Sturgeon v. Allied Professionals Insurance Co.
344 S.W.3d 205
| Mo. Ct. App. | 2011Background
- Mary Sturgeon, a Missouri-licensed massage therapist, was insured by Allied Professionals Insurance Co. under a professional liability policy when a massage table collapsed, injuring a client.
- The client sued Sturgeon for personal injuries, and Sturgeon asked Allied to provide defense under the policy; Allied refused.
- Sturgeon hired her own counsel and the underlying personal injury suit was dismissed.
- Sturgeon filed a breach-of-contract action against Allied alleging failure to defend breached the policy and seeking attorneys' fees.
- Allied moved to compel arbitration under the policy's arbitration clause; the trial court denied, citing Missouri public policy prohibiting arbitration of insurance contracts.
- On appeal, Allied challenges FAA preemption and LRRA arguments seeking arbitration relief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Choice of law governs enforcing arbitration | Sturgeon argues California law should apply per the policy | Allied argues California law governs arbitration per the policy | Missouri law applies; California clause void. |
| FAA preemption of Missouri arbitration ban | Sturgeon argues FAA does not override Missouri §435.350 | Allied argues FAA preempts state law allowing arbitration | FAA not applicable; McCarran-Ferguson prevents preemption; arbitration not compelled. |
| LRRA exemption for risk retention groups | Sturgeon asserts LRRA exempts Allied | Allied asserts LRRA preempts Missouri ban | LRRA does not excuse arbitration ban; LRRA does not preempt §435.350. |
Key Cases Cited
- Allen Foods, Inc. v. Lawlor, 94 S.W.3d 436 (Mo.App. E.D. 2003) (public policy; arbitration in insurance contracts not valid under Missouri law)
- Standard Sec. Life Ins. Co. v. West, 267 F.3d 821 (8th Cir. 2001) (preemption issues under FAA vs state insurance regulation)
- Northland Ins. Co. v. Bess, 869 S.W.2d 157 (Mo.App. E.D. 1993) (Missouri public policy on arbitration in insurance contracts)
- Clark, 106 S.W.3d 486 (Mo.banc 2003) (state regulation of insurance contracts under Missouri law)