McCormick v. Chippewa, Inc., 330 P.3d 345

Background

In 2007 McCormick was injured aboard the F/V Chippewa and sued Chippewa, Inc. and captain Louis Olsen; the vessel had a P&I insurance policy with a $500,000 face limit and a cannibalizing clause for defense/investigation costs.
McCormick offered to settle for the policy “limits”; Chippewa’s counsel responded accepting payment of the remaining policy limits and attached a settlement agreement stating the policy face limit was $500,000; McCormick signed and then dismissed his complaint.
After signing, disputes arose over what “policy limits” meant: Chippewa calculated and tendered $424,040.05 (face limit minus defense costs plus fee), while McCormick contended “policy limits” meant per-occurrence limits (potentially three occurrences, totaling $1.5M).
McCormick filed a new suit to enforce the settlement; he served interrogatories and sought discovery into Chippewa’s and counsel’s state of mind during negotiations. Chippewa resisted discovery and moved to enforce the settlement.
The superior court converted Chippewa’s motion to a summary judgment motion, granted enforcement as Chippewa interpreted the agreement (one $500,000 policy limit, less allowable deductions), and denied McCormick’s discovery and Rule 56(f) continuance as moot.
The Alaska Supreme Court vacated the summary judgment and remanded, holding the trial court abused its discretion by denying McCormick the opportunity for discovery under Rule 56(f) before ruling on summary judgment.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether summary judgment enforcing the settlement as a single $500,000 policy limit was proper without further discovery	McCormick argued the parties’ intent was disputed (possible per-occurrence limits) and he needed discovery into defendants’ and counsel’s state of mind before opposing summary judgment	Chippewa argued the signed settlement plainly referred to the $500,000 policy face limit and no discovery was necessary	Court held summary judgment premature because McCormick timely sought a Rule 56(f) continuance and discovery; denying discovery was an abuse of discretion
Whether a Rule 56(f) continuance requires detailed affidavit or specific facts to be gained	McCormick maintained Rule 56(f) does not require stating specific facts to be obtained and he adequately explained why discovery was needed	Chippewa asserted McCormick failed to justify additional discovery time	Court held movant need not identify specific facts to be produced; McCormick sufficiently invoked Rule 56(f) and showed he was not dilatory
Whether counsel’s affidavit could be used to decide summary judgment without allowing depositions/other discovery into counsel’s state of mind	McCormick argued using opposing counsel’s affidavit without discovery would prejudice his ability to rebut and he should be permitted to depose or obtain communications	Chippewa relied on counsel’s affidavit to establish intent and the objective terms of the signed agreement	Court agreed discovery was necessary before resolving credibility and intent issues raised by counsel’s affidavit
Whether failure to rule on McCormick’s motion to compel and interrogatories warranted denial of summary judgment	McCormick argued Chippewa’s cursory or absent responses left factual gaps and the court should compel responses before deciding summary judgment	Chippewa contended discovery was irrelevant because the agreement was definite	Court found McCormick was not dilatory and that unresolved discovery supported granting a Rule 56(f) continuance rather than summary judgment

Key Cases Cited

Mitchell v. Teck Cominco Alaska Inc., 193 P.3d 751 (Alaska 2008) (Rule 56(f) denial reviewed for abuse of discretion; standards for continuance)
Noffke v. Perez, 178 P.3d 1141 (Alaska 2008) (broad right to civil discovery and Rule 26 scope)
Peterson v. Ek, 93 P.3d 458 (Alaska 2004) (discovery may seek information reasonably leading to admissible evidence)
Gamble v. Northstore P’ship, 907 P.2d 477 (Alaska 1995) (Rule 56(f) generally granted when movant explains need for discovery and is not dilatory)
Jennings v. State, 788 P.2d 1304 (Alaska 1977) (Rule 56(f) continuances should be freely granted when non-movant timely requests)
Kessey v. Frontier Lodge, Inc., 42 P.3d 1060 (Alaska 2002) (affidavit not strictly required to seek Rule 56(f) relief)