Regional Air, Inc. v. Canal Insurance
639 F.3d 1229
10th Cir.2011Background
- Canal insured Regional Air under a policy with appraisal provisions and storage expense terms.
- Umpire awarded Regional Air $44,294.14 plus storage-related amounts; trial produced a separate $12,000 storage verdict after December 2001.
- District court ruled appraisal award could be undone only if fraud/mistake/misconduct were shown and later entered judgment reflecting only the appraisal and the post-December 2001 storage verdict.
- After merits resolved, both sides sought § 3629 attorney’s fees, costs, and, for Regional Air, pre-verdict interest; district court denied most relief.
- District court held Regional Air prevailing for § 3629 but denied fees/costs and awarded limited interest starting from the date of loss.
- Court of appeals vacated the orders, held Regional Air was the prevailing party, remanded for proper judgment including appraisal and storage verdicts, and remanded for fee/cost and interest recalculation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Who prevails under §3629(B)? | Regional Air contends it is the prevailing party. | Canal argues a different prevailing party based on the settlement offer and severed relief. | Regional Air is the prevailing party. |
| Should the appraisal award be included in the judgment for §3629 purposes? | Regional Air sought aggregation with storage verdicts to exceed the insurer’s offer. | Canal argues appraisal should be separate from the judgment restricting §3629 analysis. | Appraisal award must be included in the judgment for §3629 purposes. |
| Are Regional Air's attorneys’ fees and costs recoverable under §3629? | §3629 obligates the prevailing party to recover fees and costs; the district court erred in denying. | Canal contends fees/costs may be limited or denied on discretion grounds. | The district court erred; remit to determine reasonable fees and costs. |
| What is the correct basis and amount for interest under §3629? | Regional Air seeks interest on the verdict as the prevailing party on all recoveries. | Interest should accrue only on certain verdict components and possibly from different start dates. | Interest awarded on the verdict is proper; recalc from the date losses were payable under the contract. |
| Did the insured’s proof of loss requirement apply to this case? | Regional Air satisfied any proof of loss requirement by timely notice under the policy. | A proof of loss is required to trigger §3629 entitlement. | Notice satisfies any proof-of-loss requirement; no independent proof-of-loss prerequisite bars recovery. |
Key Cases Cited
- Stauth v. Nat’l Union Fire Ins. Co., 236 F.3d 1260 (10th Cir. 2001) (notice satisfies proof-of-loss requirement under §3629)
- Murray v. First Marine Ins. Co., 29 F. App’x 503 (10th Cir. 2002) (unpublished; interpretation of proof of loss)
- Oulds v. Principal Mut. Life Ins. Co., 6 F.3d 1431 (10th Cir. 1993) (prevailing party inquiry and comparison to insurer's settlement offer)
- Ass’n of Cnty. Comm’rs v. Nat’l Am. Ins. Co, 116 P.3d 206 (Okla. Civ. App. 2005) (statutory triggering notice under §3629)
- Carter Oil Co. v. McCasland, 190 F.2d 887 (10th Cir. 1951) (distinction between relief and judgment)
- Valley Forge Ins. Co. v. Health Care Mgmt., 616 F.3d 1086 (10th Cir. 2010) (policy considerations and statutory interpretation in diversity cases)