Palmer v. Allstate Insurance, 505 P.3d 517

In March 2012 Palmer (insured by Allstate) was injured in an accident caused by another driver also insured by Allstate.
Allstate agreed to pay the at-fault driver’s $30,000 policy limit if Palmer executed a general release; Allstate sent a $30,000 check to Palmer’s attorney in mid-May 2015 with instructions to hold the funds until Palmer signed the release.
The attorney deposited the check into his trust account on May 19, 2015; Palmer executed the release on May 27, 2015, after which the attorney could disburse the funds to him.
Palmer demanded arbitration of his underinsured motorist (UIM) claim on May 24, 2018; Allstate denied the demand as time-barred under Utah’s three-year limitations rule tied to the “date of the last liability policy payment.”
Palmer sued for declaratory relief arguing the “last liability policy payment” occurred on May 27, 2015 (when he satisfied the condition precedent by signing the release); the district court dismissed, ruling the last payment occurred on May 19, 2015 when the check was deposited.
On appeal, the Utah Court of Appeals reversed, holding the statute of limitations began to run on May 27, 2015, when Palmer became entitled to the funds.

Issue	Plaintiff's Argument	Defendant's Argument	Held
When does the UIM statute of limitations begin under §31A-21-313(1)(a) as qualified by §31A-22-305.3(5) — i.e., what is the “date of the last liability policy payment”?	Palmer: the date is May 27, 2015 — when he satisfied Allstate’s condition (signed the release) and became entitled to payment.	Allstate: the date is May 19, 2015 — when the settlement check was deposited by Palmer’s attorney, i.e., the last insurer payment.	Held: May 27, 2015. The check deposit was conditional; payment did not occur until the condition precedent (execution of the release) was satisfied.

Peck v. State, 191 P.3d 4 (Utah 2008) (standards for reviewing facts on appeal from a motion to dismiss)
Hudgens v. Prosper, Inc., 243 P.3d 1275 (Utah 2010) (review standard for motions to dismiss)
Berneau v. Martino, 223 P.3d 1128 (Utah 2009) (statutory interpretation reviewed for correctness)
Mind & Motion Utah Invs., LLC v. Celtic Bank Corp., 367 P.3d 994 (Utah 2016) (definition and effect of contractual conditions)
McArthur v. State Farm Mut. Auto. Ins., 274 P.3d 981 (Utah 2012) (distinction between covenants and conditions precedent)
Fitzgerald v. Corbett, 793 P.2d 356 (Utah 1990) (mere offer to pay does not constitute valid tender)
Craig v. Provo City, 389 P.3d 423 (Utah 2016) (legislative silence does not resolve statutory interpretation questions)