon may rely on Appraisal. | No duty to Icon absent direct assignment or intended user beyond Clearwater. | There is a genuine issue of material fact; certification language may establish a duty to Icon. |
| Effect of Menchaca affidavit on summary judgment | Untimely affidavit should have been considered; inferences favor CUMIS. | Stipulation allowed district court to consider it; no error. | Affidavit properly considered under the stipulation; no reversible error. |
| Constitution of 30(b)(6) testimony | Connie Miller’s testimony is admissible as Icon’s testimony. | Miller spoke for herself, not Icon; improper reliance. | District court properly considered Miller’s deposition as Icon’s testimony. |
| USPAP duty extending to Icon | USPAP standards imply broader duty to lenders if intended users. | USPAP defines standard of care but does not automatically impose duty on non-clients. | USPAP does not by itself create a universal duty to Icon; issue remains fact-intensive. |
| Delivery channel of the Appraisal to Icon | Icon could have obtained the Appraisal via several contemplated channels triggering Certification 23. | No evidence of disclosure to Icon; no duty established. | Reasonable inferences could support that Icon obtained the Appraisal through one of the contemplated channels, creating a genuine issue of material fact. |
Key Cases Cited
- Nation v. State, Dep’t of Corr., 144 Idaho 177 (Idaho 2007) (duty elements and foreseeability in negligence)
- O’Guin v. Bingham Cnty., 142 Idaho 49 (Idaho 2005) (duty analysis and contract interplay)
- Baccus v. Ameripride Servs., Inc., 145 Idaho 346 (Idaho 2008) (contract may create circumstances for a tort and duty to perform non-negligently)
- Just’s Inc. v. Arrington Const. Co., 99 Idaho 462 (Idaho 1978) (contractual undertaking can give rise to a duty in tort)
- Taylor v. Herbold, 94 Idaho 133 (Idaho 1971) (duty arising from contractual undertaking and foreseeability)
- Sun Valley Potatoes, Inc. v. Rosholt, Robertson & Tucker, 133 Idaho 1 (Idaho 1999) (standards for considering untimely affidavits and stipulations in summary judgment)
- Izaguirre v. R & L Carriers Shared Servs., LLC, 155 Idaho 229 (Idaho 2013) (appeals on stipulations and record deficiencies)