Guideone Am. Ins. Co. Inc. v. Shore Ins. Agency Inc.

259 P.3d 864

2011 OK CIV APP 69

GUIDEONE AMERICA INSURANCE COMPANY, INC., Plaintiff/Appellant,andGuideone Mutual Insurance Company, Guideone Specialty Mutual Insurance Company, Guideone Elite Insurance Company, and Guideone Services, LLC, Plaintiffs,

v.SHORE INSURANCE AGENCY, INC., Defendant/Appellee,andNancy Shore, Defendant.

No. 108,138.

Court of Civil Appeals of Oklahoma, Division No. 2.

Feb. 10, 2011.Rehearing Denied March 25, 2011.Certiorari Denied May 23, 2011.

Released for Publication by Order of the Court

of Civil Appeals of Oklahoma, Division No. 2.

Appeal from the District Court of LeFlore County, Oklahoma; Honorable Danita G. Williams, Trial Judge.AFFIRMED. Michael Woodson, Nevin R. Kirkland, Edmonds Cole Law Firm, Oklahoma City, Oklahoma, for Plaintiff/Appellant.Joe E. White, Jr., Charles C. Weddle III, White & Weddle, PC, and Mort G. Welch, Welch & Smith, PC, Oklahoma City, Oklahoma, and Bruce A. McKenna, Brandon J. Burris, Glendening McKenna Prescott & Robertson, Tulsa, Oklahoma, for Defendant/Appellee.JANE P. WISEMAN, Judge.

¶ 1 GuideOne America Insurance Company, Inc., (GuideOne) appeals from the trial court's order granting summary judgment in favor of Shore Insurance Agency, Inc. (Agency).¹ This appeal is governed by Supreme Court Rule 1.36, 12 O.S. Supp.2010, ch. 15, app. 1 and proceeds without appellate briefing. Having reviewed the record and pertinent law, we affirm the trial court's judgment.

FACTS AND PROCEDURAL BACKGROUND

¶ 2 On May 26, 2003, GuideOne's insured, Christi Roberts, was involved in a motor vehicle accident. According to Roberts, she notified her agent, Nancy Shore, on or about June 24, 2003, stating she had been injured in an automobile accident. Nancy Shore testified she did not notify GuideOne after this conversation because Roberts asked her not to turn in a claim “because she was afraid that her insurance could be canceled if she turned in another claim because of prior claim history.” ² Nancy Shore also testified that when she initially called GuideOne to check Roberts' coverage, “the company guy told [her] that [Roberts'] UM [uninsured/underinsured coverage] wouldn't kick in until the other girl that [Roberts] was involved in the accident with in the car, until her liability insurance had paid everything.” Nancy Shore told Roberts that her UM coverage did not apply until after the tortfeasor's policy limits first were exhausted.

¶ 3 Carol Curtis, an adjuster employed by GuideOne, testified that she first became involved in September 2003 when Roberts' claim was received, set up, and assigned to her for handling. Curtis had a conversation with Roberts on September 18, 2003, which was recorded and transcribed. In this conversation Roberts tells Curtis that her agent Nancy Shore told her that GuideOne would not pay until “Farmers Union was finished and if there wasn't enough money to pay the bills, then my insurance would pick up.” Despite the fact Curtis testified that she knew this advice to be wrong, Curtis could not explain why she failed to correct Nancy Shore's statement:

Q. And what I'm wondering is, if you knew what you say you knew that you knew in this time in September of '03, that that's not the way it's supposed to work, why did you not straighten her out? Why did you not tell her that's just not true; let me tell you and explain to you how it really works?

A. I don't know.

Q. Well, wouldn't you agree with me you should have?

A. Looking back now, yes.

In the fall of 2003, the tortfeasor's insurer tendered its coverage to Roberts.

¶ 4 Roberts filed a federal lawsuit against GuideOne in February 2004 for breach of contract and bad faith in its handling of her claim. GuideOne tendered its policy limits to Roberts on December 8, 2004, and later settled the federal lawsuit with Roberts. Nancy Shore testified that she attended the settlement conference on behalf of Agency and provided settlement authority. However, Shore testified she did not feel she had done anything wrong because she only repeated to Roberts what the unknown representative from GuideOne told her about the UM coverage. GuideOne ultimately settled the federal lawsuit with Roberts but retained its rights of indemnity and/or contribution against Agency. GuideOne then filed the present action against Agency seeking indemnification and/or contribution for all or a portion of the monies paid in its settlement with Roberts.

¶ 5 Agency filed a motion for summary judgment contending GuideOne cannot succeed on any indemnity or contribution theories. In response, GuideOne argued disputed material facts existed precluding summary judgment and that summary judgment was not warranted as a matter of law.

¶ 6 The trial court granted Agency's motion for summary judgment finding no substantial controversy as to any material fact existed and that Agency should be granted judgment as a matter of law on GuideOne's claims.

¶ 7 GuideOne appeals.³

STANDARD OF REVIEW

¶ 8 We review a trial court's grant of summary judgment de novo. Carmichael v. Beller, 1996 OK 48, ¶ 2, 914 P.2d 1051, 1053. On review, we examine the pleadings and evidentiary materials submitted by the parties to determine whether there exists a genuine issue of material fact. Id. This Court bears an “affirmative duty ... to test for legal sufficiency all evidentiary material received in summary process in support of the relief sought by the movant.” Reeds v. Walker, 2006 OK 43, ¶ 9, 157 P.3d 100, 106. Further, the evidentiary materials and the inferences to be drawn therefrom must be viewed in the light most favorable to the party opposing the motion. Hargrave v. Canadian Valley Elec. Coop., Inc., 1990 OK 43, ¶ 14, 792 P.2d 50, 55.

ANALYSIS

I. Indemnity.

Contractual Indemnity

¶ 9 Agency entered into a written Independent Agent Contract with GuideOne in January 1999 which governed their relationship as independent contractor and insurance companies.⁴ GuideOne does not dispute that anything that occurred regarding GuideOne and Agency's contractual relationship between January 1999 and July 2005 would be governed by the January 1999 contract. Although GuideOne admits the 1999 contract does not contain any indemnity provision in its favor, it argues this is not dispositive because the independent agent contract “excepts situations in which the agent's (i.e. [Agency's] ) errors and omissions lead[ ] to claims.” The indemnity provision in the 1999 contract states:

1. The Company shall indemnify and hold the Agent harmless against any claim or liability, including attorney's fees arising as a result of Company act or omission, except to the extent that the Agent has caused the error. The Company shall also indemnify and hold the Agent harmless based on the actual failure of the Company to comply with the requirements of the Fair Credit Reporting Act in the procurement or use of consumer reports as defined by the Act.

2. The Agent shall give prompt written notification to the Company of any claim against [A]gent and the Company shall be entitled to participate in such action or to assume the defense of such action with counsel satisfactory to the Company. If the Company assumes the defense of any such action, it shall not be liable to the Agent for any legal or other expenses subsequently incurred by the Agent in connection with such action. If Agent fails to promptly notify Company of any action or fails to cooperate fully with Company in defense of such action, Company is relieved of its indemnification obligations to Agent.

(Emphasis added.)

¶ 10 This provision clearly states that GuideOne has agreed to indemnify and hold Agency harmless against liability for damage arising out of any act or omission committed by GuideOne, unless the Agent caused the error. There is no reverse provision by which Agency agreed to indemnify GuideOne. This is GuideOne's independent agent contract, and GuideOne did not include language imposing a duty on Agency to indemnify it under circumstances such as the ones in question here. As a result, under a plain reading of the contract, GuideOne is not entitled to recover from Agency based on a contractual indemnity theory.

Implied Indemnity

¶ 11 We next address whether GuideOne has a non-contractual or implied right of indemnification. “The general rule of indemnity is that one without fault, who is forced to pay on behalf of another, is entitled to indemnification.” National Union Fire Ins. Co. v. A.A.R. W. Skyways, Inc., 1989 OK 157, ¶ 7, 784 P.2d 52, 54. “ ‘Noncontractual or equitable indemnity is similar to common-law contribution; one who is only constructively or vicariously obligated to pay damages because of another's tortious conduct may recover the sum paid from the tortfeasor.’ ” Id. at ¶ 8, 784 P.2d at 54 (quoting Travelers Ins. Co. v. L.V. French Truck Serv., Inc., 1988 OK 76, n. 16, 770 P.2d 551). “Noncontractual indemnity is sometimes referred to as ‘implied indemnity’ and ‘may arise out of a contractual or special relationship between parties and from equitable considerations.’ ” Noble Steel, Inc. v. Williams Bros. Concrete Const. Co., 2002 OK CIV APP 66, ¶ 12, 49 P.3d 766, 770 (quoting Central Nat'l Bank of Poteau v. McDaniel, 1986 OK CIV APP 34, ¶ 9, 734 P.2d 1314, 1316).

¶ 12 No right of indemnity exists between joint tortfeasors, however. Caterpillar Inc. v. Trinity Indus., Inc., 2006 OK CIV APP 48, ¶ 17, 134 P.3d 881, 886. If concurrent or joint tortfeasors with no legal relationship to each other but owing the same duty to an injured party are involved in the same injury-causing occurrence, no right of indemnity exists in favor of one joint tortfeasor against the other. Thomas v. E–Z Mart Stores, Inc., 2004 OK 82, ¶ 22, 102 P.3d 133, 140. “The right exists when one who is only constructively liable to the injured party and is in no manner responsible for the harm is compelled to pay damages for the tortious act of another.” Caterpillar, 2006 OK CIV APP 48 at ¶ 17, 134 P.3d at 886.

¶ 13 We...