200 So. 3d 1048
Miss.2016Background
- Sharel Kenney, a Louisiana resident, purchased a motorcycle in June 2011 and completed a Louisiana insurance application with Foremost that included a UMBI (uninsured/underinsured motorist bodily injury) form on which she purportedly declined UMBI coverage.
- Kenney was separately insured by USAA-CIC for a 2009 Dodge Charger; Daniel Steilberg (her fiancé) was listed as an operator on the Foremost motorcycle policy.
- In May 2012 Kenney and Steilberg were injured in Mississippi by an uninsured motorist while Kenney rode the motorcycle; Kenney sought uninsured-motorist benefits from Foremost and from USAA-CIC and was denied by both.
- Kenney sued the uninsured motorist, Foremost, USAA-CIC, and Steilberg in Hancock County, Mississippi alleging breach of contract/bad faith and related claims; Steilberg was dismissed and later his dismissal was not appealed.
- The trial court granted summary judgment for both insurers, applying Louisiana law; Kenney appealed challenging the choice of law and the validity of her UM waiver to Foremost.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Choice of law: Which state s substantive law governs the insurance disputes | Kenney argued Mississippi law should apply to her UM claims | Insurers argued Louisiana law applies under the center-of-gravity test (Boardman/Colonial) | Louisiana law governs the contract disputes (affirmed) |
| USAA-CIC: Coverage for injury while occupying a vehicle not covered under USAA policy | Kenney argued she was entitled to UM benefits under USAA policies | USAA-CIC argued its policy excludes UM for a covered person occupying a vehicle owned by that person but not insured under the policy; Louisiana law allows such an exclusion | Court held USAA-CIC properly excluded UM coverage and affirmed summary judgment for USAA-CIC |
| Foremost: Validity of the UM waiver Kenney signed on the UMBI form | Kenney contended the waiver was not validly executed (questions whether she printed name/dated form; ambiguous recollection) | Foremost argued Kenney knowingly rejected UM coverage via the completed UMBI form | Court found genuine issues of material fact as to whether the prescribed Louisiana waiver form requirements were satisfied; reversed summary judgment for Foremost and remanded |
| Bad faith claims arising from denials of UM benefits | Kenney argued insurers acted in bad faith in denying UM benefits | Insurers argued denials were reasonable under the policies and applicable law | Court concluded no bad faith for USAA-CIC based on lawful policy exclusion; Foremost s bad-faith arguments left for further proceedings pending resolution of waiver validity |
Key Cases Cited
- Boardman v. USAA, 470 So. 2d 1024 (Miss. 1985) (establishes center-of-gravity choice-of-law analysis for insurance contracts)
- O'Rourke v. Colonial Ins. Co., 624 So. 2d 84 (Miss. 1993) (applies Boardman center-of-gravity test to insurance dispute)
- Duncan v. U.S.A.A. Ins. Co., 950 So. 2d 544 (La. 2006) (explains Louisiana statutory and form requirements for valid UM waiver)
- Sandoz v. State Farm Mut. Auto. Ins. Co., 620 So. 2d 441 (La. Ct. App. 1993) (recognizes validity of certain UM exclusion clauses under Louisiana law)