604 S.W.3d 721
Mo. Ct. App.2020Background
- On June 26, 2011 Qureshi was rear-ended by a hit-and-run driver; he reported injuries (neck/back/head) and ongoing treatment, including MRIs showing multi-level cervical disc injuries.
- Qureshi notified American Family the day after the crash; the insurer attempted to locate the other driver, then closed the file in August 2011 without informing Qureshi that a hit-and-run triggers uninsured-motorist (UM) coverage.
- Between 2012–2016 Qureshi provided medical records and treatment updates; orthopedic surgeons linked his cervical injuries to the crash and recommended major surgery costing >$200,000; medical bills exceeded $18,000.
- Qureshi (through counsel) demanded $100,000 in 2014, later $75,000 (UM limits); American Family’s sole settlement offer was $20,000 and did not respond to a later $75,000 demand.
- Qureshi sued for breach of the UM provision and vexatious refusal under Mo. Rev. Stat. § 375.420; a jury awarded $75,000 (UM), $18,000 (statutory damages) and $96,828 in attorney’s fees; the trial court denied a new trial and the insurer appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1) Sufficiency of evidence for vexatious refusal under § 375.420 | Qureshi argued American Family closed his file, failed to inform him about UM coverage, conducted an inadequate investigation, made an unreasonably low $20,000 offer, and ignored later demands — supporting a finding of vexatious refusal | American Family argued insufficient pre-suit evidence of refusal; post-suit conduct is irrelevant; no submissible case on vexatiousness | Court held evidence (pre- and post-suit, including investigation, offers, demands, and file closure) supported a submissible case of vexatious refusal; Point I denied |
| 2) Admissibility of deposition excerpts from American Family corporate reps | Qureshi sought testimony about the insurer’s investigation, knowledge, and handling to show vexatious conduct | American Family claimed testimony about actions after suit was privileged/work product and irrelevant | Court held the excerpts were relevant to vexatiousness and admissible; Rule allowing depositions for any purpose applied when insurer instructed witnesses not to answer; Point II denied |
| 3) Admissibility of settlement offers/demands | Qureshi argued offers and demands were directly relevant to reasonableness of insurer’s conduct under § 375.420 | American Family argued settlement communications are inadmissible to prove liability | Court held settlement offers/demands were admissible as they bore on the reasonableness of the insurer’s refusal to pay in a vexatious-refusal case; Point III denied |
| 4) Admissibility of policy UM limits | Qureshi argued limits were relevant context for evaluating insurer’s offer and reasonableness | American Family argued policy limits were irrelevant to the UM breach claim | Court held UM limits were relevant to the vexatious-refusal inquiry (context for offers/demands) and admissible; Point IV denied |
| 5) Qualification of plaintiff’s expert (attorney Scott Kolker) to opine on vexatious handling | Qureshi offered Kolker, who had long experience prosecuting/defending UM and vexatious-refusal cases, to opine on customary/reasonable insurer conduct | American Family argued Kolker lacked qualifications to offer a vexatious-conduct opinion | Court held trial court did not abuse discretion; Kolker’s experience qualified him and weaknesses go to weight not admissibility; Point V denied |
Key Cases Cited
- Sanders v. Ahmed, 364 S.W.3d 195 (Mo. banc 2012) (standard of review for directed verdict and sufficiency of evidence)
- Dhyne v. State Farm Fire & Cas. Co., 188 S.W.3d 454 (Mo. banc 2006) (elements of vexatious-refusal claim under § 375.420)
- DeWitt v. American Family Mut. Ins. Co., 667 S.W.2d 700 (Mo. banc 1984) (jury may consider all facts and circumstances to find vexatious refusal)
- Hopkins v. American Economy Ins. Co., 896 S.W.2d 933 (Mo. App. W.D. 1995) (post-suit conduct may be considered in vexatious-refusal cases)
- Tauvar v. American Family Mut. Ins. Co., 269 S.W.3d 436 (Mo. App. W.D. 2008) (insurer’s investigation relevant to vexatiousness)
- Banks v. Village Enterprises, Inc., 32 S.W.3d 780 (Mo. App. W.D. 2000) (general rule on inadmissibility of settlement offers)
- Ullrich v. CADCO, Inc., 244 S.W.3d 772 (Mo. App. E.D. 2008) (exceptions to exclusion of settlement evidence)
- May & May Trucking, L.L.C. v. Progressive Northwestern Ins. Co., 429 S.W.3d 511 (Mo. App. W.D. 2014) (reasonableness of insurer conduct central to § 375.420 inquiry)