Huckins v. United Services Automobile Ass'n
2017 MT 143
| Mont. | 2017Background
- Huckins challenged a summary judgment finding no duty to defend USAA under Van Sickle's homeowner and renter policies.
- Van Sickle sold his Stevensville home in 2014; disclosure blanked the basement question; 2014 policy added a Failure to Disclose exclusion.
- Underlying complaint alleged misrepresentation, concealment, and related claims arising from Van Sickle’s disclosure of past flood issues.
- Van Sickle had a Pre-2014 homeowner policy, a 2014 homeowner policy with an exclusion, and a renter’s policy in effect March 2014–March 2015.
- Huckins obtained a consent judgment against Van Sickle for $300,000 and assigned all claims to Huckins; Huckins sued USAA for breach of the duty to defend and related claims.
- The district court held no duty to defend under either policy; Huckins appeals, and the Supreme Court reverses.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did the district court err denying defense under the 2014 Homeowner Policy? | Huckins argues exclusion excludes coverage but insurer failed to defend. | USAA says no occurrence and exclusion bar coverage. | Yes; exclusion created unequivocal demonstration of no coverage, but the court must analyze separately for renter's policy and homeowner policy. |
| Did USAA breach the duty to defend under the Renter’s Policy? | Insurer failed to defend despite potential coverage. | There was no unequivocal demonstration that the claim fell outside the renter policy. | Yes; insurer breached by not defending under the renter policy. |
| Was any duty to defend based on facts outside the complaint? | Knowledge of facts outside the complaint could trigger defense duty. | Duty resolved solely on the complaint unless unequivocal coverage is shown. | Yes; knowledge outside the complaint may trigger defense duty, contributing to reversal. |
| Was the Pre-2014 Policy relevant to coverage? | Claims accrued after policy expired, but may be covered by 2014 policy. | Pre-2014 policy expired before accrual; no coverage. | Pre-2014 policy inapplicable; only 2014 policy analyzed. |
Key Cases Cited
- J. & C. Moodie Props., LLC v. Deck, 385 Mont. 382 (2016 MT 301) (duty to defend analyzed; summary judgment standard)
- Schwan v. State Farm Fire & Cas. Co., 371 Mont. 192 (2013 MT 216) (duty to defend standard; policy interpretation)
- Freyer v. St. Paul Fire & Marine Ins. Co., 312 P.3d 403 (2013 MT 301) (duty to defend; policy exclusions construed narrowly)
- Staples v. Montana Farmers Union Mut. Ins. Co., 90 P.3d 381 (2004 MT 108) (unequivocal demonstration required to bar defense)
- Revelation Indus., Inc. v. St. Paul Fire & Marine Ins. Co., 206 P.3d 919 (2009 MT 123) (insurer may rely on facts outside the complaint for defense)
- Newman v. Scottsdale Ins. Co., 301 P.3d 348 (2013 MT 125) (ambiguities construed against insurer; exclusions narrowly interpreted)
- Fisher Builders, Inc. v. Employers Mut. Casualty Co., 371 P.3d 375 (2016 MT 91) (definitions of occurrence; intentional acts may be covered if not objectively intended)
- Allstate Ins. Co. v. Wagner-Ellsworth, 188 P.3d 1042 (2008 MT 240) (interpretation of bodily injury to include mental injuries with physical manifestations)